Topic: Craig shares the biggest shift in trends affecting small businesses and what HomeAdvisor is doing to help businesses overcome those hurdles.
Guest: Craig Smith, the president and COO of ANGI Homeservices, and he serves on the board of the Children’s Hospital Colorado Corporate Leadership Council the board of advisors for the National Cyber Security Center the board of directors of the Beanstalk Foundation the board of A+ Denver!
3 Points for Success – Craig Smith:
- Have a professional online presence. Everyone does online research before hiring someone to work on their house. If you’re not online, they won’t hire you.
- Have the ability to respond to inquiries online quickly. If that means having an administrative assistant, then that might be the answer. Homeowners today expect to hear back from you almost immediately.
- See one and two! That’s how important they are.
James [00:00:00] So good to have you with us for another episode of CareyBrosPros. I’m James.
Morris [00:00:04] And I’m Morris. As professionals we’re always looking to give our pro listeners great information to help me work smarter and harder on this edition of CareyBrosPros, we’re going to find out how HomeAdvisor works. Yeah!
James [00:00:19] And our guest is Craig Smith. He is the president and COO. Oh that’s chief operating officer of ANGI Homeservices . It is HomeAdvisor and in his role he oversees operations including those of HomeAdvisor U.S. Sales Force and prior to assuming his role in September of 2017 Mr. Smith served in the same role for HomeAdvisor from July 2000. And we understand that prior to joining HomeAdvisor Craig Smith worked as an investment analyst for the L. Palmer Foundation. I don’t know whether I said that right but he can correct me from June of 1997 to July 2000 and he serves on the board of the Children’s Hospital Colorado Corporate Leadership Council the board of advisors for the National Cyber Security Center the board of directors of the Beanstalk Foundation the board of A+ Denver. And now CareyBrosPros I know that’s a mouthful.
Morris [00:01:29] Welcome to CareyBrosPros Craig.
Craig [00:01:31] Thank you for having me. I’m excited to be here.
James [00:01:34] And all of that and you’re only 27.
Craig [00:01:38] I started 19 years ago. It’s been a long time a long journey with HomeAdvisor but it’s been great.
Morris [00:01:44] Okay I’m dying to know what is HomeAdvisor do for homeowners and professionals.
Craig [00:01:48] Yeah it’s it’s a marketplace for homeowners to find screening approved service professionals find somebody who’s available to do the work that we’ve done a background check on, and we provide ratings and reviews to the homeowner so they can make that hiring decision with confidence. It also helps pros grow their business very cost effectively by targeting homeowner matches in the areas and in the categories that they like to do business. So it’s a very efficient, effective marketing tool for our service professionals.
Morris [00:02:21] We know that word of mouth is kind of, actually you want to know the truth, word of mouth has never been good for anyone who wants their business to grow. And but now it’s pretty much definitely dead with the Internet and all the social networking that’s going on coast to coast border to border. Tell us a little bit about how Angie’s List and all of these online services have changed the way we do things.
Craig [00:02:54] Yeah you’re seeing more and more homeowners turn to digital mediums to find a reliable pro and the thing they really like about that experience is there is trust that through the screening and ratings that we do and then that convenience is a significant factor influencing their behaviors. You think about what Uber an open table and others have done and that has kind of shifted homeowners mentality in a way that they want to find somebody who’s available at a time that’s convenient for them that can do the work as is licensed and has a good background and track record doing that work effectively and making scheduling book on demand and more and more of the industry is moving in that direction. Every year we see significant growth. In fact, nearly 25 million homeowners used our service over the last year to find somebody who’s available and reliable to to complete their projects.
Morris [00:03:55] So explain to us how you get yours? How do you get paid? Who pays you?
Craig [00:04:00] Yeah. Are our service professional network phases. They pay a small annual fee to be listed in our directory which is a very important element of the business because nine out of 10 homeowners actually research online before hiring a pro. So even if they get a referral from somebody word of mouth or hear about a business through a billboard or whatever it might be they still will do online research before making that hiring decision and the biggest marketplace by far is HomeAdvisor. So having a presence within our directory either on HomeAdvisor or Angie’s List is key to influencing those hiring decisions be them off line or online because they’re going gonna go look to see if the pro has ratings and reviews the quality of those reviews. And if they’re good you know the homeowner is far more likely to make that hiring decision against that business. And so it’s it’s critical to have that exposure online, and then, in addition to the directory, service professionals pay us a fee for the connections that we make between homeowner and service professionals, so if somebody uses our instant booking service for example you schedule and book a pro at a time that is convenient for the homeowner. Once that connection is made between the two we charge a fee to that service professional. Doesn’t mean it’s a it’s a completed project or a wind fee it’s an introductory fee but it’s it’s a considered introduction through that experience that I described. So those are those are the two ways that we get paid. It’s free to the homeowner.
Morris [00:05:37] So how is there anything that you guys do to investigate the people who are on your Web site who have listings on your Web site.
Craig [00:05:48] Yeah we do a thorough background check. At the point of sale so as as you join as a member of HomeAdvisor Angie’s List we have the most comprehensive background check in the industry. It’s very complicated. You know each day each municipality has its own nuance and so we really refined that over time and have a great screening process up front and then what I think is more important ultimately is the rating and review feedback we get from our homeowner community, and that enables us, for example, if somebody receives a couple bad ratings we can investigate and research that pro to see what’s going on. Oftentimes it’s just a misalignment of homeowner expectations. And that’s OK. But at other times you know we’ll identify a bad actor in the network and will act accordingly when that occurs. So it’s a really powerful feedback loop to understand who’s doing a great job and who might not be. And we can maintain the integrity the network by having that continual feedback loop.
James [00:06:54] Craig what’s the difference between HomeAdvisor Angie’s List and handy.
Craig [00:06:59] Yeah they’re all really efficient effective ways to find a reliable service professional. The experience is slightly different across each HomeAdvisor focuses more on that connection that I was describing previously. You describe your project and we’ll find somebody available to do the work with handy you’re actually it’s a fixed price and you can schedule and book and purchase that service all online with with HomeAdvisor you’re actually transacting directly with the pro with handy you’re purchasing the service upfront and online and then with Angie’s List it’s more of a directory experience it’s more of a listening experience where you’re able to as a homeowner review the list choose who you want to work with and call or contact them through the various contact methods that are are provided within the directory.
James [00:07:55] Craig your category has grown exponentially in the last decade and I think probably significantly in the last five years. I remember when no one knew what V R B O was 15 years ago which was a vacation rental by owner and now it’s affectionately referred to as Vershbow and you see commercials in Super Bowl. It’s become the go to for people looking for vacation rentals in addition to Airbnb. So there is significant growth in these categories. To what do you attribute that tremendous growth and how has HomeAdvisor picking that of the three brands become really the leader in the category?
Craig [00:08:48] Yeah I think there are a few factors that are contributing that you know we have really helped create awareness of the category and the potential of utilizing a marketplace like ours. The value that we can provide to those connections for both home owners and service professionals through really aggressive advertising. We’ve spent a tremendous amount of money on TV and on digital advertising to create awareness of that. And so you know homeowners first need to understand that this type of service exists like it does with real estate or lending or all these other categories that were earlier adopters of online marketplaces. So through that advertising more homeowners are now aware of the category. I think another factor is services like Uber and handy has as really I think played a significant role in this as well as open table and others as you realize hey I can book a restaurant or I can hail a cab or an uber through this really simple elegant on demand people begin to wonder can I also do that for home improvement if I want to schedule and book an estimate with the remodel or schedule to have somebody come out and clean my gutters and services like ours exist and they’re able to find that experience through HomeAdvisor handy and Angie’s List. So there’s some of that as well and then you know we’ve seen millennials are starting to move into the market now more than ever and that is their expectation. And so as more and more Millennials become homeowners or are doing things around their home they are expecting on demand services like we provide. And that’s the first place they churn. The older generation of homeowners was more inclined to say hello to their neighbor look over the fence and say who who did that work for you. The younger millennial generation really isn’t having those conversations and they immediately turn to their their iPhone or whatever their mobile device might be to find an app that can make that connection for them. And we are there. So those are the three primary trends that I think is really propelling what has been a tremendous shift in activity just in the last five years from offline to online marketplaces.
Morris [00:11:20] So what words of advice would you give to businesses looking to grow in the space?
Craig [00:11:26] Yeah I think it’s critical to have a presence online. Eighty four percent of people trust online reviews as much as personal recommendations. Most homeowners won’t hire somebody if they don’t have an online presence because they want to be able to do that research and see additional feedback and vet and verify that pro before they hire. So those reviews with a strong online presence is really important. If you are participating in a marketplace like ours it’s really important to be responsive. We’re living in more of an instant gratification quick response society and so if somebody submits a service request at HomeAdvisor they expect to hear back from somebody within 30 minutes and the sooner the better. And so being very quick in your response is extraordinarily important and if you can’t do that which is tough for some businesses because of driving from job to job you’re on a worksite it’s difficult to be responsive it’s worth having somebody that can be available to call quickly have a professional interaction with that home owner and schedule and book an appointment.
Craig [00:12:38] So having the infrastructure to support that I think is very very important. And you know be sure to follow up if the first call is unsuccessful. It’s worth being persistent with a couple of calls you know homeowners will take that. And it’s it’s important to have that that persistence. So those are the quick things that come to mind for me.
James [00:13:01] OK well that says an awful lot. And I think that we see people trending toward more than one app these days. That’s not to say that they don’t make the buying decision on on an app singular but you know they search and quite frankly we do our own search now. We use the Internet to search our prospective clients with regard to home values and location and you know how long they’ve lived in the home. That’s a two way street which has been quite helpful.
James [00:13:36] So let’s talk a little bit about some of the things that you’re most excited about in the home services industry these days or what trends you’re seeing in the industry that are pro audience should be aware of.
Craig [00:13:49] Well I think the trend I think everybody is is kind of painfully aware of to a degree is the skilled labor shortage and you know we’ve been working hard to help address that both at a policy level but also just creating better support and resource to bring more skilled labor into the marketplace and really unskilled labor as well. We’re working on a few strategic initiatives to help support our service professional community and finding reliable help skilled and unskilled because that’s the biggest constraint to growth and the biggest complaint that we hear from our pros is you know we’re loving the marketing we’re loving the return on investment that we’re seeing with HomeAdvisor but it’s hard for me to scale because a lack of skilled and unskilled labor to help support all these projects that I have in play and as you know with the housing collapse of 2008 so many of those businesses or so many of those businesses and individuals moved away from home improvement and we haven’t seen the resumption of interest from people to get back into the industry we’re starting to see that now and I think there’s a lot of value being placed on you know the trades and you know those shifts and trends I think are very important to help support the industry and we’re working hard to help support that. And ladder recent high school graduate know that it is a great profession to be an electrician. You’re an entrepreneur you know. It pays well. It’s a highly respected position. I think we have to do a better job of creating more appreciation respect for what these businesses do and how valuable they are to our society. So people get more excited about entering the trades but we’re trying to do a lot from both a public relations and policy and creating infrastructure to help support bringing more of that skilled labor into the marketplace. But that is the biggest trend that that I’m seeing overall affecting our small businesses beyond just the shift from word of mouth and off line to digital that is that is happening very quickly as we’ve discussed.
Morris [00:16:11] You know Craig here on CareyBrosPros we like to ask our guests to share three points for success with our pro listeners. Could you share yours?
Craig [00:16:19] Three tips for success. Well you know I think it goes back to a lot of the things we’ve talked about have a really professional online presence highlight your ratings reviews and examples of work that you’ve done regardless of whether or not the homeowner is coming from off line or online referrals they’re going to do that research books where they make that hiring decision. So it’s critical to have that presence you know have an infrastructure in place that allows you to quickly respond to leaves as they come in and that could be a just administrative assistant that is able to call back homeowners quickly or to an accepted booked appointment or a same day service request that might come through our marketplace. So you know having that ability to be very responsive given the on demand and instant gratification expectation of today’s homeowners is really important. I think that’s only two but I think those are two very important things that would benefit you know all of the businesses out there.
James [00:17:27] And needless to say that you have capitalized on the jingle which is so effective. We know in in advertising and the jingle is it’s quite catchy.
Craig [00:17:41] Yeah it did once you once you get it and you know we have a nice frequency. It is certainly in people’s. And people like it.
James [00:17:51] Well I will tell you we really appreciate your taking time to join us here on CareyBrosPros. Craig Smith with HomeAdvisor and you can learn more about them by visiting their Web site. Appropriately it is www.homeadvisor.com/careybrospros/
James [00:18:08] And remember you’ll find our guest information as well as additional podcasts videos and articles on our Web site at CareyBrosPros.com.