How Leads are priced

Boatdrinks2711 · July 25

I would really like to get both pros and Thumbtack employee feedback on this.

I am completely blown away by this. I received a lead for Furniture Assembly, 5 pieces. The lead went out to 2 additional pros, totaling 3 including me. The pcs were 5 chairs, all the same, maybe 10 screws each, super simple. It's a 2 hour job, max. There was a bit of back and forth between myself and the lead as she was interacting with another pro. She asked, "How much". To just have a chance, I bid $200. I didn't get it.

How much was this lead? $83.25. So, Thumbtack makes $249.75, and the person who gets the job and does the work…..revenue (not profit) of less than $200.

I can comment on just how ridiculous this is but I am a P/L guy so I will break it down.

All things being equal, I had a 1/3 chance of winning this job. Meaning if I get 3 identical leads to this one, basic math, I win one of the jobs. See where this is going. That would mean, I would pay $249.75 to win a job worth less than $200.

Dear Thumbtack! This cannot work. Let's be real, paying 50% of revenue to Thumbtack doesn't work. You provide a valuable service and help many professionals, but this is not a business model. It is why, I have my business hidden 97% of the time. It's on only when I have an open day.

And when I ask for this to be looked out. Denied

ArvinC · July 27

Hi @Boatdrinks2711 , thank you for taking the time to share such a detailed breakdown of your experience. I can understand why the numbers you shared would raise concerns, especially when you're weighing the cost of a lead against the value of the job and the uncertainty of winning it.

We really appreciate you explaining your perspective and the math behind it. Feedback like this helps provide valuable context about how lead pricing is being experienced by pros in real-world situations. While I can't speak to how individual leads are priced or reviewed, I can assure you that conversations like this are shared with the teams working on the Pro experience so they have visibility into the feedback they're receiving from the community.

If you haven't already, I'd also encourage you to submit this feedback through your Thumbtack account or reach out to support@thumbtack.com. Feedback submitted from your account is logged directly with your experience, which helps the appropriate teams identify trends and review opportunities for improvement.

I also appreciate you sharing how you've adapted by only turning your business on when you have availability. I'd be interested to hear how other pros approach lead costs and pricing for similar jobs as well.

Thank you again for sharing your thoughts. We'll also make sure this feedback is echoed with the Product Marketing team.

DustiO · July 30

@Boatdrinks2711 (btw, I love your username, having grown up spending my summers on Lake Powell) I would also recommend revisiting your max lead price settings, as you have your furniture assembly prices set pretty high, with a lot of room to experiment with lowering those prices.

And of course, +1 to everything that @ArvinC suggested!

Jonathan_Stickland · August 4

Thumbtack is a tool to use, it's not their job to make you profitable, you've got to figure out how to maximize it. How are your listed prices for each job? Are you "competitive" with others? Maybe you need to learn to game that system a bit more if you are looking for larger profit margins instead of bulk. Both strategies can work, but you can't do both.

Raise your prices, to almost offensive. Make sure you get any low dollar budget get it done quick consumers NOT to choose you. Raising your base price on here will cut down on the race to the bottom strategy employed by the mass majority of vendors on this platform.

As I write this, I hope my competitors don't see it. I love being the highest price. The leads I get want quality and professional hassle free, and buddy, that I will pay a lot for.

Hope this helps.

DiDaisyEnterprize · August 9

I just had a very similar experience with a TV-mounting job. The customer paid me $150. Three pros were contacted, and my lead charge was around $24–$25.

I won the job, but I also had to buy about a $25 mounting bracket, plus fuel and the normal cost of doing the work. By the time everything was paid, I made roughly what Thumbtack potentially made selling that same opportunity to three pros — around $75 if all three were charged about the same amount.

That is the part that concerns me. I actually WON the job, and the economics were still poor. When the platform can make approximately as much from a small service call as the contractor who supplies the materials, drives to the customer, performs the work, carries the insurance, and takes responsibility for the result, something about the pricing model needs another look.

I understand Thumbtack needs to make money. I just think lead pricing needs to stay proportional to the realistic value and profit of the job.

Jonathan_Stickland · August 9

Have you tried turning this into some sort of continuing revenue with this customer? Did you do a good job, get a referral, inform them of other services you have available? Find a way to get more out of each lead if you can.

Boatdrinks2711 · August 14

Sorry I haven't checked back in. I appreciate the feedback. I did have some eye-opening discoveries about setting lead prices that almost definitely inflated these numbers, but that does not change the point of my post.

Of course, this doesn't take into account lifetime revenue, and that is important. Thumbtack is certainly a tool. I am trying to start a conversation about how this type of lead pricing can be bad for all parties. Simply a conversation.

If at some point Thumbtack doesn't make sense for me, I will stop using the service. But I believe that would be a disservice to everyone. I think this is a great service and is very valuable to me. I also know that I am a valuable Pro to have in the Thumbtack community, and that is valuable to Thumbtack.

How Leads are priced

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