Homeowners Unlucky Enough To Request Quotes Via Online Home Improvement Lead Services Are Going To Get Swamped By Contractors

There’s A 95% Chance You Should Just Stay Away.
But There’s A 5% Chance You Could Make A Ton Of Money….

By Rich Harshaw  

You know a company is in trouble when they feel compelled to change their name.

Amway became Quixtar to disassociate itself from cheeziness. Andersen Consulting became Accenture to avoid being identified with the word “scandal.” Philip Morris changed its name to Altria because, well, you know. And Kentucky Fried Chicken hoped that KFC would obfuscate their finger lickin’ origins.

So it shouldn’t have come as a surprise to anyone in the remodeling industry when online lead seller “Service Magic” decided to get new letterhead and business cards as they updated their name to Home Advisor in 2012. According to the official company line, the reason had more to do with a dissatisfaction with the word “Magic” in their name, and a shift to a focus on home maintenance.

In a related story, in my decade-plus long career in contractor marketing, I’ve yet to find a single business owner who claims to actually like the company.

The problems stems from their tendency to sell the same internet-generated home improvement lead to 1,322 different competing contractors at the same time (all numbers estimated). Yes, there are a brave few companies who have learned to tolerate Service Magic Home Advisor, but the majority have the kind of hatred for the company that is normally reserved for the DMV, 6 AM flights, and Justin Bieber.

And it’s not just Service Magic Home Advisor, either. It’s any company that wants to sell you home improvement or roofing leads that they generate FOR you off the internet. The general name we can assign to all these kinds of companies is “lead aggregators,” or in other words, they exist to aggregate leads from the interwebs and sell them… to you. There are lots of them, and they’re all about the same: Quinn Street, Contractor.com, GetServiceLeads.com, and Renovation Experts, just to name a few.

But alas, the purpose of this article is to discover the goodness to be found in online leads—if any. So here is my advice to you, dear remodeler, as you consider whether or not to dip your toe into the pool of online home improvement leads:

Advice 1: Don’t do it. It’s not worth it.

Advice 2: If you insist on it, bring your A+ game and get ready for a dogfight.

Don’t worry. I won’t leave you hanging there. Let’s delve into the details for both pieces of advice:

Reasons To Avoid Online Lead Aggregators Altogether

Too Much Competition: This is the obvious one, and it’s true: Those suckers are going to sell that same lead to three to ten other contractors who are all going to converge on that sad-sack prospect like circling sharks. Their phones will start ringing, their email will get blown up, and they’ll regret the moment they ever clicked “submit” on that online lead form. You’ve got better things to do with your life than trying out-elbow seventeen other guys to pay a dollar for a kiss from an ugly girl. You’re better than that.

Leads, By Definition, Are Price Sensitive: The reason the girl in the last sentence is ugly (it’s an analogy, play along) is that online lead generators screw you over by promising to get you “multiple quotes” from prescreened pros. Take a look:The very first expectation that they’re going to have from you is LOW PRICE. I don’t know about you, but I don’t offer the lowest prices, and I’m not interested in doing so. But that’s who’s going to answer the phone if a miracle occurs and you actually get through to a prospect.

Spend That Money To Generate That Lead Yourself: Let’s say you spend $50 per lead and get twenty leads. Chances are high you’ll only actually get in touch with one to two of them, which means you really paid $500 to $1,000 for a home improvement lead. What else could you do with that money? Lots of things! You could pay for SEO services, for starters. Second, spend the money on Pay-Per-Click advertising and you can intercept that exact same prospect, have him fill out your form on your website instead, and get the lead all to yourself. It’s harder, and you have a great website to pull it off. But it is doable—and recommended!

Advice For People Who Insist On Jumping Into The Shark-Infested Waters Anyway

Some of you simply can’t resist the siren’s song, so you insist on participating in the feeding frenzy despite the warnings. Great! The truth is that you CAN mine some gold out of these leads, but you have to have disciplined systems in place to make it happen:

React Quickly: And by quickly, I mean you’ve got like nano-seconds. You need to route the leads to somebody who has no other purpose in life besides dialing that phone and getting through to that lead. Because you can bet your life that many of the other contractors who also just bought that lead are going to be right on top of it. The statistics on this topic are staggering: If you fail to contact an internet lead within FIVE MINUTES, that lead is 100X less likely to be contactable. Read that again. If you’ve ever bought an internet home improvement or roofing lead, called on it an hour after it came in, and were disappointed to find you couldn’t get in touch with anyone, now you know why.

Be Persistent: This one is counter-intuitive; I just told you that if you miss the first five-minute window, you’re dead meat. But not necessarily. See, when that lead first comes in, the prospect is going to get slammed by contractors for two minutes to twenty-four hours. But then the calls will subside… which leaves an open to call twenty-four to thirty-six hours after the lead came in. You can still find interested people—you just have to wait for the rush to subside. Persistence pays.

Get Great Software To Automate Follow-Up: Immediately subscribe to Marketsharp so you can manage all this automatically. It’s a great program that will take the leads FOR you and allow you to do any or all of the following: route the lead to somebody’s cell phone via text message; send an email or text message instantly to the prospect; set reminders for follow-ups; generate mailers with personalized URLs. And probably more.

Most of the companies I know who have success with lead aggregators are larger companies who put more resources into follow up and who have systems for ensuring that things are done right and done in a timely manner. It’s not for everyone. But it can be done. How do you think the Home Advisors of the world stay in business.

Are internet lead services for you? Probably not. But with the right tools and temperament, you just might make it work.

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