Home Advisor, Houzz, Yelp, and My Three Bids. Leads that work, don’t work, and Why. (Quick Read)

If you're a contractor that has ever looked into buying leads before, you surely have come across these names before, and you've probably heard rumors for the good and bad. We wanted to settle it once and for all. Here's the scoop on what works, what doesn't, and why.

Homeadvisor

Formerly known as Service Magic, Homeadvisor is the largest player in the world of online home improvement marketplaces. It is owned by IAC, the same company that owns Angie's List. While the service is free for homeowners, contractors must pay on a per-lead basis and is very unpopular amongst contractors. www.HomeAdvisor.com

Pros for contractors:

• Building a Homeadvisor profile can help unestablished businesses get found on Google searches even if they don't have their own website.
• They have a big brand that many people have heard of.
• Leads are sold to many contractors so the competition is heavy. There is a lot of testimonials that show this number could be as high as 10 contractors, including reports from former staff of Home Advisor.
• Since the service is free for homeowners, a lot of leads are people who aren't serious (tire-kickers). HA doesn't seem to filter those out, so results are often diluted.
• Homeadvisor is notorious for having terrible customer service.
• Homeadvisor shares leads with Angie's List, so if you subscribe to both services, you may buy the same lead twice.

Cons for contractors:

In the end, it is hard to recommend HomeAdvisor based on the amount of negative reviews from contractors on this company alone (Here is a list of over 7,000 reviews that average out at 1.64/5 stars for example.) They may very well work for you, but we cannot recommend them.

Houzz

Houzz is a Facebook-like environment where contractors can create profiles for their businesses and showcase their work and testimonials. www.Houzz.com

Pros for contractors:

• A free profile can be created and built up with pictures and reviews to help advertise your business on Houzz.
• Contractors can pay to advertise and boost their profiles to the top of the list.
• Advertising contracts can require large cancellation fees to end the service and payments.
• There have been numerous reports of terrible customer service.
• Paying for advertising doesn't guarantee jobs. Contractors must still put a lot of time and effort into building and keep their profiles consistently updated.
• There have been reports of getting negative reviews from non-existent customers.
• Houzz owns everything on the contractor's profile, including the pictures posted there.

Cons for contractors:

So can we recommend them? Well, not really. It may be too early to tell, or Houzz may be a good mixed environment of shopping and contracting that is good for simpler trades. We couldn't find enough data to recommend the broad range of contractors to this service however.

Yelp

Yelp is one of the most popular local service shopping platforms on the internet. It's got a reputation for attracting negative reviews. I think this comes from the fact that a customer can create a profile for a business without the business owner's permission. This is typically done when they want to leave a bad review. www.Yelp.com

Pros for contractors:

• It's free to create a profile, post pictures, and gather reviews.
• You can pay to advertise in the directory and on competitor profiles.
• There is a large amount of traffic looking for services on Yelp.
• If you don't pay, competitors will advertise on your profile.
• Your reviews might be filtered resulting in a lot of client reviews that never get seen or counted in your star rating.
• Yelp salespeople are relentless in pursuing your purchase of advertising.
• The self-service advertisement platform allows minimal control over how your money is spent and provides little metrics reporting.
• General contractors focusing on larger projects report a lot of cheapskates and tire-kickers coming in from Yelp.

Cons for contractors:

Given that you have to pay to advertise, pay to not allow competitors advertise on your listing, and pay for each time someone contacts you, it is hard to recommend Yelp to the wide range of contractors out there looking for business. Surprisingly, Yelp does seem to be a good fit for SERVICE related pros whose business model includes changing out outlets, installing ceiling fans, painting one wall at a time, or unclogging drains.

My Three Bids

My Three Bids seems bent on evolving and disrupting the industry as a whole. They take a “match-making” approach that sometimes feels like eHarmony rather than another data-transfer lead service. Their stake in the game that seems to suite contractors and homeowners alike is that they spend some time with the homeowner, get to know the project scope of work, and match the homeowner to local contractors using a number of data points and real-market data. In other words, as a contractor - you're not just matched by the job type and zip code, but also the kinds of jobs you are looking for, the kinds of homeowners you're looking for, the brands you carry, warranties, and more. They market your company on their live phone calls, and can set appointments as well. www.MyThreeBids.com

Pros for contractors:

• It's free to create a profile, post pictures, and write blog articles.
• You can pay to advertise in the directory and on competitor profiles.
• There is a large amount of traffic looking for services on M3B, that is all Home Improvement Traffic.
• Warmer leads, referrals that have heard of your company, and appointments set take out a lot of the marketing waste (time and money)
• They set appointments for most trades, which was surprisingly hard to find with most of the other players that we looked at. This can act as a huge advantage, especially with those that cannot afford or aren't focused on a highly qualified phone team on their own.
• They have a few membership options, and don't require long term contracts, which is refreshing as well
• Some leads go to up to 3 contractors if the homeowner is looking to get 3 bids (hence the name My Three Bids), though exclusivity is also an option for many contractors.
• Support requests can take a full day to respond
• The brand isn't as well known in some parts of the US as some of the other companies listed here, although you pay for results so it may not matter for many contractors.

Cons for contractors:

In the end, My Three Bids has our vote. I know of a number of contractors that have done very well with M3B, largely because of the match-making techniques and algorithm that they use. Likely, running your own marketing (if you know what you're doing) and using a service like My Three Bids is most contractors best bet, which allows each Pro to be more autonomous and in control of their own marketing and lead acquisition.

Contractors can find pricing here: www.MyThreeBids.com/join