Why I Never Recommend Lead Sites

Why I never recommend lead sites to my clients

Lead Services for Local Contractors

If you’re a local contractor looking for leads, you may be interested in joining a lead site like Angi, HomeAdvisor, or Houzz. In this article we’re going to dive into why I NEVER recommend lead sites to any of my clients. We’ll cover pros and cons of each of these three sites, and then I’ll talk about my personal experience with each site back when I was a local contractor. Yes, I spent thousands on each of these three sites. No, I didn’t make any money on them. Maybe, I was doing it wrong, but that’s for you to decide.

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Pros

Home Improvement lead services have become more and more popular. For example, Home Advisor is a popular website that connects homeowners with contractors for home improvement projects. These are great platforms for local contractors to advertise because it allows you to create a profile that highlights your services, certifications, and reviews. Homeowners can browse through contractors in their area and request a quote from the ones they’re interested in. By listing your business on sites like these, you’ll have access to a pool of potential customers who are actively looking for contractors in your area. 

If you estimate on a cost-plus basis, or if you services are less expensive than others in your area, this could be a great option. However, if you are a high-end contractor, this may not be the best lead source for your business.

Cons

It is important that you consider which lead site will work best for your business. They are not the same, and they are certainly not a one-size-fits-all solution. Angi, HomeAdvisor, and Houzz all have VERY different features and leads, so do your research before choosing one.

The type of leads they produce can be vastly different between regions. For example, some of our clients in more rural areas are looking for the cheapest handyman to get the job done. They were not looking for a licensed and insured contractor because that would have been too expensive for them.

While the leads can be high-intent (they’re ready to buy), it depends on the average customer in your area. This can be difficult to determine before purchasing a subscription to one of these lead sources, so it can ultimately be a toss-up.

The last drawback is the price and terms. These services can be fairly expensive for a contractor that is just starting advertising. While it may be a stretch, expect to spend several hundred dollars per month for a minimum of one year with any one of these platforms. 

My Personal Experience with Houzz

Houzz is different from the other two services because it allows you to differentiate between cheap and high-end services. However, I had a bad experience with Houzz.

When I first signed up, it seemed great. I could target specific types of projects in specific areas to make sure I was getting the best type of leads. It also came with a ton of tools like estimating and 3-D rendering to help my clients imagine what the final product was like. 

However, the back-end settings can be fairly complicated, and certain settings require a Houzz support member to change them for you. This is where it went south. The support member that set up my account listed my services in the correct region, but listed the wrong services entirely. I was a kitchen and bath specialist, and I was getting leads for decks and siding. 

So, I changed the settings on my account, but I continued to get the wrong leads. After spending hours on the phone with Houzz support, I found out that they had to change those settings for me. Frustrating, yes, but at least it was fixed now. Right? Wrong. I continued to get the wrong type of leads, and not a single kitchen and bath lead came through.

Eventually, I did get them to set it up correctly, but when we narrowed down the type of service to kitchen and bath, they said that they didn’t have enough lead flow in those types of leads. So for the rest of the year (you have to buy 1 year minimum), I got a total of zero leads in kitchen and bath.

I spent countless hours on the phone with support, but ultimately, it was a total waste of money. I spent several thousand dollars to get zero leads that I could use. 

Disclaimer: Just because I had a bad experience doesn’t mean that will be the case for every contractor. In fact, if Houzz is successful and still in business, I’m sure they are providing great leads to someone. It just didn’t work for me. 

BEFORE YOU BUY: Make sure to get information about the quantity of leads in your area for your service. They have statistics on the number of leads they get for each service in each territory. While they cannot guarantee a certain amount of leads, if they cannot at least give you an estimate, don’t buy it.

My Personal Experience with Angi

Angi is a high-volume lead source. Even in my small town, they delivered a significant volume of potential customers.

However, the region I am in is a fairly low-income area because we’re out in the country. So all of the leads that came in were homeowners who were trying to get a job done for as cheap as possible. Generally, these leads were very high-intent (meaning they are ready to buy), but only for the cheapest estimates. If you estimate on a cost-plus basis, or if you services are lower than others in your area, this may be a great option. However, if you are a high-end contractor, this will not be the best lead source for your business.

The other drawback is that these customers typically diagnose their own projects before the request estimates. For example, I had countless leads that wanted a quick fix, when they really needed a more permanent fix. I had leads that wanted me to caulk and paint over rotten wood, ignore failing structural members, and patch holes that really needed replacing. I spent a ton of time explaining to these customers that these quick fixes wouldn’t address the real issue, and that I couldn’t risk my license by putting a band-aid on a bullet hole. In the end, they never ended up buying. 

There were a few projects that were much smaller that ended up buying, but I wouldn’t say it was worth the cost. I spent $300 per month, and I never really made that money back with their leads. 

Disclaimer: This is my personal experience with the platform. It may work for you if you are one of the less expensive contractors (or handymen) in the area. The other big lesson I learned is that when using this lead source, make sure to spend 10 minutes qualifying at the beginning of the estimate. For example, if they want to put a band-aid on a bullet hole, tell them the real problem, and make sure they are willing to spend the money to fix it before spending any more time with them.

 

My Personal Experience with HomeAdvisor

I worked with HomeAdvisor back when it was a flat monthly fee to join plus a fee per lead. I thought that meant that they would be high quality leads or that it would be easier to get my money’s worth since I was directly paying for the leads. I was wrong.

I wanted to focus on bath remodeling, so I limited my leads to any project in the bathroom. I got several leads for tub reglazing, which is not something I knew how to do, but I decided to go out and talk to them anyways to see if they would be interested in replacing the tub. None of the leads were open to replacing the tub. 

After doing this for a couple months, I realized that every single lead I was getting was for tub reglazing, so I decided to take it out of my available services. Since I couldn’t find the option in my settings, I called pro support and spent about an hour on the phone to get them to update my settings. They said they had fixed it, so I went back to work.

The next month, I received several more tub reglazing leads. So, I called support again, and after several hours on the phone, they informed me that there was no way to remove a specific service from my options, and that I still had to pay for the leads they sent me. 

There were several leads as well that I received two to three times. It was the same customer at the same address requesting the same service, and I had to pay for each time the same lead came through.

Disclaimer: This is my personal experience, and I’m sure some contractors out there make money on their leads. If I had done tub reglazing or if I had added different services (like kitchens, flooring, etc.), maybe I could have made my money. However, since I only received leads for services I could not complete, I decided to shut off all leads. I still had to pay for the leads they sent me, and I still had to pay the base monthly fee for the rest of the year even though I was not receiving any leads. I spent several thousand dollars on this platform, and, once again, didn’t make money on it.

 

Conclusion

As a local contractor, there are many different advertising options available to you. By choosing the right advertising methods for your business, you can increase your visibility and attract new clients. Whether you decide to list your services on Home Advisor or create targeted Facebook Ads, it’s important to track your results and adjust your strategy as needed. With a little bit of research and experimentation, you can find the advertising methods that work best for your business and reach your target audience. 

Read this article from NextDoor for a few Marketing Tips for Contractors.

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