Here’s the catch: HomeAdvisor, Powered by Angi (also called Angi Leads), is a contractor-matching service that links homeowners looking to make home improvements with qualified service providers. Many home improvement professionals joined HomeAdvisor’s network to receive quality leads. For annual membership fees of $287.99 (plus the cost of leads), service providers were guaranteed leads that match their service demographics, geographical area, and that were ready to start work immediately. But for several of the service providers, the leads were a waste of time and money.
In March 2022, the Federal Trade Commission (FTC) filed a complaint against HomeAdvisor, alleging it used false, misleading, and unsubstantiated representations about the quality, characteristics, and source of HomeAdvisor's leads and the rates at which those leads converted into jobs. Although HomeAdvisor used ad claims such as, “Only Get the Leads You Want. You pick your service types and location preferences and we bring you prospects that match what you want" and “Tell us what you do and where, and we deliver prospects that meet your exact needs", oftentimes the leads received were not the type of work the provider performed or were outside of the service provider’s area. It resulted in busy service providers spending time following up on leads that were not the quality promised by HomeAdvisor. When many sought credits or refunds for the unacceptable leads, they were often unsuccessful.
Several service providers and small businesses filed similar complaints with Business Consumer Alliance (BCA). Check out some of the complaints below:
“I have left HomeAdvisor before because they were not providing leads based on my scope of work. They contacted me about a year ago and promised better leads and service, so I agreed and I started out with a $400 credit. Since then, they have sent me leads that are vague and inappropriate to my scope of services I provide. When I call their office to complain…but my complaints seem to go nowhere. I've had this same conversation once a year, until I quit and then they always call me to sell me on their service again. I shouldn't be paying for a service that was not adhered to. HomeAdvisor sent me to collections, but they haven't provided the appropriate service, as promised."
“This company encouraged me to try becoming a member for 100.00 and they would give me commercial cleaning leads... They kept sending me home cleaning jobs. Then find out they charge for each lead, whether I contact them or not. I never received a billing statement …I called to cancel membership and tried explain that I no longer want membership based on what I just explained above.”
HomeAdvisor currently has 85 unanswered complaints, some negative reviews, and an F rating with BCA. The FTC is holding a hearing in November 2022 regarding the complaint allegations. For more details on the administrative complaint, click here for HomeAdvisor/Angi’s Leads report.
Kim’s advice: New contractors, freelance laborers, handypersons, and service providers experiencing a lull in business can benefit from purchasing leads. It helps build a client base and fill gaps when business is slow. While beneficial, it can also be expensive. Services like HomeAdvisor charge a fee for each lead. Realistically, not all leads will land a job. If you’re paying $50 for each lead, it can quickly add up. Take into consideration the pros and cons of lead generation services.
As mentioned above, leads can help establish a loyal client base or strengthen one. But it’s important to keep in mind that with services like HomeAdvisor, leads aren’t exclusive to you. You have to be ready to contact that lead right away since you are in competition with other contractors and service providers. That means someone needs to monitor your phone, email, etc. to get the lead. If you are on a job, you have to make arrangements for someone to cover this task and do so effectively. This is your time to sell your services to the client and oftentimes the early bird gets the worm. Also, remember that some new businesses will underbid to get the job. You don’t want to pay for a lead that someone else gets.
Before choosing a lead generation company, do your research. Check out the business's reputation, complaints, reviews, and background. Review their success rate and ask for references of providers that have used the lead generation services. Some questions you may want to ask the lead generation company are:
- How and where do you find your leads?
- Do I have the option to customize my leads?
- How are the leads qualified?
- How many leads will I receive and how often?
- How much will I pay for the services and what are the fees per lead?
- What is your success with delivering qualified leads?
- What is your screening process and are the leads verified for accuracy before they’re distributed?
- How often do you update leads?
- Are the leads exclusive?
- What industry does your company specialize in?
Go over the terms of service carefully to see how much you will pay per lead, what guarantees are made about the lead, if you have to pay for leads that are unacceptable or cannot be reached, cancellation and refund policies. Make sure to consider the value of purchasing leads to see if your return on the investment is worth it.
Here are some tips for success:
- Be prepared to take and make calls. Gather some general questions you can ask about the project to give you a better understanding of what the client needs. In-person quotes may be more successful to get the job, so while you’re on the phone, schedule a face-to-face meeting with the client. That extra initiative to show them you care enough about their business to come out to their home for free might be the thing that gets you the job. It also gives you a firsthand view of the project.
- Sell yourself, and don’t undersell yourself. The goal is to land the job, but also make a profit. If you have expertise in a certain field or skill, make that known. You may offer services that the homeowner may need now or in the near future. They may not know what you can do unless you tell them.
- Do good work. Some of the best business is repeat business and good referrals. You want to leave a great impression on your client so make sure you do quality work to fulfill the job. A negative experience can ruin business.
- Don’t rely solely on leads to grow your business. Successful businesses use a combination of marketing, SEO, and other advertising to get their name and brand out to others. Make sure your website and social media platforms are up-to-date and designed to attract business.
If you’re a contractor or small business in California, Business Consumer Alliance's Membership program offers a variety of benefits to help your business thrive. Our contractor link program matches trustworthy member businesses with homeowners looking to make home improvements and repairs. There’s no pay per lead. The program comes with membership. Businesses can also take advantage of BCA’s sponsored listing partnerships and many other benefits of being a BCA member. Visit https://www.checkbca.org/apply for more information or call 888-230-3706.
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