Joe McCall has been investing since 2006 and has an excellent podcast called the Real Estate Investing Mastery podcast that he does with Alex Joungblood. He’s doing deals in multiple markets across the us while traveling for months at a time in Europe and traveling the us in an RV. He’s been teaching and coaching investing since 2011.
In this episode, Joe goes into incredible detail on how he set up and runs his direct mail marketing for motivated sellers leads.
We talk about the lists that he targets and how to get them.
He even shares when he sends postcards and when he sends letters.
A funny story during the interview was when Joe realized that he had been sending a postcard for years that he got from FlippingJunkie.com and didn’t put two and two together until that moment.
Special Bonus Download: Click Here to Download the Postcard that Joe got from my blog years ago that he’s been using to generate motivated seller leads with.
Joe focuses on absentee owner mailings using postcards. When there is a lot of competition, he focuses on high equity owner occupied houses.
One way Joe finds the most sought after areas is Trulia heat maps. He targets a county and the heat map shows cheap, median and expensive houses. There is even a table of data that can be sorted to show the most popular areas.
During the conversation, we shared some numbers for the typical marketing spend per deal for investors. The numbers vary between $1,000 and $3,000 per deal and go as high as $5,000 per deal for some very competitive areas.
Mailing intervals for probates should be about once per week for the first 6 weeks or so. Mailing intervals for other lists usually are spread out from 30 to 90 days in between mailings.
One recurring theme throughout the episode was the discussion of how most investors fail to answer their phones. If there is one thing you can do to eliminate 75% or more of your competition, it’s answering your phone or calling back a seller IMMEDIATELY. Take that to the bank.
Hey everybody welcome to The Flipping Junkie podcast. Today we’re going to be talking about direct mail marketing for real estate investors. If you’ve been doing any flipping or marketing for motivated sellers or really you’ve just been studying real estate investing you know that a lot of the big real estate investors around in your area and all across the country in different places use direct mail to get a lot of leads. It’s one of the main sources of leads for a lot of investors. We’re going to talk about that with an expert in the field of direct mail marketing, Joe McCall. He’s been investing since 2006, has an excellent podcast I really enjoy getting a lot of info out from. It’s called Real Estate Investing Mastery Podcast. He does that with Alex Joungblood and he’s doing deals in multiple markets across the US while traveling for months at a time in his RV and in Europe. He’s been teaching and coaching investing since 2011, so I’m really excited to have Joe on the podcast today. We’re going to get a lot of great info and let’s just get right into it.
Danny Johnson: Hey Joe, are you there?
Joe McCall: Yeah. Hey Danny.
Danny Johnson: Hey, thanks for being on The Flipping Junkie Podcast.
Joe McCall: Glad to be here man.
Danny Johnson: Yeah. I really love your podcast and I can’t wait to see what all the information you’re able to share with us about direct mail marketing for real estate investors. I wanted to start out just by finding out a little bit more about you and so the audience can find a little bit more about you about what got you interested in real estate investing and how you got your start.
Joe McCall: Yeah. I got my start back in 2006. Of course I read the book that nobody’s ever heard of before, Rich Dad Poor Dad.
Danny Johnson: Yeah. What is it?
Joe McCall: Got excited about real estate. I actually had a friend at the time in Kansas City who was doing a ton of deals – well, not a lot, but I mean for me at the beginning, as a beginner he was doing a ton of deals. He had maybe a couple of duplexes. He was taking some classes from a well-known guru and he was showing me his training materials, the notebooks that he was getting from this from this group and I was really impressed. I was excited about real estate and I remember bugging him just asking him to teach me everything he knew and. He was busy and he said “I can’t teach you” and recommended these books. I actually heard of a friend of a friend who was building and selling duplexes down in Austin Texas. I flew down there to look at what he was doing and he recommended – it’s so strange these things happen – he recommended a book to me called Secrets of a Millionaire Landlord. That completely changed my life, that simple book. It’s kind of weird. I mean it’s not even that great of a book. It is a good book but it’s nothing as earth shattering. I don’t actually even recommend the book to many people, but he just had a real simple way – the guy who wrote it is Robert Shemin and he was a guru at the time. He still is I think, but he was teaching more creative real estate. And so I kind of hooked on to him and the things he was teaching, signed up for his coaching. This was in 2006. In fact, the other day I was looking at my notebook. I keep notes, at least I used to, before my iPad and iPhones, but I used to keep notes on notebooks with pen and paper, remember those things?
Danny Johnson: That was 2006 right?
Joe McCall: Yeah, yeah. It’s not that this is what my gurus were teaching me. This is just what I was coming to my own conclusion that real estate always goes up. It’s the safest bet in the world. And so I started buying a lot of houses with mortgages and I kind of ignored the coaching that this training company was giving me of buying houses with no money no credit. I didn’t believe them that you could actually do that. So but anyway I bought a bunch of houses I think it had maybe 15 or 16 single family homes because that’s when it was so easy to buy. Anything if you just fog a mirror. And I started also buying houses subject to their existing mortgages and I bought a bunch of courses. I was of course junkie. I had tons of books, tons of courses, went to all the workshops and the seminars and I really struggled for a long time because I had a serious cash flow problem and even when the market was good and strong $100 dollars a month doesn’t cut it because you just have one month of vacancy and all of a sudden I was equity rich, but I was cash poor on these houses. I was always struggling to pay the bills because I had so much debt in these houses. It was very frustrating. I had a big cash flow problem, I realized you can’t eat equities because the equity that I had doesn’t pay the bills again. Then the market crashed like, from bad to worse the market crashed and any equity that I had disappeared. I had a serious cash flow problem at that point. Anyway, to make a short story long, I started learning wholesaling and I started buying all the courses I could on wholesaling and started wholesaling deals and started doing a lot of direct mail like we’re going to be talking about today and I realized early on the importance of direct mail because without it I don’t think you can have a serious wholesaling business. Sure if you have people bring you deals then you can buy properties, but if you’re if you want to work directly with sellers without a middle man then you want to do direct to sell or marketing, you cannot ignore direct mail so I started doing a lot of it and I just did what the guru said to do. I didn’t know who else to believe. I had two coaches at the time. One of them said to go just make a ton of offers on the MLS and I didn’t like working with realtors. The other guy said, “Send a bunch of postcards” and that’s what I did. I started gravitating towards postcards, sending a lot of them, and once I started consistently regularly sending postcards like, not just once or tries, or just try it out see if it works. I consistently committed to send postcards every single week and I just started getting leads. I started getting a lot of leads and I started doing deals. I remember my first deal – am I talking too much Danny?
Joe McCall: Well yeah, even if somebody sent 2,000 that’s not consistency. A lot of sellers don’t respond until the fifth or sixth, seventh postcard. I could go on and on about consistency because this is what I was doing. I was doing a lot of marketing. I get a lot of leads and I get overwhelmed and I’d work those leads and I’d get them under contract and I flip them and I had a full time job and then I would stop my marketing because I was so overwhelmed with these leads that were coming in. And then I turn around and make some money, I’m all excited, but my pipeline is completely empty. There’s nothing in there. There are no new leads coming in because I haven’t done any marketing in a month and then I’m freaking out and I start marketing again. It’s not just like a light switch that automatically turns on and the leads start pouring in again. I was going through these really vicious up and down cycles where I would do a deal, make a lot of money, and then I wouldn’t do a deal for a couple of months, and then I’d do another deal, make some money and wouldn’t do a deal for another month or three, and that just got really frustrating and I heard somebody talk about, “If you don’t get somebody else to do the marketing for you it’s just not going to get done” and so I started developing systems. This guy also said, “You need to get marketing done for you in spite of you.” I was kept on getting in the way myself and I knew that I had to somebody to do the direct mail for me every single week or I just wasn’t going to do it. I was also doing other types of marketing. I hired a virtual assistant from Indiana to do my direct mail for me and she was also doing some Craigslist marketing for me too. I was contacting landlords on Craigslist asking them if they wanted to sell their house.
Danny Johnson: Yes. So can you explain what the process of that was? How did you plan out to find that person? How did you find the person? How did you talk about compensation? Would you mind sharing that process.
Joe McCall: Yeah. I think I read the book the Four Hour Work Week and that was awesome and I also had Chris Chico’s course on virtual wholesaling if you remember that from 2008-2009. Chris and I are now really good friends and I owe a lot of debt of gratitude to Chris. He’s just a great guy, but I learned a ton from him about postcards and virtual assistants. I remember at the time when Chris came out with his virtual wholesaling course everybody was mocking it. There are some forums that are really big at the time before Bigger Pockets was around and I remember people on there just ridiculing him and saying, “There’s no way you can flip deals without seeing it in other markets with just post cards. That can’t be done.” And they were criticizing these evil gurus that were teaching this trash. But I believed the guy, I was like, “You know what, I like him. I can believe him.” And sometimes that’s to a fault. I believe everybody. But I think it’s also helped me a lot because nobody can tell me I can’t do it.
Joe McCall: If I see somebody do it, then I know I can do it. If that idiot or schmuck can do it, I can do it right?
Danny Johnson: Right. And that’s the right mindset.
Joe McCall: Yeah, yeah. I think it served me well at times. It also got me in trouble, but anyway, so I started sending out these postcards consistently. I didn’t like them Danny. I mean they were ugly. They were they weren’t professional. They were just yellow old typewriter style fonts. I tried changing it. I tried to make it look better but nothing ever worked as good as those.
Danny Johnson: Well, I think people are still using those. I still receive those to myself all the time.
Joe McCall: Yeah. Unfortunately there’s more competition now than there was I think in 2009. But there still, don’t forget, there was a ton of competition back then. And people always think that this is the bad time to get into the market or it’s too competitive but it’s always been too competitive. It was competitive back then, but anyway, yeah those postcards, I think you need to mix them up and you need to test new things. I’ve been hearing people having good success with professional typed letters like a professional letter with a logo on the top and an actual picture of your family on the letter. I heard that works really good some guys are doing well with that. But it’s consistency that’s the key always making sure that you’re doing as much direct mail as possible, reinvesting your profits in your deals back into direct mail. If you have the attitude of “Well, I’m just going to send a couple thousand letters and see if it works” just forget it. Save your money and do something else. You’ve got to be committed to it for the long haul. You need to be at a place if you want to do a lot of deals, if you want to make $10-$20 grand a month wholesaling, you need to be sending a couple of thousand postcards a week or letters. It needs to be that kind of a long term commitment for at least three months before you decide whether this is for you or not. I know some people don’t have the money for that, but you do as much as you can reinvest, 100% of your profits back into direct mail, do you a few more deals, reinvest 100% of those profits back into direct mail, and just watch your business explode when you do that.
Danny Johnson: It’s the whole investment thing. It feels in the beginning like you’re throwing money into a pit, just burning money, but honestly if you do one wholesale deal that makes you $10- $15- $20,000 dollars, I mean, how much more direct mail you do. It’s only takes one phone call, a good lead from one phone call. You might get three leads and then get the fourth one have a great deal. That could be the very first call you ever receive. You just never know. But I wanted to go back in and talk and finish about the virtual assistant and then what we could do is just talk about maybe the list that we should target, and then maybe frequency and postcards and letters and go from there. So let’s go back to the virtual assistant though. How did you find the person? How did you compensate them? How did all that work?
Joe McCall: Yeah. So I just read The Four Hour Workweek and I heard about ODesk and I’ve been using it ever since. This was 2009 and I just started –now it’s called UpWork, but I posted a job that I need somebody to do marketing. “I’m a real estate investor I need somebody help me do marketing” I think is what it was. Just real simple and I found a lady in Indiana that was had a lot of real estate experience and she wasn’t much more expensive than the Filipino virtual assistant so I hired her. She did a lot of online marketing for me. I’m trying to remember at the time if she helped me with postcards or not. I was doing a lot of Click2Mail at the time – I who was sending my postcards. It was a long time ago but I might have found a local company to do it for me. I don’t remember, but it was putting somebody else in charge of that so that it just got done was my key to success in that. Whether it’s a virtual system that does it or it’s a print house or a company that does it, there’s a lot of websites out there that do direct mail, there’s yellowletters.com, yellowletterhq.com. I think there’s yellowlettershop.com. One of my clients just contacted postcard mania and got 60,00 postcards for about 0.40-0.41 cents each including first class postage which is a pretty good deal. And so there are lots of companies that do that now. The point is whether it’s a virtual system or not, get somebody to do that for you and maybe it’s a printing company and obviously the more you order the cheaper it’s going to be. So what you could do is you could order a bunch of them and just have them delivered to your house and then you mail them once a week or every day or something like that but you want to spread it out and do it consistently.
Danny Johnson: Alight. So let’s start with lists as far as what are your favorite lists to market to right now?
Joe McCall: I’ve always liked absentee owners. Most all of my deals have been from absentee owners. I know it’s a competitive list. A lot of people mail to it, but if you look at all the segments of the homeowners, the most likely homeowner to be motivated is a landlord just bottom line. They’re a retired landlord. They have their fifth eviction. They have too many houses. They’re just like me, they were the equity rich but cash poor, and they just want to sell and get rid of their house. For me absentee owners have always been my favorite list, but it’s also really competitive. Now I’m mailing to a lot more high equity owner occupants and I’ve learned a lot from a friend of mine. His name is Tom Kroll about mailing to high equity owner occupants. It’s a great list. You can even go on the List Source now and say I want to send to homeowners who bought – this is the typical list that I send to using List Source, homeowners that bought their house at least 10 years ago that have at least 40% equity in the house, maybe 40% or 50% equity in the house. It’s at least a three bedroom. I always am very specific on the zip codes that I target. I target the two different areas. I target where there is a high demand from investor buyers. I look at the last six months where were all of the investor buyers buying properties and I target those zip goods and I also target the median price zip codes. The zip codes that are really popular like if you go to Trulia and do a search for like “your county heat map” like “St. Louis County heat map” you’ll see from Trulia kind of the areas of your county whether they’re cheap, expensive or medium priced. You want to target the median priced areas and there’s also a table below that where you can sort it. You can sort that table by popularity. So Trulia will tell you in your county what are the most sought after areas, the most that when people go online and search what are the top zip codes they’re searching for and so that’s pretty helpful. I like to go up to those areas because usually it means there are good school districts. Houses are kind of median priced, more affordable, and stuff like that. Anyway so you can say, “Alright. I want owner occupants that bought over 10 years ago that have at least 40% equity, at least a three bedroom in these 10 zip codes and they have to be over the age of 55.
Danny Johnson: Yeah. Always ask age.
Joe McCall: Yeah. And so I don’t know how accurate that is, but I do know that it still gives me plenty of people to mail. It gives me more people than I would mail in a typical three month cycle anyway.
Danny Johnson: For somebody that is sort of starting out and maybe doesn’t have a huge budget, I think the question commonly asked is, “How many should I mail?” And if you want to be consistent obviously couldn’t be a huge list, you have sort of an idea of a good amount to shoot for one of those first mailings.
Joe McCall: Yeah. That’s a toughie because. It’s like “What comes first, the chicken or the egg?” You can’t do deals without money for marketing and you can’t pay for marketing without having deals to come in and so it’s really hard to coach somebody who doesn’t have much money to spend on marketing. Now what I do coach people to do is like, “Listen if you don’t have money for direct mail, you need to pull up your bootstraps and hustle.” And there are other things you can do. You can network with realtors, make a ton of offers on the MLS. You could knock on doors put flyers out there. Just cold call craigslist ads, rentals, fisbos, etc. There’s a lot of things you can do bandit signs or whatever, but if you do have a little bit of money where do you start? That’s a really good question. It depends on how much you have. If you had like $500 bucks a month, I would probably do yellow letters and I would spread them out over – I’d start sending yellow letters every day. It’s what I would probably do. You could go to your printer, buy those yellow legal pads of paper and just find a way to print 20-30 yellow letters a day and just mail them. I would be super hyper-focused. I would look at the best zip codes that have the highest demand for rental properties from landlords and I would go after like one or two zip codes. I would just try to be a big fish in a small pond. I’ll find out who all the buyers were in those zip codes and what they were wanting and I would start sending mail. Probably I’d send mail first to all of the absentee owners in those two zip codes. I wouldn’t care about dates. I’ll just send them all a letter. I don’t care how far along, far past they bought because there’s not going to be a ton of them. It’s just looking at two zip codes and I would mail all the absentee owners. Then after that I would mail to all of the high equity owner occupants that were in there. Another really cool list is the no-sale date list. What that means is there are a lot of records you’d be surprised. If you went into List Source and said “Alright send me a list of all of the homeowners that bought over 10 years ago.” Well first of all, let me say this, according to the US Census Bureau, one-third of all homeowners own their house free and clear, 33% of all the houses that you see out there are owned free and clear. There’s no mortgage on them. It’s a crazy huge number to think about. There are a lot of people that bought their houses before they started tracking the dates that they were bought. If you were to go to your county and download all of the houses that are in the county records you would find a surprisingly large number of them that did not have the sale date associated with them. And so if you were to go to List Source and say “Show me all the homes it sold before 1980…” or 1990 whatever, these houses would not show up. The crazy thing is nobody is mailing to them. I like mailing to the list that nobody else is mailing to especially if you have a tight budget. Some of my favorite like, I call them “niche lists” to mail to. if you can somehow get a list of all the homeowners from the county records and there’s different ways you can do it. You can maybe talk to your title company. You can maybe go to the county records office yourself and ask them how you can get that list and try to get that data and find out which are the homes that don’t have any sale date because you know those homes were bought a long time ago and nobody else is sending them mail.
Joe McCall: They still don’t show up.
Joe McCall: No. Because it’s not like if there’s a no value it’s going to show up. It doesn’t. It’s really hard to explain and I don’t always trust the List Source data that comes back to me. I mean because these were houses that were bought before they even kept records on this stuff. So the only thing that the county has on these homes these are the taxes, the mailing address where the tax bill is sent and the property address and the square footage and bedrooms and stuff like that. But there’s no sale date on there. There’s no mortgage recorded at all on there. I mean, maybe they do show up in the 100% equity list. I have not tested that. That would be an interesting test wouldn’t it. Just pull that list of those houses and see. Okay if I pull a list of 100% equity do these houses show up in there. I’m assuming that it might be different in each county.
Danny Johnson: Yeah. But you do bring up a great point is that like trying a different way than most people might get you records that other people don’t have. What you said was also an excellent way because you’re probably going to get stuff that most people doing these searches their List Source aren’t going to get. Where we’ve done huge mailings and we get calls that might come through our website and we look and say “Okay, well did that come from this mailing because it fit all the same criteria.” So it should have been in the mailing but it wasn’t.
Joe McCall: Here’s a crazy thing too. We have mailed to no sale dates before. We were getting decent calls. It wasn’t a huge volume but every single seller, the lead we got, when we went to go meet with them and look at the house, we ask them, “Did you ever receive a letter from anybody? “No.” They’ve never received any letters and these are all elderly people that have homes that have a lot of deferred maintenance. These are homes that have not been updated in a long time. They’ve owned them for 30, 40, 50 years. They have a lot of deferred maintenance. You can get some pretty fantastic deals times sometimes from those lists, but that’s it. Now there’s another great list that I like to target, the absentee owners that aren’t absentee owners yet. This is like a secret ninja thing that I’ve been just recently playing with and have been blown away with. You’ll think about the best motivated seller as the one that has a vacant house right? And they try to sell it at one time but they couldn’t or for whatever reason they didn’t want to and now they’re renting it out. Here’s the amazing thing, if you were to go to Zillow right now and look at all of the houses that are listed for rent in Zillow in the nicer areas. I’m talking like median home price and above. In St. Louis median home prices maybe $125-$150,000. So I’m looking at that price range and above and if you were to go look at all of the houses that are listed for rent in Zillow or realtor.com, you’re going to find that probably 85-90% of them are not in the absentee owners lists on the county records yet because these were houses that the sellers had been trying to sell but couldn’t. They decided “I’m just going to rent it out.” And I’ve done this. I’ve looked at all of these homes that come up and Zillow and I go look in the county records and the mailing address is the same as the property address. Does that make sense? So if you were to put a list of absentee owners in that zip code, these houses would not show up because for whatever reason the owner has moved out, they’re vacant and they’ve not updated the county records with their tax mailing address yet. These guys are not getting any mail. I love to send mail to houses that are listed on Zillow and Craigslist for rent because a lot of those homes, I don’t know the percentage exactly, but a lot of those homes they’re not getting mail from other investors because they’re not showing up as absentee owners. There’s another list that I like to mail to it’s the eviction list. So if your court system in your county, your city, puts their court filings and records online which most states, most counties do, you can go in and see who were going through all the evictions. You can go and see who the plaintiffs and the defendants are in most of these court cases. A lot of times, the defendant who is the tenant being sued, their address is the address of the property, and you also have the plaintiff’s address which is the address of the owner bringing the lawsuit right? So I’d like to send mail to properties that are currently going through an eviction process. You can go to code violations. I know there are some parts of the country you can get that online, who are the houses out there that are having code violations and some most counties you don’t have to go get that in person and there’s also garage sales and estate sales. I’ve done this before and it’s worked really well for us where you can go to like a statesales.net I think is what it is and you can see all of the houses that have estate sales and a lot of times those are houses that they don’t move all of the stuff out of the house to a warehouse to sell it. They sell it at the house and so those are usually houses of deceased people. People that have died and the families are selling the estate. And so you can send letters to those homes, “Hey, I want to buy your house” and garage sales as well a lot of times people are moving or maybe it’s a tenant that’s moving out of the house and they’re doing a garage sale or it could just be sometimes people do garage sale because they’re having some financial difficulties and they need to make some extra money, not everybody obviously but that’s a good place to start to get a smaller list. What I’m talking about is like thinking outside of the box how can I find the homeowners that are maybe more likely to sell it that not everybody is hitting. When you’re just getting started out you mail to those beginning lists, those smaller niche lists, and as you grow you reinvest your profits back into marketing and then you start just growing and growing your direct mail business and then pretty soon it just doesn’t matter. I mean, I have friends and I’m not at this level because I don’t want a business as big but I have I have friends that are literally sending 30- to 50,000 postcards a week and they’re not pulling any lists. They’re just mailing everybody. That’s like blanket mailing everybody in their target areas. If you want a big wholesaling business, that’s where you want to be where you’re just mailing them all.
Danny Johnson: What I like about the niche ones too that you mentioned was the fact that there’s going to be less competition, number one. Number two is that a lot of times with direct mail the reason why multiple touches will work is because the people have to – it’s going to be the right time for them to want to sell and if you’re hitting them spaced out over time you’re more likely to hit that one that has finally they’ve decided that or something’s happened and all of a sudden they’re open to it. And so if you look at those things that you were talking about Joe, as far as evictions and things like that, at that time in that landlord’s life, it could have been a real messy situation and they’re like, “I just want to get rid of this. My wife is saying no more.” “You’re going to end up with a heart attack if you don’t get rid of that place” and stuff like that and they get your post cards like, “Wow, this is timely.” Do you know what I mean?
Joe McCall: Oh yeah. None of this will work if you’re not keeping the fundamentals in place. I mean, number one you need to be mailing these same people every three months. Now if it’s a probate, you need to be mailing them every week for the first month or two, but if it’s like a regular seller, you need to be mailing them something in the mail every two to three months. For example, for me, if it’s an absentee owner, I’m mailing postcards just as many as I can. If it’s a smaller niche list I like to send letters because I get a higher response from that. But you got to be consistently doing it, that’s number one. You can spend all the money in the world on direct mail, but it’s not going to get you any deals if you don’t, number one, answer the phone. So many investors Danny I think this is a huge problem. To say direct mail doesn’t work because they make it too difficult to get the sellers to talk to anybody. They make the sellers listen to a really long voicemail. They only call the sellers back if they leave a voicemail, if they sound “motivated” and then when they call back it takes them three days to call the sellers back. They get a voicemail, maybe they call a couple of times and they give up.
Joe McCall: It just blows me away. If you want to make money in this business, you’ve got to treat it like a business not like a hobby. And guess what, I don’t think many people are going to like this but you need to answer the phones. If you can’t answer the phones just send them to a quick short voicemail or send him to a call centre, but call them back within minutes. Call them back whether they’re if they’re a hang up or they leave your voicemail or whatever. In fact it’s almost completely irrelevant whether they leave you a voicemail or not. You don’t even need to listen to the voicemail. Call every single person back within seconds of them calling you if you can’t answer the phones. That is so important because especially with direct mail becoming more and more competitive nobody else is doing this Danny, nobody.
Danny Johnson: Yeah. The first person I talk to them has a major advantage and if you’re taking forever to call them back you’re losing out. If somebody else talks to them they have a huge advantage.
Joe McCall: Right. That’s why I don’t like putting websites on my postcards and direct mail. I don’t want them to go to my website. I want them to call me. So I have a virtual assistant in the Philippines right now that answers my phones live. She has really good English and she screams leads and puts them in Podio and then we kind of filter them out on Podio and have a local wholesaler in my different markets who then calls the seller back immediately. Look at Home Investors for example, if any company in the US understands marketing, it’s Home Investors. They spend millions of dollars a month on marketing – on direct mail, on billboards, and TV ads or whatever. You call any of the successful Home Investor franchises, you get some of their mail and you call them somebody answers the phone line and you know what, it’s somebody local in their office that’s answering the phones live. I know the big Home Investors franchise here in St. Louis that’s really successful. They have a secretary, a couple secretaries that answer the phones live in their office and those ladies will actually even schedule the appointment for their acquisition guys to go to that seller’s house right then and there when they have the seller on the phone.
Joe McCall: I don’t know this is true for everybody but if the seller can’t get the phone answered live, it gets redirected to a national call centre where a live operator answers the phone and takes the messages. I’m telling you, we’re wasting so much money in our marketing by trying to make the sellers jump through a bunch of hoops, go to a website, listen to a voicemail, leave a message just so that we don’t have to waste our precious valuable time in not talking to a an unmotivated seller. But here’s the thing, if you want to be successful in this business, you need to be accessible. You need to have people be able to reach you and just the other day Danny I was calling a water company, it was like eight or nine o’clock in the morning, their office should be open and I was calling them to get some help with some – we need some more salt*. And guess what, the local office wasn’t answering the phone so it goes to voicemail – rolling my eyes this is just yesterday, I was so mad I got to leave them message. I call again and then it gets transferred to a live operator but it’s not in their office and that live operator has to know your name, your phone number, the address of the house, the city, the state, the zip. So they’re going with these litany of questions like, “Oh, my gosh. I just want to talk to somebody at the office.” And so she called me back but I wasn’t able to answer the phone. So then I called her back, so we’re playing this phone tag and I couldn’t get a hold of her and I’m talking to the national company and it’s a different operator each time and so each time I call there they’re asking me these six, seven questions and I just wanted to call the lady back. I want to talk to Nicole and I have a question for her I need to get the stuff. I finally get to talk to her and it wasn’t her fault. I mean she was just making a bunch of phone calls, but it wasn’t until I actually talked to a real person that I was able to accomplish something. If I was a customer wanting to sign up for new service and I had a list of five people to call, I would not be interested in working with the one that sent me to voicemail, that wasn’t answering their phones and took forever to call me back. I would just keep on going down through my list until I found somebody that answered the phones who could help me and schedule an appointment to come to the house and look to see what I needed. So it’s just the same in the real estate business. Now I understand you may have people listening to this who may have a full time job like I can’t answer the phones live. Okay. You got to do the best you can. What I did when I was working my full time job is I got a friend who was working who was hungry and I paid him a hundred percent commission, “Listen, here are the calls coming in” and I had him take the calls and if he couldn’t answer them, they’d go to voicemail and he’d call them back right away. I paid him 50/50. We split the deals 50/50 and that’s how we did our deals because I knew the importance of having somebody answer the phones live.
Danny Johnson: I was just going to say real quick that a lot of times especially for new investors they see all this marketing and they see all these other investors in town and they think “Wow, there are so many people vying for these deals. How is it possible that I’m going to be able to squeeze one out myself?” And it’s amazing because I get calls all the time where I pick it up and the person on the phone will say, “I’ve called six people, you’re the first person to pick up the phone.” So all that other competition you see out there isn’t necessarily real competition if you do those things like Joe’s talking about.
Joe McCall: Man this is a really really hot topic for me Danny because I see so many investors who struggle with it. If you want to do deals and you think your market is competitive, you just try to pretend to be a seller sometime and Google We Buy Houses Fast and just call all of these companies that are advertised. If you’re a landlord and you get postcards just call those numbers back, go to their websites and you just wait and see how long it takes for anybody to actually call you back or answer the phones live. It’s embarrassing. And so you think you’re in a competitive market and maybe you are, but the problem is this nobody is doing these things that you should be doing. For example, nobody’s answering the phones, nobody’s following up with old leads. We know when that lead comes in if it’s not a motivated seller it just goes in the trash bin. Nobody is calling those sellers back and following up with them a month later, two months later and nobody is making offers on every lead that comes in. This is a really big topic for me. So you’ve invested all this money into marketing – number one, answer the phones. Number two, follow up. Call every single person whether it was a hang up or a voicemail. Call every single one of them back as soon as you can and then everybody that you talk to, this is the way I do it, if it’s a cold or a warm lead I’m still going to send them an offer in the mail and if it’s a hot lead I’m going to go meet them in person or send somebody to meet them in person at the house. But if it’s a cold or a warm lead I’m sending them an offer in the mail and I’m sending them letters and postcards every single month for the rest of their lives. If you want to do deals, this is something your competition is not doing. They’re not making offers on every lead. They’re not following up and you’re going to find – I’ve seen this over and over again in my business and friends that I do a lot of the podcast interviews the guys that are crushing and are doing a lot of deals they’re doing a ton of a follow up. You’re going to find half of your deals come from the follow up and this goes back to the consistency that we’re talking about. The reason why consistency is so important is because you’re constantly following up with all your old leads. The best list, all the lists that we’re talking about, the best list in the world is the follow up list. Nothing will ever beat that list.
Danny Johnson: So the question that comes up, you touched on it a little bit, so a bigger list maybe absentee owner, you do postcards and then letters from more than niche ones, let’s go a step further and people talk about yellow letters and handwriting addresses and using live stamps, what is your take on all of that strategies?
Danny Johnson: Yeah. You know what says too is that people are branding themselves enough to make it stand out. They just had no idea that all those weren’t from one person they thought they were all from you.
Joe McCall: Yeah. So branding is important. I know guys that have – like Sean Terry does the 800 Fair Offer and he has completely changed all of his marketing now to only be branded marketing 800 Fair Offer. I’ve tried branded marketing before. It didn’t get me all that excited. I didn’t think I did any better, but there is a point to that. I mean ugly houses, home investors they do really well with their branded marketing and they’re a name that people once they recognize it, they’ll win most of the time in a head-to-head competition because they’re the bigger company. They’re more likely to close on a deal. More important than the type of letter that you’re sending out whether it’s typed or yellow handwritten or what, the fundamentals that we were talking about before being consistently mailing out, whatever it is, consistently mailing it out and answering the phones I think is so important because again your competition is not doing that. Let’s say you only get 30 leads from this campaign that you sent out, but that’s 30 sellers that you’ve actually have phone tagged. You’ve actually talked to them. Nobody else has answered the phone so you’re going to have a better chance of getting a deal with a fewer amount of leads when you do these kinds of basic things. Answering the phones and making an offer to every single lead that comes in the mail by the way I send them all a physical mail and then also in an e-mail if I can and then I’m following up with them constantly every month.
Danny Johnson: That’s the key and really when you think about it, I’ve heard numbers thrown around here and there from different people in my own experience I know investors are typically spending between $150 to $350 and I’ve even heard $450 per lead and so if you to that phone call you didn’t answer or have a way to answer, you’re throwing away $350$400 bucks. I mean it’s just crazy.
Joe McCall: At times you need 20 or 30 leads to do a deal. It depends on the market that you’re in, but in the Midwest in my experience I need to do typically about $750 to $1,250 about $1,000 on average per deal in marketing.
Danny Johnson: That’s pretty good actually.
Joe McCall: If you’re in a more competitive market, you’re maybe looking at $2,000 to $3,000 that you have to spend in marketing per deal and then if you’re in Southern California, I have a friend that his average profit is like $28,000 grand on a wholesale deal but he’s spending up north of $5,000 in marketing per deal that comes in. When you’re playing in a competitive market, it’s even so much more important that you take those calls in live and answer them live because that’s a lot of money to be spending on direct mail and if you’re not doing it right you just might as well throw the money away.
Danny Johnson: Yeah, absolutely. Do you have an example or just the gist of what your typical postcards and letters say and whether there is a difference in what you say in a postcard versus a letter?
Joe McCall: I just thought of this. You’re Flipping Junkie right?
Joe McCall: You have a postcard somewhere on your blog. You’ve been doing a blog for years and years right?
Danny Johnson: Yeah, I think since 2010.
Joe McCall: Okay. There is a handwritten postcard and I didn’t even think of this just now that I think is yours.
Danny Johnson: Is that with the marker?
Joe McCall: Yeah. I was one time I can’t believe it. I’m at Google right now and I’m typing in handwritten postcard and then I went to images and I was just thumbing through these images and I saw yours.
Danny Johnson: I have to find that and put that on the show notes page as well.
Joe McCall: The address was typed on the top or something and then it’s a marker.
Joe McCall: I don’t see it but this is from a blog post like four or five years ago.
Danny Johnson: I’ll find it and put it on there. I remember that because the thing that you want to change is make it specific as the address. It would be awesome if you could have the marker font. You could probably do nowadays and then add the address in the marker font.
Joe McCall: I’m thinking it’s your website.
Danny Johnson: I can picture in my head what the one you’re talking about looks like. I have to find it.
Joe McCall: I’ve been using that for a couple of years and I love it. It’s just simple. The address is typed on the top or on the side or something like that and then there’s a handwritten message that’s the same on all postcards just a handwritten message that says “Hey, I want to buy your house. If you’re interested in selling call me.” I can’t find it on Google anymore.
Danny Johnson: Yeah, I changed my website. There it is. I just found it. I’ll put it in the show notes page.
Joe McCall: Oh there it is.
Danny Johnson: “I would like to buy your house, the one at the address above.” If you would like to sell please call me.
Joe McCall: Phone number. “I can pay cash.” The address is typed at the top. We call that postcard The Flipping Junkie postcard. I didn’t realize that until we were just talking. I’ve used that for a couple of years and my assistant just hand wrote that same exact text and we put the address on the top like that and it’s worked well.
Danny Johnson: That’s pretty cool. And with the postcards, do you typically do live stamp postcards or you just have a meter through Click2Mail or something like that.
Joe McCall: Yeah, just metered. We usually do our postcards through Click2Mail or we have a local printing company that does an all for us.
Danny Johnson: Yeah. We’ve been doing that lately, contacting local companies to see if we can get better rates. A lot of times you got to sort use a couple people and add a little bit of work, but if you’re doing big volume you can typically save quite a bit of money.
Joe McCall: Yeah. There are a lot of companies that do it. I like using somebody local because there have been a lot of times when like I just want to send a small list like a couple hundred and these guys will do it for me and they’re usually faster. If you go the big national company with the big website, they’ll do it, but it’s got to be a lot harder for you to say, “Hey, can you just send this small batch for me?” And they’ll charge me the same price, but they would if it was big in bulk, a bulk order. It’s somebody that I can call and talk to. It’s a lot harder to talk to some of the big national companies.
Danny Johnson: I’ve had a problem with drop times. You can try to get them to drop to people’s mailbox like around Tuesday or Wednesday maybe and sometimes with a larger national, you don’t really know when it’s going to happen so it could show up on Friday, which might be a pretty bad day to get something like that, but that’s a good question. When do you try to have your years show up in people’s mailboxes?
Joe McCall: I have not done my own direct mail in probably three or four years. My assistant just takes care of it. That’s a good question. I think we try to get it to hit on a Wednesday, right in the middle of the week, but at the same time I don’t know if we worry too much about it. It’s just get it sent, get it going, get it out there. It’s one of those things that I’d rather just get done, get it out the door, than spend too much time thinking about it.
Danny Johnson: Another thing I wanted to ask before we start wrapping up here. In your letters do you favor sort of long form or short form? What your take on what the letters typically say?
Joe McCall: I’ll tell you what my letter says now. This is one of my letters, “I’m sorry for being short but I’m very interested in buying your house at 123 Main Street. Can you please call me. Phone number. Thanks Joe.
Danny Johnson: I like that you started that with “sorry being short” too something about that made me think a little bit more about it. I think there’s a little bit of intrigue there where people are sort of curious.
Danny Johnson: That’s pretty cool. Well Joe, I think we’re going to wrap up. We’ve got tons of great info for this episode I really appreciate everything that you’ve shared and taking the time to be on the show.
Joe McCall: Well Danny it’s been fun. It’s so funny that it’s your postcard. I’ll send you some brownies in the mail or something like that.
Danny Johnson: Hey, I love brownies.
Joe McCall: Because I’ve made a ton of money from that postcard. Did you make that postcard up?
Danny Johnson: Yeah. I don’t know if I saw something that I sort of got an idea from or something like that. That’s mostly my cell phone number on that card there. I obviously took off the last four digits so I didn’t have people call me.
Joe McCall: Well that’s good to know because one of the reasons why I think you’ve been so successful in your business is you understood the importance of answering the phones right?
Joe McCall: That’s good man.
Danny Johnson: Alright. Well for people out there listening that want to hear more from you or get in touch with you, how can people find you?
Joe McCall: Yeah. My podcast is probably the best way, Real Estate Investing Mastery.com or they can just go to Joe McCall.com. I have some stuff there. It’s kind of like a blog, but I really update it much. It’s just my contact information. If you’re interested in getting some consulting or coaching, see some of the products I’ve done, but probably the podcast will be the best Real Estate Investing Mastery.
Danny Johnson: Very cool. I’ll include a link on the show notes page, flippingjunkie.com/41. Thanks again Joe and we’ll keep in touch.
Joe McCall: Thank you Danny. Take care man.
Alright. Another great episode of the podcast and Joe shared a lot of great info. I hope you guys got out of a lot of information out of it like I did. We talked about quite a few things, so the show notes page is going to be pretty full of stuff here if you want to go back and get some of that. It’s going to be a flippingjunkie.com/41. Now you can also just go to flippingjunkie.com and click on podcast up at the top and then you’ll see this one with Joe McCall and click and view the show on this page. I’m going to include a link to his podcast and then also I’ll have a link there where you can download that postcard he was talking about that I had shared a long time ago. A really cool thing and I’m actually going to consider it reusing that myself just to see if it produces results like it used to. I also talked about that thing that I spent over the last week working on which is a guide to convert more of your leads into deals and it’s nearly a hundred pages and so I’ll share a link since it’s relevant. I’ll share a link at the show notes page for you to be able to download that for free as well. I had a lot of fun creating that and added some memes in there to keep it light and fun, so it’s a real good read even though it’s about 100 pages and it reads really fast. I’d like to get your feedback on that too so if you want to check it out just go to flippingjunkie.com/41 and be sure to subscribe and leave a rating and review on iTunes. It will really help out the Flipping Junkie Podcast as we get some more people on the show to share their top real estate investor motivated seller marketing tips in this series that we’re doing in the podcast. This is stuff that’s working now. You probably heard a lot of stuff that has maybe worked in the past sometimes you’re getting outdated information. We’re going to be covering what’s working right now 2016 and beyond and a really exciting time I’m looking forward to these coming episodes and hope that you subscribe and join us to hear all of them. If you’ve got any suggestions for who to have on the show, if you’ve heard some other people maybe do some podcast episodes or blog post about certain marketing topics that you’d like to have elaborated on, by all means go to facebook.com/flippingjunkie and that’s the Facebook page. You can leave a message on there for me and I’ll get there and see if I can contact them, get them on the show, or just cover it myself if you have a specific topic. Thanks again everybody. I really appreciate listening to the show and see you next time.
Hey Danny, Joe mentioned sending an offer in the mail to the cooler leads he spoke to. How do you make an offer on a house site unseen? What if it turns out to be trashed inside or something?
This is something many remote wholesalers do and I’m not experienced in remote wholesaling. My assumption is that he is calculating a guesstimate based on the ARV he calculates for the house minus an estimate of repairs that were mentioned by the seller and his required profit. I’m sure this offer is either very conservative or has an escape clause such as ‘This agreement is subject to funding approval’ or something along those lines.
I’m sure if the house turns out to be trashed, the contract is either not signed by him or is renegotiated.
One of the best podcasts I’ve heard from you Danny.
Joe was overflowing with enthusiasm and knowledge. I loved it and you should for sure have him on again if the stars align.
Thanks James! I do plan to Joe on the show again.
Great interview, tons of actionable tips as always. Thanks also for that sample postcard. I’m curious, on the postcard page you say “take a picture and upload it to create your postcard”, what sort of picture did you tend to have success with here? A picture of the actual property you’re making the offer on?
Yes, a picture of the actual house you are writing them about. Be aware though that this will freak some people out. You will need to have thick skin for some of the angry calls you will get. Of course, some people won’t have any idea their property looks that bad and will be glad you contacted them. Obviously those are the people you are trying to reach. The others just need to be politely ignored.
Thanks, Alex! I’m glad you’re getting a lot out of them. We’ve got a lot of great new episodes planned!
Fantastic information. Very good stuff. Would love to hear how to send offers to people I speak with. Meaning the details of such.