“Guys, should I sign up for HomeStars?”
This is arguably one of the most asked questions we get from our clients in home improvement, and it’s a pretty valid one. In this article, we’re exploring whether HomeStars is worth it, examining its potential to generate leads and its effectiveness for Toronto contractors.
But before we get into it, check out part one of this two-part series for more context: Is HomeStars Reliable? Part I: The Homeowner.
HomeStars is a service that helps Canadian homeowners connect with contractors in their area. It primarily relies on reviews that contractors have to request from their customers after completing a project.
The appeal of HomeStars for trades professionals is that it’s a platform where they:
- Have direct communication with project-ready homeowners
- Showcase their business
- Can get a HomeStars verified badge
But does HomeStars bring value to trades professionals?
Well, this is what we’re putting to the test here.
We signed up on HomeStars under Tatiana Moving Solutions to learn more about the service and how effective it is from a professional’s standpoint. The 2-step signup process is simple, quick, and straight-forward.
GREAT. Now where’s the catch?
In Part I of this series, we explained how homeowners can sign up for HomeStars without paying anything, which brought us to the conclusion that it’s definitely worth it for them. No subscription fee, transparency in reviews, and instant access to thousands of home improvement professionals in their area.
At this point, you might be wondering, “How the heck does HomeStars make money then?!” Yeah, we were wondering the same thing…
And the answer is that HomeStars’s revenue relies on contractors desperate for leads.
Sucks to be a contractor, huh?
The HomeStars memberships system
As a contractor, when you sign up for HomeStars, you are offered two options for your account: a basic plan and a premium plan.
At first glance, the difference between the two plans doesn’t seem all that big, but once we became active users on the site, we realized how huge of a difference it actually is.
To put things into perspective, we registered Tatiana Moving Solutions under a basic plan, meaning we didn’t pay anything for it.
Here’s what our HomeStars profile looks like with the basic plan.
And this is a preview of what it would look like if we upgraded our HomeStars membership.
Spot the difference yet?
Your basic profile features ads from your direct competitors on top of the page, and that’s no bueno.
WHO IN THEIR RIGHT MIND GIVES FREE ADVERTISING TO THEIR COMPETITION?!!
Not us, that’s for sure.
The only way to get rid of these ads is to upgrade your membership to the premium plan. And this is how you’re baited into paying for the platform right off the bat.
Okay, so the way your profile looks seems to be the first catch of using HomeStars, especially if you opt for the basic plan.
The question still remains, though: is HomeStars worth it?
Well, when we signed up for HomeStars, we were promised that we would be contacted by our HomeStars account manager to further discuss our options. And sure enough, we were within three days of joining the service. Here’s what we found.
We were wondering about the volume of leads HomeStars could generate for us. The account manager made sure to emphasize that HomeStars is a branding tool first and foremost—a “Brand Builder”…
… and NOT a lead generation tool.
This means that HomeStars doesn’t want its customers to use it for the mere purpose of generating leads. It’s either that HomeStars’ actual purpose is to help businesses grow their brand and online presence…
… or they don’t want to operate on promises they can’t keep, i.e. generating leads?
Either way, the account manager proceeded to explain that HomeStars traffic relies on two types of leads: profile leads and HomeStars leads. Read on to learn the difference.
Types of HomeStars leads
1. PROFILE LEADS are leads that are solely dependent on the homeowner’s research. So, if someone specifically looks for moving in Concord on HomeStars, then takes the time to scroll through the results, they will eventually stumble upon our profile.
The chances of this happening rely on the homeowner’s location and the contractor’s percentile ranking. But it’s also impacted by the time this homeowner is willing to spend looking for the perfect moving company…
… which, let’s face it; that homeowner isn’t going to spend that much time manually researching when HomeStars provides a simpler, automated way of finding the right moving company to hire in their area. All they have to do is type in the service they want and boom! Immediate results just like that.
2. HOMESTARS LEADS are paid leads that you can only generate if you upgrade your HomeStars membership to the Brand Builder. This is where things got really interesting for us.
As a paying customer of HomeStars, you expect to get a return on your investment. So if you’re wondering whether you should upgrade your HomeStars listing, continue reading.
What does the HomeStars Brand Builder really entail?
The account manager from HomeStars we spoke to explained the main difference between the two memberships. Aside from the fact that your competition’s ads will disappear from your profile, the HomeStars premium plan comes with other considerable advantages.
The HomeStars rotation system
The fundamental premise of HomeStars is to help homeowners find reliable contractors in Toronto and its surrounding areas. We touched on this in the first part of this series and, in a nutshell, when a homeowner with an account requests a service, they receive three different profiles from relevant contractors in their area.
This process is called the HomeStars rotation.
The rotation system is the easiest route for homeowners, and it’s also the one they most likely take when looking for a trades professional on HomeStars. It minimizes the time and effort they have to spend searching for the right contractor in Toronto and lets the HomeStars algorithm do the research on their behalf. Sounds dandy… if you’re the homeowner.
But as a contractor on HomeStars looking for leads, your main objective is to end up in these rotations.
Think of it this way: if you and ten of your direct competitors in your area qualify for a request on HomeStars, you’re competing against these ten companies to be among the three profiles the homeowner receives for their project.
And the HomeStars representative said it loud and clear, “You will not appear in rotation with a basic HomeStars plan. This is a privilege only the premium membership can grant.”
Basically, without paying for your HomeStars account, there’s virtually no way for homeowners to find you on the site.
But what about HomeStars leads?
Sure, contractors upgrade their HomeStars account to build their reputation on the platform, but the ultimate goal here is to book more jobs and sign more contracts. We were intrigued by how the Brand Builder would impact our HomeStars leads, of course. Check out our findings.
According to the HomeStars representative, for someone starting out with zero leads on the basic plan, the premium plan can increase your leads to 2 to 4 leads a month. That number can actually get to 10 leads per month, but you’d have to put a lot (and we mean A LOT!) of effort into getting reviews from your customers, all averaging around 97%.
Moreover, the number of HomeStars leads you get is impacted by how competitive your industry is.
Some carpenters report getting as much as 15 to 20 leads in a single week. That rate is pretty amazing! Other contractors in custom home theatres have stated that HomeStars pays for itself each year very easily.
However, for an industry that is a lot more crowded than carpentry or home theatres, your leads would inevitably be much less. Some of our basement renovation contractors, for instance, report getting up to 3 leads in a week. This makes sense since the basement renovation industry in Toronto is a lot more inundated than others.
So, unless you have a very specific niche in your field of work, your HomeStars leads may not be worth the $200 you pay for the service each month.
The final verdict: is HomeStars worth it?
Well, there are so many variables as to whether HomeStars will directly benefit your business or not. But at the same time, HomeStars has grown to become a well-known name among homeowners and is seen as a reliable inventory for Toronto contractors. Here’s our takeaway.
We think it’s important to diversify your online marketing.
Dabble in HomeStars for the hell of it. Create an awesome HomeStars profile while you’re at it! But don’t forget that there are so many other opportunities you should explore for your online marketing.
Sign up for other review-based platforms such as Yelp, Smart Reno, Google My Business, N49, 411, etc. What works for you might not be working for other companies, and vice versa. Find your platform of choice, put in the work, and see where things go. There are also several methods to increase your online presence for free, too. So don’t jump the gun and sign up for HomeStars just because all your contractor buddies have.
Don’t let a door remain unopened, up the ante as you go, and make something big out of your small successes.