Are Reviews Killing ServiceMagic’s Rebranding?

As ServiceMagic moves forward with its’ re-branding to HomeAdvisor.Com, I am struck by the futility of rebranding for an online company or any company for that matter.

In ServiceMagic’s case, they are giving up 13 years of branding and SEO juice for what?

This got me thinking — never a good thing, some would say!

Reasons for Rebranding

1. The business model is not profitable or profitable enough, requiring a significant shift of emphasis.

2. The reputation of the existing business/brand is tarnished beyond repair.

3. Both 1 & 2 are true.

The ServiceMagic Decision

For ServiceMagic’s move to HomeAdvisor.com, CEO Chris Terrill states that the move is driven by a desire to narrow the brand’s focus on home improvement, repair and maintenance.

Mmmmm.. that sounds like goggledy gook to me.

Both companies sell leads to contractors.  Both companies sell the same leads to multiple contractors, setting up a feeding frenzy.  Both companies have a seal of approval for contractors they sell leads to.

So why the risky change?

Giving up 13 years of hard earned progress online for what appears to be no change in target market or business operations.  Terrill said, in an interview with the Denver Post,

“For a company of our size and our age, we should be a dominant brand, but we’re not,” said Terrill, who took the helm at ServiceMagic in April 2011.

“So, we made the decision to make the change based on some very specific research.”

He is right; they should have been a dominant brand.

Why weren’t they more dominant?

The Real Rebrand Driver

I did some digging and guess what?  The company reputation is shot to pieces with an awful lot of poor reviews online.

With the example I provided, you can see that consumers and contractors alike have not been fooled by the rebrand.

I would suggest the real reason for the rebrand is that somebody thought it would be easier to recapture the SEO juice from up 10 million indexed ServiceMagic pages than it was to remove, settle and/or undo all the complaints online.

So, it appears to me the main reason for the rebranding is to escape a terrible reputation online.  The main thrust of the negativity seems to comes from consumers who get bad contractors (low quality seal of approval), and contractors who get overworked leads.

So will this slight of hand brand change work?

The HomeAdvisor.com Result

Not in my opinion.

The problem is, this is an unworkable business model.  Direct sales and flawed practices do not work online.  The internet is a wonderful place, and I love it for what it adds to all of our lives.  One of the things I love most is, it will not let you build a reputable business on the back of less than perfect business practices.  The internet really drives you to provide a really customer-focused business, providing a great product or service without any smoke and mirrors.

Note: HomeAdvisor.com is trying to resolve most of the online complaints.

Good luck with that.  The problem for ServiceMagic and/or HomeAdvisor.com is a flawed business model, and those flaws will continue to exist no matter what the business name/brand.  Sometimes what you really need to do is change the way you do business.

Author turnthepage

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Join the discussion No Comments

  • disqus_7lEAhytOR7 says:

    Home Advisor is a huge rip off for many businesses. They charge about $11 for a single ‘lead’ and businesses still have to compete with other businesses to win the customer. Also, the people who use HA are usually looking for a cheap price but expect top quality, so their expectations are never met. The businesses who provide high quality services are the ones who really get screwed because they charge more, don’t get the job, and are stuck with HA fees.

  • Phil Meyer says:

    I also agree with the associate from American Roofing; the people who have had poor experiences somewhere should use their best judgment on whether or not the problem lies within the company values or just an employee having a rough day. Either way, the company can’t escape the way they have allowed business to be conducted for so many years with a simple name change. Nice post.

  • American Roofing says:

    Really great post! Rebranding just to get rid of your bad online reputation is not going to change anything. If business continues to be done the same way, people will still use the power of online reviews to display their distaste in the company.

  • Perry Ziehm says:

    Seems if your trying to cover up the wrong thing them you will get burned agian. Re-brand isn’t about covering up, its about starting fresh and new.

  • Speedtech International says:

    I can see why they would try to re-brand but as stated in the article, it will fail because they did not do enough to change their company.

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