Generating business online

Generating business online

Benjamin Dyer, CEO and co-founder of Powered Now, considers whether generating new work online really works.

The majority of people reading this article have probably heard of at least one of Checkatrade or Rated People, not least because they regularly advertise on TV. These, and similar ‘marketplaces’ like My Builder and new boy on the block, aim to connect plumbers and gas engineers looking for work with homeowners who need jobs doing.

The idea is that these new services are a substitute for word-of-mouth and have the benefit of web-based reviews by customers. Heating and plumbing engineers can decide (with most systems) when they want to get new leads, and when not to. That can be very helpful as more business can be generated in slack periods. However, these systems are not without their critics and research by my company has identified some issues as well as finding support for some of their claims.

What is the reality?
In the early summer, we used independent survey company Toluna to ask over 1,000 homeowners if they had used Rated People, My Builder or Checkatrade to source a tradesman in the previous year. It turned out that 12% had done so. This was a greater number than Yellow Pages, local newspapers and Thomson Local put together.

However, 70% had still made a choice based on a friend’s recommendation, or had chosen a company that they had used before. Word-of-mouth is still alive and well.

How homeowners choose
Understandably, when it came to making a choice of tradesman, around half of homeowners believed that reputation should be critical in choosing their supplier. The next two things impacting choice are the convenience of the start date and a good price, both rated by around a quarter as very important.

Research from Bradstone Assured showed that 60% of homeowners are nervous meeting new tradesmen for the first time, and around half worry that they might be short-changed. For 70% of respondents, web reviews are important, with 90% having looked at review sites before deciding who to go with. Around 60% say they have provided such feedback.

So the key thing is for these new marketplaces to convince browsers that their reviews are genuine. If they can, they will have a lot of influence with prospects.

Who pays?
All of the marketplaces aim to generate new leads from homeowners. The major ones don’t charge users, getting their revenue from tradesmen who utilise the service:

  • Checkatrade claims to vet all of its tradesmen and this is part of the service provided for its annual fee.
  • My Builder and Rated People sell leads to tradesmen, with variations on how this works. They also try to levy a monthly fee (which they may offer to waive if you drop out).

Does it work?
We searched the web for feedback on these services, as well as chatting to our own customers. There’s a mix of views, but the services definitely work for some.

GHS-London gave an opinion on UK Business Forums’ trade area and takes a positive view: “Personally, as a new business owner, Checkatrade has worked well for me.”

In contrast, Audrey Wright posted a refreshingly honest opinion in the same forum: “I haven’t found a trades directory that offers fully legit ratings on trades and services .… they are all manipulated. (speaking from the manipulator’s point of view here).”

Highly experienced gas engineer John McLouglin doesn’t see much point in these services either: “You grow old with your customers,” implying that he doesn’t need to find new business.

On the Builders Talk Group on Facebook one person was very enthusiastic: “Yeah defo My Builder. Getin (sic) loads of work off it.”

Getting your money’s worth
If your business is already doing fine from recommendations and you are happy as things are, there’s not much value to you from these new services. If you really want to grow your business, or don’t have much word-of-mouth trade as you are just starting out, they may be worth a look.

Different strokes work for different folks, and I hope that some of the thoughts here are helpful. Nothing ventured, nothing gained.

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