Leads from Angi, Thumbtack and HomeAdvisor: are they worth it?
Lead marketplaces like Angi, Thumbtack and HomeAdvisor can be worth it for a service business that responds within minutes, has the capacity to take the work, and tracks every lead through to a paid job. They tend not to be worth it for businesses that answer leads hours later, compete on price for shared leads, or never measure what each job actually cost. The only way to know for your business is to calculate your cost per booked job and the profit on those jobs.
Here is how to work that out and how to get more from the leads you pay for.
How do lead marketplaces work?
The details vary between platforms and change often, so read the current terms for each one. Broadly:
- A homeowner describes a job on the marketplace's website or app.
- The platform sends the lead to one or more pros who serve that area and job type, or the homeowner picks pros to contact.
- You pay for the lead, the contact, or a subscription or advertising package, depending on the platform and program.
A few things to understand before you sign up:
- Leads may be shared. The same homeowner may be sent to several businesses, so you could be competing with others for the job.
- You may pay whether or not you win the job. That's the nature of paying for leads rather than results.
- Lead prices vary by trade, job type, location and season.
- Refund or credit policies differ. Some platforms credit certain bad leads; the rules are specific and change.
- Contracts and auto-renewals differ. Some programs involve commitments, fees or minimums. Read the agreement carefully before you sign.
Angi and HomeAdvisor are owned by the same parent company, and their pro programs have been reorganized over the years. Thumbtack is a separate company with its own model. Check what each currently offers in your trade and area.
How do you calculate your real cost per job?
Don't judge a lead source by the price of a single lead. Follow it through to booked, paid work. The figures below are made up for illustration, not typical prices.
Step 1: total spend. Add up everything you paid the platform in a month, including lead fees, subscriptions and any other charges. Say $1,200.
Step 2: count leads. Say 40 leads arrived.
Step 3: count real conversations. Of 40 leads, maybe 28 answered your call or message. The rest were unreachable, duplicates or not real.
Step 4: count booked jobs. Say you booked 9.
Step 5: count paid jobs and revenue. Say 8 completed and paid, for $4,000 total.
Now work out:
| Measure | Formula | Example |
|---|---|---|
| Cost per lead | Spend ÷ leads | $1,200 ÷ 40 = $30 |
| Contact rate | Conversations ÷ leads | 28 ÷ 40 = 70% |
| Booking rate | Booked jobs ÷ leads | 9 ÷ 40 = 22.5% |
| Cost per paid job | Spend ÷ paid jobs | $1,200 ÷ 8 = $150 |
| Lead cost as share of revenue | Spend ÷ revenue | $1,200 ÷ $4,000 = 30% |
The last line is the eye-opener. If your gross margin on those jobs is 50 percent, paying 30 percent of revenue for leads leaves you very little. If those jobs are larger, or the customers come back for years, the same spend can look very different.
Should you count lifetime value?
Yes, but honestly. A marketplace customer who books once and never returns is worth one job. One who becomes a maintenance member or calls you for the next five years is worth far more, and you didn't pay the platform again for those later jobs.
Track whether your marketplace customers come back. If they do, the platform may be a reasonable way to build a customer base. If they keep booking through the marketplace instead of calling you, you may be paying again for the same customer.
What separates contractors who make marketplace leads pay?
Owners who get good results from lead platforms tend to share a few habits.
They respond fast
When leads are shared, the first business to make real contact often wins. A lead answered after a few hours has often already booked someone else. Have a plan for who responds, and how, during work hours and after.
A quick first text, if the platform allows it:
"Hi Alex, this is Sam from Ridgeline Plumbing. I got your request about the leaking water heater. I can call you in the next few minutes, or is a text easier?"
They choose their job types carefully
Turn off job types you don't want or that rarely convert. If small one-off repairs in a far-off ZIP code aren't worth the drive, don't pay for those leads.
They follow up
Many leads don't book on the first contact. A second and third follow-up over a few days, without being pushy, books jobs others miss. See how to win more estimates for a follow-up schedule.
They earn reviews on the platform and on Google
Platform reviews help you win more platform leads. Google reviews help you win customers directly, without paying per lead. Ask every customer the same way. See how to get more Google reviews.
They turn platform customers into direct customers
After a good job, make sure the customer has your direct number, your website and a reason to call you next time: a sticker on the equipment, a reminder when the next service is due, a membership offer. Check the platform's terms first, as some have rules about this.
What are the warning signs a platform isn't working?
- Your cost per paid job is higher than the profit on the job.
- Most leads are unreachable or not real, and credits are hard to get.
- You're constantly competing on price against several other businesses.
- The jobs are mostly small and far away.
- Customers from the platform rarely come back to you directly.
- You've spent months without tracking any of this.
If several apply, pause, measure, and compare with other channels like Google Local Services Ads, your own website, referrals and repeat customers.
How do marketplaces compare with other lead sources?
| Source | You pay | Leads shared? | You build |
|---|---|---|---|
| Lead marketplaces | Per lead or subscription | Often | The platform's audience and your profile there |
| Google Local Services Ads | Per lead | Generally not in the same way | Your Google presence and reviews |
| Google search ads | Per click | No | Traffic to your own site |
| Your website and Google profile | Time and website costs | No | An asset you own |
| Referrals and repeat customers | Rewards, reminders | No | Your customer base |
For a side-by-side on Google's options, see Google Ads vs. Local Services Ads. Many established businesses use marketplaces to fill gaps when starting out or entering a new area, then rely more on channels they own as they grow.
FAQ
Are Angi or Thumbtack leads exclusive?
It depends on the platform and program. Many leads are sent to more than one business. Check the current terms for the program you're considering.
Can I get refunds for bad leads?
Some platforms offer credits for certain types of invalid leads, under specific rules. Learn the rules and request credits promptly when they apply.
How fast should I respond to a marketplace lead?
As fast as you possibly can, ideally within minutes during working hours. Speed is one of the biggest factors in winning shared leads.
Should a new business use lead marketplaces?
They can help fill a schedule while you build reviews and referrals. Set a budget, track cost per paid job from day one, and keep working on sources you own.
How ServFlo helps
ServFlo lets you set a lead source on every customer, such as each marketplace, and reports show revenue by lead source, so you can compare platforms on paid revenue rather than lead counts. Quotes go out from your pricebook in minutes, and on the Connect plan and above, quote follow-ups send themselves at 3 and 7 days and stop once the customer decides. Once a marketplace customer has worked with you, reminders, reviews and maintenance plans help them book with you directly next time. See quotes and invoices, reports and the pricing page.