The Science of Flipping - Motivated Sellers By Marketing Strategy

Episode Date: February 9, 2021

Motivated Sellers By Marketing Strategy

Yo, yo, what is up? What is up, everybody? Welcome back to the Science Flipping Podcast. I am your host, Justin Colby, and on this podcast, it's all about real estate investing, how to become incredibly profitable, what systems, processes, organizations, and tools that you need in your business to win big in real estate investing. If you have not yet gone over to my YouTube channel, I have dropped some fire videos over on YouTube. Go to youtube.com forward slash Justin Colby, subscribe to my channel. Make sure you like those videos. That is very helpful for all the YouTube gods out there to favor my channel. With that said, I want to jump into the topic today, which will be motivated sellers and what marketing

strategy specifically creates the most motivation. Now, as you guys know, and have heard even on my last episode regarding cold calling, I am a massive fan of cold calling. Why you may ask? Because it simply works. Now, also, if you guys have been listening to me for some time where the reason that I financially got hurt when spending money on marketing is because I was a one trick pony. Now, one of those times, I was actually only buying from the auction. And now there's not money spent on the auction, but it was my only lead gen. That was the only way I was buying my flips. So when the hedge funds came into town and quite literally were paying 20, 30% more than I could, I had no shot at buying homes. So you can imagine if I can't buy homes, that means I can't rehab. That means I can't put them

on the market to sell. That means I make no monies. So that hurt me for roughly nine months. Literally had to make a massive pivot. It was crazy. It was terrible. The other thing that I've gotten hurt on is when I was only doing direct mail. Direct mail being my only marketing strategy. We were doing north of $40,000 a month each and every month on direct mail. So when those callback ratios started to become worse and worse, like what I felt like was overnight, all of a sudden it went from above a 1% callback ratio to like a half of a percent callback ratio. I felt like it was overnight.

Obviously it wasn't overnight, but I got hurt because I had no other deal flow. I had no other lead flow coming in from anywhere. So if you literally cut your lead flow in half, but you're spending the same, it doesn't take a rocket scientist to realize, ah, this doesn't quite work. So what I want you guys to realize is you need to have multiple marketing strategies. Now, what would they be? You have cold calling, as I just mentioned, text messages, you have direct mail, pay-per-click advertising, door knocking are the top five. If you want to play around, bandit signs, those still work as well. And ringless voicemail or voicemail drops, those work as well. So there's a lot that you can do. But what this episode is about is to understand how to handle each lead because motivation is different amongst them all. So the first marketing strategy, which I don't want to talk too much about because of how expensive

it is, is pay-per-click advertising. Pay-per-click advertising is PPC on Google typically, and it is the most expensive way for you to bring in a lead and get a deal. Simultaneously, it tends to have the most motivation. So my PPC, I bring in roughly 20 leads a month. I convert two or one of those every single month and roughly spend $10,000 a month on pay-per-click advertising. The company I use is Geoflip. So if you can just go to geoflip.com forward slash TSOF or just go to Geoflip and they're going to have you fill out a form, let them know you came through the science of flipping

or Justin Colby, that is fine, but they're expensive. So you need to make sure you have a marketing budget. Second highest motivation is direct mail. As I just mentioned, direct mail callback ratios have gotten even worse than I just said. I am receiving roughly 0.003% callback ratio. And by the way, when I say that, that is total callback ratio that includes FUs. So not only now is it expensive, I'm getting much worse callback ratios now than I ever have. So take that into account. So I love those two marketing strategies. I'm always going to love those two, but you need to have a semi-decent marketing budget to get into those. If you don't have five grand a month minimum, I would not touch direct mail or PPC, pay-per-click advertising for sellers. Now, what I love is cold calling and I love text messaging as a one-two punch.

Now, the leads are different. Direct mail and PPC, the leads are highly motivated. You tend to get the biggest profits out of them. Cold calling and text messaging, you're being proactive. You're going after them. They do not see you coming. So a lot of times you have a lot of resistance, even though the seller might have interest in selling because you've been proactive and reached out to them, they might have a bigger wall up and you need to find a way to, you know, have a skill set in sales and negotiating to break the wall down, to get to what they value in the sale of their home and then get the deal. Now, the key to this is nurture. Cold calling and text messaging, you will need more nurture of that lead than a direct mail lead or a pay-per-click advertising lead. So you may be able to get a direct mail lead. And from, you know, day one that they call you to the day you contract might be like seven days. Well, you on cold calling, you might call

them, introduce yourself, get the information, but you might not contract that for seven weeks. And it's because they need to understand who you are. They were not always thinking that they wanted to sell. The nurture of that type of lead is much longer. So if you listen to my last episode, and hopefully you have, hopefully, by the way, you are subscribing to my podcast. I'm on iTunes. I'm on Spotify. I'm on everywhere you can think of. Make sure you're subscribing. Make sure you're getting notifications for these episodes because I'm dropping an episode a day, one episode every single day, all about real estate investing. So make sure you subscribe and give me a review. Would love some five-star reviews out there. So if you listened to my last episode, you'll realize that the nurture campaign is really, really important on cold calling and text messaging and how long you nurture is really up to

how motivated the actual seller is. Okay. So I really encourage you to understand your expectations. If you are doing cold calling, if you're doing texting, can you get a deal in seven days? 100% you can. 100%. But typically, that marketing channel, that marketing strategy is going to take a lot more nurture on your side or your acquisition side than direct mail and PPC. Now, if you layer on the next level, which is door knocking, I love door knocking because it kind of gives you the best of both worlds. You're going after the motivation of let's say direct mail, because instead of sending a mail, you're actually knocking the door. So usually the level of motivation is higher and you're actually face to face with them that helps you move the needle and helps you move the ball down the field. I tell people this all the time. The best way to go get your first deal

is by direct or door knocking. The challenge I have is people don't want to do that. So as much as I say it over and over and over again, people aren't actually executing on my suggestion. And that becomes very, very challenging. Now, all the others, ringless voicemail, bandit signs, ringless voicemails, you need to do tens of thousands of voicemail drops or ringless voicemails to bring in the amount of lead volume that you will need. But that's okay because if you layer that in with cold calling and text messaging, essentially you've already paid for the skip tracing. So why not do voicemail drops or any of that kind of stuff? But the real point of this episode, guys, is understanding and having proper expectations. Cold calling and text messaging takes you and your acquisition side, much more patience, fortitude, and follow-up. The key is in your follow-up. And then the next episode, I will give you exactly how I follow up with these individuals.

So hopefully this finds you guys well. If you have not yet subscribed to this podcast, make sure you subscribe. And if you have not yet over to the science of flipping.com and filled out the form to talk to me or some of my team about whether coaching is a good fit for you. I'm happy to coach you go over to the science of flipping.com, fill out the form. Someone on my team will contact you and we can talk about whether you're a good fit for us or if I'm a good fit for you, because I'm more than happy to coach you to get to you to where you want to be.

Just go over to the science of flipping.com, fill out the form and we you to where you want to be. Just go over to thescienceofflipping.com, fill out the form, and we'll talk to you then. Peace.