Following the Revenue
Depending on your market, Angie’s List
may be a big driver of sales for your business. They have announced some major changes that mean you will need to adjust your strategies. The biggest change is Angie’s List is going to offer a “freemium” model. The public will be able to read and write reviews for free, with some optional upgrades. In the past several years, the percentage of revenue that Angie’s List gets from member dues fell from 50% to 30%. Meanwhile the percentage of revenue from advertising from 50% to 70%. This trend is expected to continue. Angie’s List is counting on growing their user base. This will allow them to increase their advertising revenue and more than replace the lost subscription income. However, there was a less publicized change which is equally if not more important.
Green, Silver & Gold
Angie’s List will offer 3 levels of membership. Green level will be what has historically been known as Angie’s List. It will be free. This will basically be the company’s answer to Yelp.
The next level up will be Silver, a paid level. Silver will include their Fair Price Guarantee, Quality Workmanship Guarantee, and they are promising future improvements of project financing, scheduling, and a project pricing guide. At this level, Angie’s List is going to start behaving more like Amazon, actually booking services. I suspect that there will be a free option for service providers at this level as well.
The premium level will be Gold Level service. It will include an emergency service request line, dispute resolution service, and another new feature that has not been explained yet called Instahire.
Getting Between the Business and the Client
The trend seems clear. Angie’s List wants to move deeper into the client relationship: scheduling services, suggesting prices, and serving as a platform for dispute resolution. Personally, as a cleaning business owner I am concerned about most of these services. When someone wants to stand between me and my client, they add a level of complexity which causes more issues than it solves. And they want to be paid a large percentage of revenue as well.
Ratings and Ad Rotation
Angie’s List has made another big change, but quietly. In the past, the website sorted companies into categories based on ratings. If you advertised, all of the advertisers appeared at the top of the list, but your exact order was determined by your rating. Effective immediately, all “A” advertisers rotate their order, then the “B” articles, and so on, regardless of ratings. This means that on week 1 you will be in spot 1. Then in week 2 you drop to the second slot. In week 3 you are in the third slot, and so on, until you rotate back to the top. Under the old system, the vast majority of revenue went to only the top 1 or 2 rated companies. That made It hard for Angie’s List to sell out their advertising slots. Rotating the listings spreads the leads evenly between all of the advertisers. If you were number 1 or 2 in the past, this is a huge hit for you. If you were 3-10, this could be a big upgrade for you
Derek Christian has been involved in the cleaning industry for more than 20 years and is an owner or investor in several cleaning companies including My Maid Service Dayton and Real World Services Columbus, and now he works as a sales and marketing consultant for Castle Keepers.