Q & A About Direct Mail.
This post is in reply to private messages and emails about direct mail following my testimonial for John Locke’s course.
Direct mail is an effective means of advertising. Like any marketing weapon it has to be aimed and fired properly to hit the target. Keep the following important statistics in mind. Large direct mail companies are stupendously excited to get a 0.5% response rate with direct mail. Response rates with a successful direct mail campaign range between 0.1% and 0.3%. How many direct mail pieces did you mail out? Never mail less than 1,000 of any direct mail test. Be properly shocked if 5 people respond, be satisfied if 2 do so, and be content with just 1. If no one does, make adjustments in your direct mail design or audience and send it out again. If it worked, send it out to the same list 2 weeks later and your response will climb. Let’s assume 2 people contact you. What is your closing ratio? With John’s targeted mail campaign and his personal guidance, you can expect to close 1 of those deals. Compare the cost of mailing 1,000 pieces of mail to the amount of profit from one deal. Direct mail really works.
Maybe you are wondering why I haven’t actually used direct mail in my business yet. It is simple. I built a business and marketing plan that called for 2 or more phone calls coming in every day because I’m making a full time living at this business. To achieve 2 phone calls per day, you must send out 1000 pieces per day or 30,000 per month. Here is the really sobering point. According to the marketing data available, the number of ideal subject to sellers in my metropolitan area is less that 15,000. This caused me to make a course correction and change the focus of my marketing to a larger audience. You can still use direct mail if your situation is different than mine. It just requires patience. Eventually, the power of word of mouth takes hold. Then away you go!
Thanks!
Mark Walter[ Edited by ludmark_re on Date 07/23/2004 ]
ludmark,
What is the criteria that you used when targeting the Sub2 prospects in your area? Also if you send out 1000 per day to 15000 propects, then do you send out 2 mails to each household every month? What are you expenses in this? Thanks so much... This help would be greatly appreciated.
It depends so much on your area. How many ideal prospects exist in your area based on marketing data? The answer depends on the level of appreciation over the last 2 years and the number of conventional purchases and refinances. After you have that number, then you can strategize around the best way to target them.
Sincerely,
Mark Walter
How do you know there are 15,000 people ideal for subto. Is that based on the number of new mortgages 1-2 years old? How do get your market data?
I had another question mark. How do you advertise if you do not direct mail? Word of mouth?? Are you sucessful in getting two deals a month?
Oh, by the way, I also use bill boards, yellow pages (starting this year) and cable television last year.
Sincerely,
Mark Walter