By the time I finished researching this month’s feature on the rise of Web-based cost-estimating services, I realized that the real story extended far beyond what it costs to replace a kitchen. These sites ultimately want to overturn—even control—how you deal with customers. And it starts with how you find clients.
Most remodelers historically have generated the bulk of their business from personal referrals. Odds are good that you rely entirely on word-of-mouth marketing or know someone who does. Practices such as leaving door-hangers and putting ads in the Yellow Pages supplement your sales work, but those leads don’t cover the bills.
Angie’s List and its cousins started changing the game a few years back by creating virtual communities for consumers to share recommendations. These back-fence conversations were virtual, but for remodelers the benefits were just as real as if the prospect had been referred to you by a neighbor. I don’t think that leads from such sites will exceed what you get via word of mouth, but you can expect a future in which they’ll account for a much larger share.
So, more referrals are good, right? Not always.
The Internet sites would be great if all they did was give your phone number and a five-star rating. But when you talk to people leading firms such as Porch, Redbeacon, and Planease, it’s clear that they don’t want to be mere tipsters. Rather, they aim to create closed environments in which you and the customers seek out each other, create deals, do projects, and then rely on Web-based systems to keep records of what was done and what will need maintenance and upkeep. They don’t want to be the butler who brings food to your table; they want to own the table.
When done well, such initiatives remind me of working with Apple Computer products. Steve Jobs created a cozy environment in which all Apple products are integrated, making life seem idyllic. The trouble is that, as many Apple users have learned, reality requires you to operate both inside and outside that cocoon. Given that none of these Internet services are very big today, remodelers likely will have to get used to signing onto a slew of services. Angie’s List, Houzz, and Pinterest will be just the start.
As with so much else in life, the Internet is shaking up how you work and profit. Expect the Web’s spinners to bring you new business. And expect them as well to try to ensnare you in their creations.