The Science of Flipping - Episode 135: The Market Is SHIFTING – Real Estate Investing

Episode Date: January 7, 2019

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Welcome to the Science of Flipping Podcast. I'm your host, Justin Colby. Yo, yo, what is up? What is up? Welcome back to the Science of Flipping podcast. I am your host, Justin Colby. If this happens to be your first time to this podcast, I really urge you to listen, concentrate. I'm going to keep delivering you great content. Also, I'm going to be giving away my book. But listen, this is the best time to be listening to this podcast. We're talking about the market shift. Holy shit, the market is shifting. It's really happening. It's happening right now.

So what do we do? This has been a subject that I've been talking about in my masterminds now for about four months. I've been teaching and coaching my clients what to do with it. So I want to make sure I get on here right now because I don't care if you're in Phoenix like I am. I don't care if you're in Miami, Dallas, any of the major markets, the market is shifting. And so I want to make sure I present you with everything that I'm currently doing in my business. This is what the podcast is about.

And the reason why I'm actually shooting this podcast right now is because I just got off a great call with one of my clients. And he was asking me this question. I said, well, what better time to record a podcast episode than coming off an incredible conversation with one of my one-on-one clients? And he is very, very successful. He is in the Dallas market. He's crushing it. And he's saying, hey, we're seeing the shift happen. How you handling it what should we do you know they're thinking about um you know canceling some marketing strategies trying to save a little bit of money and I told him stop you have to first look at the numbers you have to first look at are your marketing strategies bringing you in revenue that's the first thing you have to look at so that was the start of our conversation because I

don't want anybody canceling or stopping any marketing strategy from direct mail PPC cold calling bandit signs doesn't matter what until they realize whether the marketing strategy is working the number one thing that I would advise you not to do is just, you know, code red, stop all money going out, stop all spending, stop all marketing, or even stop this avenue, stop this avenue, you know, whatever the case may be, don't stop. First, get educated. Is this marketing strategy bringing in money? If I spend a dollar, how many dollars are coming back, right? So, if I spend one, am I getting three back? If I spend one, am I getting six back? If that is still the case and you still see it to be profitable, don't stop it, right? Now, again, I'm talking to someone who

I think he's doing roughly five different marketing strategies. He's been in this business for a very long time. And so we're working together to make sure that he is making sure that he is spending his money wisely versus simply doing it because that's what he's always known. A good example was I talked to him about direct mail. I've always known direct mail. It's been my first marketing strategy and I still use it today. And at the beginning of this year, if you would have asked me, how's your direct mail going? I would have told you, shit, I'm basically torching $40,000 a month in direct mail. It's terrible, right? Call volumes down, lead volumes down,

deal flows down. You fast forward till December, direct mail, hands down, is my best performing marketing strategy. Not just in lead volume, but in the deal volume. Not just in deal volume, but profit per deal. It is hands down my best strategy. So the reason why I told him that, and I'm telling you guys on this podcast that is this reason. You need to have two, three, four, five, six, seven marketing strategies going at all times. If you are reliant on one marketing strategy, you will lose money. You will go out of business. You will stop. Now, I'm being extreme here to prove a point. Can you absolutely do well on one marketing strategy? Yes, I did. I made millions and millions of dollars on direct mail alone. But with that said, it will really, you know, pigeonhole you to what kind of revenue or deal volume you can do.

I really urge you to get two or three at very minimum. Now, it doesn't mean you need a big marketing budget. It doesn't mean you need to be able to go spend $40,000, $50,000, $60,000 a month in marketing like we were. It means you can have direct mail going, cold calling going, and door knocking going. You can have voicemail drops, cold calling, and door knocking. You can mix and match marketing strategies. But what I don't want you to do in this time of shift is stop everything, right? Cancel Christmas, I like to say. Do not do that. You need to keep the marketing strategies and how you know what strategies to keep is by understanding your numbers. How much are you spending? How many leads are coming in? How many deals are you doing? How

profitable are the deals? Focus on your KPIs. You've heard me say this time and time again on these episodes. KPIs and your numbers are everything. Focus on them. So the shift is here. The shift is coming. Whatever you want to say, you need to not just be reactionary, but you need to lead the shift,

meaning you need to be ahead of it and say, okay, it's coming. It's here. How do I pivot? What do I need to do so I can stay in business? Because in January, if you were just doing direct mail, you would have been out of business. In December, if you were just doing what's our lowest performing right this moment, cold calling, you'd be out of business. But what I will tell you is three months in the middle of the year, cold calling was lights out. We were crushing it, cold calling, killing it, right? So the point to this message here is things change, right?

Just like economies, it's up, it's down, it's, you know. So if you have two, three, four, five, or six, I actually have seven. If you include JV deals, networking, and social media. If you can run two or three at the same time without blowing your budget and do it by focusing on the numbers, your KPIs, your spend, your lead volume, profit per deal, then you will be safe throughout the year. There will be times, for example, PPC has gotten very expensive for us recently. Our cost per lead and our cost per deal has become highly, well, it has just gone through the roof. Let's say what it is. But we just contracted a 25 pounder and we're going to close on it before the year's over. And it completely changes the numbers. It completely

now makes sense again. But for the last two months, it literally was a, do we need to stop PPC conversation? Literally, do we need to stop torching money? And we kept with it because I don't just preach it, right? I do what I'm telling you. I do, I practice what I preach, right? That's why I have this podcast. And now, you know, a week or two ago, we contracted a 25 pounder, which means $25,000. We're closing it before the year is over. It readjusted our numbers. So it does make sense again. So the shift is here.

The shift is coming. Do not, do not, do not stop marketing. Do not just cut marketing off. Look at your numbers. Focus on what's getting you the most leads. Focus what's bringing in the most revenue. Stick with those. If you need to peel back how much you spend per marketing strategy, that's fine. But do not just cancel Christmas. Stick with them. You're using them for a reason. If you're just starting, I'm going to always advocate door knocking. It's you're just starting, I'm going to always advocate door

knocking. It's incredible. In fact, I'm going to do the next episode. The next episode is going to talk about door knocking. If you're just starting door knocking, cold calling, ringless voicemail, those are the best strategies for someone with little budget. If you do have a pretty good budget like myself, I'm such still a huge advocate of direct mail. It's crushing for us, but we have to remain consistent. PPC now, again, has flip-flopped and now is making us money and cold calling. You can't go wrong with cold calling no matter how much money you have.

So that's this episode guide. The shift is here. Holy hell, the shift is here. Well, don't worry about it. I'll help you through this time. It's gonna be a little chaotic. You're gonna see your market shift. You're gonna see different things happening. Still focus on time. It's going to be a little chaotic. You're going to see your market shift. You're going to see different things happening.

Still focus on marketing. It's all about marketing, knowing your numbers. That's it, ladies and gentlemen. We're good. If you want my book, if you want my book digitally download for absolutely free, go to thescienceofflipping.com forward slash free dash book, thescienceofflipping.com forward slash free-book. Download it for free. It's still selling on Amazon, but you guys are my people. You're my tribe. I love you all. Thank you so much. So you get it for free. Talk to you guys soon. Peace.