HomeAdvisor is a giant in the group of lead generation services. It’s known to almost everyone, and presumably has many faithful customers—but is it worth the hype? Let’s examine HomeAdvisor’s system and compare it with other services including Pro In Your Pocket, a smaller lead-generation site. We’ll see if HomeAdvisor is all it’s cracked up to be.
HomeAdvisor: The Basics
HomeAdvisor’s process is extremely similar to Porch: It’s a site that offers home services where customers answer questions about their project, and HomeAdvisor sends out the project request to local pros. Up to four pros can respond to the request, and the customer chooses from those four options.
The Customer’s Perspective
The process for the customer is pretty simple, and it’s better than other sites like Takl or Thumbtack in that the pros come to the customer instead of the customer having to search through a huge list to find a pro that matches their needs. That feature is definitely more convenient for the customer, but that’s where the advantages end.
Because only four pros can respond to a request, the customer’s choices are extremely limited. This system is meant to not overwhelm the customer with dozens of responses, but this also means there’s a higher likelihood that the customer will end up unwittingly choosing a mediocre company. When the options are so limited, it would almost be a better choice to skip the lead generation service altogether and turn to Facebook or Yelp for recommendations instead.
Of course, not all lead generation sites use this system. Sites like Takl provide the customer with a long list of providers to sort through—which gives more options, but is time-consuming. In this sense, Pro In Your Pocket is the best of both worlds. The customer submits a request and the Pros bid on the project, but there’s no limit to the number of bids per project.
The Pro’s Perspective
There’s no fee for a customer to use HomeAdvisor, so it’s not surprising that the large business makes its money off its pros. For pros to sign up with HomeAdvisor, there’s a whopping $350 annual fee. In addition to that, HomeAdvisor utilizes a pay-per-lead system, meaning that pros pay a small fee every time they reach out to the customer. This doesn’t seem like a big deal at first, except that the pro will inevitably end up paying for leads that don’t work out. So with the combined subscription and lead fees, professionals will end up losing a lot more money than they make through HomeAdvisor.
With that said, it’s obvious that picking a service with a much lower subscription fee, or no lead fees—or both!—would be a much better investment. That way, professionals won’t be paying for leads that end up going to other contractors, and there won’t be pressure to make back the money spent on the excessive subscription fees.
Suppressing Businesses: The Secret Issue
There’s a sort of hidden problem with HomeAdvisor that most professionals won’t notice upon first glance. When services like HomeAdvisor limit the number of pros who can respond to a project request, it cripples the competition instead of helping businesses grow. And worse, it really favors bigger businesses while suffocating the smaller ones (you can read more about that here). In short, while this system is somewhat more convenient for customers, it’s really awful for businesses.
The Bottom Line
Now that we’ve looked at the ins and outs of HomeAdvisor, it’s safe to say that it’s not the worst choice for customers, but it’s definitely a bad choice for professionals. What customers gain in convenience is negated by the low number of choices for professionals. And for professionals, the pricey fees will really add up—especially when there’s such a strict limit on the number of responses. This system will ultimately crowd out the smaller businesses, while companies of all sizes will lose massive amounts of money using HomeAdvisor.
Pro In Your Pocket, on the other hand, was founded to help small businesses flourish. We believe in keeping subscription rates low, not charging lead fees, and not restricting the number of professionals who reach out to customers. That way, both customers and professionals are left satisfied and able to save money. Check out Pro In Your Pocket today!