Scraping Data for Mailer Pricing Pros and Cons (LA 1399)
Scraping Data for Mailer Pricing Pros and Cons (LA 1399)
Transcript:
Jack Butala:
Steve and Jill here.
Jill DeWit:
Ho, ho, ho.
Jack Butala:
Welcome to the Land Academy Show, entertaining land investment talk. I’m Steven Jack Butala.
Jill DeWit:
And I’m Jill De Wit, coming to you this Christmas week from sunny Southern California.
Jack Butala:
Today. Jill and I talk about scraping data for mailer, for your mailers, the pros and cons.
Jill DeWit:
You’re all business and I’m all into the holidays.
Jack Butala:
Yep. For the last decade, that’s how it’s been.
Jill DeWit:
Yep.
Jack Butala:
I think holidays-
Jill DeWit:
Careful.
Jack Butala:
… disrupt-
Jill DeWit:
Oh.
Jack Butala:
… revenue streams.
Jill DeWit:
Well, in the old days, this would be a high retail year and it would make revenue streams.
Jack Butala:
There’s something about this holiday at the end of the year, it just becomes a two week thing. Versus, I don’t know, whatever other holidays that you’re into, Easter or Thanksgiving. It’s that day, and maybe if you’re a cool employer like us, it’s you take the day off after that so it becomes a long weekend. But this just, it’s a two week thing. Jill’s right, it starts right about now.
Jill DeWit:
You know the good thing is? If you haven’t experienced before in our business flipping land, when people are home on their computers with nothing to do and they’re tired of their family, sometimes they spend money on dirt. Just saying.
Jack Butala:
Yeah, well.
Jill DeWit:
It has happened.
Jack Butala:
Okay.
Jill DeWit:
It has happened.
Jack Butala:
December is not historically our best month by any stretch.
Jill DeWit:
It has done okay.
Jack Butala:
Today’s topic. Oh, we already talked about it. 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:
Ellen S. “Hello, everyone. On a recent episode of the land Academy podcast, Jack mentioned something about how investors shouldn’t be buying land in Apache County, Arizona. Would he or anyone else be able to give some more information about why? I’m a virtual assistant, one of my clients is a land investor.”
Jack Butala:
Okay, hold on.
Jill DeWit:
This is funny. Do you want me to keep going?
Jack Butala:
She, Ellen, is a virtual assistant for one of the land investor or Land Academy members.
Jill DeWit:
Right.
Jack Butala:
She handles sales and … Go ahead.
Jill DeWit:
Okay. Okay. “I handle sales and marketing for him. I’ve been doing this for almost a year and a half [inaudible 00:02:16] success selling his properties in another state, but I struggled with selling these in Apache County.”
Jack Butala:
Okay, one second.
Jill DeWit:
Okay.
Jack Butala:
Ellen has success selling properties for the person that she works for. So if you need a virtual assistance that’s successful at selling property, why not contact Ellen? She’s right there in landinvestors.com.
Jill DeWit:
May I continue?
Jack Butala:
This is how you use land investors. It’s not just like a newspaper.
Jill DeWit:
Okay.
Jack Butala:
It’s huge resourcing.
Jill DeWit:
Listen, Captain Obvious. Okay. “They’re in Holbrook, right by the Petrified Forest National Park. I’ve never been to the area.”
Jack Butala:
Good for you.
Jill DeWit:
I would appreciate any tips on how to sell these properties here, and I would love to know why Jack doesn’t like it. Any help is appreciated. Also, I love the podcast.” That’s funny and cool and sweet.
Jack Butala:
If you apply the red, green, yellow test, like we talk about in our education programs, and you look up Apache County or Navajo County, you will see that it doesn’t in any way pass the red, green, yellow test. There’s three components to it and it doesn’t pass any of them.
Jill DeWit:
And once upon a time it did.
Jack Butala:
Yes.
Jill DeWit:
So that’s a point here, so there’s still leftover properties. I probably have some leftover properties.
Jack Butala:
Yeah, we do.
Jill DeWit:
So it doesn’t mean that … It’s just not the best place now. There’s just so many good areas and we have so much more information and data now in our hands.
Jack Butala:
There’s a lot of people that piped in on this. And somebody said, “Well, it’s the water quality.” And there’s all kinds of obscure things. Look, for us, it’s just money.
Jill DeWit:
Yeah.
Jack Butala:
There are too many properties listed there as a percentage of the universe of properties in that county. You want to have less than 1% of all the properties in the entire County listed. And the lower, the better. That’s one of the red, green, yellow tests.
So that won’t pass it at all. You could stop right there. There’s a tremendous number of properties. And a lot of these desert counties, not all of them, out west, this day and age now, I think they’re great practice. Learn how to buy property, buy it for a thousand dollars or $500 and really get your feet wet on how to do deeds and talk to sellers and all of that. If that’s where you are in your career, these desert counties are fantastic for that because you will buy some property.
It’s like, when I was a kid in Northern Michigan, my dad took us to this little watering hole. I learned later it was the person who owned it, stocked it for fish for their own consumption. And so the fish were tiny. I mean, you would literally drop your fishing rod in, and boom, pull up a little [inaudible 00:00:05:12], take it off the hook, throw it back in, do the same thing over and over. You’re practicing fishing. And then we would go to the real lake and do it.
So that’s what’s a lot of these desert counties are good for.
Jill DeWit:
I concur.
Jack Butala:
Today’s topic, scraping data … Scraping data for mailer pricing, the pros and the cons. This is the meat of the show.
Jill DeWit:
I have two questions.
Jack Butala:
Sure.
Jill DeWit:
Well, really one question. Well, kind of two questions, and I know you’re going to do anyway. Here’s my notes for this. There’s a right way and there’s a wrong way. So will you please describe, I know you will, the right way and the wrong way.
Jack Butala:
Sure. So the right way to price your mailer data is to accumulate as much for sale comparison values from a pricing standpoint, and sold comparison values from a pricing standpoint. So you’re trying to extrapolate data from existing places on the internet to come up with a price per acre.
So let’s just say from one to five acres, you realize that the average of everything that’s been sold recently and for sale, is $500 an acre. At that point, if you just said, “Great, I’m going to mail it out at 10% or 20%,” of whatever you decide of that $500, you’re going to be overpriced. There’s going to be all kinds of issues there. And here’s why.
There’s issues with the data that need to be manually addressed. You can’t just press a button and review that, you have to do what I call is a test for reason, and pretty heavily. And we’ve been doing this for decades. And I’ve never sent a mailer out and it never would without doing a pretty severe test for reason. And the test for reason essentially means this.
You price your mailer, it comes out at $500 an acre. Then you’ve got two or 3,000 units that qualify, and you pick out 20, 30, 40 properties. And then you look at it as if you’re going to buy it. As if somebody sent the purchase agreement back, signed it, sent it back and said, “Absolutely, I want to sell my land for $4,200. Let’s do it.” And you look it up and you run through the due diligence, it’s a dry run on a due diligence in make-believe, to see if you would actually pay $4,200 for that property.
And nine times out of 10, you wouldn’t, because there are manual things that have to go on at the end that need to be addressed. If you’re a data person, what you’re doing is looking for the exceptions. So 80, 90% of the properties are probably going to be okay, but what’s throwing that number off? What’s making it $500 per acre? When in reality, it probably should be closer to 300 or 350.
Or maybe there’s lack of data. Very often you’ll run one of these automated programs in a dataset that … This is all data-driven. In a dataset that doesn’t have enough data. I mean, can you imagine if you’re a statistician doing a survey and interviewing 10 people, asking them a question, a survey of 10 questions, asking 10 people.
Jill DeWit:
Right.
Jack Butala:
Would you want to ask 10 people or do you want to ask 20,000 people?
Jill DeWit:
Tell me when I can jump in.
Jack Butala:
Go ahead.
Jill DeWit:
Okay.
Jack Butala:
Absolutely. Just jump in.
Jill DeWit:
All right. The reason this is coming up, and the reason this is important that we’re covering this today, is a lot of people think there’s an easy button. And there’s some people that are current and former Land Academy members that think, “I got this.” And they’re coming with some easy buttons, and it’s not perfect.
And I don’t want anyone to go down the path thinking that, “This is perfect. It takes all the work out of it. I never have to think about it. And I just push a button and it goes to offers to owners and done in the mail.” Because you’re not going to get the yield the rest of us are getting, that’s the point.
Like Jack was saying, there’s weird outliers. If you really sit and do this … Jack showed us a couple of weeks ago on one of our member calls, the right way. There’s a right way and a wrong way to get data. So the right way is, you can go, and he does, manually scrape if you will, download the data from some land selling sites, put it into a spreadsheet.
But then, and that’s when the personal stuff comes in, where Jack goes, “Well, that’s clearly not right.” When a property got transferred for a dollar, that’s going to throw off your numbers. We do this all the time. That’s going to throw off the numbers. Or this one’s a hundred million dollars. “Okay, that’s probably not right. There’s something else going on there.”
Jack Butala:
They’re data exceptions.
Jill DeWit:
Exactly, that should be taken out. And those are not accounted for in these quote unquote pricing, easy button solutions that people are trying to create.
And I love the fact, don’t get me wrong, I’m all about making this easy and automating everything that you can, we both are. But there’s just a few things that you need to do and they’re just not perfect. And by you putting it on what’s cruise control, you might hit something. Or you’re not going to get the yield that I’m getting, and I want you to be very successful.
Jack Butala:
Jill and I are … This is a huge topic right now. There are former Land Academy members that are coming out with these products, education products and pricing products and all this stuff, that are tragically flawed.
Jill DeWit:
Yeah.
Jack Butala:
And our response is we will now develop the correct products, the same way that we went and developed offers to owners, because we just couldn’t get a mail company to understand what we do. In the same way developed a neighbor scoop, because we just couldn’t get a land-specific way to look up an APN, city county APN.
So Jill doesn’t know this, but we are developing our own pricing product and it will be released early next year. This is-
Jill DeWit:
You are going to come up with a way to automate this.
Jack Butala:
Yeah, I already talked … I talked to the developer yesterday, who is a member and he’s-
Jill DeWit:
He can take them out? Is there a personal piece … Can I ask some questions?
Jack Butala:
Sure.
Jill DeWit:
Is there a personal component that goes into it?
Jack Butala:
What do you mean?
Jill DeWit:
Is it going to do what I think it’s going to do? Scrape, give you the chance to adjust, take out what you want to take out and then continue on the process. Because I think that’s what needs to happen.
Jack Butala:
There is a manual component where you have to, at the end of the scraping, assuming you have enough … There’s all kinds of red lights that should go on. Developers love to just jam you down a funneled corner without you knowing it and say, “Okay, it’s 500 bucks an acre in Navajo County, Arizona.” And then they want to suppress a button, like politicians. They want to tell us what to do and press a button, and then be happy.
And so no, this is going to … Well, you will be involved-
Jill DeWit:
I’m glad.
Jack Butala:
… independently involved, in making decisions all along the way. And so, if you’ve got five or six pieces of data and that’s all you can collect in a county, it should stop you right there. And here’s why. Sending mail out is expensive, we know that. Well, why would you want to waste thousands of dollars sending mail out when it’s grossly overpriced?
I can tell you, we have this thing … If you’re a member, you know this, on our Thursday call [inaudible 00:12:36], would you do this deal? And people are constantly saying … They fill out the thing and we talk, Jill and I talk about it. And we say, “Yeah, we’d absolutely do this deal.” Or, “No, we wouldn’t do this deal. And here’s why.” And I can tell you, who used an automated pricing tool immediately because it’s two or $3,000-
Jill DeWit:
Too high, too low.
Jack Butala:
… at the bare minimum. Too high.
Jill DeWit:
Is it too high?
Jack Butala:
Yeah, you’re constantly overpricing mailers, especially if you’re new-
Jill DeWit:
And that’s the hardest.
Jack Butala:
Especially if you’re new and you just don’t have a knack for this stuff yet. There’s nobody …. I’ll tell you this, no one in the advanced group and nobody who’s making a hundred grand a year, using any pricing tools.
Jill DeWit:
That’s true.
Jack Butala:
So yeah, the one that we will develop will allow the user to have complete control, and stop you at certain points and ask you to test for reason.
Jill DeWit:
That’s good.
Jack Butala:
We won’t make a crappy product.
Jill DeWit:
Of course.
Jack Butala:
We’ll make a product that works.
Jill DeWit:
Exactly.
Jack Butala:
It’s going to be in part of a dashboard that we’re developing to make this a little bit easier and more organized and all in one place.
Jill DeWit:
I’m so happy. Happy you could join us today. Five days a week you can find us right here on the Land Academy Show.
Jack Butala:
Tomorrow, the episode on the Land Academy show is called, “People who create change are overwhelmingly more content.” You are not alone in your real estate ambition.
Jill DeWit:
I’m good at creating change. You probably don’t like it when I create change.
Jack Butala:
I love when you create change.
Jill DeWit:
Here’s some change.
Jack Butala:
Jill and I were talking recently, actually this morning, I’m very, very comfortable changing huge things in my life overnight, and so is she. And we’ve had people in our lives in the past separately that were just anti-change. It’s hard. It’s hard to explain to somebody why you think you should never work at that accounting firm again.
Jill DeWit:
I understand.
Jack Butala:
“Yeah, but we have all these bills.”
Jill DeWit:
Well, no. Or it’s like they go, “But I’m going to retire,” or, “I’m going to get this raise,” or, “I’m promised this bonus and then promised one more week of vacation.” I get it, I know.
Jack Butala:
That’s the golden carrot that they promise you.
Jill DeWit:
Golden handcuffs, is what we call them.
Jack Butala:
Well, the carrot leads to the cuffs.
Jill DeWit:
Exactly. Thank you for tuning in. We hope you find our content valuable and we appreciate your support. If you haven’t already, please get on over to our YouTube channel and hit the subscribe button.
Jack Butala:
And your comments and suggestions help us to create the type of content you’re here for. Hitting the like button helps us support our channel’s algorithm, engage your interest for future shows.
Jill DeWit:
We are Steve and Jill.
Jack Butala:
We are Steve and Jill.
Jill DeWit:
Information-
Jack Butala:
And inspiration.
Jill DeWit:
… to buy undervalued property.
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