Dear Angie,
First, I want to tell you how great this relationship has been. You have, for most of our seven years together, been a faithful partner, doing more than you needed to do to make our relationship work. Your leads drive me wild. They’re like gold—make that platinum! The prospects you send our way convert to sales more frequently than our own referrals. As they were signing the contract, the leads from you would say: “Mike, we pretty much knew right away we were going to hire you.”
Angie, I used to ask myself, What in the world did I do before you came into my life? I was out there, scrounging and scraping like the rest. Walking together, hand in hand—you with the best brand in lead generation that the home improvement industry ever knew (at least as far as I could see), and us with great installation and customer service—it was like a dream come true. What a couple!
Angie, I believed in you. I was faithful, even when rivals began batting their eyes at me. Yelp, Thumbtack, Houzz, Porch … I put them all in their place. They were useful, sure, I told myself, but there’s no one like Angie.
So, now I’m left wondering … Is it true that all good things must end, or is that just a line in a song?
Not Playing It Straight
I heard about the class action lawsuit filed in federal court last year that accuses you of deliberately manipulating reviews and how they’re ranked on your site. Jannell Moore, of Philadelphia, who filed that suit, claims that “Angie’s List ranks service providers based on how much providers pay in ‘advertising’ fees.” Is that really you, Angie?
Moore uses the example of a plumber who has an A rating and all positive reviews—but who isn’t an advertiser—being ranked below the plumber who has lousy reviews and lower ratings. Ms. Moore says that you, my dear Angie, refused to publish her negative review of a remodeling contractor that you’d recommended—after that contractor made off with Ms. Moore’s $4,000 deposit and failed to finish the work he’d started.
How can this be?
Those Pesky Exes
But I still want to believe in you, Angie, so let’s let that suit go for a minute. Maybe the court will rule against Ms. Moore. Besides, I can see you’ve got other problems to deal with right now, like 17 of your former salespeople suing you for overtime. According to the law firm representing the plaintiffs, as quoted in the Indianapolis Business Journal, you “routinely and regularly instructed” your sales reps “to under-report, or not report, hours worked over 40 hours per week, in order to avoid paying overtime.” And I got to thinking … I was able to overlook some of the high-pressure, price-dropping tactics of your salespeople on the phone, but it did bother me that there seemed to be a different salesperson every few months.
And then I come to find out, again from your hometown business paper, that three of your former salespeople defected to Homeadvisor and that you then sued them to prevent them from working there. The court threw out your suit. On top of all this, your CEO and co-founder, Bill Oesterle, jumped ship because, he says, he wanted to enter Indiana state politics. I don’t think it’s smart to mix business and politics, but I have to say, the timing of Oesterle’s resignation seems kind of suspicious, coming just a month after the class action suit was filed.
It’s You and Me, Angie
Yes, people should mind their own business. Loose lips sink ships. And I know you’ve got problems—we all do. But business is business, which is why I’m writing to you. The leads we get from you are down 70 percent—not just 10 percent or 25 percent, but 70 percent. I know because I track and measure those leads. At one point, 65 percent of our leads were coming from you, Angie. I know that kind of concentration on one lead source probably isn’t a smart marketing strategy, but it is what it is. I was devoted to you—I mean, I was devoted to you. After all, who’s going to argue with a great lead?
But right now, less than 25 percent of our company’s leads come from you, and our lead cost has gone from 3 percent to 10 percent and it’s still climbing. That’s about what we pay everybody else. It used to be so different. The reason we’re chugging along is because we’ve now diversified our lead sources.
Angie, I hope you and your new CEO can turn it all around. If not, I guess I’d say ours has been a fairly good run, for any relationship.
In the meantime, our biggest thrust now is getting on page one of Google’s search results. Through that we’re generating more leads organically that take prospects to our company’s Web page, and those leads close at the same high rate that yours do—or did, when we had them. But the best thing about our organic search leads is that we can generate them through our own efforts. And that means we have control of our marketing future.
So thanks, but now it’s time for me to take real control of this lead-gen relationship.
Love,
Mike Damora
How a great relationship began to unravel from neglect