What Internet Lead Services Should Do To Corner The Market

Mike Finley · 03-13-2009, 05:49 PM

Only problem with all that is that their incomes (SM) has fallen dramatically, because while you point out their obvious attitude (contractors are a dime a dozen), unfortunately the sheep they have been sheering have woken up to the fact that SM thinks they are a dime a dozen.

SM business model is fundamentaly flawed. Making contractors compete is a race to the bottom. They can't keep their product high quality because of this flaw. The flaw feeds upon itself, they lower their standards for contractors, they lower their standards of what a lead is and around and around it goes to where they are today.

You think they are doing well, I say they are just around the corner from closing the doors.

rbsremodeling · 03-13-2009, 05:53 PM

Quote:

Originally Posted by Mike Finley

Only problem with all that is that their incomes (SM) has fallen dramatically, because while you point out their obvious attitude (contractors are a dime a dozen), unfortunately the sheep they have been sheering have woken up to the fact that SM thinks they are a dime a dozen.

SM business model is fundamentaly flawed. Making contractors compete is a race to the bottom. They can't keep their product high quality because of this flaw. The flaw feeds upon itself, they lower their standards for contractors, they lower their standards of what a lead is and around and around it goes to where they are today.

You think they are doing well, I say they are just around the corner from closing the doors.

I hope your right but as the saying goes

"There's a sucker "Contractor" born every minute" P.T. Barnum (1810 – 1891),
"

RidgeWalker · 03-13-2009, 06:35 PM

Quote:

Originally Posted by Mike Finley

Only problem with all that is that their incomes (SM) has fallen dramatically, because while you point out their obvious attitude (contractors are a dime a dozen), unfortunately the sheep they have been sheering have woken up to the fact that SM thinks they are a dime a dozen.

SM business model is fundamentaly flawed. Making contractors compete is a race to the bottom. They can't keep their product high quality because of this flaw. The flaw feeds upon itself, they lower their standards for contractors, they lower their standards of what a lead is and around and around it goes to where they are today.

You think they are doing well, I say they are just around the corner from closing the doors.

I have to disagree with you Mike,

I recently decided to rejoin SM. The stipulation was that I was allowed to keep my two year old ratings that made me a Certified 5 Star Contractor. However during the process they tried to tell me my state requires a license to practice my trade, I had to school them on what the law actually said. They did not care that I was right and they even admitted I was right, but a section of the law also stated that if during the process of the work performed an amount of 25% or 10k required a license, the non licensed contractor would have to have a state license. So SM would not allow me to get leads for my trade for replacement, only repair.

They have not lowered their requirements at all from my perspective. I'd like to know how you really know they are making less money, they are a private company and as such they don't publish their financial statements.

Do you have inside information? Are you making a reasonable assumption based on the down turn which means less people are requesting service?

Some see it as flawed because they are looking at it as a service to you, and that's not what company's like SM are about. Its about fulfilling the needs of the user. The users/prospects makes us compete. It is nice that SM has helpful tools for contractors and articles to help a contractor sell better because they do see some value encouraging success. But they really don't need the whiners and complainers who don't get it.

If I take A. B. & C. Painting company and say, I have a lead of which you each must pay me exactly $50 for the lead, it is fair treatment.

The competition comes when these three meet with the lead. I spoke for almost two hours to a nice young lady at SM who grew up in construction as her father was a GC. "Yesterday actually" She said something that is very true about the construction industry.

"Its full of very talented people who are masters at their trades, but most of them have no idea how to be a real business or how to sell." And that's why these folks end up unhappy or just bash the lead company. They want to blame every one but themselves instead of doing a self examination to see if they need to better themselves instead. But that is a whole different story anyways.

Mike Finley · 03-13-2009, 08:45 PM

Quote:

Originally Posted by RidgeWalker

" She said something that is very true about the construction industry.

"Its full of very talented people who are masters at their trades, but most of them have no idea how to be a real business or how to sell." And that's why these folks end up unhappy or just bash the lead company. They want to blame every one but themselves instead of doing a self examination to see if they need to better themselves instead. But that is a whole different story anyways.

I don't agree with how she is connecting the dots. I'd call that rationalization at it's best.

RidgeWalker · 03-13-2009, 09:38 PM

The dots are that the contractor in a lot of cases is not understanding the mentality of the user. The user is in the GET IT NOW mentality that's why they are using the internet to find a contractor. I can't make that any clearer! I have to follow up just as fast when I get a lead off my website too! People do not want to wait these days.

Any one who is reading this, if you've used a lead service and don't get this most important point you are wasting your money. Period!

My team, myself included never had any trouble or problems with SM leads EVER. (only used SM) Sure we had a certain percentage that did not fit with us, and a certain percentage that were tire kickers or never even responded to our calls. But overall 85% percent of the leads where good. We closed almost every single one of that 85% too.

I always received credits for leads when ever I asked for them, yet I hear people complaining that they asked for credits and never get them. There's a reason why and I won't go into that here.

I'm willing to put my money where my mouth is too.

Any one on this forum who is willing to;
A. Let me personally coach them.
B. Take my exact directions.
C. Take the action I deem necessary.

If you will do the above and you don't have any level of success with SM I'll personally pay you $500 dollars. If any one takes me up on the offer we'll see if we can get a special thread that is moderated and the contractor I work with and I will post the coaching, and progress in that thread for EVERY ONE to see.

And just in case any one tries to bring this up, I know that a year or so ago I posted either on this board or roofing.com that I was going to side with my peers and stop using SM. I never really thought that through because I was most likely listening to peers who where not getting it and just ranting like little children on the forums.

rbsremodeling · 03-14-2009, 08:30 AM

I used SM for 2 years.

I can sell ice to an eskimo who lives in a freezer full of ice cubes. I never closed a deal using SM in the entire 2 years.

SM and their leads suck. Any way you package ****e it's still ****e, even with a pretty bow on it

Mike Finley · 03-14-2009, 11:11 AM

Quote:

Originally Posted by RidgeWalker

The dots are that the contractor in a lot of cases is not understanding the mentality of the user. The user is in the GET IT NOW mentality that's why they are using the internet to find a contractor. I can't make that any clearer! I have to follow up just as fast when I get a lead off my website too! People do not want to wait these days.

As I said - fundamentally flawed. If you are saying that the success of SM system for it's customers (contractors) is to be the fastest to respond (let's boil it down then to the 1st 3 to respond are statistically the only contractors who statistically have a chance at closing the lead)....

RidgeWalker · 03-14-2009, 11:46 AM

Quote:

Originally Posted by Mike Finley

As I said - fundamentally flawed. If you are saying that the success of SM system for it's customers (contractors) is to be the fastest to respond (let's boil it down then to the 1st 3 to respond are statistically the only contractors who statistically have a chance at closing the lead)....

... then selling the leads to 30 other contractors....

connect the dots here.... is a flawed system if you are the other 27 contractors!

As I said, the system is fundamentally flawed.

No real proof to substantiate that claim. Really. Personally I tested SM back in 2006 by requesting leads for my service and spent over 500 by making fake requests. NOT ONCE did I ever receive in my email more then 3 to 4 contractors. So from my experience this is a bunch of hearsay bullcrap.

tinner666 · 03-14-2009, 12:54 PM

Quote:

Originally Posted by RidgeWalker

No real proof to substantiate that claim. Really. Personally I tested SM back in 2006 by requesting leads for my service and spent over 500 by making fake requests. NOT ONCE did I ever receive in my email more then 3 to 4 contractors. So from my experience this is a bunch of hearsay bullcrap.

I wonder if any other contractors were also testing?

Fo reach test, 2-4 paid for the test!

Interesting thought. Wonder if it's still going on?

rbsremodeling · 03-14-2009, 01:00 PM

Quote:

Originally Posted by RidgeWalker

No real proof to substantiate that claim. Really. Personally I tested SM back in 2006 by requesting leads for my service and spent over 500 by making fake requests. NOT ONCE did I ever receive in my email more then 3 to 4 contractors. So from my experience this is a bunch of hearsay bullcrap.

That my friend is the Greatest flaw right there.

Mike Finley · 03-14-2009, 01:00 PM

WHAT?

I see. So you're under the belief that SM sells a lead to 3 contractors, and the early bird gets the worm. The 1st guy to contact the lead closes at your "almost every single one" rate as long as he isn't a typical contractor in that he has no idea how to do business or sell?

I'd have to say your experiences are akin to a lottery winner.

RidgeWalker · 03-14-2009, 03:22 PM

Yes I tested the system why not? It's very very easy to fool the system. Created 10 free emails using inbox.com and hotmail.com. 10 fake names and addresses. Visited the SM site via a proxy server and submitted request's for my task's in the zip code I set my account up through.

I did this because it says right in the agreement that SM limits the number of contractors that are sent to users. I was told by the VP of Marketing himself that no more then 3 to 4 contractors are given to a user per task.

If any one doesn't think SM does not know that contractors test the system they are completely fooling themselves. I still believed what people on here where saying, even though I had personally tested the system myself. But in hindsight it does not make any sense to me that a company would claim one thing and then do something completely opposite. Especially with something so easy to get caught doing.

Another aspect is to consider the user. No user want's their inbox filled with 30 contractors all trying to get their kitchen remodeling job, that equates to a REALLY CRAPY user experience, which again equates to the user not returning to use SM again.

Oh your looking for a roofer, here we are going to send you an email with 30 contractors to choose from. Additionally SM sends an email on behalf of each contractor so the users inbox instantly gets instantly SPAMMPED with 30 emails. The user becomes immediately paralyzed with information overload when faced with the prospect of reviewing 30 profiles, reading 30 emails and taking 30 phone calls. So they end up doing nothing.

Yeah that's a business model, I think SM knows that operating that way is not effective and gives an impression they don't want to communicate to users.

Pro Builder · 08-02-2009, 07:14 PM

Quote:

Originally Posted by RidgeWalker

Yes I tested the system why not? It's very very easy to fool the system. Created 10 free emails using inbox.com and hotmail.com. 10 fake names and addresses. Visited the SM site via a proxy server and submitted request's for my task's in the zip code I set my account up through.

I did this because it says right in the agreement that SM limits the number of contractors that are sent to users. I was told by the VP of Marketing himself that no more then 3 to 4 contractors are given to a user per task.

If any one doesn't think SM does not know that contractors test the system they are completely fooling themselves. I still believed what people on here where saying, even though I had personally tested the system myself. But in hindsight it does not make any sense to me that a company would claim one thing and then do something completely opposite. Especially with something so easy to get caught doing.

Another aspect is to consider the user. No user want's their inbox filled with 30 contractors all trying to get their kitchen remodeling job, that equates to a REALLY CRAPY user experience, which again equates to the user not returning to use SM again.

Oh your looking for a roofer, here we are going to send you an email with 30 contractors to choose from. Additionally SM sends an email on behalf of each contractor so the users inbox instantly gets instantly SPAMMPED with 30 emails. The user becomes immediately paralyzed with information overload when faced with the prospect of reviewing 30 profiles, reading 30 emails and taking 30 phone calls. So they end up doing nothing.

Yeah that's a business model, I think SM knows that operating that way is not effective and gives an impression they don't want to communicate to users.

So....how does SM decide what small number of contractors get to bid on each job?

I can't pm yet. Can you email me so i can ask you some questions about SM? I am interested in learning how to work the system. Thanks!
domainspotter@hotmail.com

Carport King · 08-04-2009, 07:05 AM

I am on the computer a lot and all I see is SM using adwords and banners to gain leads. Leads that they then sell to you the contractor for $40-80 a lead.

But then I here contractors crying the blues when they spend $2-3 bucks for a PPC keyword. I don't get it. Why would anyone even use SM?

My partner Josh in the seamless gutter business has a PPC campaign with only 19 keywords and stays slammed with fantastic leads in his area. Since starting this way of marketing he has spent less then last years ad budget but has added $350,000 in more sales.

So my question is why wouldn't a contractor do the same thing as SM and do your own adwords or banner campaign? Am I missing something?

Pro Builder · 08-05-2009, 01:45 AM

Quote:

Originally Posted by Carport King

I am on the computer a lot and all I see is SM using adwords and banners to gain leads. Leads that they then sell to you the contractor for $40-80 a lead.

But then I here contractors crying the blues when they spend $2-3 bucks for a PPC keyword. I don't get it. Why would anyone even use SM?

My partner Josh in the seamless gutter business has a PPC campaign with only 19 keywords and stays slammed with fantastic leads in his area. Since starting this way of marketing he has spent less then last years ad budget but has added $350,000 in more sales.

So my question is why wouldn't a contractor do the same thing as SM and do your own adwords or banner campaign? Am I missing something?

Your not missing anything. Your partner is the exception to the rule. Many could do that, but they just don't. Just like I don't like making burritos even though I can get them cheaper than the local mexican restaurant. A professional entertainer could book his own gigs, but the doesn't. There is a need that obviously is being filled, whether it is a need that is essential to life itself is another story. I could do without a cell phone ten years ago, can't live without one today.

While service magic may be far from revolutionary, it appears to be just taking root. I would expect that they will rise along with their competitors as a service that will ultimately have the market decide it's prices. The whole idea that there needs to be an auction in order for prices to be fair is against market principles.

I suggest that everyone STOP biddin on SM jobs altogether. That way I can get them all...lol

But seriously,

After alot of research, I have decided that I am going to give SM a try. I will expect the best leads and an honest way of business from SM. I will report my results on this forum.

As for selling ice to an eskimo and not closing one lead from SM, I am calling BS.

Over two years, how many leads are we talking about? 10? 20? 100? If you can't close 1 in 10 leads I would suggest getting a salesman.

Now the caveat is this: What makes SM leads so empty and worthless? If you do really great business and have a high closing rate with leads from sources OTHER THAN SM, you might be on to something. So far, the only person I know personally (not on the forum) has had a 100% closing rate for SM. Sure the guy can close well, but that is the point.

I know that if I were to assume all positive posts here about having "too much" work are honest, I would say that there are plenty on here that are doing fine without SM. What are they doing differently?

ManBearPig · 08-06-2009, 06:54 PM

Per lead buying is insane.

I have no idea why people go that route..........

mudmixer · 08-06-2009, 07:08 PM

Actually,ServiceMagic is a very good lead service,I've been getting leads from them for 8 years and I get about 50% of the jobs they send me.

Pro Builder · 08-07-2009, 01:32 AM

Quote:

Originally Posted by ManBearPig

Per lead buying is insane.

I have no idea why people go that route..........

Are you cereal?

Pro Builder · 08-07-2009, 01:35 AM

Quote:

Originally Posted by mudmixer

Actually,ServiceMagic is a very good lead service,I've been getting leads from them for 8 years and I get about 50% of the jobs they send me.

How long has service magic been around? I am not going to say they work until I actually get a few jobs from it, but I think there is a reason why they are all over the internet and on my tv screen.

I think that the few contractors on here that have had zero results from 2 years worth of leads or 40 leads or whatever are suffering from something unassociated with SM. I might not want to drop $50 on a lead, but there is no way I can afford the BS some guys on here are selling.

Pro Builder · 08-07-2009, 01:42 AM

Quote:

Originally Posted by RidgeWalker

I have to disagree with you Mike,

I recently decided to rejoin SM. The stipulation was that I was allowed to keep my two year old ratings that made me a Certified 5 Star Contractor. However during the process they tried to tell me my state requires a license to practice my trade, I had to school them on what the law actually said. They did not care that I was right and they even admitted I was right, but a section of the law also stated that if during the process of the work performed an amount of 25% or 10k required a license, the non licensed contractor would have to have a state license. So SM would not allow me to get leads for my trade for replacement, only repair.

They have not lowered their requirements at all from my perspective. I'd like to know how you really know they are making less money, they are a private company and as such they don't publish their financial statements.

Do you have inside information? Are you making a reasonable assumption based on the down turn which means less people are requesting service?

Some see it as flawed because they are looking at it as a service to you, and that's not what company's like SM are about. Its about fulfilling the needs of the user. The users/prospects makes us compete. It is nice that SM has helpful tools for contractors and articles to help a contractor sell better because they do see some value encouraging success. But they really don't need the whiners and complainers who don't get it.

If I take A. B. & C. Painting company and say, I have a lead of which you each must pay me exactly $50 for the lead, it is fair treatment.

The competition comes when these three meet with the lead. I spoke for almost two hours to a nice young lady at SM who grew up in construction as her father was a GC. "Yesterday actually" She said something that is very true about the construction industry.

"Its full of very talented people who are masters at their trades, but most of them have no idea how to be a real business or how to sell." And that's why these folks end up unhappy or just bash the lead company. They want to blame every one but themselves instead of doing a self examination to see if they need to better themselves instead. But that is a whole different story anyways.

I think you hit it squarely right there. Imagine if you stroll into burger king and the guy at the cash register says "damn its about time you come here...don't you eat?" lol

I don't think that there is a valid response to the financials counterpoint you brought up. Did you know that 87% of statistics are made up on the spot?

03-13-2009, 05:49 PM	#21
Mike Finley View Profile Mike Finley Chief Toilet Mover Send Message Follow Blogs (0) Threads (14,078) Photos (0) Reviews (0) Projects (0) Toolbox (0) View All Activity Chief Toilet Mover Trade: Bathroom Remodeling Join Date: Apr 2004 Location: Littleton, Colorado Posts: 14,078	Re: What Internet Lead Services Should Do To Corner The Market Only problem with all that is that their incomes (SM) has fallen dramatically, because while you point out their obvious attitude (contractors are a dime a dozen), unfortunately the sheep they have been sheering have woken up to the fact that SM thinks they are a dime a dozen. SM business model is fundamentaly flawed. Making contractors compete is a race to the bottom. They can't keep their product high quality because of this flaw. The flaw feeds upon itself, they lower their standards for contractors, they lower their standards of what a lead is and around and around it goes to where they are today. You think they are doing well, I say they are just around the corner from closing the doors.

03-13-2009, 09:38 PM	#25
RidgeWalker View Profile RidgeWalker Certified Crazy! Send Message Follow Blogs (0) Threads (404) Photos (1) Reviews (0) Projects (0) Toolbox (0) View All Activity Certified Crazy! Trade: Insurance Restoration Roofing Join Date: Nov 2006 Posts: 404	Re: What Internet Lead Services Should Do To Corner The Market The dots are that the contractor in a lot of cases is not understanding the mentality of the user. The user is in the GET IT NOW mentality that's why they are using the internet to find a contractor. I can't make that any clearer! I have to follow up just as fast when I get a lead off my website too! People do not want to wait these days. Any one who is reading this, if you've used a lead service and don't get this most important point you are wasting your money. Period! My team, myself included never had any trouble or problems with SM leads EVER. (only used SM) Sure we had a certain percentage that did not fit with us, and a certain percentage that were tire kickers or never even responded to our calls. But overall 85% percent of the leads where good. We closed almost every single one of that 85% too. I always received credits for leads when ever I asked for them, yet I hear people complaining that they asked for credits and never get them. There's a reason why and I won't go into that here. I'm willing to put my money where my mouth is too. Any one on this forum who is willing to; A. Let me personally coach them. B. Take my exact directions. C. Take the action I deem necessary. If you will do the above and you don't have any level of success with SM I'll personally pay you $500 dollars. If any one takes me up on the offer we'll see if we can get a special thread that is moderated and the contractor I work with and I will post the coaching, and progress in that thread for EVERY ONE to see. And just in case any one tries to bring this up, I know that a year or so ago I posted either on this board or roofing.com that I was going to side with my peers and stop using SM. I never really thought that through because I was most likely listening to peers who where not getting it and just ranting like little children on the forums. __________________ Restore My Home Construction Atlanta Roofing Repair My SN Profile

03-14-2009, 08:30 AM	#26
rbsremodeling View Profile rbsremodeling Professional Instigator Send Message Follow Blogs (0) Threads (6,872) Photos (0) Reviews (0) Projects (0) Toolbox (0) View All Activity Professional Instigator Trade: Design Build Remodeling Contractor DC MD Join Date: Nov 2007 Location: Washington, DC/ Maryland Posts: 6,872	Re: What Internet Lead Services Should Do To Corner The Market I used SM for 2 years. I can sell ice to an eskimo who lives in a freezer full of ice cubes. I never closed a deal using SM in the entire 2 years. SM and their leads suck. Any way you package **e it's still **e, even with a pretty bow on it __________________

03-14-2009, 01:00 PM	#31
Mike Finley View Profile Mike Finley Chief Toilet Mover Send Message Follow Blogs (0) Threads (14,078) Photos (0) Reviews (0) Projects (0) Toolbox (0) View All Activity Chief Toilet Mover Trade: Bathroom Remodeling Join Date: Apr 2004 Location: Littleton, Colorado Posts: 14,078	Re: What Internet Lead Services Should Do To Corner The Market WHAT? I see. So you're under the belief that SM sells a lead to 3 contractors, and the early bird gets the worm. The 1st guy to contact the lead closes at your "almost every single one" rate as long as he isn't a typical contractor in that he has no idea how to do business or sell? I'd have to say your experiences are akin to a lottery winner.

03-14-2009, 03:22 PM	#32
RidgeWalker View Profile RidgeWalker Certified Crazy! Send Message Follow Blogs (0) Threads (404) Photos (1) Reviews (0) Projects (0) Toolbox (0) View All Activity Certified Crazy! Trade: Insurance Restoration Roofing Join Date: Nov 2006 Posts: 404	Re: What Internet Lead Services Should Do To Corner The Market Yes I tested the system why not? It's very very easy to fool the system. Created 10 free emails using inbox.com and hotmail.com. 10 fake names and addresses. Visited the SM site via a proxy server and submitted request's for my task's in the zip code I set my account up through. I did this because it says right in the agreement that SM limits the number of contractors that are sent to users. I was told by the VP of Marketing himself that no more then 3 to 4 contractors are given to a user per task. If any one doesn't think SM does not know that contractors test the system they are completely fooling themselves. I still believed what people on here where saying, even though I had personally tested the system myself. But in hindsight it does not make any sense to me that a company would claim one thing and then do something completely opposite. Especially with something so easy to get caught doing. Another aspect is to consider the user. No user want's their inbox filled with 30 contractors all trying to get their kitchen remodeling job, that equates to a REALLY CRAPY user experience, which again equates to the user not returning to use SM again. Oh your looking for a roofer, here we are going to send you an email with 30 contractors to choose from. Additionally SM sends an email on behalf of each contractor so the users inbox instantly gets instantly SPAMMPED with 30 emails. The user becomes immediately paralyzed with information overload when faced with the prospect of reviewing 30 profiles, reading 30 emails and taking 30 phone calls. So they end up doing nothing. Yeah that's a business model, I think SM knows that operating that way is not effective and gives an impression they don't want to communicate to users. __________________ Restore My Home Construction Atlanta Roofing Repair My SN Profile Last edited by RidgeWalker; 03-14-2009 at 04:22 PM.

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08-04-2009, 07:05 AM	#34
Carport King View Profile Carport King Pro Send Message Follow Blogs (0) Threads (470) Photos (0) Reviews (0) Projects (0) Toolbox (0) View All Activity Pro Trade: Aluminum Contractor Join Date: Jan 2008 Posts: 470	Re: What Internet Lead Services Should Do To Corner The Market I am on the computer a lot and all I see is SM using adwords and banners to gain leads. Leads that they then sell to you the contractor for $40-80 a lead. But then I here contractors crying the blues when they spend $2-3 bucks for a PPC keyword. I don't get it. Why would anyone even use SM? My partner Josh in the seamless gutter business has a PPC campaign with only 19 keywords and stays slammed with fantastic leads in his area. Since starting this way of marketing he has spent less then last years ad budget but has added $350,000 in more sales. So my question is why wouldn't a contractor do the same thing as SM and do your own adwords or banner campaign? Am I missing something?

08-06-2009, 06:54 PM	#36
ManBearPig View Profile ManBearPig Registered User Send Message Follow Blogs (0) Threads (16) Photos (0) Reviews (0) Projects (0) Toolbox (0) View All Activity Registered User Trade: General Contractor Commercial Join Date: Aug 2009 Posts: 16	Re: What Internet Lead Services Should Do To Corner The Market Per lead buying is insane. I have no idea why people go that route..........

08-06-2009, 07:08 PM	#37
mudmixer View Profile mudmixer Registered User Send Message Follow Blogs (0) Threads (4) Photos (0) Reviews (0) Projects (0) Toolbox (0) View All Activity Registered User Trade: mason Join Date: Feb 2008 Location: Wisconsin Posts: 4	Re: What Internet Lead Services Should Do To Corner The Market Actually,ServiceMagic is a very good lead service,I've been getting leads from them for 8 years and I get about 50% of the jobs they send me.

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