Sears will try to leverage its identity with home improvement and repair with ServiceLive, a new leads provider for service pros that is being pitted against ServiceMagic, Angie’s List, DoneRight and others. The tagline for the service, which begins a marketing campaign next week, is “Your price. Your time. Your way.”
Its basic concept is a mix of ServiceMagic and PriceLine. Consumers pay $10 to list jobs, and will provide project specs. They’ll have the option to upload photos of areas to be repaired (if possible). Then they’ll select from pre-screened contractors, while naming their chosen date for service, and their own price, guided by sample labor costs. If no one bids for a job, ServiceLive asks the consumers to up their price.
Under ServiceLive’s system, first respondents “win” the jobs. But then their fees are held in escrow by ServiceLive until jobs are satisfactorily completed. At that point, “ServiceLive Bucks” are deposited into contractor accounts, minus 10 percent for commissions and transaction fees. On paper, at least, the system promises to be much more efficient than other payment systems.
When jobs are completed, consumers are asked to provide comments and ratings on a five point basis. While reviews are expected to become a major part of the screening process, there aren’t many at launch, and it should take several months before any volume is built up. Until then, consumers can rely on ServiceLive’s guarantee that its contractors have undergone complete background checks and provided insurance information.
Based on various contractor blogs, the service has been recruiting contractors in several markets since November. Nine thousand of the 23,000 that have registered have already gone through the approval process. But not surprisingly, posts on the blogs aren’t especially positive.
“Who in their right business mind would allow the customer to dictate how much a job should cost?,” said Ed The Roofer, on Contractor Talk. Patrick the Door Installer doesn’t like it either. “That just sounds like a disaster waiting to happen. ‘Sorry, they never logged in to OK the job; sorry, we can’t pay you till they do.”
Patrick added: “Sounds like it should be named: ‘Find a hungry, desperate lowballer.com.’” Jason, from “The No Faux Zone,” sees more ominous issues, especially with the involvement of Sears. To date, he contends that contractors have been able to underbid Sears Home Improvement because it isn’t especially aggressive at the grassroots level, and it tends to build in corporate overhead.
But Jason fears that an online leads service will kill contractors’ competitive edge. “If you’re the type (that) wants to exceed expectations and brand your business as something above and beyond, then this is just garbage,” he says.
We asked ServiceMagic CEO Craig Smith, a direct competitor, to weigh in as well. Smith notes that “a reverse auction is a challenging model to execute. It’s difficult for some homeowners to understand the full scope of materials and labor needed. Many homeowners and professionals will prefer to discuss the cost variables of each project in person before writing a detailed estimate.”
(Smith’s complete response is included as a “comment” to this post).