Marketing Lesson: Want More Business? Get Less Leads!

Generating leads is at the core of any real estate investing business, but here’s an important marketing lesson…

All leads are not equal!
and
All phone calls are not leads!

A successful marketing campaign is not one that generates a ton of phone calls. That’s actually just a ton of work. Work is different than business.

“I don’t like to work… I love to get new business.”

Make sense?

The answer here is in the pre-screening. Good marketing will allow people who don’t qualify (because they can’t work with you or won’t work with you) to do the initial screening for you.

Good marketing will allow people who don’t qualify to do the initial screening for you.

Real estate investor newbies are always afraid of losing a single lead, and, if you just want to hone your skills talking to sellers then maybe keep doing what your doing for a bit, then fix it.

For the rest, understand that fewer leads who are more qualified is the desired outcome. We’re working with Pareto’s Principle (aka the 80-20 rule)… 80% of your business comes from 20% of your work. Spend more time in the 20% that creates 80% of your business (the stuff that makes you money), and eliminate as much of the 80% as possible.

Here are a couple real-life examples from my business:

The “UGLY” Post-it Note

One of the things people know me for has been my use of post-it notes. I didn’t invent the idea (it was a pizza shop from what I understand), but I have distributed more post-it notes through my door-to-door system than any other investor I know of.

The original post-it I used had a very effective, but generic message. It garnered TONS of phone calls, and cost me a TON in answering service bills. There was gold in those leads, but also a lot of folks just looking to save a few bucks on Realtor commissions (not what I was looking for – I wanted ugly houses to rehab and flip).

So how did I improve the message? I added the following language:

How’s that for calling it like it is? That’s right… if you want retail, don’t call us. Why waste your time and theirs? Why deal with the uncomfortableness of telling them you want to pay 50 cents on the dollar or take their house subject to?

How’d it work? It cut our calls in half, with no decrease in A or B leads (we classify leads… A’s are hot to trot, B’s are someday-maybes, and C’s are non-deals). So, net financial gain, as I was paying a couple bucks per lead for the call handling.

The Yellow Letter

I forget who pioneered the yellow letter, but, again, it wasn’t me. The idea, which many are familiar with, is a handwritten (or handwritten-looking) letter on yellow legal pad paper. It says something like “My wife Erin and I want to buy your house. Please call us at 555-1212.”

For people who haven’t seen it before, it looks real enough to be creepy. It does get a lot of calls… like:

• Upset people with bad tempers and foul mouths
• Police calling on behalf of little old ladies
• A random lead or two… and
• Lots of people telling you that their house is NOT for sale

So, how to fix it? Easy… I just added that if I didn’t hear from them, I’d assume that they weren’t interested or the house was not for sale:

How’d it work? Like gangbusters. The yellow letter remains a top marketing tool for us, but now we don’t need to field the 70% of the calls who wanted to tell us that their house isn’t for sale.

Moral of the story is that if you want better efficiency with your time and you want to focus more on business than busy work, then start adding language to your marketing pieces to pre-screen the sellers who you are not going to be able to (or don’t want to) work with.

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