All ADMS lists are guaranteed to be of the highest quality in the industry. Lists are updated quarterly, NCOA'd twice a year and certified to be 93% accurate.      

American Direct Marketing Services Blog

Investor Lead Generation for Accredited Investor Leads (Employing Traditional Direct Marketing Techniques in the Digital Age)

by Scott Casson | Jun 23, 2014

Coming as no surprise, investor lead generation marketing techniques have evolved over the ages; but, as much as it has changed, the tried and true [Traditional Direct Marketing] remain an effective means of gauging, engaging, and reaching out to qualified investor prospects to generate “Accredited Investor Leads.”

Lost in the Fray

Today, on average, a consumer will be exposed to upwards of 5,000+ advertisements per day. [1] Typically these ads will appear via TV, Print, Radio, Magazine, Newspaper, and Digitally (which includes Social Media so take that into account as well).

With all this noise, how can a business expect to make an impression? How will a company know their message has been received? Where is the guarantee—will the prospective investor respond?  Did the message elicit the desired response?

Focus is on Marketing ROI

The largest problem with typical methods of communication is assurance of Marketing ROI [Return on Marketing Investment]. TV, Radio, Magazine, Newspaper, Print, Digital Advertising—these all rely on the wager of the message being plucked from the masses.

Sure, they are great at mass outreach; however, given limited metrics [potential message exposure and stratification], drawing connections between these marketing techniques and consumer action is correlation-based at best [weak].

In traditional Direct Response Marketing these ‘unknown’ variables decrease immensely because the business is communicating their marketing message directly to the target market making the response rate and Marketing ROI stats empirical.

The Promise in Traditional Direct Response Marketing… “The Numbers!”

It’s quantifiable, it’s measurable… you know if it works or doesn’t work, pretty darn fast. This IS the tried and true , the real McCoy of the marketing world. Fads and guerilla marketing tactics will come and go, but Traditional Direct Marketing has and will last the times. When it comes to execution—there are three core techniques:

  1. Direct Mail Marketing
  2. Telemarketing
  3. Email Marketing

The naysayers and new age critiques will flock to the web and gripe away, but the facts and numbers favor Traditional Direct Marketing to continue leading the way.

Direct Mail: Still a Leader in Direct Marketing

In a technologically advanced digital world, the ritual of receiving letters and mail at a physical mailbox has become unique. In fact, these days a well executed direct mail investor lead generation campaign can not only make your organization stand out, it can also yield specific types of investor prospects such as:  Accredited Investors, stock market investors, penny stock investors, oil and gas investors and  gold investors to name a few.   

The primary reason is… Less Clutter!

What’s even more interesting is to compare the number of digital brand messages to postal brand messages—the gap is enormous. [2] This ‘void’ plays to the uniqueness of postal mail and proven success of Direct Mail Marketing.  

According to Epsilon’s 2012 Channel Preference Study, “73 percent of U.S. consumers said they prefer direct mail for brand communications [to other advertising methods] because they can read the information at their convenience.  Additionally, 62 percent of Americans said they enjoy checking the mailbox for postal mail.”  And, over half of the respondents enjoyed receiving postal mail from companies about their new products. [3]

Clearly the majority of recipients want to be ‘in the know,’ but they’d like to get their information on their own time and as stated, “at their convenience.”

A USPS 2012 Mail Moment Study drew on similar positive attitudes towards the mail ritual. “In over 80 percent of homes, the person in the household responsible for collecting and sorting mail will collect the mail at their first opportunity.  And, once the mail is brought into the home, 80 percent will sort the mail immediately while 18 percent will sort it later that day.” [3]

It would seem that people are eager to dive into what is being sent their way which bodes well for direct mail campaigns.  Why?  Well, apparently you are catching them in a good mood.  Also - with the understanding that most people [85 percent] set aside time for the daily sorting of mail—you have their undivided attention. [4]

As mentioned earlier… there’s less clutter in their mail boxes so you are going to stand out.

At this point you’re probably thinking—‘It’s great that people are excited to receive their mail, but so what—there’s no guarantee that my Direct Mail package is even being opened, let alone read.”  Well, if you want to believe that, fine, but Print is Big and 2013 Print Drive Commerce’s stats will urge you to reconsider.

In 2013, “U.S. advertisers spent $167 per person on direct mail to earn $2,094 worth of goods sold; that’s over a 1,250% return.” [5] You can’t argue with that ROI.  Furthermore, the Direct Marketing Association [ ] boasts that direct mail generates a 4.4% rate (including customer mailings, catalogues, envelop formats, etc.), compared to email's average response rate of 0.12%, says Yory Wurmser, director of marketing and media insights at the DMA [6]

Yes, a sophisticated Direct Mail Investor Lead Generation Program can take a lot of time to develop, cost a lot of money and by comparison, sometimes yield a lower overall response rate than the DMA’s 4.4% average. 

However, when you consider the individuals who take the time to respond to a self reporting direct mail investor lead generation program, [investors who open the actual mail pieces, fill out investment research surveys of specific interests or other response devices and mail them back] the qualification and validation of those individuals as  Active Investors or Accredited Investors are very strong compared to other methods.  

Plus, taking into account the recipient’s undivided attention [stated above] you have the opportunity to boost those response rates to 6.5 percent with the personalization of content [even if it’s just a regional-based style or hand addressing the envelope]. Personalization gives the feeling that you are reaching out to them as one individual to another. [7] 

No longer are they a number or a statistic, but a ‘potential business partner or strategic relationship or valued client.’  

Consider these numbers from a sample Direct Mail Accredited Investor lead generation program for a Rule 506(c) investment opportunity: 

● 100,000 pieces of mail sent [at a cost of $1.00 per piece = $100,000 spent]  
● 1.25% Response Rate [1,250 overall responders]
● .9% Conversion Rate [11 investors participated/invested]

Think those numbers are low?  Think again.  If these Accredited Investors participated in your Rule 506(c) offering at a minimum of $100,000 each, that .9% conversion rate generated $1,100,000 for an 11x return [or $1,000,000 net]!

What if your numbers were only half as good…I’d take that in a heartbeat and I’d wager you would too. (As you always see in investment documents…”Past performance does not guarantee future results.”)

Telemarketing: Giving Your Company a Voice

Done wrong and your business will be snubbed off as a call-center, done properly and you cultivate a relationship between two parties.  Over time, the term ‘Telemarketing” has been tainted; however, this very personal and useful communication tool is making its come back through ethical practices and attention to professionalism concerning investor lead generation.

Although cell phones and smart phones have significantly eroded residential landline usage as a household’s primary phone of choice, recent studies suggest it’s the younger generations and penny pinchers that have cut the cord first. [8] So targeting older, wealthier baby boomers [who hold a majority of wealth in the U.S.] at their residence or at their place of business is still a viable solution for a successful telemarketing lead generation program intended to identify and capture Accredited Investors. 

However, there are a few things to remember:

1) Accredited Investors, generally speaking, are intelligent, sophisticated, well moneyed and educated individuals.  When you begin to develop your script make sure the language and flow cater to that.  

 Furthermore, it’s important to tweak and tune your script until you have a solid 8-10 second opening pitch telling them who you are, what company you’re with and a little about why you’re calling.  Gatekeepers will most likely be screening calls…so be sure you bring your ‘A-game’.  

2)  Make sure your collateral material and marketing tools (i.e., your website, business plan, executive summary, et al.) communicate your corporate message clearly, concisely and effectively. A vast majority of Accredited Investors have a college degree or higher and a lot of businesses and financial services marketers are targeting them as well so it’s best to have a corporate message that resonates loud and clear. 

Additionally, your collateral or marketing materials are a direct reflection of the quality of the financial product or service you’re offering.   Double check for misspellings and grammatical errors… especially these five that can make you look silly:

  1. Your vs. you’re
  2. It’s vs. Its
  3. There vs. Their
  4. Affect vs. Effect
  5. The Dangling Participle

If you need to brush up a little, here’s a great article by Brian Clark:

It makes no sense to look unsophisticated, unprofessional and amateurish when a few extra minutes can make all the difference. 

3)  Show Accredited Investors a little extra respect, and they will in-turn reciprocate.   I’ve always found C-level executives to be direct, yet respectful of a professional approach; time sensitive but willing to listen if it can benefit them; and willing to open up given the right conversation.  

This is why a direct approach is the key; it implies that you’re in the same position they are: busy, professional, and let’s get direct to the point.  

As a side note:  A beneficial aspect of Telemarketing is speed—it is almost instantaneous in response.  Deal or no deal; you will know quickly whether or not the potential buyer or investor on the other side of the line is in or out… or at least has enough interest for you to continue pursuit.

Email Marketing: Reaching the Masses at the Click of a Button

Cheap and Fast.  Except for the time and money it takes to create the actual content going into the email, the outbound product ETA is instantaneous [barring the actual checking of the email inbox].

Luckily for us, technology has dawned on the smart phone—in 2012, 50 percent of mobile phone users accessed email applications on their smart phones; 88 percent of that population did so on a daily basis. [9] Looks like communication via email just got a lot more effective.

With a 0.03 percent response rate, email is the lowest responding of the three Traditional Direct Marketing techniques.  But when comparing the value of time spent for content creation [vs. individual phone calls and direct mail] and the speed of response turnaround, the email track is a winner. [10]

Email Marketing, unlike Telemarketing and Direct Mail, has a very cool up-front benefit… a sort of automatic gathering of metrics; multiple data points can be gathered from a large audience through their mere opening of the email. Elaborating on this—a marketer will know who opened the email, when it was opened, what links have been clicked on, and if the initial message has a high probability of being a success or failure.  Armed with this information, you have a pretty good idea what actions need be taken next.

This channel for Accredited Investor Lead Generation (assuming the campaign utilizes quality Accredited Investor email lists) is strongest in convenience and instant access to metrics (open rate, click thru rate, etc.). With multiple ways of access [mobile or desktop], the recipient is more than likely to come across your email sometime throughout the day.  

Additionally, you can utilize this initial opportunity to gauge how the individual wants to be contacted in the future.  I’d recommend giving the prospective Accredited Investor the option to follow your organization via other digital channels of communication (i.e., Facebook, Twitter, digital newsletter, email, etc). 

This not only identifies which method of communication is most effective for that individual investor prospect, it makes your organization’s advertising and Accredited Investor lead generation program more relevant, stickier and efficient. 

Reliable Tools Need Skilled Artisans Behind Them

You’ve seen that each of the three core Traditional Direct Marketing techniques can be used to launch a successful investor lead generation campaign, or even maintain a solid Business-Consumer relationship—but at the end of the day, they really won’t be successful if what you have to say isn’t interesting, entertaining, informative or motivating. 

Ultimately, the message and how you present it, whether it is in a Direct Mail piece, a Telemarketing pitch or a savvy Email creative, are what will set your business, your services, and your products apart from the rest. 

Again, it’s not like you have to reinvent the marketing wheel…however, when utilizing Traditional Direct Marketing Techniques be creative, pro-active (reach out to your target audience and request a specific action) and professional, because it’s hard to go wrong when you do it right. 

Sources & References

1)[Source: NY Times]
2)[Source: Marketing Profs]
3) [Source: Epsilon]
4) [Source: Epsilon]
5) [Source: Epsilon]

6)[Source: DMA] 

7) {Source: The AZ Republic]
8)[Source: The Wall Street Journal]
9)[Source: Practical eCommerce]
10) [Source: Harvard Business Review]

      All ADMS lists are guaranteed to be of the highest quality in the industry. Lists are updated quarterly, NCOA'd twice a year and certified to be 93% accurate.