| Have you ever used direct mail before? | | | | from state to state. It would be exhaustive and |
| You know; the type of marketing where you send a | | | | unproductive for me to go into all of this here. Just |
| physical mailing to somebody's home so that they | | | | do the right thing and get a securities lawyer's opinion |
| can touch, feel and read a marketing message in | | | | and/or ongoing counsel when you get really serious |
| their hands? | | | | about raising private money. |
| It seems as though everywhere I look and | | | | * Send a sales letter - a sales letter is just that: a |
| everything I read is all about "online, digital and social" | | | | letter you write to somebody where you enter into |
| marketing. Nary is anything written anymore about | | | | a conversation already going on in the prospects |
| direct mail. Sure, there are some people here and | | | | mind and show them how you have a cure for what |
| there who use it for their real estate investing | | | | ails them. Don't use a lot of hype. Write for emotion |
| businesses - and kudos to them - but the digital | | | | and use enough logic to justify a prompt response |
| advertising tidal wave has engulfed just about | | | | (oh...and give a reason for prompt response, too!) |
| everybody in business. | | | | * Offer free information (not brochure or 'credibility |
| And, if it's engulfing you, you may be flushing | | | | kit') - either a free report/white paper or prospectus |
| hundreds of thousands of dollars in private money | | | | - Always remember that people like to buy - they do |
| right down the toilet. | | | | not like to be 'sold.' I know this sounds like a |
| Here's what I mean: | | | | philosophical argument two French guys had back in |
| Direct mail is a very tried and proven method for | | | | the 1700's, but it's very true with anything you want |
| getting results with your marketing. You never have | | | | to market or sell. Your free information is what's |
| to guess if you ran a direct mail promotion correctly | | | | called a 'soft sell'. Learn to use and master this and |
| or not. Why? Because you either get orders or you | | | | you will get monster results. |
| don't. It's a pure blank white canvas of business | | | | * Use a #10 envelope with a live first class stamp or |
| opportunity - one of the last remaining vestiges of | | | | send FedEx - Many direct mail pieces fail not because |
| pure "winner take all" capitalism remaining. | | | | the message was bad nor because the offer was |
| With many other forms of media used in marketing, | | | | bad nor because the list was bad - many of them fail |
| you cannot and will not know the true results of | | | | because they intended reader did not get or open |
| your efforts. For every one real estate investor (or | | | | the envelope or package. Using a good old #10 or |
| agent) that knows precisely where their leads came | | | | FedEx will cost more but the resulting response |
| from (and also: what the cost to get that lead was | | | | should easily overcome this extra cost |
| and how many leads they need to close a sale, | | | | * Send follow up mailings (min. 3 mailings) - many |
| lifetime value of customer) there are probably 1,000 | | | | direct mail promotions fail to yield a return on |
| that do not. | | | | investment because the sender gives up if they don't |
| The one big thing most real estate investors miss the | | | | break even on the first mailing to the list. Show some |
| boat on when raising private money is that they | | | | persistence and send at least 3 mailings. |
| think of getting private investors as a financing | | | | Have a 'backend' sequence in place - if your call to |
| process.It's not. Getting private money is a marketing | | | | action is a phone call, then make sure you have a |
| process. | | | | business line, a receptionist (or virtual receptionist |
| For those select few that understand this, the next | | | | perhaps) and/or voice prompts |
| step is implementation. And here's how it usually goes: | | | | * Use a good mailing list - talk to a professional list |
| post on real estate message boards, blogs and online | | | | broker and do not use 'compiled' lists whatever you |
| classifieds that they 'need a private lending partner'. | | | | do. |
| Ambitious investors may even get a website | | | | Whew! |
| specifically for private money - but they will | | | | Does that seem like a lot of work? |
| completely mess up this website. The site won't talk | | | | Well...it is, sort of. But as long as you remember the |
| about the benefits for investing in real estate | | | | 80/20 rule (80% of the wealth is controlled by 20% |
| passively. No. Their websites will basically be geared | | | | of the people, 20% of your time drives 80% of your |
| toward somebody who has been to the same boot | | | | results) you should have no problem investing some |
| camps and other seminar training that they have. As | | | | time and a little bit of money where most of your |
| you probably know, the response and ROI for these | | | | competitors will not. |
| types of websites is pretty low. | | | | Earn Nightingale (founder of Nightingale-Conant) was |
| So, this brings us back to one method (note: I did | | | | one of the best inspirational speakers of all time. He |
| not say the only method) that has proven to work in | | | | was quoted as saying: "if you want to know how to |
| marketing anything and everything for over 100 | | | | become successful - and you have no other model |
| years: direct mail. | | | | to go by - just look at what most people are doing |
| Here are the basics of using direct mail (the right | | | | and...do the exact opposite." |
| way) to get private money...oh, also...please | | | | I couldn't agree more. Especially when getting private |
| remember that there are legal and securities laws | | | | investors to fund your deals. |
| issues on marketing for private money that vary | | | | |