What’s the cost of getting a deal in YOUR market?
How much you should mail is a constant question by clients of Ballpoint Marketing.
It’s also a constant problem when people don’t get this part right.
The truth is, many investors UNDERESTIMATE how much they should mail/market.
So we’ve written this report called “Cost per acquisition market guide”, where we tell you — based on the millions and millions of mail we’ve sent — how much it cost to mail, PER market/area, to acquire a deal.
The chart is below…
But first here are some “tid-bits” you should know about marketing before you dive in…
What is Cost Per Acquisition (CPA)?
We don’t mean what your cash offer is… but the gross cost of marketing; the marketing cost to ACQUIRE 1 deal. There are OVERALL marketing costs (CPA), and there are “channel” specific costs (ex: how much do I spend in mail to acquire a deal?”). The numbers we quote and the context of this guide will be talking about Marketing Channel Specific costs (AKA: what are the MAILING costs to acquire a deal).
Marketing as an investment
Marketing should be looked at as an investment.
You input $$ and it outputs $$$. Mail has been proven to have an output. People struggle with it, because it’s not as simple as “pick the cheapest letter and send”. There are nuances per market (like CPA), and list strategies. NOTE: We don’t need to go into “does direct mail work?”, we’ll assume you DO believe in it… and for those that don’t believe in it, I’ll ask you to divert your attention to some of the biggest companies in the US, and look up what their MAIN marketing/delivery avenue is (Hint: it’s still direct mail; even in a digital world where online is “cheaper” — even Google still sends you mail).
Mail vs other mediums
There’s a plethora of marketing mediums to use: radio, cold calling, cold texting, door knocking, online (paid ads, organic), networking.
All marketing has costs (even if it’s “free”, your time still costs money). Every lead/call has a cost. If you have to pick 1 lead generation, our “unbiased” opinion is that mail is actually the most scalable, direct, legal, and “*cheapest” there is. We’ve seen multi-investor studies that pinned all those above-mentioned marketing platforms against each other, and saw that MAIL (specifically our handwritten mail), had the lowest cost per deal.
*Cold texting is the exception for upfront cost… but there are 2 complaints about it: One is that it’s not technically legal (not our words, but the Federal government’s who HAVE fined investors). Another is the amount of 24/7, “back and forth” required in a cold texting lead to acquire the deal as opposed to mail or radio which is typically a 3rd or less of the work.
Using multiple mediums — the exponential factor
With all that said above…
Pinning one marketing medium with another to see which is “better” is actually a mistake. Because in today’s world, marketing doesn’t work that way. Marketing channels/mediums don’t work in isolation from one another. They actually help each other. And it’s been known in the marketing world that when you start “stacking” mediums together the “math formula” is no longer 1+1 =2, but 1+1 = 5.
The results are exponential.
Case in point: Our founder Ryan Dossey, puts a URL and company name in all his mail. Why? Because 50% of his leads come directly from filling out a form on his website.
Money is energy
Many will re-consider using mail (or any other paid medium) saying to themselves “It’s too expensive!”.
However, understand that the chart below, is a representation of the EFFORT it takes to get a deal in that market; It’s not just $$$, but energy/output it takes. For example: If you choose to use door knocking because you don’t have any money (which is fine, there’s no shame in that), understand that there is an equivalent exchange in that market of money to energy.
Meaning, in that same “High-tier” expensive market, it may take 3x the amount of door knocks and effort to acquire a deal than it would to door knock in a “cheaper/rural/midwest” market.
What’s more important than CPA (cost per acquisition)?
I’m about to show you the “CPA” (cost per acquisition) per market. But this trips people up. Because they see how “cheap” it is to market in the Midwest and will say, “Jeez Paul, I’ll go to the Midwest for deals then!”.
But that’s assuming that profit is equal from market to market.
Sure, it’s 4 times more expensive to acquire a deal in Los Angeles, but the profit is also 3x-4x bigger; profit in flip revenue, and appreciation.
Now we have all those “bases” covered, let’s get to the marketing chart…
Here’s our GUARANTEE to you…
If you use us for mailing, and things don’t go as expected, We’re HAPPY to get on a call and work with you on fixing these results for you. Many times, it can be bad data, or there actually IS a deal somewhere in those leads, or it wasn’t enough volume for your market.
If you’d like to know the EXACT list and mailing strategy you need for your market…