Generating Business: Thumbtack versus Google Ads
I want to be clear. When you use Thumbtack, you’re using Google Ads. But, it’s the difference between buying wholesale versus retail. Thumbtack buys their results from Google ads, marks that up, and sells their Google ad client leads to you, and your competitors, at a premium price. Often the Thumbtack price for a lead can be three to five times the cost of buying that same lead from Google yourself.
Advertising Charges
Google charges an average of $3 every time a prospective client clicks on the ad. That’s the wholesale price. But, many professionals, like myself, still buy retail from Thumbtack and others of that ilk for $15-$30. A large part of the problem is that prospects may click on that ad ten times and never decide to provide their name or email address. You can pile up a lot of $3 charges waiting for that one prospect that not only likes your ad, but they like what you have to say on your landing page.
Thumbtack’s Big Advantages
The big advantage of Thumbtack, and their many competitors, is ease and speed. You can literally be up and running on Thumbtack in less than a week. If you’re ready to build an online presence for your business then you already have the credentials, the ideas, the photos, the text, the reviews, the completed organizing projects, and the motivation to quickly fill out a profile on Thumbtack. And quickly start spending money. I had no idea that so many leads would come in so quickly. I had spent months trying to find people willing to do free trial projects, now I had five people a week who wanted to pay me.
With my New Jersey territory, including some New York City and Philadelphia leads, I can expect to see three to five leads from Thumbtack in a week by spending around one hundred dollars. The cost of the leads varies from $10 to $30 depending on what Thumbtack thinks the job is worth. Keep in mind that New Jersey is one of the most populous areas per square mile of any part of the country, so your results in Kansas will be different.
Spending Your Money Quickly
Thumbtack spends your money very quickly whether or not you make any money. It was a bit scary when I first turned Thumbtack on because the money went out much faster than the leads came in. I had to get used to the idea of investing a few hundred dollars before dollar one went back into my pocket. There were weeks where I would spend two or three hundred dollars and none of those leads resulted in an assignment. Everyone says you have to spend money to make money, but actually watching the spent money fly out the window is nerve wracking.
Quality of the Leads
The Thumbtack leads are not scrubbed before they’re sent on to you. Potential clients are asked to fill out a simple form about their organizing desires. Thumbtack asks when they’d like to start, what type of organizing help they need, their level of organization, the square footage involved, and which areas need organizing.
Often, frankly very often, people are window shopping. They haven’t really decided whether they want to start organizing. Many of these “leads” change their mind between filling out the Thumbtack request and the time required to send the lead to the organizer. Or they may hire another organizer who responded before I did. Some people just want to ask a question that has nothing to do with booking a professional organizer. A lot of phone calls and texts are never returned. I would estimate that at least 50% of the Thumbtack leads never result in a conversation with a prospective client. More than 75% never result in a job. Like any business, professional organizing is highly competitive. The secret that makes a client choose one organizer over another is still a mystery to me.
Most people underestimate the amount of work it takes to organize a room. See my article on how to help clients save money on any project. I’ve had many clients request three hours of help. Then they ask me to stay for another day or two once we get started.
Competition for Leads
Thumbtack will also send the same lead to multiple professional organizers at the same time. Thumbtack may sell the same lead to five, or more, different people. The lead Thumbtack bought from Google for an unknown amount dollars, they resell to the many professionals in their database for fifteen dollars. And they resell that lead five times or more. Thumbtack has the same problem with clicks that I do. Many of the clicks are just looking with no buying intent.
Thumbtack Works
But, for all of those problems, there is a big upside. It works. I do get a stream of leads, it is extremely easy and fast to set up. Whatever I spend on Thumbtack is a small percentage of what I make. Not an insignificant percentage but small enough to make sense. Most importantly, without Thumbtack I wouldn’t have a growing business that is steadily expanding.
Still, as a businessperson, I’m keenly aware of that wholesale/retail price difference. I’m always looking for smart ways to improve my efficiency. In a future article I’ll explore the Google ads alternative to Thumbtack and more about my search for the perfect marketing channel. If anyone knows where that perfect channel is located please tell us in the comments below.
