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The Accountants' Mastermind - How Robert Newman generates leads using direct mail
The Accountants' Mastermind - How to generate leads using direct mail
We came across this webinar being run by The Accountants' Mastermind about how to use direct mail to generate leads. Robert Newman is a long-standing member of the Accountants' Mastermind community and has used direct mail for over 20 years.
In a world where people are using mail less and less to advertise and moving more towards digital marketing, we thought this was a very interesting subject, so we attended the webinar - and it was indeed super interesting.
The Accountants' Mastermind gave us permission to cut the webinar down and feature it on our blog so that other people may benefit from Robert's learnings.
Watch the condensed webinar or read below to find out what worked for Robert and how you can generate the same success in your business.
Welcome! It’s a bit of a surprise that anyone’s interested in direct mail, I thought that it had completely out of favour - although for the last 20 years I have been consistently generating leads for the accountancy firm through it. It has and still remains to be, probably my most consistent method of generating work.
To give a brief background, we are a general practice of accountants in North Manchester. We have about 2,000 clients, the average fee is about £1,500. I have some outliers in there with some big fees, I have some people spread all over the place, but most of the work is within 25 miles of my office - they are small, owner-managed businesses.
Here's what I'll be covering in this session:
How I got started in business and direct mail
Why you won’t use direct mail
The results I get from direct mail
What you should actually do
Some samples of what I’m sending
Who to target
Where to go to get things
How I got started
I had a previous career in the army, I came out of the army and for some reason ended up in accountancy.
I did the usual thing - big firms, small firms, then joined a regional practice that had the dubious honour of being one of the very first firms that got bought out by Tenon. We all got called to a hotel in Central Manchester and were given red and green badges as we arrived. I got a green badge, green was for go, and I suddenly found myself with no job.
Having been through a few different firms with a few interesting characters I thought it was a “now or never situation”. This was 1999, I wasn’t married at the time, had no family, had some redundancy money both from the army and from accountancy and decided to stick a sign on a door.
Having stuck the sign on the door, I went around looking to buy into a practice, which I’ve subsequently done an awful lot of but at the time had done practically nothing of. I was also starting to rapidly run out of money at this point because I carried on spending as if I had a job, and I didn’t. In part of that spending, I joined 2020 Group.
At the start of everything was Chris Frederickson and The Marketing Correspondence Cook Book, which Chris used to publish through the 2020 Group. The Marketing Correspondence Cook Book was about 200 letters that Chris had sent out to the local inhabitants of San Francisco to try and generate new work for himself.
He published this to all of the members and advocated buying a copy of ACT for £99, getting hold of a marketing list (which he got from Yellow Pages, he just typed them into ACT, I did something similar) and start pumping out letters. It was no more complicated than that. The letters went out on letterhead and I literally copy-and-pasted what he did.
Having exhausted the Marketing Correspondence Cook Book and the results I was getting from it, I started reading around and this would be my top eight best books to read:
- Commonsense Direct and Digital Marketing - Drayton Bird
- Blink - Malcolm Gladwell
- Ogilvy on Marketing - David Ogilvy
- The Direct Mail Solution - Craig Simpson & Dan Kennedy
- Scientific Advertising - Claude C. Hopkins
- The Robert Collier Letter Book, Fifth Edition
- The Copywriter’s Handbook: A step-by-step guide to writing copy that sells - Robert Bly
- No BS Direct Marketing, The ultimate no-holds-barred, kick-butt, take-no-prisoners direct marketing for non-direct marketing businesses - Dan Kennedy
The principles apply equally if you’re going to start running any form of advertising, whether it’s on Google or LinkedIn or anything else.
The other thing I subsequently did was become a member of the Direct Marketing Association (or DMA) - now the Data & Marketing Association. It’s one of these things that you can quite easily join and take some of their courses.
In doing direct mail, you’re cutting out all of the middlemen that could possibly come between you and your future client and you’re appealing directly to them, so you’ve got to be able to deliver a message to them quickly, in a way that they’re going to grasp and understand.
Why I think you won’t use direct mail
1. It’s gentle rain
I use the title ‘gentle rain’ because it’s drip, drip, drip as opposed to an influx.
If you go and buy a client base or buy a practice, you immediately get a massive amount of work from it. If you go and talk at a webinar or a seminar, you’ll likely get a number of prospects all in one go. With gentle rain you have to be consistent, you have to constantly pump this stuff out.
It doesn’t need massive amounts of your time and it certainly doesn’t need much of your energy once you get it going. In the very early days, yes, I was literally putting letters in envelopes and stuffing them and even licking them at one point, because I couldn’t afford to buy gummed envelopes.
You have to be consistent, rhythm and routine. The rhythmic acquisition of new clients has to be paramount to what you’re doing if you’re going to take the direct marketing approach - which is why I think a lot of accountants won’t do it.
2. You get a 1% response rate - and you have to work it
1%, that’s typical. A really good campaign may get 2%.
I typically send 1,000-2,000 letters a month, that’s 12,000-24,000 letters per year. (I actually aim for 15,000-25,000 pieces per year.)
If you send 1,000 letters a month, you’re looking at 10 prospects on average, and you won’t get all 10 prospects to convert to clients. You still have to work them, but they are pre-qualified. You have already identified a target that is very interested in what you’re doing.
With direct mail, you’ve written to an individual, they have had to open and read your letter and respond - they are interested, they are self-selecting - but you still have to create a system and process for following it up that works for your practice.
3. It’s completely intangible
You’re going to spend £12,000-£15,000 per year on what?
As accountants, we don’t like spending money, or I certainly don’t.I don’t like spending money on intangible things, which is why I struggle to be willing to spend lots of time, money and effort on things like social media and google adwords. I do a very small amount of those, but nothing like I do with these, and you do have to send thousands of mail pieces.
Your target audience, in my humble opinion, is within 25 miles of your office. Yes, I know there are people who work nationally or regionally in accountancy, yes I know you can have zoom calls, yes I know there are online firms.
I do have a school of surfing in Cornwall as a client even though I’m based in Manchester because I love going to Cornwall and signed up for the surfing school and managed to convince them to become my client, but it’s an outlier.
Within 25 miles of my office is 95% of my work.
4. It’s boring and old-fashioned
There’s no glamour to direct mail anymore, although that’s why I actually think you’ve got more chance of being read that way than any other way now - because people get less and less post. If you go back 10-20 years ago, people were getting a lot more post.
The results I get
I typically spend £1,000 per month, which gets me around 1,500 mailers.
I get around a 1% response rate, that’s giving me 10-15 leads a month.
If I see 10 of those leads and sign up 65% of them at an average fee of £1,500 each, that’s bringing me £9,000-£10,000 a month of new work, with an average lifespan of 5 years.
If you’re right at the beginning of a practice, 9-10 thousand pounds a month is transformational for you. You pull £120k of fees in a year and by the following year, you’re pushing £220k-£230k, allowing for some losses in there, that’s utterly transformational, but to sustain that growth you need to invest in infrastructure to support it.
What do you actually do?
I believe there are 2 ways of doing this, although I have done other pieces over time. I think you either send a letter, on 2-colour letterhead, around 3 paragraphs long with a title, a P.S. and a signature (including a leaflet and a keepsake), or you send a postcard.
The perfect direct mail would be a handwritten envelope with a stamp in the corner. I don’t do that, simply because it’s too time consuming. I do use window envelopes, I actually outsource the whole process. In so doing, it becomes a lot cheaper as well.
The two things you can guarantee will be read in any piece of direct mail are the title and the P.S., you almost want to be able to have a letter that you can understand by just reading those two sections.
What do you write in your mail pieces?
Short and sharp. I quote what is believed to be the shortest story in the English language, written by Hemmingway - “For sale - Babies shoes. Never worn." Hemingway was the master of taking English and cutting it down to its absolute bare essentials.
Also bear in mind everyone’s favourite radio station, WII FM, “What’s In It For Me”.
You’ve got to take what you do and turn it into a short, sharp sentence that is appealing to the reader. For example:
“We do auditing” is not of any appeal to anybody. “We do auditing, this will help you” is the start of forming a decent sentence.
I’ve distilled this down to: “Review your financial systems and learn how to make more money.” - Which is going to get a lot more attention than “we do auditing”.
Write what it is you do, write how it will help someone and tidy it up to end up with “For sale - Baby shoes. Never worn.” Copywriting books will help you with this.
For the body of your letter, you want to have no more than 100 words.
Here is an example of a letter that I use on my website and in my leaflets etc, which is exactly 100 words:
“Having accurate, timely information will help you manage your stock, what people owe you, what you owe people and your cash flow.
And at the year-end, we’ll ensure that your final accounts are prepared in accordance with all accounting standards and we’ll then check that you are claiming everything you are entitled to claim.
Whether you’re a sole trader, partnership or limited company, letting us prepare your bookkeeping, accounts or VAT will relieve you of what can be a very stressful and time-consuming process.
And we promise that our accountants offer a friendly service delivered in plain English!”
Whatever it is you’re writing about, the aim is no more than 100 words. If you can, 60 words is better still, but very hard to do. Again, if you’re in doubt, hire a copywriter.
Here’s another example of a letter we sent:
The truth is numbers and tax can be a right head peck if you run your own business.
But whatever you need from your books - from ‘just enough to make the tax man happy’, through ‘12 key things your accounts tell you’, all the way to ‘7 special tax strategies that make business owners rich’, our small team of local people speak plainly in words that make sense.
And yes, we’re absolutely bang up to date with ideas to save tax or save money, and we’re always on your side - as our many google reviews testify.
For a chat, that costs nothing, about getting more from your business, call Andy Barker on 01706 860 255 or go to calendly.com/andrew-barker
We look forward to hearing from you today.
P.S. The first 10 people to speak with Andy and say ‘Redigendum tax meum’ get either a £25 car valeting voucher from motovalet.co.uk or a copy of ‘the secrets to grow your business fast - starting today!’ - a best selling amazon book worth £30.”
Nothing surprising, nothing revolutionary, just saying what it is. You’re not writing for accountants, you’ve writing for others.
What we also put in is a leaflet. It splits into “Our guarantees to you”, our contact details, our services and testimonials.
We also include a personalised pen with our website and company name on it, which we source from Boston Promotional and they work out at about 3p each. The reason we buy these pens is that people keep them. They might throw away the leaflet and the letter but they’ll keep the pen.
One of the best giveaways we’ve ever done in a direct mail piece was ice-scrapers, but they worked out quite expensive, it worked out to about one pound per ice-scraper, taking our total cost per piece of mail to about £3, but they have 100% retention and are still talked about now. We give them away now as opposed to putting them in direct mail pieces.
We’ve done a few post-cards, this example was aimed at pubs:
We did a practice acquisition and started a campaign going after the license trade - with impeccable timing. February 2020, we bought a practice that did nothing but pubs. Yes, that was a disaster.
However, despite all the closing down over the years, the pub business is a great business to get into for accountants, there’s a lot that we can do for them.
We send these out in bulk. I get them done internally by our three AAT trainees, who hand write them and stick a stamp in the corner. We’re sending about 60 postcards a day, four days a week.
This one reads:
“Our team are all Rochdale locals who understand the challenges facing pubs and restaurants coming out of the chaos of 2020 and the lockdown.
Our advice has helped countless venues - just like yours - get their personal and business finances sorted - saving money, boosting profits and future-proofing. (Check out our Google reviews - you’re sure to spot someone you know).
Call me today - on 01706 860 255 - for a free chat about getting more from your pubs or restaurant.
All the best! Andy Barker”
Handwritten message on the other side, stamp, you’ve got a very good chance of that getting through, but it does take vast amounts of time.
Here’s another one for general business owners:
Basically the same sort of wording. The aim is to get read and get a response, you’re not going to sign a client directly from one of these, but it’s to start a conversation and relationship.
Who to target
Whoever you’re interested in! If you have a particular interest in a topic, sector or subject, go for it.
We did a significant mail piece to solicitors’ practices within 150 miles of our office when the CGT rules changed and you had to do (what was then) the 30-day return. I can tell you we generated nearly £100,000 of work out of that campaign.
You could target pubs, restaurants, sectors of businesses, geographical areas. If you love dealing with sports clubs, charities - anything and everything.
My principle is geographic - 25 miles from my office, that is the bulk of everything.
That said, the first practice that I created, which I sold to the national, specialised in dentistry. That wasn’t intentional, it just happened. Once it became clear that that’s the route I was going I was targeting them nationwide.
To get your mailing lists, there are a million providers of them, I use 121 Direct Mail. They may be good for you, they may not be, but I’ve used them for years and they work fine for me. I’m not connected to or promoting any of the people I talk about here, I’m not trying to sell anything, so please use whoever you want to use.
1,000 names and addresses will cost a couple of hundred quid. I think for 12,000 names and addresses, you’re approaching about £700-£800 to buy that. I buy it once and then filter it every year by going back to 121 Direct and asking them to please clean my database. About 1,000 names usually drop off and I purchase back that amount to get it back up to the 12,000.
I can change the campaign at will, they print it monthly. I’ll get 50,000 pens and leaflets done and have them delivered straight to Linda at 121 Direct and she stores them for me.
I’ll write a letter on letterhead and email that to Linda at the beginning of each month and she'll use that until I say otherwise. We tend to change or tweak it about every 6 months so that the people on the list who are getting their second letter will get a slightly different one. We’ll do a slightly different campaign if we’re going after solicitors or start-ups or something, but I largely don’t get involved. Not only does outsourcing involve none of my time, but these companies get significant discounts on mail costs.
The beauty of direct mail is that, as much as you can on the internet, you can track where your leads come from as long as you use a different call-to-action each time to measure your investment. A good tip for that is something we do - James Green is put as the sender on each piece of direct mail we send out. James Green is actually not a real person, so if James Green is ever asked for, we know it’s from a direct mail.
How many pieces of mail are you sending per lead?
That kind of links in to what kind of database you have. I go out 25 miles from the area, I buy the data in, I aim for 12,000 names and addresses on my mailing list. What that means is, I’m hitting them twice per year on average, every 6 months.So the cost per piece of mail is about 66p in that scenario.
Is there any difference in outcome between targeting newly incorporated companies vs established businesses?
No. We always do new co’s and there’s a variety of companies that sell that data but Recently Formed are probably the cheapest. We actually send them a birthday card. We bulk buy birthday cards and the receptionist, Liz, handwrites them.
Within 25 miles of this office we get between 60-100 new co’s every week being formed. The list comes through, Liz, my receptionist, knows most of the addresses of the other accountants in the area, which she’ll remove, and we’ll send out our birthday cards and a voucher for a free meeting with us. The response rate is no better or worse.
How do you find the addresses to target?
You buy the data. There are loads of places to get it from, selectabase is probably the biggest, but I get mine from 121 Direct Mail.
How do we get custom postcards?
We have a graphic designer who designs the postcards for us, we originally found them from People Per Hour, we found them to be pretty good so we now deal with them direct. I think it cost us about £50 to have it laid out, we then printed them using Solopress.co.uk - the more you do the cheaper it becomes.
Have you sent any free gifts other than the pen and ice scraper?
Yes, probably everything over the years. The most significant one wasn’t to recruit clients, the most significant one was to get staff.
My now tax partner came from a direct mail piece. Around 2006 I wanted to hire a decent tax person, I went to an agency and they said it would cost around £20,000 to headhunt someone. I didn’t want to pay that so I asked if they would sell me their list and they said no but they would post out for me.
So I had a small branded box done with a cake in it and on the cake was iced “have your cake and eat it, join [name of firm] telephone [number]” and targeted that within 50 miles of my office to about 200 people. I think it ended up costing about £15 per piece. I was inundated with applicants, saw 10 of them, took one on and she, to this day, is still brilliant.
Do you know how many times you have to mail one person before they respond?
No, because it can vary. Statistics in the advertsing/marketing industry are that it takes 7 contacts before someone signs up to you, but I don’t track it in that way. It can be very weird with direct mail, you can get people who respond immediately.
One of the weirdest I ever sent resulted in a telephone call I got in the middle of last year. I’ve managed to hold on to every business telephone number I’ve ever had, despite being a few different firms. The middle of last year, we got a call from someone who produced a letter under the name of ‘Robert Newman & Co’, which is how I first started trading in 2000. They had kept this letter for 20 years. They sad they knew that one day they’d need another accountant, so they held onto it.
How large should your mailing list be?
I do 1,000 to 2,000 a month, because I know that generates me £7.5-£10k per month. If I wanted to do 20,000 I would just increase the investment. The number depends on how many you can realistically handle to follow up on and deal with.
My theory is you hit each person on your list twice per year, I wouldn’t do more than 3-4 times per year on direct mail because it can start to get spammy.
What advice would you give to somebody who is looking to start?
Ready, aim, fire. Get on with it, don’t think about it too much, just start.
Make sure you read the books, do the research and write the letter before going out and doing the shiny objects.
Is it better to sent a letter to each person every six months rather than every month?
If you mailed someone every month you would just irritate and annoy them. What you’re trying to do is get somebody when there’s a reason for them to look at their accounting relationship.
You could hit them 3 times a year, or four times a year, but if you start doing it more than that nothing will have changed in such a short period of time.
Companies I’ve mentioned: