ServiceMagic CEO Craig Smith started off his keynote address this morning stating that the current recession has been a good thing for the industry. His controversial point was that prior recessions have spawned innovation. “I think we’ll see more innovation in the next two years than we’ve seen in the last 10 years,” said Smith.
Smith discussed how ServiceMagic, an IAC company with annual revenues in the US$120 million range, is continuing to evolve and innovate in the home service marketplace for which it operates in some 500 categories. It should also be noted that ServiceMagic has begun expanding into other areas such as elder care and events like weddings.
The launch of Ask the Reviewer, a method through which consumers can ask a prior reviewer more specific questions about a particular service provider, and a neighborhood group buying initiative demonstrate Smith’s belief in building smarter communities at the hyperlocal level. “No one’s really doing things well on the neighborhood level right now,” he said.
Moreover, he sees the importance of investing in vertical content strategies as well as creating value beyond the transaction through programs such as an ask the expert channel and a hotline for consumers to ask questions prior to embarking on a home service project. Lastly, he sees an important function that plays into the long-term value of a customer as the role customer service and supporting and educating new providers and consumers coming online to use the service.
Some trends that Smith has seen through the recession is a shift in type of home service requests. Prior to the recession there were major home renovations as the result of the home refi market, and now ServiceMagic is seeing lower spend, more minor home aesthetic changes. The company has weathered the recession fine as its scope is more than 500 categories instead of just a few major home categories. Smith reports that ServiceMagic’s traffic has continued to grow and home service requests have grown roughly 20 percent year over year.
Through a quarterly home service index, ServiceMagic is providing important data to advertisers to assist them in understanding what’s going on with consumer spend and trends for their respective city. Smith noted that advertisers want more and expect more and ServiceMagic is trying to make online advertising easy for them. “Performance based media is good, but the new transparency puts a greater onus on the publishers to do even more,” said Smith.