How To Use Facebook Marketing To Get More Deals For Less Money – Dmitriy Kruglyak

Sean: [00:01:04] Go ahead and introduce yourself and let us know who you are and why we should listen to you.

Dmitriy: [00:01:08] Thanks for having me Sean. My name is Dmitriy Kruglyak. I have a marketing agency focused specifically on Facebook advertising and within that, I focus specifically on real estate, and within that focused on real estate investment. I have been in digital marketing for 20-something years in different incarnations, doing a bunch of different things. I came to Silicon Valley back in the original dot-com bubble so I have a lot of stories to tell from back then as well. Over time I have done different things and Facebook right now is all the rage in marketing. And real estate has a really really simple business case for advertising. Right? So you generate leads, high-value leads, you turn them to an opportunity, you close some, you make a lot of money.

Sean: [00:01:58] Sounds good. So let’s start with the most obvious question. What makes Facebook so special especially compared to other forms of advertising like using other online platforms or using traditional marketing techniques such as mail or cold calling people?

Dmitriy: [00:02:12] Great question. So first of all, the main thing about Facebook is everybody’s on Facebook, it is ubiquitous, right? So everybody’s on Facebook. Facebook knows who we are, Facebook knows what we want, Facebook knows what we are in the market for. Even though there are all those privacy issues were they are trying to not disclose and all that, they have all this data under the hood and they use it on behalf of advertisers. So they just won’t give it to you directly, but they know who is in market for what. And the fact is that everybody is there and Facebook knows who they are and you can reach them there in a very trusted and low-friction environment where you can capture the leads, that lead information we can pass them into CRM. We can engage them with video and a bunch of other good ways. It becomes a trusted environment to acquire just the exact people that you want. So it’s really incomparable to all other mediums. You can’t truly engage people with direct mail, right? You just have to hope that they’re gonna call you and most of them don’t. So here’s the thing to consider, which lots of people do not do: they use other channels, whereas what they should be doing is do an actual math. So how much of a spending is a direct mail campaign, how many pieces we are mailing, right? What is our response rate? What is our cost per call? And what is the conversion rate on those calls into offers made on a house and the deals? And what is your cost per offer? What is your cost per deal? Right and only then it is easy to see how much waste is in the current marketing that most people are using. It is just absurd. I was just talking to somebody who did this math and said that for them the cost to acquire a deal for investment for flipping is around 17K. But really what this means is if this is your acquisition costs, then Facebook becomes a no-brainer because you can test it quickly, you can get very quick validation of what kind of leads you are getting, how are you engaging them? The only problem is that lots of people simply don’t know how to use it or they have a fear of the unknown. But then you look at the numbers, how much it cost to acquire a deal and how much the marketing can be scaled on Facebook, it really becomes a very logically easy decision.

Sean: [00:04:49] Yeah, I think with $18,000 on direct mail, if you spent $18,000 on online campaign for Facebook, you’ll probably get more than one deal.

Dmitriy: [00:04:56] That’s the whole thing. So the averages are going to be different based on how you target, based on how you engage basically, etc. But the thing is with Facebook you always get early indication of what’s happening. With direct mail, you do a big drop and you wait: are you getting responses or not? With Facebook there’s a lot of feedback, it’s immediate.You can do a lot of revisions immediately. And also as you do Facebook marketing New opportunities just come up. That’s one of the most beautiful things.

Sean: [00:05:27] Yeah, exactly. So let’s go ahead and talk about the marketing strategy. If I wanted to get leads let’s say for rehabbed homes or homes that need to be repaired here in the Bay area, what do I do?

Dmitriy: [00:05:38] So first of all, I would encourage you to step back a little bit and think about your marketing end-to-end, right? There’s lots of people who do other types of marketing and even Facebook marketing but they’re not really thinking about the entire customer journey, right? But think about all the stages a prospect goes from being an unknown contacts on Facebook or on your mailing list or wherever to selling the house. Let’s go through the stages. So first of all, they are cold contacts. So whether they are just a person on Facebook or a name you bought somewhere. The next stage is you need to put a piece of content in front of them to make them take a first action. It could be a low commitment action. Just put something like “How much is your house worth?” for example or from an investor perspective, “How much your house is worth? Would it be nice to sell it right away?” If you’re not going this angle then, “Are you a homeowner who’s facing some kind of financial difficulty?” Not all of those type of people would want to sell a house right away and the ones that don’t you can get them on other offers, perhaps. Those leads would be cheaper and you will have to filter out the ones who would be interested in selling and take them to the next step. So what I just described, it’s called the marketing qualified lead. It’s just a contact. It’s not even a lead. Lots of people would call those leads. I don’t call them leads because they have taken no action whatsoever. They’re just like a name in the phone book. When somebody opts in, let’s say for a PDF guide “How can I save my house from a foreclosure”, chances are you are going to buy their house in the end. Right? So let’s say they took an action. They just showed the intent. They showed some intent they are interested in the subject. Now you capture that contact information. You want to start following up with them. How do you follow up? You capture that contact information, you send them that guide, you put them on email sequence, you put them on SMS sequence, you call them. But call in a marketing qualified lead. It’s completely different than calling a cold lead. In calling a cold lead you have no idea who they are and what they want. Why would they want to talk to you? If you’re calling the marketing qualified lead, you can say “You opted in for this thing, is it helping you? What else do you need? Let’s talk about the actual issues you are facing.” A bunch of people would not engage in this. They just went on Facebook and clicked something to get the thing they wanted. They just ignore it. But the ones that start talking to you, that is what I call a sales qualified lead. They’re responsive. We’re going to have a conversation with them about their need and the fact that they’re devoting the time this means they actually have a problem worth solving. So now as they’re moving through the pipeline, let’s look at what is the cost of the marketing qualified lead, then what is the cost of sales qualified lead. Now that we are looking at sales qualified lead, what we are working on is how good is our sales script and our offers, right? So if you want to buy their house, we need to give them the reasons why they should sell, why they should sell to us. We have to look at the property, inspect, pre-inspect to the point where we are going to make an offer. And not all of the sales qualified is going to get to that point. But let’s say we are giving them an offer. So now the next stage in the customer journey is the offer. You have cost for margin qualified leads, for sales qualified lead we can look at the cost per offer. Then certain percentage of them are going to go into contracts, certain percentage of them going to close. What I just outlined, it’s a sales and marketing process that has certain steps. Now to get your cost per acquisition down you need to optimize each of those steps separately and then the entire journey together. So let’s say if you’re just starting a new project, you’re just generating a new leads, the only thing you can look at initially is just what kind of MQL/marketing qualified leads we’re getting. Are we getting enough of them that we can talk to them? Once we have enough sales qualified leads, now we know what we are talking with them about, we know what kind of issues the leads we generated are having from this particular target audience, with this particular creative. And already here we can take some of this feedback on what kind of sales conversations we are having and take them back and then revise the ads. For example, there are certain people who own homes in certain value range and you want to be targeting different value range, or we want to be targeting a different type of an issue they’re having because they would sell. So these are continuing to iterate and the beauty of it is we can do a lot of those iterations before we spend the full amount that you will have spent on a direct mail campaign before we have any idea at all what we are doing. So rapid iteration, this is one of the big benefits of Facebook. And again the real big Insight is you take your insight from the stages of the customer journey when we get them on the phone, when we give them offers, when we get them under contract and then take this insight and bubble it up to the front end to the ads to make sure they’re generating exactly the kind of people who are going to convert and we gonna close on. That really is the name of the game in Facebook advertising and this also what a lot of people do not understand. Lots of people have misconceptions about Facebook. They think about it as direct mail. I spend some money I get a result. Well, you get the result if you actually think of those steps and you optimize them properly, right? So there are lots of people who say Facebook ads work for us and lots of people who would say Facebook ads do not work for us. And when you start talking to people who said they don’t work, we typically find that they haven’t done one of those things that I described. And this process, these issues, they are applicable to every industry and every type of business. So not just investment but for real estate investors, there is just so much room to work with given how much value is the deal and what are the state of the art acquisition costs throughout other channels. It’s really a no-brainer.

Sean: [00:12:04] Right. I mean typically the real estate industry is relatively outdated compared to the rest of society who are still sending out mailers. Very few Industries actually do that still.

Dmitriy: [00:12:14] Some could argue that real estate industry is outdated. I would say that real estate investment industry is more outdated than let’s say realtors or lenders because there is a lot less liquidity I would say in investment part of business versus others. There are lots of marketers who are calling on realtors and loan officers, but there are much fewer who actually serving investors because you actually need to understand more to work in this market properly and it’s harder to find a lot of investors. With realtors there is a directory of them everywhere right? So they get lots. Lots of those guys are getting 10 calls per week from marketers and they all sound the same but with investors, most investors are not getting as many calls because they’re not as easy to find.

Sean: [00:13:06] Now that’s true. So before you go on, I want to go back and just summarize everything you said so that we’re all kind of on track. So the first thing you want to do is maybe brainstorm your ideal customer’s journey and then you want to create a good reason for them to even opt in. So you say my customers are maybe someone who’s going to be foreclosed on, maybe I’ll write a quick PDF guide on what to do if you’re being foreclosed on and what your potential outs. Then when they raise their hand and say yes I want this pamphlet, then this guy is potentially going through foreclosure. They are now a “qualified lead” and you just follow up with them until completion and that completion can be either they say go away or they say, yeah I’m going to sell my house.

Dmitriy: [00:13:47] Exactly. Here’s something else. I want to emphasize in the early stages in the customer journey, the wider we cast our net the more leads we’re going to get and the cheaper those leads are going to be. So if we’re gonna run the ads, just saying “sell us your house today”, those leads are going to be expensive. It’s like asking for too much on the first date. It’s just the expectation shouldn’t be there that this is going to happen. It could but those leads are going to be expensive. And because the leads are going to be more expensive it is going to be harder for Facebook to optimize those campaigns properly. Facebook needs to have a certain number of conversion events to properly optimize. So what I always recommend is cast the net as wide as possible, catch in anybody who might potentially have any type of interest, even tangential in what you are doing and then qualify them through following up with content, and take the ones that bubble up and actually take action, get them on the phone and go from there. Sometimes people get really particular, “I want just this thing.”, “I just want just this type of house”, “just people who want to sell right now” for investors or for realtors, “I just want listings of houses above this certain range”. And then you try to target those people, they are expensive. It’s hard to optimize for Facebook unless you’re spending a lot more money and if you cannot optimize it gets more expensive. So that’s the problem. The recommendation is to go to the lowest common denominators possible and ideally have some additional offers you can get in front of those people other than selling their house, because maybe if they’re not going to sell maybe they’re going to refinance right? Well, maybe they’re gonna do something else. Right?

Sean: [00:15:29] So let’s talk about optimizing your advertisement. So that’s going back making your pictures better or your copy better. So what are you doing to determine whether or not this is a better ad?

Dmitriy: [00:15:42] So again I just described all the steps in the customer Journey. I described the steps, the stages, and I described that each of those stage has a cost of getting to that stage. Cost per marketing qualified lead, cost per sales qualified lead, cost per offer contract and closed, right? So what you would like to do ideally is just to go look at your closes and optimize to close right away. But in practice you cannot do this. So this means you optimize by looking at each of those steps separately. First what you want to get down is the cost of marketing qualified lead. So we need better headlines. We need better pictures. You need to be testing lots of options. We can test them quickly side by side and we can see what is getting us the opt-ins. So the ads that are not getting us a lot of opt-ins, quickly we can cut them right away. Because you know, to check whether this ads going to work they’re going to need to get enough of MQLs, and figure out how they turn to SQLs, etc. So that’s going to be tough. So we’re gonna first focus on basic engagement metrics and the cost per lead. Once you have enough of those leads coming in, then we’re going to start looking at different ad sources, different targeting sources, different creatives and say “okay, now we are getting those leads, what is the quality of those? What percentage of them become sales qualified leads that we can get on the phone and have intelligent conversations with”, right? So once you collect enough data, you can compare several campaigns and they have to survive the cut off. Is there any engagement at all? Now we can say “you know with this creative we are getting our MQLs may be a bit more expensive but these people really get on the phone and we can talk to them about their problem.” So at this point, maybe we’re going to cut an ad which has higher cost per MQL, but we’re going to keep it because we know we get people who are truly motivated, they have intent. Let me give you an example of an ad that’s going to get a lot of engagement, but it’s going to be completely useless. Just picture an ad with a headline “Did your mom just died?” An extreme example of something’s going to get people’s attention. They can click, they might opt in, but they have absolutely no commercial intent. So when we design the copy to engage people on one hand, we need to be thinking of things that are catchy that’s going to get them engaged, it’s going to get cheap cost per lead. But on the other hand, you gotta watch out for those gimmick and keep asking a question or you going to get the wrong kinds of people because there are certain expectations in the Bay area right? As long as we are not doing something like what I just described, as long as we keep the neutral or other things like incentivizing the lead, for example put in your name to win something. You do this those type of people, sweepstakes type of people and sell-your-house type of people, those going to be completely different. But you can get a lot of leads by gimmicks like this. So you want to avoid the gimmicks and make sure your offer is aligned with what you want to happen further down in the customer journey. So that’s the baseline. But once you have multiple ad types on the front end, you’re going to keep watching your metric. So what is the cost per sales qualified lead, what percentage of them turn into offers, what percentage of them turn into contract, etc. And as you collect more data you keep refining right? So you cannot jump all the way to the end of the process and expect that what you typically spend 10 to 20 grand you’ll get optimized right away. Because if you optimize for an event that cost let’s say 10K and let’s say you need a hundred of those events to really know what’s going on, you see how much you have to spend right? So typically you’re not going to be optimizing for the latest stage in the customer journey directly. But you’re going to be optimizing for early stages and then just kind of adjust as you go. And this is typically enough because what happens in the sales process is typically out of the hands of what you can control on the front end, but you can still take some insight. For example somebody wants to sell because they have high medical bills and their home is in huge disrepair and they do not want to deal with repairing. So if you see that those conversations consistently come as we get them on the phone then you could revise the copy to target specifically to those type of people. And when I say target, it does not mean we’re going to target them with Facebook targeting, we’re going to target them by creative, by ad copy and then Facebook is going to find who is responding to this. So at end of the day this is iteration. Also different types of investors they have a different sweet spot, like different type of deals they want. So depending on what you want at the end, you can pretty much write down your ideal customer requirements, your ideal customer profile, and then work backwards. Let’s get into their head and let’s think about what is going through their head? And how do you connect with them? Well, let me also just throw another good way of thinking about this. Everybody watched the Inception movie. You definitely watched it right? There is a scene when they are planning how they’re going to do the Inception, how they’re going to get into the brain of this gentleman through three levels and how they’re going to give him an idea that they want to take hold and act upon it. How is this different from sales? It is not! It is sales 101. So it’s basically you are getting in the mind of your prospects. You’re thinking of what kind of issues they’re dealing with, thinking of what kind of messages they were going to respond to, and then you work backwards to give them a sequence of pieces of content which means the ads, which means the email follow-up, which means phone scripts, which means the offers, so that they feel comfortable they move from one step to the next and they feel that it is their decision to do this. We are guiding them to the path that we desire but we want them to feel that this is their idea. This is their decision. We are doing Inception, right? So when you are thinking about the customer journey, I would just say think of Inception. I love this movie, but it’s really explains what we are doing with sales and a lot of salespeople who do you know direct sales, they rely on personal contact, they just rely on the charm, so they do the same thing, but they wing it. But digital marketing forces us to think through all of those issues and Facebook forces us more so than a lot of other advertising medium. For example on Google ads, people are searching so they already have this mindset of what they’re looking for. We just need to give them the answer. On Facebook people do not go on Facebook to look for anything. People on Facebook they have certain characteristics and you need to gradually engage them and gradually raise their level of commitment. This is really the name of the game with Facebook and doing this right can get really really cheap deals. Doing it wrong might make somebody believe that Facebook doesn’t work. And lots of people would say that. Well, I mean I’m in the industry and it worked great for me, but there is more opportunity for me because you’re not taking your time to figure it out or invest in it propertly.

Sean: [00:23:21] Yeah, they’re probably just doing it wrong. Yep. So you talked about how you’re gonna have all these leads and you need to follow up with everybody. Do you use a specific type of CRM software to follow up people?

Dmitriy: Yes. So first of all, I would say there are lots of different CRM systems, right? So technically a lot of functionality is very similar between all of them. So I use one CRM for my own agency sales and I use a different CRM that I recommend for most real estate related projects which includes investors. So for real estate, right now, one of the top CRMs that I recommend is LionDesk, but you can use something else. So it’s mostly designed with agents and loan officers in mind with anything that is real estate-related. It lets you track the status of the deals. It just has a lot of real estate functionality just built-in so I would recommend it for investors as well. And I would just say that the cost of CRM Is nothing compared to everything else. But it takes it takes sort of practice to internalize how you have to use the CRM. On the other hand when you integrate the CRM with lead capture, the the lead is captured, it goes into CRM automatically. The user gets texted right away. They get email right away. They get on sequences right away. It’s all pre-built. If they respond right there you can see it in the CRM. If you’re using a CRM, you have it as a mobile app. You’ll get notified right away. You can call them right away. By the time you’re getting a big stream of leads, you might not necessarily call them right away. You might want to hire the inside sales agent to call them and qualify them depending on how big your operation is. But typically this is what happens once you really dial in the process of getting cheap marketing qualified leads. You would not have time to call them all. You’re gonna have to outsource tasks, but you don’t have to start there. CRM is also where you’re going to keep all the notes and all the calls’ information. Like this person, I called them, got them on the phone,I talked about the issues they’re facing, here is a type of house they want, here’s their requirements, time frame, here’s what they’re thinking on selling their house, here’s the things they need to know to move to the next step. Right? So CRM becomes one place where you have all the notes and as I talk we’re going to look at everything that we are doing and figure out how to revise ad copy. This means we’re actually going to look at the notes in the CRM. Look at the entirety of conversations you are having so that we’re not just trying to reconstruct it from our memory. It’s written down, you can review and say “you know what, we see time and again this particular type of issue comes up. Let’s write an ad that’s going to address to it directly in a positive way and get us people who were already thinking about these issues in the way they want.” So this is just one example of why CRM is important. So it’s automation and scale, but it’s also the intelligence. Intelligence and pipeline management, right? Because you have all those leads coming in you need to know which one should have the priority right. You assign the priority in the CRM.

Sean: [00:26:49] Does CRM give you a automatic alerts like “hey remember to follow up this person in two weeks or so”?

Dmitriy: [00:26:55] Yes. You can create tasks. These alerts you can have it in a mobile app. It’s all there. That’s the whole point of using CRM. Adopting CRM and using it correctly is key to your productivity. Because the whole point of investing in marketing is so that you generate enough leads to keep your sales busy. Once they are busy you need to get really efficient with your time. Who are you spending your time on and who are you letting to kind of sit there to follow up later? Maybe you have some Junior assistant follow up with them, right? So this is critical. And CRM is a critical tool for actually helping anybody doing any kind of sales including investors manage their time. Because at the end of the day it comes down to your metrics, right? How many houses you buy per month or per quarter, if you’re a realtor how many houses you buy or sell or how many listings right? It really comes down to how much effort you need to put in to do a contract, to do a transaction, to do whatever and you have to work backwards to your metrics and you have to work backwards to your use of time and the CRM is a tool that helps you but you have to use it correctly and you have to make a commitment to use it correctly. It’s no good if you have a CRM and you don’t use it.

Sean: [00:28:17] Do you want talk about how chatbots work and how that can help your business?

Dmitriy: [00:28:21] I’m glad you asked. I would actually step back a little bit and just ask the question this way. When somebody is on Facebook, how do we capture the information? How do we make them a lead? Actually first, let’s step back a bit more. How does somebody become a lead If you do direct mail? You just mail something and then somebody’s going to call your number. And you first you have to ask “what’s your name?” and maybe half of them or whatever are not even going to tell you their name.

Sean: [00:28:49] “What’s your address? You mailed me!”

Dmitriy: [00:28:52] Exactly. So that’s another point going back to traditional marketing methods. It’s like you cannot capture the leads. I’m going through the process of getting a real estate license and I just have gone through the real estate practices course, and it has some sections on how you do marketing and I was just really laughing reading through the marketing section and they’re basically giving a bunch of advice. “When somebody calls your number, how do you deal with the objection of them not giving their name?”And I’m just laughing because if you are doing online lead generation, you are capturing their name. But anyways, so there are three ways of lead capture. So one is a Facebook lead form. So what is a Facebook lead form? You can capture somebody’s contact information on Facebook, which is their Facebook contact information. So basically you have an ad. And you create an ad with a lead form. They click the ad, the lead form comes up pre-populated with their Facebook name Facebook email and Facebook phone number. They just hit submit and you get the lead. Those leads are really cheap because it’s really easy to do. Anybody who has any kind of curiosity are going to click the form. It’s pre-populated then submit. That’s it. And it goes into CRM, fire follow-up sequence,that real easy, right? So you can also make those forms more sophisticated asking all kind of questions, but you probably don’t want that. This kind of makes them more expensive you’d rather just collect them and ask them later, right? So then you can also capture the forms on the website, right? And those tend to be more expensive than Facebook native lead forms, but they tend to have higher intent right? Theyre not pre-populated. The website doesn’t look like Facebook. It’s going to take longer to load, there could be some distractions there. Those are typically more expensive but they could be appropriate. And the third one is a messenger bot. I would guess that most people who are listening to this podcast would not recognize a messenger bot if they would run into it on Facebook because they will just think they’re chatting with somebody and unless the thing would say “hi,I’m a bot!” they would not even think about it. Here’s the bottom line. So Facebook has a Facebook messenger application. And the Messenger application can host applications which could be bots. Right? So this means you can take a sales script just like what most sales scripts look like right? You ask somebody a question and they give you an answer and depending on the answer you ask them the next. It could be one question and another question. For example, “are you looking into selling? Yes or no?”, “Yes.”. Then, “what type of property do you have? Enter your address or something”,then we’re going to have the address. We’re going to be able to actually look up the property. Let’s say they say “no”. Well, ask “are you looking to refinance” or something like that. So you can take a sales script and turn it into a structured conversation. What you can do with Messenger Bots is you can take the script, you can take the structured conversation and turn it into Facebook Messenger. So you’re running an ad, “Do you know how much your home could be worth? If you want us to give you an instant valuation on your home, how much would you buy it for?” And they say “oh, yeah, let’s see”. So they’re gonna click the ad instead of opening Facebook form, instead of opening a website, It is going to be Facebook message, right? It’s going to have the screen say, “We are going to give you the home valuation. You need to hit get started.” It’s even less commitment than submitting your contact information through the form. Just hit “Get started” and you’re on the messenger bot. Guess what, as soon as I hit get started they show up in your Facebook page mailbox so you can message them manually. The bot can respond to their get started with “Great! Enter your address”. They type in the address. We take this address and let’s say we pull the house valuation from zero and let’s say if you’re doing this bot for a listing for realtor doing the list and you would just report this number and say “this is what I think I can sell your house for if I list it, but you really need to book an appointment with me.” They’re gonna do a CMA or comparative market analysis and then give them the specific answer for how much to sell the house. Let’s say if you’re an investor, you’re going to take the estimate and maybe cut it by a certain percentage and say “Do you think we could buy your house in cash for this amount?’ You could just take an estimate, multiply it by something and say “this is what I’m willing to buy your house” even before you look at it and then you’re going to look at it and just give a real number. So right now those type of opt-ins through messenger, they are the cheapest. They’re cheap because it is such a low commitment and even the people who hit the get started button, but do not enter the address they’re in your page inbox. You can follow up with them and say “hey, why didn’t you respond” Well, you can have a bot follow up in an hour and say “hey, why don’t you respond” and it could have a recovery message and you can say “are you concerned about privacy? Your privacy is protected blah blah blah” something like that, right? So this is the power of the bots. Then let’s say they have gone through this initial sequence. Maybe they did. Maybe they didn’t. Whether you converted them on the initial sale sequence,then your bot can send them a broadcast message next week. It can send them a market update. You can send them whatever right? So you can continue communicating with them like with email but not exactly. There are some important differences. So here’s how it’s different from email. Let me ask you what do you think is a typical average open rate on the regular typical mailing list?

Sean: [00:34:44] Email–I don’t know, 10%?

Dmitriy: [00:34:45] Yeah, it depends on what you’re doing. Right? So if you have a really high intent newsletter, 10% 20% is possible. I was just talking to a loan officer today. I asked him this question. He said, for my mailings on law or loans, he said 2% would be a great open rate, but the more commercial message it is the more it’s being tuned out right now. Guess what is a typical open rate on Facebook Messenger messages from the bots.

Sean: [00:35:15] 80%

Dmitriy: [00:35:16] 90%. Because it seems personal. People are trained to ignore email. They assume that email is garbage. Somebody’s spamming them but Facebook is not allowing people to spam any messenger. Which brings us to the next question. You cannot spam people. There are some rules very strict rules. But if you live within those rules you can get the right message in front of the people. You can engage them in a sequence and you get another chance to sell them something. This is a huge value of the messenger Bots. Right? So I do not have any announcements yet on this podcast, but they have some really really cool stuff happening around the messenger bots. And also I should mention I’m speaking at the chatbot conference in New York closer to the end of May. This is May 22. I will be talking about kind of what they’re doing, the bots’ different way versus what most people are doing, but I guess we can leave it out of this podcast for now.

Sean: [00:36:10] We can have a follow up later on. I was wondering Facebook sounds really great. Is there something that Facebook doesn’t do, that you feel like it’s lacking?

Dmitriy: [00:36:19] You can always think of a wish list. I wish Facebook did this. I wish Facebook did not have this rule. The biggest issues with Facebook is how fast they change the rules, how fast the platform changes. And this also brings us to the very important point. So I talked to a lot of people who say “oh Facebook, it’s just gonna throw out some ads and that’s it.” And there are lots of people who learn doing Facebook certain way and then things change and I don’t know what to do after that. Right? So I guess the biggest concern with Facebook is how much changes are there. For example, there was this big privacy debacle last year with Cambridge Analytica right? So everybody heard about it, right? This really put Facebook in a kind of paranoid mode and started to change a lot of things especially in their marketing platform and overall trend. They started taking a lot of features, hiding them under the hood and let you use them indirectly. For example, it used to be possible to run ads directly to homeowners who own a home in this type of value range or whatever, right? That was before Cambridge Analytica and Facebook was getting this data from their third party partners. But once they started looking at privacy, they say “You know what, we’re just not going to allow this.” So now when this happened lots of people started freaking out. All the word is “It’s over. Real estate marketing on Facebook is over” Now what really changed is the data is taken away explicitly, but it’s still under the hood. That just means you need to craft the content that appeals to homeowners who owned the property in this range, right? And once you get enough of them responding to the ad, Facebook is going to optimize for them behind the scene. So Facebook is becoming very less involved on the targeting elements. We’re going to target it, get into the brains of those people, put out the content that’s going to connect with them so that we get more of them. That’s really the name of the game in Facebook these days.

Sean: [00:38:24] What are some things that we haven’t talked about?

Dmitriy: [00:38:27] You really need to think of investment and Facebook as a long-term investment. There are lots of people who work with Facebook, they will just going to dabble a little bit . I was just talking with someone and say,”Do you have a package where we spend a few hundred bucks?” And I would ask right away,”So are you expecting to buy or sell a house from spending a hundred bucks on Facebook over a week?” Because people when I say what their expectations are, they come from a perspective “how much I’m willing to risk before I feel comfortable with what I need to do”, right? But once I put it in these terms they just realize how unrealistic this expectation is. So the question is how somebody can get started with Facebook. There are really two ways. One is you’re going to jump in and learn everything, spend a lot of time, spenda lot of effort. It’s a good option for some people. It might not be an option for some other people. And if you do this, you might be able to manage your investment carefully. But on the other hand you’re going to be making lots of mistakes. So another option if you want to have somebody do it for you,you need to have a real business that is going to support the appropriate investment and need to have the right long-term horizon of managing this investment and you need to know. Because let’s say you are new investor, right? You haven’t done any deals. Maybe you’ve done one or two deals that you do not yet feel confident knowing what your deal is. You’re probably going to be very nervous about any kind of investment to get more of what you don’t know how to close. But if you’ve done quite a few of those, you know exactly what you want, you have certain level of confidence and you understand what the metrics are on how much it costs to buy a property through traditional marketing methods. Then it should be a logical decision for why it makes sense to invest in Facebook advertising. But you still have to have this long-term outlook and you still need to have a plan to learn the specifics relevant to your specific business right? Because every one does business in a slightly different way. Everybody has certain different emphasis type of deals they want, type of people that would buy houses for, etc. You really have to understand this and have a plan to learn this and realize that your marketing’s going on Facebook through several iterations as your metrics improve, as your sales scripts improve and as you get your acquisition costs down.Because by the time you have done this,the goal of Facebook advertising is to have a well oiled marketing machine that you can just scale by throwing more money at it. This is really the name of the game with Facebook. The name of the game is figure out how to make something work on small-scale. Once you do then you start throwing more money and you 10x your business because lots of people expect to rely on referrals or your sphere of influence type of stuff, right, but the problem with sphere of influence is there is a limited number of people with whom we can actually maintain our relationships, right? That’s a structure of the human brain. There is a psychological theory for this which is the Dunbar number. It’s about 150 people. We cannot really keep in touch with more than a hundred fifty people effectively, right? But the overall market out there It is much bigger. And the question is how do you break out of your sphere of influence and reach the whole market. And guess what? Everybody’s on Facebook and Facebook knows everything there is to know about them and lets you reach them. So this makes kind of the overall case for why Facebook is an attractive investment for real estate investor, but it’s also set certain guidelines on how to think about it, right? Because this is not a short-term thing where you just think “hey, I’m just going to spend a hundred bucks because lots of people do that right, because it’s very easy.”

Sean: [00:42:36] I mean they will see the ad over and over and over again and then be like, “okay. Yeah, maybe I can click on that one today.”

Dmitriy: [00:42:42] It’s funny that you mention this, we haven’t talked about the retargeting at all, which is kind of funny, right because when we are talking about general principles, we’re not even going too much into the details because in my experience we can talk about the details all we want but if people do not understand how to think about advertising projects, how to plan for them, the tactics are not going to do much good to them. But anyway, so let me talk about retargeting. So one of the massive functionalities in Facebook is audiences, custom audiences. So here’s what this means, an audience is basically just a list of people. So just a list of people on Facebook just like your email list, but the audience can be created multiple ways. Yyou can take your emails or phone numbers, you can upload them into Facebook and this will become an audience based on an email list, right? Facebook is going to match emails to users, certain percentage of the match, who are active on Facebook and you can advertise to them. This is one way. Second way is you can drop a pixel on your website.Pixel’s just a piece of code. Everybody who visits your website, they visited the website and you can build the audience of the pixel and then you can run the ad to them. Now you understand why you keep seeing the same ad over and over again. You visited some website, right? They pixeled you and now you’re going to keep seeing the ad for how long they put you in that audience for. Lots of people just do it, by default leave you there for 30 days and that’s how you get annoyed. But maybe you should pixel an audience for seven days, not 30 days, maybe for longer whatever. There are a bunch of other audiences. For example, if you’re putting out a video on Facebook, you can make an audience of people who watched the video. Let’s say for example, you’re going to make a 15-minute video sales letter when you talk about how to invest and all the tips and tricks and whatever. Guess what, the people who are actually going to listen through all 15 minutes, they’re really interested in what you’re doing right now. Not first three seconds. Not first 10 seconds. Maybe, I don’t know, how about half of a 15-minute video. But people who watched the whole thing they actually have much higher intent than somebody who just click the form or somebody who just click to a website, right? And then you can retarget those people with a specific offer. Right? So that’s another example. So essentially there are all those ways to build the audiences once you have the audience in FB. You can run an ad to this audience. Let’s say your video is let’s say 15 minutes, “How do I become a real estate investor” and you just explain it in 15 minutes and they go through this video. You get them on this audience, right? And now you start retargeting them saying,” for a low fee of X, you can join my course on real estate investment.” So, you know that these people showed the intent, they showed their hand, on your list now, you give them a specific offer, and you would run this ad and then once a month you’re going to drop your price by certain percentage and say “if you sign up before this Sunday night or whatever you’re gonna get X off” and because they’ve seen your ad for a while as soon as you give them this trigger they’ll just gonna go jump in and sign up like crazy, right? So I just gave you a very short glimpse into the future of the audience’s, how it could be used. But there is a lot more for example, you can take a list of people in a certain audience and you can build something called the look alike. This means let’s look at people on this list for all of those audiences I described. This means based on emails, based on Pixel, based on video views, based on anything. You can pick an audience and you can ask Facebook to look at this audience, look at the people who watch the video or converted on an offer or did something else. Now rank all the people in the United States by how similar they are to the people in this audience, rank them and then break them up by percentages. So in the United States, there is about 200 something million people on Facebook. So top 1% would be 2 million people in the US. In the US who are the most similar to the people you want and then you can narrow them down by region or by whatever else and then you can run a laser targeted acquisition ad to them. They are just like the people who I want, right? The trick here with this look-alikes is in computer science, there is a term “garbage in garbage out”. So if you’re putting bad data in, you’re going to get bad data out. So this is really where the art of Facebook advertising comes in because they have taken out so much direct data elements you can target you have to pretty much engineer the right kind of audiences based on the right kind of response that you are collecting. Then you would build the look-alikes out of them. You would refine the audience and to that audience you might even run something different. I mean there is a term for this also. It’s a little bit negative sounding but sometimes used, it’s “audience laundering”. So you might get the original list of e-mails from somewhere. But the emails are not very good and not necessarily people who are going to do the deal right now. Maybe not all of those people are really active on Facebook. But you could start with this email list, build a look-alike, run ads to them. But the people who are responding to ads they are based on the pixel, based on lead forms, based on the audiences. And then you’re going to be specifically engineering the content where you’re going to ask the question “if somebody watches this video, if somebody opts in for this offer, what must be going through their head and do I want more people like this”, right? So the real art of Facebook advertising is really designing your customer journey, understanding the steps in a journey where you can collect the data. How do you use this data for retargeting? And how do you use it for acquisition with look-alikes? Right? So with all the things I was talking about customer journey,understand every step, you need to optimize every step, this is how you do it. This is how you actually optimize a step. So you iterate on the content. And you iterate on the audiences. And now let’s add that Facebook keeps changing. So you learn how to do it today, right? So you need to learn not just how to do it. You need to understand the principles because when Facebook changes something, usually change specific features, but they usually keep the principal so you need to know how to work around certain things. And this shows the power of Facebook, but on the other hand the complexity of Facebook. So the question is really what is the best way for somebody to take that power and bring it at their disposal right? It’s like rubbing a lamp and calling the Genie. You want it ideally to be like that but it’s not always quite like that.

Sean: [00:49:50] Thank you so much for dropping so much value on us and teaching us so much about Facebook advertisements. How can people get in contact with you? And what services do you provide so that people can work with you in the future?

Dmitriy: [00:50:00] I’m glad that you asked Sean. You can go to targetchoice.com. There is a marketing blog that you can find there. There is a contact information as well. You can look me up by name on Facebook. Just send me a message add me as a friend. I talked a little bit before about the mindset you need to be thinking about if you want to have Facebook advertising run directly on your behalf. Right? So if you already are in business as an investor, if you’re not completely new, if you know what kind of deals you’re looking for, if you already understand the cost of acquisition of the deals and you are willing to invest accordingly, reach out to me and we’re going to do a full presentation. We’re going to talk about the specifics but just given how much it cost to acquire deal, you’ll probably going to like those numbers. There are going to be some people who’s just going to say “Oh, I don’t want to commit to something. I’m not sure if this is going to be right for me.” This is fine as well. I also want to hear from you. If you’re an investor and you’re not sure you want to invest in services upfront done for your services, you’re going to have another option for investors to work with us. We are launching our own internal deal sourcing property where we will be doing all of these early steps. We’re going to be running our own properties, generating the leads, qualifying them, getting them in the contracts. And then we’ll be putting up those contracts for sale for the assignment. So if you are open to working with wholesalers, just reach out to me, get me your contact information and give me an idea of what type of deals you’re looking for because we are going to be generating those. So we’re gonna be going to see where we’re going to focus, but just reach out to me. I want to talk to you, but I have to tell you that if you’re going to be buying deals from wholesalers, your acquisition cost is probably going to be higher than if you are going to invest with us up front, but it’s really up to you and even if you don’t want to do business with me right now still reach out. Let’s talk and let’s find other opportunities because I’m pretty sure there are different people listening to this podcast. There are investors or other people in real estate. We work with realtors, buyer leads, seller leads, listings. We work with the lenders,we work with everybody in real estate. So if you have any kind of marketing question just reach out. Let’s talk. Let’s see where we go from there. But if you are a serious investor, if you already invest in marketing, if you understand how much it cost to acquire a deal, It really should be a very very easy decision to at least talk And then once you see how we can work with you, hopefully we can help you with this as well.

Sean: [00:52:44] Awesome. Well, thank you so much for teaching us everything about Facebook advertising today. And I’m sure that anyone that contacts you will have a great time working with you and your team.

Dmitriy: [00:52:52] It’s a great pleasure. Thanks for having me Sean.

Here are some of the key takeaways I got from Dmitriy. Before you start your campaign, think about your ideal client. And what kind of journey they will take. Instead of cold calling or cold mailing people, create a way for people to opt-in to your offer by creating something that would be useful for them. For example, if you’re targeting pre-foreclosure property create a small ebook that you can give to people if they fill out some information. Facebook is very powerful. You can target people who have similar characteristics as the people who have opted into other things you sent out as well. You can even have chatbots who can talk to your leads and since they replied to a chat on Facebook, you can follow up with them directly afterwards. Most importantly Facebook is a great way to market to people because you’re able to tweak and optimize your campaign on the fly. I hope you learned a lot from this and there was still so much that we didn’t cover. If anything was confusing or if you’d like to use the services, feel free to contact Dmitriy at targetchoice.com. He’ll be a great help. Thanks, and have a great day.