Why Most Home Improvement Lead Companies Suck

lead companiesAt least 90%+ of the home improvement service business owners who contact us have been fueling their business with only two forms of promotion—referrals (word of mouth), and purchased leads. Now, it’s widely accepted that word of mouth is the best form of marketing there is. Every business should be taking advantage of it. The drawback is that word of mouth and referrals have limited scaleability, which is why other activities need to be done, like buying leads…

However, as you undoubtedly know, most lead companies (and their leads) are extremely weak, as I’ve eluded to in our FAQ page—and that’s putting it nicely. Now, to be clear, I don’t own a home improvement service business and never have, so you may be wondering how I know this. Aside from hearing it from our lead gen prospects every day, the primary reason I know this is because I’ve seen the marketing these companies do to acquire their leads. And there’s no way these campaigns can result in good leads!

For those of you who are experienced business owners and lead buyers, I’m be preaching to the choir here, but many new(ish) business owners don’t realize how their leads are produced, much less why they’re so low quality right from the word go.

So let’s get into it..

Here’s the experience business owners will have working with most lead companies:

  1. Most companies advertise to home owners the ability to receive multiple project quotes, which naturally attract prospects with no money who are shopping on price alone.
  2. The company then sells the data as a “shared” lead to 4 – 5 business owners in the same geographic area, leaving these owners to compete against 4 – 5 local competitors.
  3. Because 4 – 5 businesses are calling on the leads, prospects are inundated with too many calls, further reducing what little qualifications they had in the first place.
  4. Many times the business owner will call on the lead, only to hear the prospect say they never requested a quote, when in reality, they’ve already hired another business and are simply trying to get off the phone.
  5. In many cases the prospect was simply window shopping and had little intention of hiring anyone in the first place.
  6. You as the service company can’t convert any of these leads to billable jobs, so your ROI is weak, if even positive.
  7. Now you’re left wasting valuable time disputing unqualified leads… time you could be using servicing customers or prospecting for more jobs.
  8. If that wasn’t enough, you can’t get timely refunds because the lead company must complete a 5 day “verification” process by attempting contact with the leads, and if no contact is made, no refund is issued!

I can go on and on, but like most of my lead gen prospects, you probably have first hand experience with this racket.

I’ve said it to so many business owners who contact me everyday, I just don’t think this high turnover “churn and burn” fulfillment model is sustainable. It’s my belief that companies who use this model won’t be around much longer and smart business owners will eventually turn to pay per call lead providers who take a much more custom, quality driven approach to lead development. This is a much more sustainable model built on value, service, and most importantly, results.

It’s such a basic tenant of business to focus on delivering value and quality service to customers and clients before profits. That’s the philosophy we’re building our business on, and in the long run, I believe we’ll separate ourselves from the overwhelmingly negative reputation lead companies have in the home-improvement service markets, and be highly rewarded as a result.

I hope you agree and use this same approach with your customers and clients…

Please feel free to comment below, and let me know if your experience with other lead companies resembles what I’ve described above. And if you have something to add, or even dispute about my commentary, I’d love to hear it!

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