Lead Company Issues

Mike Finley

Of course it won't be. You aren't hearing what you want to hear. Lots of people have the same sickness. They ask a question with a pre-meditated answer already in their heads that they want to hear and get upset when they don't get that answer back in the replies.

You started this thread with this question:

I kind of set you up, because as I've said the online lead generator business is bullsh*t. It's a broken model so there is no such thing as a win/win for the lead company and the contractor.

When I said: "offer a single lead to the highest bidder" and you bit on it, I already knew that while it sounds great, it's a flawed solution. That's why I said:

You proved my point by saying you would need to set a reserve because as we both know the leads aren't worth enough to keep a middle man in business generating them. If they were then you wouldn't have to set a reserve they would be bid up high enough for you to make money.

See it yet?

Probably not.

You're in the business, you might not be as bad as your competitors but you're still in the business and still in denial of the truth that online leads can't survive without all the smoke and mirrors. You've proved it in your own thread.

rispgiu

Actually I meant did you try the SEO ?

Lead Guy

The point of this thread was to get some ideas. Not cool 'set up' questions so you can fire away with your witty rebuttals. Im not on here trying to drum up any new business, so what could my motivation be?? Thats right... to see if anyone has any good solutions to some common problems with lead companies.

Your assumptions about me having some 'sickness' are totally unfounded and your insults dont phase me at all. Im sure you have had plenty of practice bashing lead companies, but you dont seem to understand when a lead company wants to help make things better.

I think your sickness is that you think you know everything about a business that you have never run. You need to be the expert at something, and maybe this is your thing?? Have you ever even worked with any of these lead companies that you love to bash, or do you just go off of what others have said about them?

So, since you have no idea of something that could actually work, (except for your cool hypothetical set ups) you are currently no help to me, as I stated before.

When your ready to hop off your soap box, let me know and we can try to work together to figure something out. Im open to trying some new things with the help of some contractors. Ill happily report how things are going here on the thread if we can come up with something good.

carolinahandyma

What is the name of your company and URL? Just curious.

NormW

Why would you have to charge $100-$300 per lead? If the customer paid a small up-front fee to list his ad ($5, would probably chase away most time wasters). How would that increase your overhead?

Im sure the referral business is more involved than I imagine. How hard is it on the inside? Where are the hidden costs?

NormW

Heh, I read the rest of the thread, after my previous post.

You did flat out admit that most leads really aren't worth a thing. Its a credit to MF for getting you to show that hand, and I credit you for not trying to BS an answer.

So again... why not charge a small fee to the customer, charge a higher fee to one contractor....

Or, Charge a high fee to the customer, and charge a small fee to three contractors...

Let the customer choose his option, post it somehow, then let the contractor decide if they want a lead that wants to shmooze, or if he wants a lead thats price driven.

If you did this, you'd have a much different product then your competitors, granted, you would get less leads... but You'd have contractors flocking to you. Im sure you could find a way to make it work.

and... IM nosy... what are the real costs, in your business... Truly, your time is worth something, but what other costs are there, that I don't see.

kevjob

Come on Norm, they could only charge only one HO where they can charge 10-15 contractors!

__________________
Kevin
Basement Finishing Highlands Ranch Colorado
Littleton Colorado, Basement Remodeling
Kitchen Remodeling Denver

NormW

I know. I'm trying to give charity to his original post, where he was saying he was trying to create a new way.

He has yet to come up with anything new. But, hope springs eternal... he has determined what his leads will be worth $100-$300 each . He just has to work out the little details ...

I do love the Marketing and Sales section of the forum though. I checked this part out to find ways to generate "buzzz" about my business. Instead, I find something new to entertain myself with each time...

The referral services poisoned the well they are drinking out of. Its hard to give credit to anyone trying to find an improved model.

Im amazed that people think we are dumb enough to pay that kind of money to get a "lead". Then Im even more amazed that people are that dumb, and are already paying for leads.

IMO, I don't think tele-marketing, lead services, high pressure sales, or any kind of automated sales approach helps our industry. If anything its helping to saturate the market with mistrust.

Mike Finley

Difference is lead guy is I'm a business man, I can run any type of business. Online leads have been around for along time now, they aren't new, they aren't a mystery. I've seen the evolution.

Are you aware of the evolution of the online lead service? Can you outline it for us?

News flash buddy - there is nothing that 'works' there is no way for a lead company to run a lead service as a win/win.

YOUR LEAD ACQUISITION COSTS ARE TOO HIGH.

You know it, I know it, therefore the only way to stay in business is to run online leads with all the garbage that comes with them.

You revealed some of them yourself - setting a reserve, I won't be able to do returns.... contractor retention is the main problem....

The best advice in regard to lead services on this thread was given by Bill Z


So lead guy, don't get mad at me. Prove me wrong. Show us your win/win.

You can't do it, not as long as SM is around. You know it and I know it.

Mike Finley

Very logical Norm, because you are thinking like a craftsman. You are thinking how to create a better product. Like a good business man who makes something, the road to success lies in making your product the best in the marketplace. So logically as a contractor you know that the problem with the online lead services products is that the leads themselves are not a good product. Logic dictates, make them better and you have solved the problem with lead services. Raise the quality of the leads and you will have created a great product and success will be yours.

Here is where the dirty secret of the online lead business bumps against normal business logic.

#1 Online lead services customers are not contractors, they are homeowners.

#2 There fore if contractors aren't their customers, then that means Leads aren't really their product.

#3 If they improve the lead by raising the quality by eliminating the bad leads right off the bat, they lose 50-70% of the quantity of the leads they could sell.

#4 If they lose that quantity they can't afford to advertise to get more leads.

It's a vicious circle and defies normal business logic. They can't improve their product without losing the ability to acquire more of it.

That's the dirty secret that they all live with.

They deny it and are in denial and instead are all searching for a better way to do things, hence this post.

The better way is to serve contractors as their customer, not the homeowner. The better way is to charge a small fee to the homeowner to submit a lead.

They can't do this and make any money. If they charge homeowners they lose volume of leads to resell. If they treat the contractor as their real customer and therefore serve their customer better by increasing the quality of the leads they lose volume of leads to resell.

If you follow the logic, the end result is online leads will never work as a viable business model that serves contractors well. Not as long as SM is around which dictates to all of the rest what their lead acquisition costs will be.

LEAD GUY - what do you think? I'm way out in left field huh?

festerized

I like Angies list format, have the customer pay for a request in some kind of manor, therefore weeding out bad leads, saving contractors thousands of dollars per year
What we need is new government format the oversees these company’s
Setting ground rules of conduct will insure a healthy and honest market
The construction field is a vital part of our economy, protecting contractors in same way Home improvement licensing protects homeowners will help the our economy grow

AtlRemodeling

How about something similar to what the Blue Book, Dodge plans and several local reprographics companies have for commercial work. If you are unfamiliar with these companies it plays out like this:

1) The owner submits their plans/project to Dodge (for example). I used to subscribe to Dodge and I would get an email each morning listing new plans available to bid. If I choose to bid a particular project, I would pay the fee for that project. The fee was reasonable and based upon the size and scope of the project.


2) Local reprograpics companies would accept plans from anyone (Commercial Owner, Residential Owner, GC looking for bids, etc). They also sent a daily email listing new projects that I would then order on-line and would swing by their store and pickup the printed plans. They made their $ off the plan printing.

3) Blue Book accepted plans for same sources and if I remember correctly they operated similar to Dodge but it has been a few years. I know we ran a small ad in their book (not just the free listing) so it may have been included in their advertising fee.

In the summary we got before any additional spending the owner specified the date construction was to start, date bids were to be received, project location etc. so I guess the "Lead Services" could alter this information if they were dishonest (or is that a given). I routinely would see the same project come in from these same 3 sources (usually owner would submit to multiple sources) but since I had the details I could get them from the best (cheapest) source.

It seems to work well for Blue Book and Dodge Plans as I never hear anyone biatching about their services. Just my thoughts (that an $5 will buy you a cup of coffee).

Bill Z

Regarding the "Dodge way". Wouldn't the BIG difference be in that Dodge reports come with prints and plans BUT homeowner's generally do not have specifications, but only a vague idea of what they want to accomplish?

Part of our job is to help create specifications based on the homeowner's expectations.

Back to the topic, I just prefer to hide my head in the sand and believe I can live without someone else meddling in my marketing plan. If everybody refused to use these on-line lead predators, they go out of business in an instant. Just say "NO", and hang up. It's that simple.

Bill Z

Dude, I gotta admire you for thinking outside the box, but the last thing we need is "a new government format to oversee these companies". We need less government, not more. If the government is going to "protect" contractors I have a feeling someone is going to need a condom.

Back on topic again.... YOU ALREADY HAVE THE POWER to oversee these companies, just say "NO". They provide nothing of value, they tempt you by appealing to your greed, and all they want is your money. There's no commitment to the customer whether it be the contractor or the homeowner.

It's a scam! As Earl Pitts used to say "Wake Up America".

AtlRemodeling

Bill you are correct and I wasn't quite thinking along those lines. I am with you on not using the POS lead services. I have not used them in the past nor can I see a reason to do so in the future. Obviously, with the exception of the commercial work I used to do which is also no longer applicable.

Lead Guy

Thanks everyone for your responses! I have been really busy and I will try to answer them all at some point this weekend, or first thing on Monday. Great stuff! This is the kind of debate I was looking for.

tinner666

You asking me. Yes. Just having my link here is part of SEO. A also use keyword terms on my site, as opposed to keywords by themselves.
Cost? $0.00. Time? A minute here and there typing and uploading. Some time subconsciously tweaking those terms, on occassion.
Does it work? I dunno. I only got 12 calls today.

__________________
Frank Slate Roof Repairs, Richmond, Va.

rispgiu

Would you have by any chance more information? I have been trying to do it myself but very unsuccefull. The companies that I called they asked for several thousands of dollars

tinner666

I've gto company and can't take any calls right now. Google this for some insight;
' Long tail keywords ' or ' Long tail keyword terms '
Just paste them into the search box at G.

Look here, CT, for posts by Ivinni and a few others on Marketing and Sales area.

__________________
Frank Slate Roof Repairs, Richmond, Va.

Kekeever

I have done a lot of research lately on SEO for my company website. What I have found is there are many companies out there that promise to instantly elevate your web presence to the first page of Google as long as you pay an up front cost of $1000 or more and then a monthly fee that's as much as $500 to keep you there. What I discovered is that most of these companies making these promises use "black hat" techniques that only work when you are paying their fees. Worse yet if those techniques are found out by Google you run the risk of being blacklisted. The way I decided to approach SEO is I hired a "coach" that is helping me redesign my website from the ground up so that it has a good SEO foundation that I can build on. The first thing we are doing is putting the site on a Wordpress blog. Wordpress is very easy to use and delivers professional results. I am just getting started with the SEO thing but am hoping to have my site revamped and live in the next 2 weeks. Good luck.

__________________
keeverandassociates.com