Question: “I have seen Amazon Home Services and Google Local Services on the internet. Should I be concerned about their offerings? How can I compete against them?”
Stephen Dale; Trainer & Coach, Power Selling Pros:
That’s a great question. It’s an interesting time in our industry, and I look at all the disruptors like Uber, and what they did with the taxi industry, and Airbnb, and what they did with the hotel industry. And the phrase I like to look at is “keep your friends close and your enemies closer.”
What I mean by that is that as a contractor, you need to understand what’s going on in our industry. And two of those juggernauts happen to be Amazon Home Services and Google Local Services.
Amazon Home Services – I’m sure you’ve seen it, you can go to Amazon.com/HomeServices – they offer over 1200 different services right now. They’ve made it extremely simple to use. They offer heating & air, electrical, plumbing, all sorts of stuff. They do background checks; they have licensed technicians, insured. They have a happiness guarantee which, if you’re not completely satisfied, guess how much you have to pay: zero dollars.
So it’s interesting how Amazon is coming into our industry and they see it as a multibillion dollar opportunity. They’ve been doing it now for about three years and are very successful.
Google Local Services – used to be called Google Home Services but they switched over – they’re basically doing what I would call lead-selling; AdWords. It’s a Google-generated lead, contractors have to pay for those leads, but then you get top of the local search results.
The interesting thing about Google Local Services is that, to me, it appears it’s designed to create the illusion that all contractors are created equal. We all know that’s not the case, but they’re really driven on price, because they actually set the price.
When I look at both of these operations, and such large operations, I look at it as the commoditization of services – meaning it’s about the commodity, it’s about the price, the time, the availability. I think you need to know what’s out there, I’m not here to advocate you be a partner with them or without them, I’m simply saying they have a presence and it’s growing quickly.
How do you compete against them? I believe you’ve got to have a very strong online presence, in how you communicate with your clients, through email, through chat, through texting. Being able to setup appointments online. What do your reviews look like? Your first line of communication has to be spot on.
So it’s an interesting time. We don’t compete on price, we compete on value, so your competitive advantage is creating that customer “WOW” experience with them.
James, are you familiar with both of these services?
James Leichter; President, Aptora Corporation & Mr. HVAC, LLC:
I am. I think you did a great job of addressing it. I think that Amazon Home Services is a bigger concern for me when it comes to satisfying millennials.
I think millennials like the idea of buying something on Amazon and clicking an extra button and having them install it. But they wouldn’t if they knew a local contractor.
So you started to mention what I was going to say: It’s all about how you communicate with your clients. Nowadays that’s texting, actually sending them text messages, and Facebooking with them, and instant messaging with them, and all the things that the younger people are used to.
The whole reason you would click that button to have it installed is because you don’t know anyone else. So you just need to be the contractor of choice, you need to be in that person’s mind, instead of a stranger on Amazon Home Services.