Happening NowCold Calling / SMS Lead Generation

SMS keeps beating mail on cost per contract in this comparison, and that looks too good

Building a channel comparison for an acquisitions budget, and the SMS column looks too good, which usually means something has been left out. Mail: 10,000 pieces at $0.62 all in, so $6,200. Response 0.9 percent, 90 calls in. Say 14 percent of those become a real conversation with a seller who will talk price, so 12 or 13. Contract rate 1 in 8. Call it 1.6 contracts, roughly $3,900 a contract. SMS via a vendor: 10,000 records skip traced at $0.09, so $900. Vendor charges $0.035 a message plus a platform fee, with a historical average of 2.8 messages per record before they stop, so about $980 plus $600 platform. Total roughly $2,480. Reported response is 6 percent, 600 responses, but 70 percent of those are wrong number or hostile, leaving 180 usable. A reported contract rate of 1 in 22 gives 8 contracts and $310 a contract. That spread is a factor of twelve, and nothing in real estate holds a factor of twelve for long. The likely leaks: carrier filtering means delivered volume is well under sent volume while quotes are usually given on sent, the 1 in 22 figure tends to be a vendor's best client rather than a median, and the labor to work 180 usable responses inside an hour of arrival rarely appears in either column. Texting consent and outbound rules are also the live regulatory question in this channel, and any adverse change hits the SMS column and not the mail column. The decision this framework should settle is whether a 90 day SMS test at $7,500 is worth funding against a mail program whose numbers are already known.

dpatel_re CP3APRO 22

Answer

brandonlee36 SP1BPRO 15

Delivered versus sent is the whole thing. Ask the vendor for delivery receipts by day rather than an average, and ask what percentage of their sends were filtered by carriers in the last 60 days. A small text program can go from 88 percent delivered to 41 percent inside three weeks with no change on the sender's end, and the vendor will rarely volunteer that until asked. Your $0.035 is per sent message, so a filtering event lowers your output without lowering your cost. The other omission is the response window. 180 usable responses arriving in a 4 hour blast needs somebody sitting there. If that is a person at $22 an hour for two days, add it in and your $310 becomes something more honest.

brandonlee36 SP1BPRO 15

2 replies

gregpowell66 AC4BPRO 19

The mail contract rate and the SMS contract rate came from different places. One is measured on your own operation and the other is the vendor's claim, and that alone can explain most of the twelve. Run the test, but only fund 30 days, and make the deliverable delivery receipts plus call recordings, with the contract count as a secondary measure. What that budget buys this quarter is information about the channel, and any contracts it produces are a bonus.

gregpowell66 AC4BPRO 19

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