Buy a book, rent a movie, purchase the newest version of Madden for your XBOX and oh don’t forget to book the plumber. This is not as far fetched as it sounds. In fact it’s a reality with the introduction of Amazon’s new service called Amazon Services. Amazon wants it all and now they are adding home services to the mix.
So what is Amazon Services and how does it work? First lets understand what Amazon has to offer. They have the largest database of shoppers and credit cards online. Amazon is a monster and is expanding in many different markets which include their Prime service. Amazon Prime’s $99 per year price tag started by including free 2 day shipping on most purchases. Over time Amazon has built in their video streaming service as well as music and now cloud services. Making Prime an amazing value. Amazons goal is to pack as much value into it’s Prime service as possible which could possibly add it’s new Amazon Services to the mix as well. So what is Amazon Services and why? Well why not? Just take a look at what AngiesList has done for the contracting industry, their success must have Amazon licking it’s chops seeing nothing but dollar signs all the way. Amazon has such a major advantage over AngiesList in the long run with their massive database of customers who are programmed into using Amazons online review system to make purchasing decisions.
If there was anyone that had a chance of taking on AngiesList it would indeed be Amazon. Backed by major marketing dollars and an infrastructure to handle massive amounts customers Amazon surely will pack a punch.
The concept is pretty simple, need a plumber do a search on Amazon Services, read the reviews and make contact. Amazon comes in with no monthly fee to the contractor but they do take a whopping 20% of the service fee up to $1000 and 15% over $1000. Depending on the amount of business they send your way that high percentage could cost you quite a bit of money and indeed cut into your profit margins. But, you have to look at this from another point of view. Exposure to new customers. Avoid the one and done mentality and try to build long term relationships with your customers and then this becomes a no brainer. It always costs a little more to take on a new client but if you think in terms of lifetime customer value, Amazon Services could prove to be very lucrative in the long term. There is no contract so you can walk away at anytime if it’s not working out for you. It’s very important that you watch your email closely because when you receive an order you are contacted via email giving you 24 hours to contact the customer. Personally I think 24 hours is a long time before I hear from a service I ordered. The customer pays via Amazon, then Amazon submits payment to your bank account minus their fees.
So here is a losing scenario:
You only use Amazon Services for marketing your plumbing company. Month after month you pay the 15-20% customer acquisition fee. You have no follow-up plan in place to keep in touch with your clients, this might sound crazy to some, but it’s a true fact most businesses have no plan in place to stay in touch with their customers. This makes this business rely on bringing in new customers every month. This is costly and a bad long term use of Amazon Services
The better scenario is:
You list your business on Amazon services, have an online marketing plan in place which includes SEO, PPC, Social Media, and eMail Marketing. Every new customer you acquire from Amazon, you collect their contact information INCLUDING AN EMAIL ADDRESS. On a monthly or weekly basis you send a email message including valuable information like a free boiler inspection or ideas on how to weather proof their home for winter. You don’t have to limit it to just plumbing information. This is value added information a homeowner would find useful. The most important thing here is keeping your name in front of your customer, so when they do need you they don’t forget who you are or head back to Amazon to find you.
The next thing is the value that being listed on Amazon adds to your local SEO results. Getting listed on Google Maps is a very important factor and one of the ongoing things you must do to get your there and keep you there is finding high quality directories to be listed on. Amazon will be a very high authority directory to be listed on.
So how do you get started with Amazon Services? Right now they are in a beta program. They do have a listing for Monthly subscription fees which will be in addition to the 15-20% but that is waived until January 31 2015. There is a $50.00 background check fee also waived through January 31 2015 and keep in mind that each of your employees that perform services from Amazon Services also require a $40.00 background check. The 15-20% service fee includes invoicing, payment processing and fraud protection so Amazon does adsorb some costly fees like credit card fees and if someone decides not to pay their bill.
If you head over to amazon.com/sellingservices you can apply to have your business listed or activate an invite if you received one. It’s also important to understand this service is only available in a few test markets including:
Los Angeles-Long Beach-Anaheim Area
Riverside-San Bernardino-Ontario Area
San Diego-Carlsbad Area
San Francisco-Oakland-Hayward Area
San Jose-Sunnyvale-Santa Clara Area
Miami-Fort Lauderdale-West Palm Beach Area
Atlanta-Sandy Springs-Roswell Area
New York City Area
Houston-The Woodlands-Sugar Land Area
San Antonio-New Braunfels Area
Green Bay Area
In order to successfully market your Plumbing or HVAC company you have to do a lot of different things, SEO, PPC, Directory Marketing, Social Media Marketing, eMail Marketing these are just a few of things you should be doing to successfully grow your business.