Why Test Mailers Do Not Work (LA 1417)

Transcript:

Steven Jack Butala:
Steve and Jill here.

Jill DeWit:
Howdy.

Steven Jack Butala:
Welcome to the Land Academy Show, entertaining land investment talk. I’m Steven Jack Butala.

Jill DeWit:
And I’m Jill DeWit, broadcasting from sunny Southern California.

Steven Jack Butala:
Today, Jill and I talk about why test mailers don’t work.

Jill DeWit:
Do you want to describe a test mailer first? Or do you want to …

Steven Jack Butala:
Yeah, sure. A test mailer … Before we get into all of this though, will you please tell me the story?

Jill DeWit:
Oh.

Steven Jack Butala:
Jill was telling me a story about a deal we’re doing, and the seller is …

Jill DeWit:
Oh yeah, I came running downstairs.

Steven Jack Butala:
I said, “Save it for the show, save it for the show.”

Jill DeWit:
Yeah, because this seller … It’s one of those run to the bank deals, but I had a talk with this guy and his background is amazing. I’m like, “I want to get to know this guy.” This happens sometimes, you almost make friends with them. I remember one time I had this guy that was bugging me in Orange County, “Come over, my wife will make you dinner.” It was so cute.

Steven Jack Butala:
So earlier in the week we had shows about building relationships with buyers and sellers, that’s what this is.

Jill DeWit:
Exactly. So this guy, his name is Ed and he raised … I don’t know how we got on this topic but it happens. He would race motorcycles for 40 years, it was really cool. He was telling me the story about when he stopped racing. He was 60 years old, still racing, if you can believe that. He was of course … It was his grandson’s birthday, and Grandson wanted to race motorcycles with Grandpa. And then Grandma got on the phone too and confirmed this whole thing. And she’s just so chill. So it was funny because-

Steven Jack Butala:
Got on the phone with you?

Jill DeWit:
Yeah, we were all talking on the phone.

Steven Jack Butala:
Jill, this is hilarious.

Jill DeWit:
It’s the cutest thing. So anyway, Grandpa tells the story that he was racing with Grandson and he had an accident. He missed a jump somehow and tweaked his shoulder, but good. And Grandma’s like, “Oh, that’s just what happens.” The reason I brought it up because I … So we were talking, he’s telling me this whole story, and then Grandma gets on the phone, because Grandma’s the one who was doing the deal with me but Grandpa had some information. Anyway, Grandma gets back on the phone. I said, “You know what? I understand, because this one, Steven,” I said, “My sweetheart used to race superbikes back in the day.” And we were talking, I said, “And thank goodness, when kids came along he decided [inaudible 00:00:02:10]. She’s like, “Oh yeah, mine didn’t do that. No, I live that life.” And she’s like, “Yeah.” And she just tells me, “Yeah, he didn’t tell you he was doing it with his grandson because his grandpa wanted to do that with Grandpa on his birthday and that’s the day that Grandpa had the big crash. But everybody’s okay.”

Steven Jack Butala:
The big crash.

Jill DeWit:
The big crash. And, “Grandpa’s fine, but Grandpa took how many months of recovery and surgery for his shoulder.”

Steven Jack Butala:
Oh geez, surgery?

Jill DeWit:
Uh-huh (affirmative). I’m like, “Oh, man.” And Grandma’s totally chill about it, it’s like, “Yeah, this is what happens, that’s my life.”

Steven Jack Butala:
Well, that was … For every big surgery there’s a lot of falling off.

Jill DeWit:
Yeah. Oh, I can’t even imagine, so what kind of life she led. It was so funny, because I’m on the phone with him, I’m looking him up. I’m like, “Wow, there he is.” In Motorcycle World, I’m-

Steven Jack Butala:
Is he a BMX?

Jill DeWit:
No, motorcycle.

Steven Jack Butala:
Superbikes?

Jill DeWit:
Not superbikes. I want to say off-road stuff.

Steven Jack Butala:
Yeah, BMX.

Jill DeWit:
Yeah, okay, is that what that is? So that is not bicycle?

Steven Jack Butala:
Right. Yeah, that’s what I meant.

Jill DeWit:
I thought BMX was bicycle.

Steven Jack Butala:
I think it is, you’re right. Here we’re all superbikes.

Jill DeWit:
Okay, yeah. Anyway, it was really, really … You mean motocross?

Steven Jack Butala:
Yeah, motocross.

Jill DeWit:
That’s it. Because they were talking about a cross country race him and a guy won, I found this article. As I’m talking, I’m like “This guy’s legit.” It was really cool. Anyway …

Steven Jack Butala:
So tell us about the deal.

Jill DeWit:
It’s great. I [inaudible 00:03:33] think about the deal.

Steven Jack Butala:
I looked it up. I know about the deal, let me tell you.

Jill DeWit:
Yeah.

Steven Jack Butala:
It’s about 30 miles from a suburb of most attractive city, one of the two or three top attractive cities in the country. It’s 2.35 acres with structures all around it. It’s got [inaudible 00:03:56] foundation. So we’re going to buy it for I think 3,400 or 2,400, one of those, and it’s probably worth 25 wholesale, wholesale, probably more.

Jill DeWit:
Yeah, it’s just a cool deal.

Steven Jack Butala:
And you don’t have an idiot seller like yesterday and it’s just a bang, bang, bang, probably buy it, probably buy it. In two weeks the whole thing will be done.

Jill DeWit:
I forgot … Oh, it doesn’t matter.

Steven Jack Butala:
No-

Jill DeWit:
No, you’re all good. No, it’s all good.

Steven Jack Butala:
Before we get into it let’s take a question posted by one of our members on the landinvestors.com online community, it’s free.

Jill DeWit:
Nate wrote, “I own a parcel out in X County, California.”

Steven Jack Butala:
You can say it.

Jill DeWit:
Okay. “Kern County, California, and currently have a terms customer. My terms client was out of the parcel this week and noticed a large X shape mark probably spanning five feet by five feet. It’s bolted to the crown with metal nails to keep it in place and marked panel six.” What the heck is this? Is this a target for somebody to drop from the air on, practicing skydiving?

Steven Jack Butala:
I’ll explain it.

Jill DeWit:
Okay. “This is land that I own, and I haven’t been made aware of this by anyone, nor has anyone asked permission to do this. Wonder if anyone in this group has come across this before. Any thoughts on one, what is this? And two, how to resolve it? Thanks in advance.”

Steven Jack Butala:
There’s a lot of people that piped in on Land Investors.

Jill DeWit:
It’s so funny.

Steven Jack Butala:
And so here’s the answer. It’s your freaking property, you’re going to do what you want with it. This is America, number one.

Jill DeWit:
That’s the best description, I love it.

Steven Jack Butala:
The X shape is one of two things. It’s a large aerial survey marker, but this one seems a little bit more permanent. Usually they would just spray paint something or whatever. This is probably somebody’s … If you want to waste a half hour of your life, go on Google Earth and go down to Kern County and San Bernardino County, California. Just look around, and there’s some funny stuff. I don’t know if it’s leftover from movie shots or whatever.

Jill DeWit:
Go on Google Earth?

Steven Jack Butala:
Yeah, Google Earth. Is that what I said?

Jill DeWit:
I don’t know.

Steven Jack Butala:
Oh, you’re just thinking about something else.

Jill DeWit:
I was.

Steven Jack Butala:
Welcome to the Land Academy Show, Jill.

Jill DeWit:
I’m listening.

Steven Jack Butala:
Just take it off of there. But I would take pictures of it and stuff, it’s unique, it makes the property unique. If you were going to sell it, not on terms, just for cash, I would leave it there and shoot it and laugh about it.

Jill DeWit:
It’s hilarious.

Steven Jack Butala:
Which brings me to the bigger-

Jill DeWit:
Comes with a skydiving marker.

Steven Jack Butala:
Jill, you can do that.

Jill DeWit:
Here you go. You want to jump out of a plane and land on your own property? The marker is there, you can find it.

Steven Jack Butala:
Totally be that. It’s panel six.

Jill DeWit:
Exactly.

Steven Jack Butala:
If you miss panel five, look for panel six.

Jill DeWit:
Yeah. That one’s yours. Yeah, make it a positive. Isn’t that cool?

Steven Jack Butala:
The takeaway from this is that when there’s stuff left on your property, no matter how bad it looks, nine times out of 10 it’s better. It makes your property unique versus the person next to you who’s got nothing on theirs.

Jill DeWit:
Well, I was bummed the other day when I found out that I had a property that I thought had a gate on it with a fence and it was locked and I’m like, “This is cool.” So I told the people, “If you’ve got some bolt cutters, it’s mine, cut the lock.” Well, they were at the wrong property, I found out mine doesn’t have it. But even something like a fence people go, “Oh no, it’s bad, it’s a fence.” I’m like, “No, this is great. Somebody took the time to build a fence. There’s something worth having a fence for.”

Steven Jack Butala:
Exactly.

Jill DeWit:
And there’s a road for the fence, this is all good information.

Steven Jack Butala:
This a very popular thing right now that I hear, “Stuff’s on my land,” or, “There’s a locked gate.” I mean, you bought the property.

Jill DeWit:
Great, there’s something worth having a gate. Somebody cares.

Steven Jack Butala:
So I just wonder, when there’s legal access and physical access, because we don’t buy property otherwise, I don’t know why that becomes … It’s very, very common. I mean nine times out of 10 people are like, “Oh my gosh, what do I do?” So I don’t-

Jill DeWit:
Nothing. When you buy it, you cut the lock. Put your own lock on it.

Steven Jack Butala:
It’s one of the things … Usually you can figure stuff out, I can’t figure it out. Anyway … Today’s topic, why test mailers don’t work. This is the meat of the show.

Jill DeWit:
Will you please explain test mailers?

Steven Jack Butala:
A test mailer is this … We have a bunch of new people, because it’s the new year and I’m watching in Discord and Land Investors people testing, I’m going to use the word with air quotes, testing test mailers. Nowhere in the program do I advocate this and nowhere have I ever seen anyone in the advanced group say, “Let’s just check it out.” Here’s why. A test mailer is when you say I’ve identified this market as a place that I want to send mail. It passes the tests, I’ve gone through the education and I’m ready to do this. I’m going to send out 150 mailers and just see what happens. I’m going to play one hand of blackjack and see what happens. I’m going to throw my fishing line into the water one time, and if I don’t catch a fish I’m leaving.

Jill DeWit:
Excellent.

Steven Jack Butala:
So that’s just not how this works. You need to get in there. If you’ve identified a fishing hole and you’ve talked to a bunch of people and they’re like, “Oh yeah, we pulled out 25 fish over there in two hours yesterday, here’s the coordinates go over and give it a shot.” That’s good information, you’ve done what you’re supposed to do, and you’re going to go … Versus just driving out in the middle of the ocean and dropping a line in. Test mailers don’t work, and because this is a numbers game. If you send out 10,000 mailers, and I’m not saying do this, please don’t. Send out 10,000 mailers without any research at all, and you put $5,000 on every single one of them, you’re going to buy a property. I don’t care, unless it’s Manhattan, New York or some crazy high-end thing, you’re probably going to buy a property.

Jill DeWit:
Now in Manhattan you probably will.

Steven Jack Butala:
Yeah. I’m not saying do that, I’m really not. I’m saying do your homework, do some stuff, don’t send out three or 400 mailers. All it’s going to do is discourage you. The odds are no longer in your favor of getting anything at all and it’s going to make you mad, and it’s going to fail. And so you’ve done all this work to identify market instead of sending out 1500 or 2000 mailers, which is what you should do. You send out 200 just to see. I had a football coach, I haven’t said this in years on the show. He was famous for saying, “If you’re going to make a mistake, make it at a hundred miles an hour.” So don’t just go, “Oh wait, I’m going to see if it’s going to happen.” Don’t do that.

Jill DeWit:
You got to be in it, you got to be in it. I was thinking myself, our test mailers are 3000. That might be … It’s not really a test, it’s not a test. There is no test, just send it out. What’s the minimum … I would love to share for everyone here.

Steven Jack Butala:
1500.

Jill DeWit:
Per zip or county?

Steven Jack Butala:
If you’ve identified and done all the work, just like the program says-

Jill DeWit:
You want to do a multi-zip or multi-county mailer, how much is the minimum you want for each one? I’m going to say 1500.

Steven Jack Butala:
Here’s a perfect scenario. I love multi-county or multi-zip code mailers, because the stuff comes back, and if you get three or five purchased properties out of it and they’re in different zip codes or different counties, that’s really good for sales, because you don’t have a lot of property in one area. But at this point in our career, I wouldn’t send out a 600 unit mailer in one zip code or county, I just wouldn’t do it. 1500.

Jill DeWit:
Well, and I want to talk, as I talk about this a lot, this comes up in a lot of the things on the live stuff and everything, people ask this question. One of the reasons why is if you’re doing it all, especially when you’re brand new, it’s so much easier and you have such a better chance of success if you send 1500 units to one area, one parcel size, one whatever. You’re comparing apples to apples. When these calls come back, all you’re dealing with … You know the county, they’re all roughly five acres, whatever it is that you have identified for your mailer, it’s so much easier when you’re sitting there lining up the deals and picking the best ones, “Oh, this is access is better than this access.” And you’re not jumping around like, “Oh, okay. How much-”

Steven Jack Butala:
Especially if you’re new.

Jill DeWit:
Yeah, when you’re new, “Oh yeah, over here they’re priced differently than over here.” That’s just a little nightmare. I don’t want you to do that, I want you to get comfortable with how the transactions go, A, and B, I want you making some money. Then when you go on … You can start rolling in some other areas and branching out a little.

Steven Jack Butala:
So I guess my question is, and I really want to know the answer, because usually I can figure out why people do stuff really, but like I said earlier, what’s the point to testing a mailer? I’m asking you, really, what do you think goes on in someone’s head?

Jill DeWit:
I think people are uncomfortable with their selection. They maybe not confident with the area that they chose, so they think they’ve … They’re going to send out for five and hope that one of the five is a good one, and one of the five is going to be … And that’s going to … They’re going to get the right offers back, and that’s going to be okay. Instead of maybe spending a little more time picking up ahead of time and doing it like that.

Steven Jack Butala:
Yeah. Truly, all kidding aside-

Jill DeWit:
There’s no money savings.

Steven Jack Butala:
What Jill described, don’t do that. And later in your career, after you’ve worked the state and you know the difference between the counties and you know everybody, you really know, you can pretty much say what’s going to happen when the mailer goes out and comes back, that’s when you’d start getting creative. So here’s another thing, nowhere do we teach this. So if you wanted to be a welder, I’m just not one of these people. Again, I’m asking you, if I wanted to be a welder, I would take a class, figure out what it is, what the certification levels are, go to the class or take it online or however it works right now. Exactly follow the instructions of how to become a welder and how to be certified and how to get an A too, how to pass it with flying colors. And then the minute that I was done, I’d go back out into the junk yard and just test my stuff. I would … If I wanted to get creative, I wouldn’t do it during the time where I’m learning.

Jill DeWit:
Do you know what you sound like? This is like a 17 year old with a new driver’s license and a new car. “Okay, I did what I needed to do to pass the test, now I’m going to go practice burning the back tires off of this.”

Steven Jack Butala:
God, that sounds fun.

Jill DeWit:
Yeah, yeah, yeah. “I know how to drive, I know what to do, now I’m going to go have some fun.”

Steven Jack Butala:
That’s why your insurance is $1,200 a month.

Jill DeWit:
So funny.

Steven Jack Butala:
Until you’ve got 10 deals under your belt, just do what the program does.

Jill DeWit:
Well, here’s my point. I want to say, if you’re new and you’re thinking of these test mailers, I would rather you spend a little more time. If you’re in Land Academy, you know what I’m talking about with picking a county in the red, yellow, green. I want you to spend a little more time, maybe spend an extra day, an extra weekend, who cares? Double checking your red, yellow, green stuff to make sure you feel good, and then I want you to go at it with confidence. And then no matter what, you know that if you came in too high on your offer price, you know how to solve that problem, we talk about a lot, and if you came in too low, that’s even easier, by the way, on these offers, you know how to solve those too, and you’re going to get some deals.

Steven Jack Butala:
And Jill, how do you know you came in too high or too low?

Jill DeWit:
Well, if you came in too high, every single person loves you. They call you back with a smile and you are overwhelmed with signed offer agreements, because they all said, “Wow, this person actually wants to spend this much on my property.”

Steven Jack Butala:
And too low?

Jill DeWit:
And too low is you got a whole lot of hate, and that’s okay. I’ll tell you real quick. So what do you do with a whole lot of hate? Big deal. Find out if they want to sell and then … Because every time you add money to it, they think they win and it’s a good situation. “Oh, I’m sorry. I offered 500 and it’s really worth 1500. Holy cow, I’m so sorry,” whatever it is. You know it’s worth even more, you know it’s worth 4,500, so you’re okay paying 1500. That’s the point here.

Steven Jack Butala:
So here’s what happens when you send out a 300 to 600 unit test mailer, nothing. No one calls you back, there’s no hate. You might get two calls and they hang up. You haven’t sent out enough to get any feedback to make the appropriate adjustment. You have to fail at a hundred miles an hour. Send out 1500 to 2000, maybe 3000 units or whatever. You’re going to get all kinds of feedback, you’re going to buy some property. But just testing it …

Jill DeWit:
You’ll know.

Steven Jack Butala:
I have to tell you. I’m going to say it, truth time. And it’s not going to be a popular thing, but I’m going to say it. I question the personality, this test mailer personality, and how successful they’re going to be at this.

Jill DeWit:
They’re not confident. They need to have confidence.

Steven Jack Butala:
You need to have some … You need to say, “Whatever it is, bring it, bring it. I will find a deal out of these 1500 to 2000 mailers, whether it’s too high or too low.” You’re not going to … If you send out three to 500 units just to test that market to see if it’s good, that’s absolute incorrect logic. What you’re doing is pulling the slot machine thing once, you didn’t win, you’re walking out.

Jill DeWit:
Right, you don’t really know. That’s perfect. Happy you could join us today. Five days a week you can find this right here on the Land Academy Show.

Steven Jack Butala:
Tomorrow the episode on the Land Academy Show is called providing information instead of directly selling. You are not alone in your real estate ambition.

Jill DeWit:
This has been a fun week, we have a lot to say. You know what? Because we’ve just had some kooky situations and deals that have just, man, just given us a lot of content. That’s awesome. Need to send out a few thousand offers to property owners like us? Check out offers2owners.com. No setup fees, free mail merge, and exceptional service. We should know, because that’s our company. Give Offers 2 Owners a call today.

Steven Jack Butala:
We are Steve and Jill.

Jill DeWit:
We are Steve and Jill.

Steven Jack Butala:
Information …

Jill DeWit:
And inspiration …

Steven Jack Butala:
To buy undervalued property.