My Headaches with HomeAdvisor

I typically don’t like airing complaints publicly, but I have already brought my grievances to the companies mentioned here and gotten no resolution, so I feel comfortable in putting this out into the world.

I would like to share my HomeAdvisor experience with any contractors or home owners who are aware of the company and may be thinking of using their services. I feel this is important to do, even if it doesn’t gain much visibility, because when I was searching for information about them before signing up I was unable to find any information that didn’t originate from their company – no independent reviews or experiences from contractors or customers.

I absolutely can NOT recommend HomeAdvisor to either contractors or customers. I found their business practices deceptive at best, and don’t believe they serve either the contractors or the home owners honestly. They are first and foremost a marketing company, not a screening and matching company. Their effort is put into dominating Google results, and aggressive sales tactics, not screening or matching.

Immediately after my contractor license was issued, I began getting calls from HA sales reps posing as customers. “Hi, I’m Alex, I’ve got a flooring project in Shoreline…”, then they would go on asking questions about my business, and whether I do different types of work, and what areas I operate in, etc. before finally revealing that they were from HA and wanted to match me with prospective customers. Putting aside the irritation at being misled from the outset of the conversation, once I started asking questions about their process and pricing they would tend to become rude and impatient at my hesitation to sign up. These phone calls came in every few weeks for months, always a similar misleading intro followed by rude impatience when they sensed I wasn’t going to bite.

Fast forward about a year from the first phone calls, and I hadn’t managed to accumulate the critical mass of customer base necessary to keep busy from word of mouth referrals alone, so I decided to try paid advertisement to jump start that process. In searching around for advertising options and lead services, HA was showing up at the top of every search, so I figured if they are doing that much work for visibility and my main problem was lack of visibility, then they might be a viable solution – and given their search rankings, they seemed to have made themselves the only game in town.

So I called to sign up, I got a sales rep that actually seemed professional and friendly for a change, it seemed like a good sign. The “screening and approval” consisted of verifying that I had a contractor license, and paying an annual subscription fee of $350. Not quite the level of scrutiny that a home owner using the site is lead to believe. They explained how the system worked: I picked services I offered and areas I worked in, and when they got requests from homeowners that matched those criteria, they would send them to me (and up to 3 other contractors) and charge me (and each of the others) a fee for the lead. They told me that if I was unable to contact the prospective customer I would be able to get the fee credited back. Great, that seemed reasonable if a bit pricey (more on that later). They also requested first names and phone numbers for five people who they could contact for referrals, so I put them in touch with five people who I had done work for previously, figuring this was part of the screening process. About an hour after the phone call and the up front annual subscription fee was received, my account was live and receiving leads – though none of the referrals had been contacted yet – so I guess that wasn’t part of the screening process.

A week or so later a sales rep contacted the listed people, asked them about me and my work, then created a review on my profile from them. Each one of them had given detailed accounts of their experience with me, the kind of information I am usually interested in reading in any product or service review, but these didn’t match up with what showed up on my profile. Each person’s review had been shortened to a single sentence bearing almost no resemblance to what they said to the rep. This coupled with a 5-star rating, and everybody being given the last initial A. There was also nothing done to verify that I had actually worked for any of the people, I could have just as easily passed the names of five friends and had them lie about work I had done. So the reviews that show up for each contractor’s profile are essentially fabricated, if not by the sources themselves, then by the sales rep. My main gripe was that all of the reviewers were given the last initial A and the same overly simplified tone was used for each, which to me made them all look like they had just been faked by one person (which was basically the case).

So far these issues are mainly of concern for the home owners, in that their “screened pros” are barely vetted, and their reputations inflated – I guess that’s to be expected from a marketing company. Now onto the issues from the contractor side of things. When a customer puts in a request through HA, they fill out a form giving their name, phone number, address, and the type of project – in my case the relevant categories were repair, refinish, or install. No further information about the size or scope of the project is required, though customers could optionally include additional details. But, without any guidance in what information to provide, this information was typically not very useful if provided at all.

Each category of work had a price for the lead: for the Seattle area these were $17.13 for repair, $33.03 for refinish, and $57.67 for install. Up to 3 other contractors would be sent and charged the same, and if no others were available for the service in the area at the time, and I was the sole recipient, then I would be an charged an additional 50% for the lead. In my experience, being the only contractor matched through HA didn’t mean I was the only person bidding the job, it just meant the other contractors were contacted outside of HA, but the amount of competition was basically the same. People tend to want about 3 estimates regardless of what website they come from, which means that I was paying 50% more for basically nothing.

This is all information I knew before I signed up, I am not complaining about this, just giving context – it means that given the amount of competition, and the possibility of home owners deciding to not to go through with the project at all, I could expect to land around 25% of the jobs I bid. So in the worst case scenario, single matched install leads ($86.50/each), for each job successfully won, I would expect to pay $346. Expensive, but even this could be acceptable given that a standard install of unfinished wood has the profit made on both the installation, and the sanding and finishing. So a typical install of 500+ sqft has a profit margin that would make this an acceptable expense. But HA doesn’t differentiate between that type of job and somebody who just wants to install prefinished click together flooring in a single bedroom, something that can easily have a profit margin of less than $346.

All of this I was still willing to accept if it managed to line up work and build customer base and referrals. But, then I started running into other problems. While talking to potential customers I would hear that one of the other people HA sent had quoted a substantially lower price in exchange for cash payment. This is nothing new in the industry, one of the largest problems is competing with companies who are working under the table – avoiding local sales tax, federal income tax, and L&I insurance among other expenses incurred by companies doing business above board. The problem is that HA provides cover for these companies, and through the practices listed earlier, gives them an equivalent looking reputation to law-abiding companies. I understand that some of this is outside the scope of HA’s ability to control, but it is worth noting since I was ending up in price competition with companies who were able to drastically undercut due to illegal practices, while customers were being given the impression that these companies were reputable.

Another issue was being able to actually contact leads. About one third of the leads I was sold were unresponsive after multiple attempts to call, text, or email over the course of a week or two. My impression when signing up was that this was no big deal, I would just request a credit and get refunded for the lead fee. Then I began to have my credit requests denied, so I contacted HA customer service to find out why. Here is a portion of that conversation:

This went on for a bit, but the conclusion was that despite what I had been told when I signed up, they would only issue credits if the contact information was incorrect, not if I was just unable to get a hold of the person. From my perspective these are the same thing: a dead lead. Many voicemail greetings only read back the phone number dialed, so in many cases I can’t even verify if the phone number is incorrect. This issue causes several problems:

1. Given the amount of dead leads I was being sold, the effective cost per active lead was about 50% higher, so take that $346 from earlier and call it $519.
2. If a home owner put in a request without realizing the level of commitment, and changed their mind for whatever reason, I was now in the position of having to send them unwanted calls, texts, and emails (HA required at least two attempted phone calls over multiple days before a lead could be eligible for a credit at all). The home owner doesn’t have an option to retract the request, opt out of being contacted and nullify the charges created for the contractors. I don’t want to harass anybody who doesn’t want to hear from me, but if I’ve been charged a substantial amount for the phone number, I can’t just leave it alone after a single attempt.
3. Since HA takes no responsibility for the quality of the leads being sold, they have no incentive to screen them more carefully. Their model is based entirely on volume, not quality. This is why home owners aren’t told what is happening when they put in a request, they are funneled to the site from a huge number of possible searches, and asked to answer basic questions about the project, unaware that they have just triggered potentially hundreds of dollars in charges for the contractors on the other end. The entire process is set up to be as casual and non-committal as possible for the home owner – they aren’t even asked for their name until the very end of the process.

Due to the nature of advertising and cost per click, the cost of getting a home owner to the site to put in a request is on the order of a couple of dollars for HA, and since they are the ones in control of the screening process, it seems reasonable to me that they should bear the cost of unreachable leads instead of profiting from them by passing the full lead price on to the contractors. This is permissible according to the fine print of their terms of service, but it means that the sales rep misled me in terms of criteria for refunds, and in the nature of the competition – I wasn’t just competing with other contractors, but also with the customer’s willingness to answer their phone at all. Given that around 1/3 of the leads were non-responsive it would have been prudent for them to be clear about that policy before I agreed to sign up.

I should also mention mHelpDesk here. This is a company HA is partnered with, whose service was forced upon me at sign-up, despite my telling them I didn’t want it. mHelpDesk is a service that combines customer relationship management, scheduling, estimate generation, and integrates with HA. I was given a free one month trial (credited to my account at $99.99) and wasn’t allowed to simply opt out. I use a combination of Evernote, Google Calendar, and QuickBooks to handle my administrative needs, so I wasn’t interested in paying for an additional service (three times more expensive than the other three combined), that would only provide part of the functionality I got from the others together. I would still need to use the other three, and then have the added complexity of coordinating with the new service as well. I was under the impression that I was being given the trial, and that after a month I would have the choice to opt in to keep it if I liked it. Coming up to the end of that month I received an email from mHelpDesk saying my trial was about to expire and the card they had on file would be charged for the monthly membership – so just another thing I was lied to about when signing up.

In closing, for home owners: you would do better to simply search Google for local contractors, since the “screening” HA provides is worthless (you can verify a contractor’s license number on L&I’s website), and while Google reviews can also be fake, at least Google isn’t actively working to fabricate them. For contractors: try anything else first. HA should be about your last option. You will get some percentage of leads that will pan out, but they will be more expensive than projected, and if you incur any problems, HA customer service is not going to be on your side. I hope this can help save somebody else some frustration.