Maximizing the Value of Your Motivated Seller Leads

Scott: Today we are talking to John Martinez, who is known in the real estate industry as being the go-to guy when it comes to sales strategies, sales processes and maximizing revenue from leads. So glad you’re on today John, it’s great to have you.John: Hey Scott, thanks for having me. Happy to be here.

Scott: Super, super. So for those of you who don’t know us, my name is Scott Corbett. My company is Lightmark Media, and we specialize in real estate lead gen, mostly with PPC.

So today the topic is going to be how to maximize the value of a PPC lead, and the reason I wanted to focus on that was because PPC leads are expensive and getting more expensive all the time. However, it seems likely to me though, and I don’t know if you agree John, that everything we’re going to talk about today is probably just as true for a direct mail lead, or even a word of mouth lead, for that matter.

John: Yeah, absolutely, 100%.

Scott: So it’s really just all about how you can create the most revenue, create the most business, create the maximum number of deals for the leads that are flowing into your system from whatever channel, but particularly for PPC since that is such an expensive form of lead gen.

For those of you who just need a 30 second overview, PPC is what we call the situation when somebody goes to Google and they type in something like “companies that buy houses” or “sell my house fast” or “sell my house as is,” things like that. And when that happens, ads pop up at the top of the page, and those ads link back to landing pages sponsored by the kind of companies that John and I work with.

John: Yes.

Scott: And once that person clicks through, clicks that ad, hit’s a landing page or a website, it’s there they have the opportunity to really do one of two things: pick up the phone and call, or fill out some kind of web form that usually asks for contact info and maybe a little information about the property.

So at that point when they either call or fill out a form, that’s when it’s on you now, the potential buyer, the rehab-er, the wholesaler, the guy who wants to build his buy and hold portfolio. That’s when it becomes all on you and everything you do from that point on is gonna be a big determinant in how this turns out.

And John, if you would, let me tell a couple quick stories about why this matters so much. This is a painful story I’ll start with, and I won’t name names, but in one of the hottest real estate markets in the entire country right now, a market where a wholesale assignment can easily run $40,000, $50,000, $60,000, even $100,000. It’s that high. These leads are pure gold, and here’s what happened to a colleague of ours, John.

A lead came in through PPC, and I think it came into his office probably around noon, let’s say it was on a Wednesday, and for one reason or another, the acquisitions team just didn’t follow up on the lead immediately, and it just kinda sat there. And they thought, I think, “Well, we’ll just get to it tomorrow. We’re really busy, things are going on.” So the next day, let’s say it was Thursday morning or something, an email pops into their inbox and says “Hey, we just put this property under assignment yesterday and wanted to know if you guys wanted to buy it from us.”

So sure enough, somebody else had gotten the same lead, because these people often go to more than one person at a time, right? They’ll check out two or three or four people to see where they can get the best deal or the best service or whatever. So the moral of the story is, by waiting, by choosing to not act for that 18 hour period, they ended up losing tens of thousands of dollars. I’m not saying they would’ve gotten the deal for sure, but they would’ve had a seat at the table. They could’ve been in the mix to get the deal because obviously this was a seller that was interested in doing something quickly.

The second story I’ll share, just to kind of set up what John’s going to talk about, is a guy we’ve been working with who’s in a somewhat small market and has been doing PPC for years and years and years, and it’s done okay for him. It’s been steady. But he recently completely revamped his entire follow-up system for what his people did when a PPC lead came across.

After putting these new follow-up systems in place and not spending a dime more in his ad spend (i,e. no more leads from a quantity point of view) but just by changing his follow-up system, he doubled the number of deals that he was getting from his PPC leads. In other words, he doubled his ROI.

So I think this is a very, very important thing. I’m so glad, John, that you’re going to help coach us a little bit on how to do this because it’s potentially a big swing in revenue if you start to do this right. So I’m gonna turn it over to you right now, John. Why don’t you walk us through some things that you think are the keys to maximizing the value of PPC leads when they come in, either by phone or through a web form, the mistakes that you see people commonly making in all the people that you’ve consulted with or worked with over the years, and maybe if you have some time, I know you’re an absolute expert on sales processes and sales philosophy for how to deal with these sellers. So anything that you could share with us on those three things, I think it’d be great. So over to you now.

John: Yeah, I’m really happy to be on, because this is, man, this is right in my ballpark, Scott. I’ve probably worked with two or three hundred investment groups throughout the country, and all I focus on is exactly what you’re talking about. They’re already producing leads. I don’t help people produce leads, I help people convert leads.
So I love this topic, because in my eyes, as far as sales and marketing goes there’s only two pieces of it; there’s getting in front of the right people, which, mailers, PPC, all that stuff is lead gen. But all the lead gen in the world doesn’t matter if you’re not actually converting those leads into some type of deal. So you’ve gotta have both.

And then the flip side of that is even if you’re a sales expert and can convert 100% of the leads coming in, which is impossible, none of it matters if you don’t have any leads coming in. All those skills are worthless. So I really think that the two go hand in hand. You gotta have that awesome marketing channel to keep pumping leads in, which is what you guys do, and then you gotta make sure you’re converting and basically closing every closable deal, and that’s what I do. So I think this is a great conversation to have.

So when it comes to that lead generation … Again, I currently probably work with a hundred investors that are spending between $20,000 and $100,000 a month in marketing. So I see the insides of a lot of businesses, Scott. And I see the leads that are coming in and how they’re being dealt with including the good, the bad, and the ugly.

The best lead source by far, also the most expensive usually, is PPC, right? It’s expensive because it’s competitive. Everybody wants them, you’re finding that seller … They’re highly motivated, they’re ready to go for the most part, more so than any other type of lead generation out there. So I really love PPC.

Because of all those things, again, PPC can be one of the more expensive lead generation tools, but most effective. So you really want to make sure you’re getting the most out of every single lead. So I just want to go over a few best practices and mistakes to avoid.

The biggest thing we see is response time. If you get nothing else right, respond as quickly as possible no matter how that lead comes in. Whether it’s a lead form that’s filled out online or a phone call, you want to get the quickest response time possible. When we look at inside sales data and stuff like that, what we see is after the five minute mark, Scott, your chances of converting that lead go down about 9x.

Scott: Wow.

John: Yeah, five minutes is where you’re gonna be at. Ultimately, you’d love to live answer everything. And that’s the same for, even if you’re doing mailers, like you said. This applies to all kinds of lead generation. If someone calls into your office, same thing- sub five minutes. It’s just that when you’re dealing with a PPC lead, you’ve got a lot more on the line, ’cause it takes a little more resources to generate that. PPC leads aren’t as plentiful, and they’re super super hot. Hotter than any other lead that I’ve seen out there. So number one rule, sub five minute response.

Scott, I work with a lot of your clients, so I’ve seen your leads come through, I’ve seen how they automatically generate emails and all kinds of different notifications and push it through right away so people … I think you’ve even got it set up maybe so that the phone rings when something comes in. So I know you’ve got your system set up for that immediate notification, which i think is awesome and absolutely essential, because the story you told about Denver, that happens every single day. I probably see a whole lot more of it than you do, because I get to review company’s leads and what happened with this one and that one. The story you told about the client who didn’t act quick enough, and then it comes through the email as “hey do you want to buy this property from another wholesaler?”, that’s an every single day type of thing. So I’m glad you brought that up, but I kind of want to put an exclamation point on it because that’s something that happens all the time. So number one, sub five minute response time.

Scott, do you have anything to add to that, or any questions you had around that?

Scott: I am curious about the response. Do you have any opinions about whether it matters whether the response is a phone call or a text or shooting out an email or … Any thoughts on that?

John: I do, I do have some thoughts on that. So what you might be looking for is which is best, but the deal is we’ve got all kinds of people who are reaching out to us with all different kinds of communication preferences. If we just think about our everyday lives and those people we communicate with in our own personal lives, there’s some people who never pick up the phone no matter how many times you call, but they’ll text you right back, right? There’s some people that will email you right back, but good luck texting them or getting them on the phone.

It’s just different for everybody. Some people, the main forms of communication are going to be email, text, and telephone. We don’t know who’s turning in that PPC lead. We can ask about their communication preference, and we’ll get into nurturing in a second, but I would reach out to them with all three modes of communication and let them choose what they prefer to do. The important thing is just starting the communication. I don’t care how we start it, I say let them choose. So reach out all three ways, and then let them get back to you immediately if you don’t get a hold of them in real time. However they like, does that make sense?

Scott: That’s great. So basically, give them the opportunity to reply back in the way they’re most comfortable.

John: Absolutely. Absolutely. Yeah, I think we try to overthink it and guess what’s most effective, where it’s really a case-by-case basis. So why don’t we just reach out all three ways and let the sellers decide?

Scott: Great point, yeah.

John: Cool. So that sub five minute response time is a big one. When you do actually get a hold of someone, there are two other things that I wanna talk about that are really important to do. Number one, we’ve gotta get inside the mind of the seller. Oftentimes, they don’t know what to expect, right? Most people aren’t used to selling a house this way. Some of them may or may not be under different kinds of distress. Some may have fears or anxieties about being taken advantage of, or is this the right way to go about it, so all that stuff leads to this. Whenever someone reaches out, and whenever you get a hold of them, you have to realize that right up front, a lot of people are going to be uneasy because they don’t know what to expect. They want to make sure they’re making the right move.

And again, when dealing with a salesperson or anything like this, there’s always some apprehension, right? So the first thing I always recommend you do is relieve those fears. A lot of wholesalers, rehabbers, flippers, a lot of people in the investment space in real estate, Scott, they’re in this business all day, every day. So they know exactly how these transactions go down. They know exactly what the conversations need to sound like, and I think it’s super easy to forget that the other person on the other end of that phone or that email, they have no idea what to expect. And if they don’t know what to expect and they’re a little apprehensive, they are gonna be reluctant to give you a lot of information, answer the questions that you need answered, and so on.

So first piece of that communication when you do get a hold of them, hopefully in under five minutes, is gonna be to very quickly relieve any of those fears just by letting them know what to expect. That simple piece of setting expectations will go a long way. Like “Hey, just in case you didn’t know, this is who we are, this is what we do, this is how we do it, by the way at the end of all this, if it makes sense, we’ll get you an offer. If you love it, we can do business, and if not, no sweat, at least we gave it a shot.” Just some communication as simple as that will get you through the door and start the conversation a lot faster.

So that’s kind of a sales tip, a best practice for PPC or really any other kind of lead. I’ll open it up there, Scott, if you had any specific questions around that tip.

Scott: I get what you’re saying. So this is someone who is potentially guarded, they may be worried about what’s going on, the overall situation, about making a mistake, or worried about being taken advantage of, and so all that worry and anxiety is basically going to cause them to just clamp down, right? They know they need to do something, but they’re just afraid to do it maybe.

So what you’re saying, basically, is get them comfortable.

John: Yeah, give them motivation to reach out, but then when you reach back to them, oftentimes they’re pretty reluctant to … I’ll tell you, the average investor will just call and go “Hey, I saw you filled out a form, what do you owe on your house? Why are you getting rid of it? How quickly do you want to sell?” And it kinda catches some people off guard, and that conversation can get shut down prematurely.

So what we’re talking about here is once that lead is generated, what are the simple little things we can do to ensure that everyone who should convert to next step does convert to next step? And this is the human element of it. We know going into this there’s going to be some uneasiness. We forget it because we’re in this business all day, but we have to take a second before we get down to business to say “Hey, by the way, let me just tell you how this all works, who we are, what we do, and at the end of this thing, if you love it, we can do something about it, and if not, no sweat, we gave it a shot.”

That right there is going to help you convert more leads to a next step than if you didn’t. It’s just as simple as that. Take the extra fifteen seconds and relieve any anxieties or pressures or fears someone might have.

Scott: Alright, so basically, so far what you’ve told us is hurry up, and then slow down, right? Hurry up, and respond …

John: I never thought of it that way, but that’s perfect! Hurry up, and slow down. So yeah, I think you hit it right on the nose.

And then two more pieces I wanted to talk about that are a little easier and quicker to talk about. One is this. Once you start that conversation, whether again it is text or email or voicemail, your main focus for that step is not to buy the house.

I’m just bringing this up because this is where I see a lot of investors sometimes get it wrong, or new salespeople or managers get it wrong. It might get to that later in the conversation or in an appointment, but your only job at that point is to either set up a next step with that prospect or disqualify them or just gauge them somehow to put them in the right follow-up sequence, which we’ll get to in a second, or something like that.

That’s the goal, to set up a next step if a next step should be set up. If we go and try to close a deal on the phone immediately, that’s going to put pressure on people. It’s going to do all kinds of things. Usually it takes one or two steps, sometimes three, to close down one of these deals. But you’ve gotta realize that the purpose of this initial phone call is we want to set up the next step. We want to set up the next step so we make sure they’re moving through our sales funnel, and also, whenever we set up a next step, what happens psychologically is whatever the problem is, whatever the motivation was for them to call in, fill out that lead form, answer a postcard, whatever it is, when we set up a next step, they get that closure. The seller gets that feeling of “Okay, I am on the right track, I’m moving forward.” So there might not be any need to go ahead and click on another ad or call the next postcard or do another search. We want to capture that lead, right?

Now again, maybe later in the phone call, you actually get to an offer or a deal. Maybe it’s a second phone call, maybe you’re going out and visiting the property. But the initial objective is just to find out if a next step should be set: do they qualify, is this someone I want to do business with or should do business with, can I help them, and if so, let’s set that next step up. That is it. Only goal is to set up that next step so number on, they’re moving through your sales funnel, number two, it’s going to prevent them looking elsewhere.

If they don’t feel like their problem is on the way to being solved, if they don’t feel like they’re making progress, chances are they will call someone else. Just think about the old days of the yellow pages, right? When you had a problem, and depending on the ages of everyone who’s listening to this, it may or may not make sense. Think of the yellow pages or searching online, right? If I’m looking to get a tire repaired, let’s say I ran over a nail, I’m looking to get the tire repaired, and in the old days I flipped open the yellow pages, or today I type in “tire repair” online, which is what PPC is.

I’m going to get some companies and phone numbers that pop up. If I dial a phone number, no matter where I found it, and nobody answered, what am I going to do? I simply go down to the next phone number and call until I get a hold of someone. It’s the exact same thing with PPC.

We’ve got to set that next step so that they don’t feel that need to go down to the next search result or go down to the next number in the phone book, whatever it is. Does that make sense, Scott?

Scott: It makes perfect sense. You’ve gotta get them a feeling that you, the potential buyer, could be the right person to take care of their problems. You’re giving them that closure from that initial conversation. They’re clear about what the next steps are, and probably by doing that, you’ve started to establish some level of rapport, so why would they go anywhere else? They’ve kinda crossed the first bridge with you, and they just wanna keep going.

John: It gives some relief. And think about it like this: how many people in this country want to lose weight? Tons. Almost everybody wants to be in better shape, or healthier, or whatever it is. And most people have enough motivation to take that first step, which is to sign up for a gym membership, but after they do that, they get enough “Okay, I’m on the right track, I’m moving towards health and fitness,” and they never go any further. It’s kind of the same, right? That’s just human nature.

As soon as we feel like we are going toward that goal, we kinda stop looking. We stop doing anything else. It’s, along the same lines, those infomercials that sell every kind of fitness product under the sun. It’s all these people who are sitting there, going “I need to do something, motivation, motivation, motivation.” As soon as they buy that piece of equipment, get that gym membership, whatever it is, they go “Ah, I feel a relief. I know I’m on the track to accomplishing what I want to accomplish.” That’s what you want to happen. You want that initial contact with you to give them a little bit of relief, so they can get that feeling of “Okay, now I don’t need to reach out to anyone else.” You want to capture that lead.

Scott: Yes, makes perfect sense. So then, you’ve basically fenced off the competition. So now it’s your deal to either win or lose. How do you take it home from there?

John: A couple ways. Number one, we’re going to try and close that deal. We can do it on the phone, we can do it in an appointment, we’ve got all kinds of strategies. That gets into sales process, that’s what we go on and on and on about. That’s my passion, what I love to do. So obviously we’re gonna try to close the deal. But I think the more important thing to talk about on this call, where a lot of people fall short, and you referenced it when you were kinda telling your stories about your experiences, and I think that’s the nurturing sequence.

I love helping people convert, but like I said, I work with a ton of companies in this space, and a lot of them over the last 24 months or so have implemented followup and nurturing campaigns. Here’s the thing, not every lead that reaches out to you today is gonna close today. They can close in 30 days, 60 days, 90 days, and most investors are so focused on the immediate, they forget about the long term.

So when I talk to the companies I work with about their long term followup strategies, the numbers I’m hearing, Scott, is that year over year, somewhere around 30% of the new business that comes in is business that has been in a 30 day to up to 13-14 month followup campaign, which is massive. That means those leads that are coming in, they’re able to close about 60-65% up front, but everything else, if you have a million dollar business, $300,000-350,000 comes from some kind of automated nurturing campaign if you have it in place. When you talk about ROI, that’s massive.

Scott: That’s huge. Okay.

John: So the last tip I give is, hey, if you wanna really maximize your lead, no matter what kind of lead it is, you’ve got to nurture that lead. And most of it can be automated at this point. Like Scott said, it’s just a matter of setting it up once, and once you set it up once, that machine can run for years and years and years for you. And you do need to automate part of it too, because let’s face it, if you’re producing 50 to 500 leads on a monthly basis, nobody has the manpower, it doesn’t make sense to have the manpower to be manually following up with everybody.

So you need some type of nurturing campaign to do that for you. So if you want to get a quick tip, 30% more out of every lead that’s coming in, set up a thirteen- or fourteen-month following campaign.

Scott: That’s so important. And just so we don’t assume anything here, at a very simple level, what this could mean for you would be what we call an autoresponder sequence or an email drip campaign. Any email system these days can really do this for you, but it’s set so that at certain intervals, a new email goes out. And this happens every five days, every three days, every week or whatever, and you can vary the frequency. Even text messages can go out or voice broadcasts can go out automatically through these systems, and it’s just a way to stay in touch, remind the potential seller that you’re still there, you’re still interested, you’re still willing to help them solve their problem. It’s a way to stay in front of them, right? For when the timing becomes right for them.

John: That is exactly it. You’re staying top of mind because they might not be ready today, but when they are ready, you want them to be calling you first or messaging you first. And if you have the right type of messaging that’s going out, that’s also building a rapport for you and building a trust without you having to do anything, right?

So you’re building trust and rapport, and then when they are ready, and they raise their hand and say “I’m ready to sell now,” you’re the people that they call. That’s what you want it to do.

Scott: Very good, yeah. And doing this right could add 30% to your bottom line.

John: Absolutely.

Scott: Yeah, which is huge. And I think the important point to make is, it adds 30% to your bottom line without increasing your marketing cost at all. You’re just getting more value out of the leads you already have.

John: That’s it. That’s all we’re talking about here, is how do we do the most with what we’re already paying for? Not paying any more, but how do we take those leads and we make sure that every one that we can potentially convert, we actually convert to some type of next step, and convert those next steps into deals.

Scott: Fantastic. So hurry up first, with your response time, slow down, get people comfortable on that first phone call, establish a clear next step so that hopefully they will feel like they’re in good hands and don’t need to go anywhere else, then on one hand shift over to sales, a well thought out sales approach, on the other hand, for those leads who are not gonna convert to a deal immediately, put some sort of nurture or stay in touch program so that you’re staying connected, building rapport and staying top of mind.

John: Absolutely. Absolutely.

Scott: Excellent. Well, this is great stuff, John. Anything else you want to add to this conversation today about maximizing the value of your PPC and your other leads that come into your system?

John: Again, I work with hundreds of companies, so the only thing I can say is it’s silly not to. People put so many resources, so much money, so much time, so much effort, so much manpower behind lead generation, and you can probably, and I’m not exaggerating, but you can probably get 50% to 70% to maybe 100% or more of a return from those same leads by just putting in 10% more effort to do the four things we talked about here. So it’s just really silly not to because we put mountains of effort behind lead generation, and we can get mountains more of deals if we just take one little extra step and put some of these best practices in play.

So I really recommend and would love to encourage more people to do those types of things.

Scott: Excellent. Yeah, it’s so important. It’s crazy not to.

John: Yeah.

Scott: This has been great stuff, John. And I know you’re condensing a pretty big topic into a short amount of time here today. Is there any way that people can follow up with you to continue this conversation? Is there anywhere that people can go to learn more about what you do and how your company helps people do all these things better?

John: Yeah, so I usually just point people towards our website, it’s midwestrev.com. And you’ll see all the things we do. We’re heavily focused in sales training, so you can find actually lots and lots of, we’ve probably done 30 or 40 free sales training videos. Everything from negotiating to questioning strategy and so on. So there’s lots of free stuff there, and we’ll go over all the services and the different types of trainings and things that we provide. If you want to get a hold of us, you can easily do so through that site as well.

Scott: Fantastic. And guys, it’s no exaggeration to say that from being in this world of fairly successful, active real estate investors, knowing people around the country, I don’t think it’s an exaggeration to say that the very best companies turn to John to help them maximize their revenue, maximize the value of their leads because what he teaches, what he coaches people to do, absolutely works and provides huge value to people. So I’ve seen this over and over again with our clients who work with you, John, and I’ve heard it from so many other people, so Midwest Rev is a highly recommended resource if you have not come across John’s stuff before.

And I just wanna say thank you, John. It was so much fun to talk to you and have you share your insights based on working with so many investors all around the country. Very helpful, I really appreciate it.

John: Thanks for having me on, I enjoyed the conversation too.

Scott: Alrighty, well let’s talk again soon, but meanwhile, that’ll do it for today, so have a great day, take care.

John: Bye.