Service Magic

 
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Old 03-09-2006, 11:30 PM   #1
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Service Magic


Does anyone use Service Magic to get jobs? Whats your experience with them and would you recommend going that route? I am just starting a garage building business.
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Old 03-09-2006, 11:41 PM   #2
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Re: Service Magic


Have you met Juanita? I assume not because she would be bugging you to death.

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Old 03-09-2006, 11:47 PM   #3
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Re: Service Magic


Too expensive for me. I tried them for a couple months. They made a lot of money and I made none. Too many leads from people not real serious and too much competition for the ones that are serious. I was getting leads for kitchen and baths.



Quote:
Originally Posted by MKECONTRACTOR
Does anyone use Service Magic to get jobs? Whats your experience with them and would you recommend going that route? I am just starting a garage building business.
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Old 03-10-2006, 12:19 AM   #4
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Re: Service Magic


With Service Magic, if you don't accept the lead and call the customer within 30 minutes of submission, chances are they have already found someone and are not interested in another person coming out. That can cost you $25.00 to $75.00 per lead. I had a customer send in a Service Magic lead to extend his garage 3' because he could not fit his new truck in his garage. I accepted his lead and when I called him to set up an appointment, he said he found a way to fit his truck in his garage and did not need the work done. That phone call cost me $25.00.

I have paid as much as 900.00 in a months time for these leads and only landed about 25%.
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Old 03-10-2006, 05:33 AM   #5
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Re: Service Magic


We have been using them for 3 or 4 years now. No complains here. We pay them approx. $1200 to $1600 per month. We only close about 20% of the sales but the lead is so inexpensive that we don't care.
In 2004 our average lead cost was $310
In 2005 in went down to $287 per lead.

Service Magic Leads cost us $25.00
We can throw 9 out of 10 of them away and still be less than our average lead cost. Sounds like a no brainer to me.
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Old 03-10-2006, 07:16 AM   #6
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Re: Service Magic


We have looked into them, but for us it would be waste of money. There is already enough competition out there why would we want more. All the people that shop Service Magic are shopping and looking for the cheapest deal. Our time is worth money so if we signed up we would have to pay for the leads and then go give a bid and wait. If we did not get the job we just lost time and money. Seams to me Service Magic is making all the money. Not me…IMO
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Old 03-10-2006, 08:29 AM   #7
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Re: Service Magic


ServiceMagic has grown to be a 300 million dollar a year Company and is still growing. I used their service a few years ago to get my business started. My Average lead cost went from $10 per lead to $25 plus. Their lead quality became about 90% garbage. ServiceMagic in my opinion lost who was their real customer the CONTRACTOR not the consumer posting their project for free. I found myself wasting time, money & effort until I became completely fed up.

I was Inspired to develope a better version of lead generation.......

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Old 03-10-2006, 08:35 AM   #8
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Re: Service Magic


Quote:
Originally Posted by marc
We have been using them for 3 or 4 years now. No complains here. We pay them approx. $1200 to $1600 per month. We only close about 20% of the sales but the lead is so inexpensive that we don't care.
In 2004 our average lead cost was $310
In 2005 in went down to $287 per lead.

Service Magic Leads cost us $25.00
We can throw 9 out of 10 of them away and still be less than our average lead cost. Sounds like a no brainer to me.
Marc,

what kind of business are you in that it cost you around $300 bucks for ONE lead...

This Service Magic thing dont make sense to me...

I have researched it and others like it and I think it is more of a waste of money than useful...

I can think of a other marketing ideas to spend $1200 to $1600 bucks a month on and get a much higher return...

Seems like the main complaint is that you have to be "Flash Gordon" to get a lead and If you except a lead and they already have someone...or its a bogus lead... you just gave away your money for nothing...you dont even get a chance to estimate the project or sell your services...

AND... if you do get a chance... you just spent $$ on that service... THEN you go and spend more money going to estimate the project...(it costs money to do a "free estimate") so it really costs you a lot more than the Service Magic fee... Right? So how much is it REALLY costing you? Is it REALLY worth it...

DIRECT marketing is the best form of marketing... YOUR COMPANY contacts the potential customer through YOUR advertising... you introduce yourself... provide a good selling point... and make it easy for them to contact you etc etc...

Having the customers jump through hoops to be contacted by a contractor I think is rediculous...AND I think MOST of the customers that fill out that form are price shopping, or not that serious, (probably just seeing if filling out the form would work and how long it would take for someone to contact them)

It costs you money for these people just messing around, not serious etc...

If they contacted you directly... then you could screen them over the phone (most of the time)... Having it the other way around... dont make sense... unless it was a REAL referral from a past customer....

I think most of us contractors dont put much thought into certain things we do to market ourselves.. I have done some "waste of money things"...in the begining...but I learn fast...

There is nothing anyone could say to me that would change my opinion on this subject... it may work for some... OR you may THINK it is working for you... maybe you dont keep track of anything...but I really think the majority should spend there money on REAL marketing... its more rewarding...

It will cost me LESS than $30.00 per lead... per year....

I think that if you want your company to progress further each year you MUST have a REAL referral system (through your own customers) in place... IT WORKS! One customer could produce up to 4 new customers per year... with a good system.... this is the first year I am using my system...so I dont have any numbers yet...

This is ALL my opinion... and to me Marc... my opinion is a no brainer.....

Last edited by JMGP; 03-10-2006 at 08:37 AM.
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Old 03-10-2006, 09:03 AM   #9
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Re: Service Magic


WOW!

A lot has changed in the 1 1/2 years I've been on this site. Back then the responses to online lead services were either positive or "I don't know, never used them". It appears a lot more contractors have experience using these services now and the majority of the responses are negative.
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Old 03-10-2006, 09:51 AM   #10
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Re: Service Magic


Quote:
Originally Posted by Mike Finley
WOW!

A lot has changed in the 1 1/2 years I've been on this site. Back then the responses to online lead services were either positive or "I don't know, never used them". It appears a lot more contractors have experience using these services now and the majority of the responses are negative.
Mike,

These services MAY have been a good choice in the BEGINING...

Now there are to many involved with the system and it just doesnt seem cost effective or even worth the time...

If the system was set up to ONLY have a handful of QUALIFIED contractors sign up for each county... Then it may be worth it BUT... thats not the case... ANYONE can sign up... as long as you have a credit card to charge....

And that is why I beleive those of you who are signed up are wasting your money... you could put better use of your money elsewhere...

I havent used any of these services.. and I never will... my opinion is all based on simple research... and common sense...

I think that contractors should take the time to do research and ask questions about services like this BEFORE they sign on... I think most of us are small companies that every penny counts...

Thanks,

Joe
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Old 03-10-2006, 10:10 AM   #11
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Re: Service Magic


Quote:
Originally Posted by dfwhomeremodele
With Service Magic, if you don't accept the lead and call the customer within 30 minutes of submission, chances are they have already found someone and are not interested in another person coming out. That can cost you $25.00 to $75.00 per lead. I had a customer send in a Service Magic lead to extend his garage 3' because he could not fit his new truck in his garage. I accepted his lead and when I called him to set up an appointment, he said he found a way to fit his truck in his garage and did not need the work done. That phone call cost me $25.00.

I have paid as much as 900.00 in a months time for these leads and only landed about 25%.
Tim, I feel your pain.

I try to make contact within 15 min of the lead and still havent had many work out for me.

To me, they are like insurance companies, they want your money and show you nothing in return.
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Old 03-10-2006, 10:47 AM   #12
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Re: Service Magic


JMGP, you said that maybe I'm not tracking.

Here is my tracking data for this year to date

ABC Leads...4 leads
Direct mail...14 leads
Malls...3 leads
Home Shows...100 leads
Homeimprovementleads.com...5 leads
Maine Air Show...1 lead
Referrals...25 leads
Renovationexperts.com...2 leads
ServiceMagic....33 leads
Showroom...11 leads
Site signs...7 leads
Sunroomtree.com...4 leads
Trucks....1 lead
TV....3 leads
Our website...3 leads
Windowbuyer.com...1 lead
Yellow pages.....2 leads

Co. Total...219 leads

SALES.........
Site signs...$28,574
Direct mail...$76,609
Home Shows...$230,342
Homeimprovementleads.com...$10,182
Referrals...$111,378
ServiceMagic...$48,098
Showroom...$40,283
TV....$4,637
Our website....$19,829

Co. Total....51 sales...$569,932

I believe I'm tracking our leads and sales pretty good..............Any sugestions are welcomed though.

Our plan is to spend 10% or $500,000 on marketing to get $5,000,000 in sales
This $500,000 includes a $100,000 salary for our Marketing/Events director
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Old 03-10-2006, 11:05 AM   #13
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Re: Service Magic


Marc, just curious here. With a company such as yours that does (compared to most of us on this board) large volume/large sales, why is it that your referral leads aren't higher? The more work I do, the more referral leads I am getting. Granted, I'm tiny compared to your business, but it would seem to me if you are doing that many jobs per year, you should be getting more referral leads per year? I have seen comparable numbers with other large companies, painting/remodeling/etc., and all seem the same. This leads me to believe they have swapped quality for quantity. Please don't take this the wrong way, I'm not knocking your business at all, just trying to understand. Why aren't your previous customers 'selling' for you?
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Old 03-10-2006, 11:10 AM   #14
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Re: Service Magic


Marc you lead acquisition costs are astronomical, (at least compared to mine. ) Is there an industry average lead cost for you guys? Is it because of the products and services you sell?

Obviously since you are so diverse in your advertising you have different acquisition costs depending on the media, have you looked at the per costs based on the media. 3 leads from TV - did that cost you $900.00 and did the 14 leads from directmail cost you $4200? One of the first things I would do is look at the individual return rates and spend more money on the ones with the lower acquisition costs and try to dominate those markets. Also there are residual effects you can consider. Such as money spent with Service Magic advertising is pretty much 1 shot. You spend $400 and get 1 customer and no matter how frequently you buy from them it doesn't build. But money spent on direct mail can go farther since the frequency of your mailings over time increases the return rate.

Last edited by Mike Finley; 03-10-2006 at 11:16 AM.
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Old 03-10-2006, 11:12 AM   #15
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Re: Service Magic


Quote:
Originally Posted by marc
JMGP, you said that maybe I'm not tracking.

Here is my tracking data for this year to date

ABC Leads...4 leads
Direct mail...14 leads
Malls...3 leads
Home Shows...100 leads
Homeimprovementleads.com...5 leads
Maine Air Show...1 lead
Referrals...25 leads
Renovationexperts.com...2 leads
ServiceMagic....33 leads
Showroom...11 leads
Site signs...7 leads
Sunroomtree.com...4 leads
Trucks....1 lead
TV....3 leads
Our website...3 leads
Windowbuyer.com...1 lead
Yellow pages.....2 leads

Co. Total...219 leads

SALES.........
Site signs...$28,574
Direct mail...$76,609
Home Shows...$230,342
Homeimprovementleads.com...$10,182
Referrals...$111,378
ServiceMagic...$48,098
Showroom...$40,283
TV....$4,637
Our website....$19,829

Co. Total....51 sales...$569,932

I believe I'm tracking our leads and sales pretty good..............Any sugestions are welcomed though.

Our plan is to spend 10% or $500,000 on marketing to get $5,000,000 in sales
This $500,000 includes a $100,000 salary for our Marketing/Events director
sorry marc,

I wasnt directing that to you...I use the word "you" as a general statement...most of the time... I think a lot of us are guilty of not keeping track...

Basically the first sentence was directed to you... and the last.. I found the answer to my question...do you sell windows and doors?

thats one of the things I hate about talking through forums... its hard to tell whats what or tone... or what is directed to who...sometimes

obviously you are a bigger company... like I said it works for SOME.(service magic).. selling windows and doors is a big market... ( i think thats what you do)

anyways... good to see you keep track... I feel it is one of the most important things to do...

Joe

whats your website address....

Last edited by JMGP; 03-10-2006 at 11:22 AM.
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Old 03-10-2006, 11:16 AM   #16
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Re: Service Magic


Our volume used to be entirely referral based until 1999.
That's when I dicided to grow the business and actually have a business vs. the business being just me.

In 1999 our volume was $380,000 ......100% referral.
LAst year we did over $3 million and our goal for 2006 is $5 million.

So far this year 25% of Closed contracts are from refferals and/or past customers (in my mind that's pretty good) We shoot for 35% of our business come from referral. That's 1.75 million.

The larger you get ...the smaller that percentage gets.
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Old 03-10-2006, 11:20 AM   #17
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Re: Service Magic


I should also add that the jobs from referrals and past customers tend to be smaller. Let's face it ....a customer doesn't usually vinyl side his home a second time.

So far this year the average sale for a referral/past customer is $8567.53 vs. or co. average of $11,175.13

That's $2607.60 less per sale.
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Old 03-10-2006, 11:38 AM   #18
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Re: Service Magic


Quote:
Originally Posted by marc
So far this year 25% of Closed contracts are from refferals and/or past customers (in my mind that's pretty good) We shoot for 35% of our business come from referral. That's 1.75 million.
Yeah, I just looked back and saw that. I would be happy with that number too.

Quote:
Originally Posted by marc
The larger you get ...the smaller that percentage gets.
I'd have to agree, thanks for explaining.
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Old 03-10-2006, 11:40 AM   #19
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Re: Service Magic


web site is

www.Sylvaincontracting.com

Last edited by Cole; 03-10-2006 at 11:42 AM.
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Old 03-10-2006, 12:02 PM   #20
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Re: Service Magic


[QUOTE=marc]I should also add that the jobs from referrals and past customers tend to be smaller. Let's face it ....a customer doesn't usually vinyl side his home a second time.[QUOTE]

Hey Marc,

Seems from what you wrote here, you need a ferocious hailstorm to hit your area!

That'll bring in a few 2nd-timers!

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