Lead Prices

Options

Hey all,

I have been with Thumbtack for years and have even held Top Pro Badge status. Are there any other Pros out there that are shocked by the huge hike in lead prices? I used to pay $9.50 per lead for a service that I am charging $60 for. This was a roughly 16% commission for Thumbtack per lead that contacted me. Now the leads are costing $30+ dollars a piece EVEN if the client does not purchase a service. I only charge $60 for my services. Am I supposed to hike my charges up to $90 just to make up for what the leads are costing me on Thumbtack? What if then the customer still does not purchase? I am still charged that amount x clients. How am I supposed to offhand this new charge and still remain competitive in pricing? This is ridiculous. I raised my prices to $65 but if this keeps up, I do not think that I can afford to keep marketing through Thumbtack.

«1

Comments

  • Plumbernick417
    Options

    @Brian218 I agree with you that the lead prices have been getting higher. I know it doesn't seem like it's worth the price you pay up front. I remember when we used to have to bid against 10 other people . It was really tough back then. Everything has gone up alot in the past couple years including my prices.

    My bread-and-butter is customer retention. We don't have to pay for the customers that call us directly in the future. Keep building that organic customer base .

  • David_Carroll
    Options

    Direct Leeds are a big advantage for me but how are we supposed to be charged if the hires a different pro before the first pro never makes contact

  • DustiO
    DustiO Administrator, Moderator Posts: 1,659
    Options

    @Plumbernick417 Thank you for your thoughtful response above! @David_Carroll not sure if this will help, but have you ever used the saved replies option in your app? This allows you to draft responses ahead of time so that you can quickly answer a customer even if you're on the job. I can't remember the exact statistic, but pros who answer customers within the first 5 minutes are substantially more likely to be hired. If that doesn't work, then I would echo what Plumbernick147 said and really work on customer retention/repeat business, because those types of clients are gold! (I was a business owner for 12 years before joining Thumbtack and that was definitely my bread and butter as well).

    Here's another helpful article with tips for responding to customers. Hope these help!

  • alexrez52
    Options

    Unfortunately, I have not seen a correlation between the size (volume) of a project and the prices for direct leads. My average project is about $50 while the price for a lead is about $18+. More, whatever budget I allow to spend on a weekly basis, no doubt that all of it is spent. If I am correct, such policies are a real brake to any such small business development as that of mine.

  • David_Carroll
    Options

    It's been getting better on my end with that now my problem is getting the client to pay after the job is finished

  • alexrez52
    Options

    My biggest problems are very high prices for leads while there is no guaranty that a customer is retained. There are many issues related to quality of leads. For example, in many cases a prospect customer is unable to shape his/her needs precisely. Therefore, I have to pay for a lead which is not a lead at all because the client’s needs differ quite substantially from what I have advertised and supported (to say the least). I have addressed this issue a zillion of times. No changes have been made so far…

  • alexrez52
    Options

    Jami, you are not alone. I have suspended my business at Thumbtack about a month ago and will do that again. My average charge (IF I am selected) is about $50. A lead (with low probability of getting hired) is about $18+. Is there anybody who can convince me that it is a profitable way of doing business except for Thumbtack itself? Especially taking into consideration that one single lead may be sent to several (!) pros who will pay for it, as well. This is a killing model for any business. Including Thumbtack itself.

  • alexrez52
    alexrez52 Posts: 14
    edited January 2022
    Options

    Jami_JConcepts_55, I just called one. The answer was: "I don't need it anymore". What's that? How should one interpret such an answer: another pro bypassed me? A stranger's phone number was entered, like you said? Obviously, no intention to do any business! But I already paid for the lead! This business model won't last long as it is unfair and self-limiting. If I pay, I'd prefer to know what I pay for. Is it too smart or unusual?

  • alexrez52
    Options

    My business is translation. I called to the customer because I was the first who responded (and there was still no activity on the customer side). So I decided to call but the prospect "customer" was obviously not interested at anything. When I subtly suggested that a customer should be at least sensitive to the fact that a pro pays just for the air, I got a simple response: "Oh, I hate these apps". And that's it. So I asked the same notorious question to myself, again and again: "what did you just pay for"?

    Please keep in mind that my business is much smaller in comparison to yours (from the revenue point of view). A lead costs sometimes 35-50% of the projected cost of my average project. A quality of leads is a different story. Even if I won the business, a customer might require a service to be provided in his/her state only while I had clearly indicated that my services are remotely provided throughout the US. I could continue but I'd better stop here. Frustrated.

  • DustiO
    DustiO Administrator, Moderator Posts: 1,659
    Options

    @Jami_JConcepts_55 Yes I am here! I don't have anything new to offer, but I do really love seeing these conversations unfold between pros. Thank you for keeping a tough topic productive and constructive. I love the advice about how to handle phone contacts and wording in profiles - and I love seeing these shared experiences and advice. Thank you all for being here!

  • alexrez52
    Options

    DustiO, thank you for looking into these conversations. It would be really nice if you shared your experience re. the following: has Thumbtack listened to its pros at all? Any positive example of any measure taken in relation to issues and/or questions raised by pros? Frankly, my personal impression in that regard has been negative; so many issues have been raised over the years but the overall situation just gets worse.

    Thank you and happy new year!

  • DustiO
    DustiO Administrator, Moderator Posts: 1,659
    Options

    @alexrez52 So much at Thumbtack has been done/updated/built thanks to pro feedback. I understand that not all product updates work as well for all pros, but feedback is definitely seen and considered by many teams. I started out as a pro on Thumbtack (I ran a business for 12 years, and the last 4 of those Thumbtack was my sole source of leads) so I understand the experience from both sides.

    When I was a new pro and customer on Thumbtack years ago most customers that came to Thumbtack never got a response from a pro (remember back in the day when pros had to reach out to customers? I myself tried hiring pros during that time with little luck) - I think it was like only 30% of potential customers actually got contacted by a pro - although the system isn't perfect now and we are continuously striving to improve it, customers are now able to see all available pros in whatever category they are looking and can reach out proactively to pros they want to work with. Better customer experience means more customers returning to Thumbtack to hire pros and more jobs done by our pros (last year alone customers started 7 million projects on Thumbtack). Huge improvement, largely driven by pro and customer feedback.

    We recently started requiring customers to enter a phone number, due to pro feedback as well (not a perfect system, but again, continuously being improved).

    I personally have also worked on things like Thumbtack Pro Rewards, this pro Community, third party partnerships, and more, that were designed thanks to pro feedback (and with direct input from pros).

    These are just a few examples. I know it can feel like feedback isn't being heard and I am sorry to hear that the "overall situation has just gotten worse" for you. I am happy to take a look at your account and see if there is anything I can help to improve! If you want to send me a DM we can discuss your specific details in more depth.

  • alexrez52
    alexrez52 Posts: 14
    edited January 2022
    Options

    DustiO, thank you for your extensive comment. You are welcome to look at my account; I would gladly follow any sound advise. However, I don’t think that anything is wrong with my account since I have always been very sensitive towards quality of my work and customer service (check my feedback roster). Rather, I would summarize just three critical points:

    1) An average ratio lead/pros in my business is 1:3. It means that, as soon as a new lead appears, 2-4 pros react to it trying to be the first. If I am just the second one (not to mention about being the third or forth in the row), I would have to pay for a lead which goes to someone who responded faster. That is a reality. This situation leads to a funny competition between pros; no time to even analyze the request, the most important thing is to be the first! One of the customers who got my response in SECONDS, reasonably asked: “did you read what I need before responding?”. No, because I would have to pay for nothing if I am late! (Likely, I was able to help thanks to versatility of my services). Does it make any sense for anybody except Thumbtack?

    2) Quality of leads. How many times I have tried to address that! The customers’ specific requests vs. the pros’ terms have been largely ignored like the drastic differences between jobs have been. Just a lead, to be paid for! In a number of cases such leads had nothing to do with a pros’ ability to help or a customer was not ready to do any business at all (typical reasons: my paperwork is not ready yet, it should be ready in a month, or I need to have your service to be done in my state only —despite the terms clearly advertised by a pro according to which all services are provided remotely throughout the US). Yet, each “lead” like this is to be paid.

    3) Thumbtack customer service. Each dispute results in a standard bureaucratic denial, obviously without an attempt at getting in the issue. The typical Thumbtack’s answer to above problems is “no”.

    Therefore, my impression is that the only thing which is of interest to Thumbtack is collection of money for leads, no matter of their quality. To my opinion, the company’s business model could and should be different. For example, Thumbtack should charge its pros a % of the real project’s cost (to be verified within the platform) but not for any poorly substantiated “leads”. Otherwise, more and more pros would halt their business at Thumbtack because nobody would like the idea of paying for nothing.

    Apology for a lengthy response.

  • alexrez52
    Options


  • alexrez52
    Options

    A single lead for 3-4-5 pros… Sounds good provided that each pro pays. Why not, indeed? One of the pros will supposedly earn some business. The rest would just pay for a “lead”. Isn’t it a nice, win-win situation for Thumbtack? Any opinions?

  • alexrez52
    alexrez52 Posts: 14
    edited January 2022
    Options

    I agree, more so re percentage. However, to pay 30% or even more of an average project cost (in my case a typical project costs about $50) just for a lead which did not turn into a project - what’s the point? To rush things just to be the first (and I totally agree with you on this) having no chance to even evaluate the task - what’s the point? Thumbtack wants me to elevate my budget. So that I pay for a lead not $18+ but, say, $25? Will anybody in my shoes go for it?

    This is not a business. This is just a nonsense GREED killing any business. Let’s name things by their true names.

  • alexrez52
    Options

    I’ve been with Thumbtack for about six years. My expenses related to leads take about 70-80% of the entire profit (as I said, the average cost of a project in my case is about $50). Unfortunately, if these practices continue (and I don’t see any signs of positive changes), I would have to quit despite my excellent reputation, great feedback built over all these years, etc. No reason to expand my budget - just to pay more for leads? No reason to keep it this way either…

  • anhtuanb
    anhtuanb Posts: 1
    Options

    I am in the same situation as alexrez52. I joined Thumbtack to build my business and hope it would help me to do so but I'm paying for leads that never get hired or no responses. I do think the system should discount the ones that never got hired or responses. It seems unfair to charge everyone the same lead price on a request from a customer" knowing" they can only pick one. Once the job is confirmed by a pro, the hired pro will pay the full lead price while everyone else should get a discount. It's hard to earn money already. When you work on a job, there's a thought on the back of your mind saying the hard work you do now will just pay for another non-hired or non-responding leads. I don't mind paying for leads but not at full price if not hired.

  • LeslieMorgan58
    Options

    I'm in the graphic design field and have been on Thumbtack for about 2 1/2 years. The issues I have are with lack of filtering of customers. To illustrate my point: I design websites and I select the programs that I use clearly in my services (Wix, Squarespace). Yet I get requests for sites to be built in Wordpress only! Website design leads can cost about $120.00 each. I've also gotten requests for sites to built with ADA compliance -- I have no experience with that. So why doesn't Thumbtack filter for designers that are certified with ADA compliance? I've also gotten requests to design websites from sex workers and adult video shops. Why aren't we allowed to reject leads on those grounds and not get charged. The refund policy so far has been fairly lenient so that helps. But I don't want to feel like Thumbtack is doing me a favor "out of courtesy" when I turn down a job for the reasons I've stated here.

  • Studio513
    Options

    Going to parrot everyone here. The check availability box is ludicrous. Also, it does seem incredibly greedy to send each lead to four freelancers. A customer has the opportunity to search for exactly what they need and pick who they want. Why not just let the customer contact the individual they clearly selected, or at least limiting the scope of competition to one additional lead. Paying 20% of my job cost for one lead with a 25% conversion rate is unsustainable.

  • Matt
    Matt Posts: 155
    Options

    @Studio513 Yep, piggy back on this. I have only been on TT for a month or so, and my experience has been far from great. I am ok with a service like this making money, however they WAY they go about doing it feels like they don't have the Pro's best interest. It is ONLY the interest in making money, and not caring about the Pro's experience on the platform, only that they get to charge for any lead, regardless of how quality it is. Somehow, I have hit $400 in leads, with most of them being ghosts, got one job that paid $850, so my profit continues to go down as "leads" decide they reach out to me.