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Sunday, April 24, 2016

Tires or Brakes?

If you could each seriously think about this scenario and provide an answer (and why) it may give you a lot of insight as to what type of investor you are. It does relate to investing and something that is part of my goal list for this year, but I'm not quite sure how to proceed. I'll share details with anyone who leaves a comment.

You are alone on a camping trip far out in the desert. You have a truck with bald tires and bad breaks. You get bitten by a rattlesnake and have 6 hours to get to the hospital. If you take the road out of the woods you drove in on, it will be too far a journey to make it to the hospital in time and surely you will succumb to the venom. Luckily, there is a shortcut through the desert that will get you to the hospital in time.

The shortcut road to the hospital is dirt, gravel and mud. You can make it with your bald tires, but it will be a long, slow journey with lots of hard work involved and time is not on your side.

At the end of the dirt road, it comes out to a paved road, but it is at the top of a long hill. At the bottom of the hill is an intersection with a stop sign. The cross street is not well traveled, but there are semi trucks that do use it often enough that a collision is definitely a possibility. After the intersection, it is a long straightaway to the hospital which you can use to slow down enough to easily stop even with your bad breaks.

If you could do one of the following before your trip, would you:
A) Buy new brakes so you are certain to stop at the intersection and avoid a potential collision, but risk getting stuck on the way.
B) Buy new tires so you can get easily get through the shortcut road, but risk a collision with a large semi truck.

You can only pick one and please share why you choose the one you pick.

Saturday, December 19, 2015

Telescope, Binoculars, Maginifying Glass or Microscope - How Do You View Your List?

I had a great conversation with a consulting client today about lists. (For a consulting session, you can book it on my website at www.AarontheHouseBuyer.com.) We were discussing marketing lists and what he is mailing to versus what he should be mailing to. His current list was absentee homeowners with a few small variables in place. Let's analyze that list from the telescopic, to the microscopic and see if we can't find some niches to bring more riches into your marketing machine.

Telescopic - Absentee homeowners, 30% or more equity, no corporations or trusts and maybe a few more minor variables like property age (year built), 3-4 beds

Binoculars - Absentee homeowners living in a zip code other than the subject property zip code or even a different county!, 30% or more equity, no corporations or trusts, year built 1995 or older, single story,  3-4 beds, 1-2 baths, 800-1,800 sq/ft

Magnifying Glass - Absentee homeowners living in a county other than the subject property, 30% or more equity, no corporations or trusts, year built 1940-1995, single story,  3-4 beds, 1-2 baths, 800-1,800 sq/ft, no trust deeds recorded in last 10 years and owned 20+ years

Microscope - Absentee homeowners living in a county other than the subject property who are 65 years of age or older, 30% or more equity, no corporations or trusts, year built 1940-1995, single story,  3-4 beds, 1-2 baths, 800-1,800 sq/ft, no trust deeds recorded in last 10 years and owned 20+ years, haven't paid property taxes last year/code enforcement notice/eviction filing, etc.

If you had an opportunity to mail 100 marketing pieces to each list, which do you think would have the highest response rate? Which would be the most difficult and costly to obtain? Which would you rather be working? Answering that question, is it worth it to do more work on the building of a a targeted list or later on the fallout of mailing to a broader list? Do you think you would say the same thing and mail the same piece to each list? What would you say (message) and in what method would you get that message to your prospect?

You can do this type of analysis on any list you are currently marketing to. When the well runs dry, is it more costly to dismantle the well and move to a new location or drill deeper? This is how you drill deeper in the same market to get more and better results from your efforts. If you have any questions or suggestions, please leave a comment below and feel free to share this post with any of your fellow marketing investors and post a link to this on your favorite social media.

Tuesday, August 25, 2015

An Easy Way to Split Test

You've been hammering away on your marketing and think it is time to change things up a bit. Should you change the color, size, a headline, try a new picture, send letters instead of postcards, try a different sized envelope for your letter, or maybe an invitation style with a card? How do you decide? You don't want to change the whole piece. It is important to have some connectivity between your pieces so your audience remembers who you arre. Where do you start?

I like to look at and learn marketing from the biggest names in the marketing world. No, not the gurus. They don't amount to peanuts. I'm talking about the companies that have been in business for decades, and make their money by constantly pushing their products in your face. Companies whose marketing budgets are higher than many small countries GDP. One of the biggest of them all is McDonald's - $988 Million spent on marketing in 2013! Of course, that isn't even 1/3 of what Coke spends, but since they are only selling Coke, they utilize more logo recognition by plastering it everywhere and hiring high profile spokespeople.

McDonald's knows exactly who their target market is, how to best reach them, and what to show them to make them want their product. Although the commercials and menus have changed over the years, they utilize mascots to reinforce their brand recognition. They really have their marketing dialed in and you can learn a lot by paying attention to them.

Since we're not dealing with McD's marketing budget, but want to conduct a split test we need to figure out something easier than running a commercial with the Hamburglar in Texas and one with Grimace in California to see which sells more cheeseburgers before going nationwide. So, what do we do?

 Most likely you don't have two phone numbers or two extensions you can use. And, asking "Exactly which mailer did you receive?" can really put a damper on your negotiation, especially when dealing with older people who don't always understand complex questions, never mind the address of the property they own.

Let's say you are mailing postcards and want to try a new headline. What do you mean you don't use a headline? Some examples from the many mailers I receive on my rentals and have sitting here on my desk include, "Urgent Notice," "Attention Homeowner," "Houses Wanted." By the way, these all suck, but I bet they still get houses in escrow. So, you put pencil to paper and come up with a few dozen new headlines. You show them to a few trusted advisers (could be your kids, spouse, dog) and narrow the field down to just two. Problem is, you can't decide between these two remaining contenders. You're sure they are both going to make sellers hand you deeds and keys faster than you can write checks.

An easy way to split test your two new headlines is to send a batch of cards out with your new headline and use your first name at the end of your call to action. "Call me now! Thanks, Aaron" What do you mean you're not using a call to action? On your other card, you use your middle name, "Call me now! Thanks, Michael"

Just by answer the phone and listening for whomever the caller wants to talk to, then keeping a simple record on a Post It note somewhere convenient, you'll quickly learn which headline is more effective.