We now live in a world in which curiosity is limited only by how fast you can type. That leaves homeowners with little patience for restricted access to the information they want.
Faced with this trend, Angie’s List – a Web site known by homeowners and home improvement companies alike – changed its sales model. Ratings and reviews of verified contractors are now free for homeowners to browse.
Prior, Angie’s List relied on a subscription-based, paywall model to generate leads and reviews for home improvement companies. Homeowners paid an annual fee to access the Web site, where they would see verified reviews of contractors and remodelers.
This model was generated revenue for Angie’s List, and provided home improvement companies with an engaged and highly-qualified audience of homeowners to which they advertised. Although this model was controversial (Moore v. Angle’s List, Inc.), and it drove a small number of qualified leads to home improvement companies, lead volume was constantly an issue.
Over the past year, Angie’s List memberships leveled off and homeowner interest in the service diminished. Angie’s List found it harder to convince homeowners to pay a membership fee when are so many other Web sites offer contractor reviews free of charge.
And that competition is fierce. Yelp, Google and Facebook are making a serious splash in local services. As their bases of users grow, review quality soars. 23 million users alone use the Yelp app every month to find reputable companies in their area, compared to 10-12 million unique monthly visitors at Angie’s List. Google hosts even more visitors.
With homeowner access now free, Angie’s List can attract a broader swath of homeowners. The company will monetize its surge of visitors by selling leads and “freemium” marketing programs to home improvement companies. Contractors can pay premium memberships fees to lock in their pricing and receive “first class” customer service.
Many of our clients tell us that Angie’s List has been a good source of leads for them. Certain advertising packages have performed better than others, but as lead programs go, Angie’s List provided a strong audience.
Angie’s List can now expect to host a lot more homeowners to their Web site. But we’ll be watching to see if that translates into more leads for the contractors that are paying them. My sense is that it will.
As your home improvement company gains experience with the new approach at Angie’s List, please let us know. You can expect an eventual update from me, and I’d love to include your perspective.
