Seven steps to becoming a direct-mail dynamo

Send mail to the right target the right number of times with the right message, and you will see big results.

by Greg Herder   No doubt, the Internet has impacted the real estate industry. Yes, you must have your personal Web site and be Internet savvy, and, yes, e-mail farming may eventually replace direct-mail farming. The key word, though, is eventually. Today, there are 100 times more agents making money with direct mail than with e-mail. In the future, that ratio is sure to change, but right now direct mail is still very much alive and well and, when done right, is one of the most consistent and profitable prospecting methods in real estate.

The real key to success with direct mail in today’s marketplace is to understand that the Internet has changed the rules of direct mail, and many of the things that worked in the past are now totally worthless. In addition, although it’s not mandatory yet, a direct-mail campaign today works best when integrated with an Internet-marketing strategy.

Following is a step-by-step plan that will teach you the rules for cashing in with direct mail in today’s marketplace. I believe each of these rules is critical. You cannot pick and choose the ones you like. If you break even one, your chance for success is greatly diminished. Follow them exactly, and they will make you rich. I am so confident in these rules that when agents hire my company to create direct-mail campaigns, we give them a money-back guarantee if it does not work.

1 Select a direct-mail farm in which you feel comfortable

So many agents try to be something they are not. If you don’t feel 100% comfortable with the people in your farm area, you are destined for failure. It is so much easier to succeed when you match the style of the area you select with your style of marketing. If you go after the high-end but don’t feel comfortable socializing and chatting with rich people, they will sense it when you show up at a listing presentation. And, no matter how good everything else is, you have lost their business.

2 Pick a large enough farm to achieve your goals

My rule of thumb is to make sure your farm has twice as much turnover as your listing goal. For instance, if you want to take 25 listings in your farm, then make sure there are at least 50 homes selling in the area each year. The exact number of homes to send mail to will change depending on the turnover rate in your area. Let’s assume you want to take three listings per month, or 36 listings per year, in your farm. You will need an area that has 72 (36x2) sales each year.

You can figure out the size farm you will need by dividing the total number of homes required to sell (72) in the area by the turnover rate (5% is average) or 72/.05=1,440. So the minimum number of homes you need in your farm in order to reach your goals is 1,440. Direct-mail farms of 100 to 500 homes are so small that average turnover rates do not produce the returns you need to succeed. I believe your farm must have at least 1,000 homes or more. Fifteen hundred to 3,000 homes is the ideal size for the best return on investment.

3 Your direct-mail materials must make you stand out from the average agent

First and foremost, your direct-mail marketing must promote you—not your company, not your listings, not the great services you provide. You. Here’s the easy way to tell if your materials truly promote you: Pick up each piece of your direct-mail campaign and glance at it. Then, set it down and write down the most dominant thing you remember about each piece. If it is anything other than your name or slogan on each and every piece, your direct mail is worthless.

Research shows that the most dominant image on a piece of direct mail is the only thing remembered 90% of the time. Your direct mail must also make you stand out from all the other agents who are sending out stuff.

The good news is that these goals are not hard to accomplish. The average agent simply slaps his name and picture onto the standard real estate stuff provided by his company or one of the standard real estate formats for direct mail. But today’s sophisticated consumers know the difference between truly unique personal marketing and personalized trash.

4 Every piece of direct mail you send out must have your picture in full color

The Internet has color pictures of everything. What would you think of a Web site that was only black and white? You would probably think whoever developed it was cheap. This attitude has rubbed off on direct mail.

Today, there is not one massively successful direct-mail catalog that is printed in black and white. Color is the baseline for being perceived as a high-quality professional agent. The worst mistake you can make is printing your direct-mail piece in full color but your picture in black and white. When you do that, you tell the consumer that the agent is the least valuable part of the message.

A lot of agents have been moderately successful with standard black-and-white picture formats. But, as soon as an agent sends quality, full-color materials into the same area, he or she quickly gains almost all of the business.

5 People forget fast, so you must mail often

A lot of agents’ direct-mail campaigns fail, because they do not mail often enough to get their message into their prospects’ conscious awareness. Research shows that in today’s marketplace, you must have three exposures a month for a minimum of six months to get your name into the conscious awareness of a prospect. If you are mailing to a brand new farm area, the best plan is to mail one piece per week for eight weeks. Then mail three pieces per month for the rest of your real estate career.

If you mail one piece per week for eight weeks, 40% to 60% of the people in the area will know your name. And what’s really amazing is that after just eight weeks, most of them will assume that you have been working the area for years, even if you have only been in real estate eight weeks. This is truly amazing to watch!

6 Give people a lot of constancy with a twist every now and then

As a psychologist, one of my most fascinating studies of human behavior has to do with how people respond to advertisements. The research shows that people respond best and pay more attention to TV commercials they see between seven and 15 times per month. The key is for the commercial to feel familiar to the viewer without getting completely repetitious.

We have all had the experience of seeing ads on TV that are played over and over again until we actually start hating them. The most effective advertising uses a series of ads that all have a basic format, look, and style, but then have ever-changing little twists to keep the campaign fresh. In direct mail, you accomplish this by creating what I call a PowerKard, or a large, oversized, high-quality, full-color postcard that is overprinted with constantly updated information. Use information you know your farm area will find interesting, such as just-listed or just-sold info about local homes, with their average sales prices, average days on the market, etc. You will use this master format for years. This high-quality PowerKard provides the credibility and perception of experience to get you into your clients’ minds as their agent.

Send out two PowerKards per month with ever-changing messages. Then once per quarter, surprise people with something really different. I have had great success with offbeat things I improvised, like a "Merry After-Christmas" card and an April Fool’s Day card. The key is to do something that surprises and delights a prospect every now and then—maybe four to six times per year. You can’t do this every month or it will lose its value.

Twice a year, send out a simple letter telling your clients you value them and their business. This should not take the form of a high-pressure message, but make sure the clients know their business is important to you. Finally, twice a year, mail out three copies of your personal brochure with a cover letter asking them to give it to friends who have a real estate need. This comprehensive plan leads to three mailings per month, and, in the process, it will make you rich.

7 Develop continuity with all your marketing materials

Include your Web site address on every piece of your direct mail. Then carry the look and feel of your direct mail through to your Web site and into every other piece of marketing you create. A strong graphical continuity across all of your marketing materials will dramatically increase the effectiveness of your entire campaign.

Follow these rules and I guarantee success. Break even one and you risk failure. In today’s competitive marketplace, you cannot risk doing it any other way.

Photo illustration by Sheryl Stone; photos © ThinkStock and Rubberball Productions.

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