Amazon looks to one-better Angie’s List

Discussion
Dec 04, 2014

In its apparent effort to have a hand in absolutely everything, Amazon’s latest rollout positions the e-commerce giant as a middleman between you and your handy man, a la Angie’s List. A beta version of Selling Services, Amazon’s after-sales services marketplace, is currently live in about 15 cities nationwide.

A video on Amazon’s Selling Services website explains that those contractors interested in offering their services apply to have their names listed. After being verified, the service provider appears in a standalone marketplace for their region as well as alongside applicable products, so if a customer buys a washing machine, she will be offered a list of washing machine installation professionals in the area. The video shows the disparate range of services, highlighting plumbers, auto mechanics and yoga instructors as potential sellers.

According to the video, the contractor sets the price for the service and only pays out to Amazon on completed orders. The video states, "Service providers are hand-picked, and only highly-qualified ones are invited to participate." Amazon’s Selling Services FAQ explains that providers must pass business background checks and in-home technicians must pass individual background checks.

[Image: Amazon Selling Services]

Techspot reports, "Amazon is currently waiving background check fees for contractors through January 31, 2015, and monthly subscription fees through June 30, 2015. After those dates, Amazon will collect 20 percent of the service fee on jobs of up to $1,000, and 15 percent on jobs costing more than $1,000. Background checks will run $50 per business and $40 per participating employee."

A TechCrunch article points out a few possible concerns with the emerging model (outside of the logistics of managing licensure and background checks and any potential liability therein). For instance, the possibility that being given a huge list of options rather than one vetted vendor at the point of purchase will lead to buyer fatigue. Citing other similar marketplaces, TechCrunch mentions the tendency of third-party sellers to attempt to compete on price to attract business, and the tendency of customers to pick the lowest-priced option, or an option that carries a dubious high rating.

Amazon’s Selling Services FAQ does not explain the criteria along which service providers will be ranked, or what will determine how prominently they are displayed on the site.

The established high profit margins of the after-sales service market could bring a lot of cash to Amazon. By the same token, where computer repairs are concerned (not to mention in-home plumbing and wiring), an A-to-Z guarantee might not cover grievances as easily as it does with third-party returns in the Marketplace.

Will consumers trust Amazon when seeking help for their home improvement projects? Will Amazon’s Selling Services be a boon to local contractors seeking clients or will it cause a race to the bottom based on price?

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15 Comments on "Amazon looks to one-better Angie’s List"


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Tony Orlando
Guest
7 years 5 months ago

Amazon is like the Godfather, as they want a cut of everything IMO. If contractors are willing to pay this fee, then fine. To me a really good service company or contractor would not need this service, as they have plenty of work in the pipeline because of their outstanding work. Getting the best in the market to sign up for this—I have my doubts. I have several top-notch contractors and service companies I am friends with and they are constantly busy, so we’ll see how this goes.

Ian Percy
Guest
7 years 5 months ago

Have you ever noticed that when you’re trying to roll out pie dough so it stretches to cover a bigger pie plate, that it gets too thin to hold the fruit and starts coming apart?

Max Goldberg
Guest
7 years 5 months ago

Consumers trust Amazon and love its customer service, so why shouldn’t they allow the retail giant to recommend people to service their devices? As long as the work is performed well, why shouldn’t consumers choose the service person that offers the lowest price?

This is another potential revenue stream for Amazon.

Richard J. George, Ph.D.
Guest
7 years 5 months ago

Amazon’s positioning is based on simplifying and customizing the shopper’s experience. Home improvements are a logical extension. The potential advantage over Angie’s List is Amazon guarantees the work of its recommended service provider. Given this guarantee I suspect this will be a boon versus a race to the bottom on price. If low prices translate to poor service guaranteed by Amazon these contractors will not be on the Amazon Selling Services site for long.

Gene Hoffman
Guest
Gene Hoffman
7 years 5 months ago

Really good service providers are already in demand these days. Adding an extra channel for such operators via Amazon is much like providing a sleeve out of a vest. But never underestimate whatever Amazon does.

The results of Amazon’s Selling Service will be, my guess, spotty. For those with knowhow—no. For home improvement pinheads—probably.

Gene Detroyer
Guest
7 years 5 months ago

Will consumers trust Amazon when seeking help for their home improvement projects? WHY NOT? Amazon customers trust Amazon. That is why they keep coming back.

Ben Ball
Guest
7 years 5 months ago

I don’t know.

I didn’t even read the thread.

Here’s why.

May we PLEASE have one discussion involving Amazon/online retailing that does not invoke the phrase “race to the bottom”!?

Just because we have price transparency, thereby forcing all vendors and retailers to justify their particular approach to price/value in the bright white light of day, does not mean all competitors therefore have to revert to “lowest price” to survive. If they do, then it means consumers don’t value all that other stuff the retailer has been pushing as highly as the retailer is marking up their prices to cover it. Plain and simple.

Good grief.

Gene Detroyer
Guest
7 years 5 months ago

Bravo, Ben Ball!

Shep Hyken
Guest
7 years 5 months ago

Interesting concept here. Getting a referral or sale via Amazon.com. This may be a great opportunity for the contractor, consultant, etc., to market their services through Amazon’s e-commerce system. Just another place to be seen.

I don’t believe it will cause a race to the bottom based on price. Sure, some consumers are only interested in price, but there will be a great opportunity with descriptions and testimonials to prove value over price for some of offers. Could be a win-win-win for Amazon, the business and the consumer.

Ed Rosenbaum
Guest
7 years 5 months ago

Amazon is a well trusted, respected brand. This will work But as Tony says, a good contractor does not need this kind of work. They can make more without giving Amazon a cut. You can believe Amazon will not be doing this gratis.

Lee Peterson
Guest
7 years 5 months ago

Hope you’ve all read Brad Stone’s book, “The Everything Store”. If you have, you’ll quickly suss out what this is all about: World domination. All things retail, including the people fixing and installing the stuff you buy, will flow through the gates of Amazon. Think Geek Squad, i.e., it’s already working. So it’s not new ground.

I do have to add that I LOVE the way Amazon will try virtually anything. Fail fast is the MO for the future of retail and they certainly get it.

George Anderson
Guest
7 years 5 months ago

As Seth Godin said many years ago, we live in a world today where pretty much everything is good enough. Consumers go into the purchasing research process, whether it is for a TV set or a home repair, with this as a starting point. When they see specs that appear the same and prices that are not they often default to the lower alternative. They may regret the decision after the purchase, but by then their recourse is limited to bad reviews, social media, personal contacts and lawyers.

In the end, without a unique point of difference, product parity combined with information transparency leads to one logical course of action—it’s that race that Ben doesn’t want us to discuss.

Naomi K. Shapiro
Guest
Naomi K. Shapiro
7 years 5 months ago

I don’t care whether consumers will trust Amazon more or less when seeking help for improvement projects.

I don’t care whether Amazon’s selling services will be a boon to local contractors seeking clients.

This discussion, for me, asks the wrong questions.

The issue for me, and obviously for many BrainTrust colleagues is: Why should Amazon be in this business at all?

Craig Sundstrom
Guest
7 years 5 months ago

Let’s be candid here (actually, based on the polling and comments, we HAVE been candid): outside of selling general merchandise, Amazon is just another company. Sometimes when a company tries something new, it’s because its success in one field logically spills into that related field, and sometimes a company just goes around trying everything, because it can. I’m waiting for Amazon Air…or will it be Amazon Buslines?

M. Jericho Banks PhD
Guest
M. Jericho Banks PhD
7 years 5 months ago
Amazon’s Selling Services resembles today’s marketing model for the Better Business Bureau. Unlike at its inception, the BBB is no longer positioned as a fair arbiter between sellers and complainers, determining the merits of both sides of an argument to help determine a satisfactory resolution. Rather, the general impression of the BBB among the retailers I know is that their mission today is to encourage their members to pay a small toll to make the complainers go away—regardless of the merits of their complaints. In fact, the BBB seldom requests the seller’s side of customer disputes. Further, to become a member of the BBB, all you have to do is pay your dues. If there is a background check by the BBB, it’s mysterious at best. Amazon’s Selling Services sounds like the BBB. As long as mysteriously-vetted sellers and their customers are paying some sort of regular fee, customer complaints will result in the financial acquiescence of the service seller. Amazon, positioned between seller and complainer, is in no position to arbitrate fairly based on… Read more »
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