Contractor referral service expands to St. Louis, Atlanta

By William Atkinson

Special to CONTRACTOR

INDIANAPOLIS — Angie’s List, a company that collects customer satisfaction ratings on local service providers such as plumbers, electricians, roofers and landscapers, planned to open locations in December in Atlanta and St. Louis.

The company is in business in 13 other market locations: Indianapolis; Tampa, Fla.; Milwaukee; Minneapolis and St. Paul, Minn.; Charlotte, N.C.; Boston, Chicago; and five cities in Ohio — Cincinnati, Columbus, Cleveland, Akron and Canton. The company has ratings on 10,000 companies in these cities, which are used by more than 75,000 homeowner subscribers for selecting service providers, founder Angie Hicks told CONTRACTOR. Homeowners pay an annual membership fee of $37 ($45 in Boston and Chicago) for access to local information, which they can receive via telephone call, Internet, fax, e-mail and a monthly magazine.

“When we set up in a new market, the first thing we do is extensive consumer surveying by phone, mail and other media to get the list started,” explained Hicks, who also is chief marketing officer.

Angie’s List then contacts companies that initially receive good ratings to seek additional information, such as areas of town where they work, specific types of work they do, methods of payments they accept and other details that they would not be able to get from consumers.

“Once we get this initial work done, the ratings continue to come in from our members, who are consumers in the area,” Hicks said.

In other words, rating information, including service quality, timeliness and friendliness, is gathered from homeowners themselves, based on the experience they have had with various providers over the last six months. Service providers are rated from “A” to “F,” and the grades are based on the average of the reports received over the last two years.

When providers receive negative ratings by homeowners, they have the opportunity to resolve the issues. If they fail to do so, their names are printed in the “Penalty Box” column of the monthly magazine for three months, or until they resolve the problems. Providers with good ratings have the opportunity to advertise with Angie’s List, but it is by invitation only.

“The company must maintain an A or B rating from the members and must offer a one-time discount to members in the ad, such as a coupon,” Hicks explained.

Most service providers with positive ratings have nothing but positive things to say about Angie’s List.

“I didn’t even know I was on the list until I went to a customer’s house to do some work a couple of years ago,” said Bob Ferretti, owner of Ferretti Plumbing & Heating in Parma Heights, Ohio. “She told me she had called because we were on Angie’s List.”

Subsequently, three or four customers also mentioned to Ferretti that they had found his company’s name on Angie’s List. Ferretti’s first direct contact with the organization came just recently, when the company called him to see if he wanted to advertise.

“When Angie’s List first set up in Tampa about four years ago, I received a call asking if I wanted to be on the list,” said Phillip Maurici, president and owner of Phillip Maurici Plumbing. “They wanted to know a little bit about us. After that, they put us on the list, and we started getting calls.”

The plumbing contractor now receives an average of one to two calls a day from customers who retrieved the name from Angie’s List. Maurici also advertises in the monthly magazine.

“It’s been really good for our business,” he said.

Metzler Plumbing Co. in Indianapolis has been on Angie’s List for about five years, said Larry Metzler, president and CEO.

“We have a very strong rating with them, and I would say it’s probably our best marketing tool,” he said.

Each month, the magazine features the nine service providers who have received the most positive comments during the previous month.

“We’ve been fortunate to be on that list several times,” Metzler said. “They also recently called to interview me for an article for their magazine.”

Angie’s List has contacted Metzler on occasion when he receives a negative response from a customer, so he can explain the situation.

“One was a person we didn’t get back to with an estimate,” he said. “I admit that I dropped the ball on that one. In another case, it was one of those customers that you’re just never going to make happy. She wanted us to warranty a product that we didn’t even supply.”

Metzler advertises with Angie’s List, but added that he hasn’t “done the math” to determine the exact benefit.

“I do know, though, that I don’t have to see the cost to know the benefit,” he said. “Overall, it’s a great program. It’s been by far the best marketing we have ever had, other than repeat business.”

He cautions, however, if you’re someone who does not provide quality service, being listed can surely make your business go in the other direction.

Angie’s List recommends Jeff the Plumber in Akron, Ohio, and has even given it an award for its reputation. However, owner Jeffrey Thompson said he is under the impression that Angie’s List charges contractors to be on its list. It doesn’t.

“For that reason, I do not participate,” he said. “I do quite a bit of advertising on my own, and I get a lot of word-of-mouth referrals, and that is enough for me.”

Two contractors said they prefer Angie’s List to the Better Business Bureau. Ferretti Plumbing & Heating has an excellent rating with the Better Business Bureau, but Bob Ferretti said he likes the Angie’s List concept better. The BBB simply logs in the number of complaints it receives each year from dissatisfied customers, he said.

“They don’t even investigate the complaints,” he said. “If a customer calls to ask about a specific provider, the bureau reports whether the number of complaints received about that provider is above average, average or below average.”

Larry Metzler added: “One thing I like about Angie’s List is that they rate companies on a positive basis, rather than just a negative basis like the Better Business Bureau does.

“They solicit reviews from their customers, rather than just wait for complaints to come in.”