Chores like repairing, fixing, or rebuilding something in the home bump up every now and then. And homeowners struggle to find professionals for various jobs like plumbing, carpentry, masoning, and many more as all of these service providers do not have an online presence.
HomeAdvisor is an online marketplace that aims to connect homeowners with service professionals to carry out home improvement, maintenance, remodeling, and repair projects. It has grown to become the world’s largest digital marketplace for home services. So, how did they make it to the top of the list?
Well, we did a bit of research and were able to figure out most of the insights of the business which can be a lot of help for entrepreneurs aspiring to enter this industry. So, here you go - the insights of HomeAdvisor.
What is HomeAdvisor - An Overview of the Online Services Marketplace
HomeAdvisor is an online services marketplace that helps homeowners hire prescreened service professionals for home improvement projects. Homeowners get to choose from a list of services and from whom they want to avail those services. HomeAdvisor has more than 500 home-related services, from house cleaning to remodeling, listed on the platform for homeowners to choose from.
The platform, since its launch, has helped more than 30 million homeowners and has around 90 thousand verified service professionals registered. The platform’s annual revenue is more than 300 million and has completed 1 million projects to date. The statistics of HomeAdvisor are quite impressive which clearly shows the huge scope of the service marketplaces in the near future.
How HomeAdvisor Works?
HomeAdvisor has a very useful cost-estimating tool that attracts homeowners. It estimates and breaks down the cost for any type of home improvement project based on what others paid for a similar project in that area. With this information available at the fingertips, no wonder HomeAdvisor has become the preferred marketplace for homeowners.
In addition to providing the cost estimate, the platform’s ProFinder technology collects data from the homeowners about the project to find the best service professionals based on availability, location, service type, expertise, etc. The platform then sends job leads to multiple professionals who can then call the homeowner to negotiate and close the deal.
How HomeAdvisor Makes Money?
This on-demand services marketplace has several sources of income.
The platform has monthly, quarterly, and annual subscription plans for service providers which is one of the primary sources of revenue of the platform.
The platform also charges commissions from registered service professionals which ranges between $15 to $60 for every qualified lead that comes through HomeAdvisor.
HomeAdvisor also earns huge revenue from sponsored ads.
Top Industry Players Like HomeAdvisor
In addition to HomeAdvisor, there are many other players who have made a mark in this industry. To name a few:
Thumbtack
Angie’s List
CraftJack
HUX
Pro Referral
Houzz
Porch
1800Remodel
Homeflock
Why Building a Services Marketplace like HomeAdvisor a Great Business Idea
Service marketplaces have become incredibly popular over the years as they bring the homeowners and service providers on a single platform. Making the yellow pages days obsolete, these platforms cumulate all the information needed at a commonplace making it easy to make an informed decision.
Other benefits of investing in a services marketplace are:
The growth of a services marketplace is rather easier; all it requires is a unique idea and good service providers.
Service marketplaces depend a lot on third-party customers and sellers making them functional by themselves without much external help.
Service marketplaces work by creating a network among parties which creates a sense of commitment.
If the points mentioned above have persuaded you that it’s worth creating a service marketplace, your next concern will be how to do it. First and foremost, you should decide on the essential features of the marketplace.
Deciding on the Essential Features of a Services Marketplace
Coming to the technical part of building an online services marketplace. One needs to determine and implement the key features required to launch an online service marketplace. Let’s have a look at all these features.
Simplified On-Boarding
No one prefers to fill out lengthy forms to sign-up at the time of registration. Moreover, users also do not prefer to share too much of their personal information. So, make the onboarding process as simple as possible for the users. The less effort it takes to onboard on the platform, the more users will get registered.
Exceptional Search Functionality
With hundreds and thousands of services listed on the platform, users should be able to search and find the services they are looking for without making them dive into the ocean of similar services. An intuitive search bar with spell-checking, synonyms and common terms should be significantly visible for the users to type and find the service they require.
Clear Reviews/Testimonials Mechanism
Reviews and testimonials; one of the most important features in an online marketplace play a significant role in the brand image. The reviews and testimonials of the users on the platform helps to build trust and transparency among your users. In addition, the reviews allow the service providers to assess the negative feedback and resolve the objection.
Efficient Payment System
Managing the funds between the homeowners, service providers, and the marketplace is the core function of an online service marketplace. Easy and efficient payment flow should be integrated into the system to support its specific business flow. Key functionalities like split, hold, refund, need to be available in the system in order to make the marketplace more effective.
Elaborate Availability Calendar
A thorough availability calendar enables service providers to update their calendars as per their availability to prevent double bookings, which in turn provides an ease to the homeowners when booking a service. The platform (if global) should also be time zone friendly to make it easy for the homeowners and professionals to coordinate with each other.
Maps & Geolocation
Geolocation feature in a services marketplace allows the homeowners to find the professionals in their geolocation and vice-versa. It allows the business owners to establish the geographical area in which the platform will be operating. Geolocation also helps in calculating the travel costs through the platform.
The integration of maps helps service providers in locating the precise location of the homeowner.
Marketing Capabilities
A marketplace must help service providers market their services to their audiences. Marketplace featuring a powerful, SEO-optimized content management system for services page, landing page, and promotions creation helps the service providers to boost their sales. Service providers can also feature their popular services and set discounts for customers.
Communication Within Platform
Communication between the service providers and seekers builds trust and makes it easier for the seekers to make the decision and commit to the purchase. A service marketplace with a messaging system makes it easy and quick to resolve the issues if they arise. It should be ensured that the personal contact information is hidden from users to keep the users inside the platform.
Building a Service Marketplace like HomeAdvisor
Building a service marketplace can be done in two ways:
Either custom-build your website from scratch which will allow you to build everything from start to finish. Being a costly and not very flexible way of building a marketplace, this is not a preferable way of building a services platform. The other and easier way to build a services marketplace is to use ready-made software.
It does not require any technical skills and you can set up your platform in a couple of days. These software have all the features required to build and launch a services marketplace that can also be scaled at a later stage. Being fully customizable to accommodate the different needs of entrepreneurs as per the market trends, these software have become the preferred way of building a services marketplace.
Bottom Line
We hope this comprehensive article gives you sufficient information to build a services marketplace like HomeAdvisor. You can build and grow your services marketplace indefinitely, for which you only need to take the first step. Contact experts who can help you address all the issues like prioritizing features, choosing a technology stack, and finally meeting end-user needs.
Ramesh Lal is a Sr. Digital Marketing Executive at FATbit Technologies. He has extensive expertise in assisting businesses streamline their business operations and launch new ventures. With in-depth knowledge of B2B marketing, Ramesh also assists B2B businesses in reaching new customers and securing conversions.
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