The Best Pay-Per-Lead Marketing Services for Small Businesses

 In Articles, Blog

With a vast array of different pay-per-lead (or PPL) marketing services now available, it can be hard to research and discern which options make the most sense for your industry and, more importantly, for your business. Despite this, small businesses everywhere are relying less on traditional advertising tactics and more on sophisticated strategies like PPL, and the HVAC industry is no exception. Despite the vast majority being locally based small businesses, HVAC providers must now navigate the complicated world of PPL services in hopes of maintaining a steady customer base.  

In researching PPL options for our own clients with HVAC businesses, we found there to be very little cumulative data on which services worked best for their type of businesses. So we compiled all the information we found on the subject in order to determine the best pay-per-lead marketing services currently available for local HVAC businesses. 

The HVAC Industry

The HVAC service industry consists mainly of small businesses with local customer bases, most of which are either sole-proprietorships or family-owned and operated. As such, your standard HVAC company is representative of small businesses across America in more ways than one, including their marketing practices. So while the information presented here may seem hyper-specific, it can actually be applied to a number of different industries and business types. 

What is Pay-Per-Lead Marketing?

To get paying customers, you need a system by which you obtain and follow leads to convert them into sales. This is where PPL marketing comes in. In the most general terms possible, pay-per-lead marketing is exactly what the name implies – a digital marketing service in which businesses pay either a fixed or variable rate for some form of leads on new business. When it comes to breaking down all the associated costs and technical details of how PPL actually works, however, things become a lot more complicated. 

What Exactly Are You Paying for with PPL? 

So when a business invests in PPL, it is essentially paying for potential customers to be directed toward or exposed to your business.  in the hopes that you can a) turn them into an actual customer and b) make more money off of their business than you spent to get it. If your average ROI (return on investment) per lead far exceeds your average CPL (cost-per-lead) is, then your PPL service is doing exactly what it’s supposed to do. If not, chances are the service isn’t worth the money you’re putting into it. 

Different Forms of PPL 

Different PPL providers charge different prices for different services, which take advantage of one or more varieties of digital avenues, all of which we’ll get into in detail here shortly. Before we do, it’s important to understand the four basic formats of pay per lead services and the different types of leads businesses pay for with each. These formats are pay-per-lead, pay-per-click, pay-per-view and monthly/annual PPL services. 

Pay-per-lead (as opposed to pay-per-click or pay-per-view services that technically fall under the same blanket term of PPL services) generates costs based on the number of qualified leads. What makes a lead qualified is based on a set of predetermined criteria that business owners can often set themselves. These leads are ideally targeted consumers who have expressed a tangible interest in doing business with the companies paying for them. 

Pay-per-click (or PPC) services use a different metric for counting the leads they generate, charging advertisers based on the number of people who click on an advertisement, link or website. Because they are less targeted than a PPL service, the cost-per-click (CPC) is generally going to be cheaper than a CPL would be, giving you the ability to reach more people despite the fact that they may be significantly less likely to do business with you in the end. 

Pay-per-view (also known as PPV or pay-per-impression) is a type of PPL in which a fee is generated based on the number of people who will see your ad on their screen, whether it’s via their social media newsfeed, on a certain website, etc. Since they’re counting everyone the ad will be visible to instead of just those who click and/or express interest in it, the cost-per-view (CPV) should be lower than both CPL and CPC. 

Monthly/Annual PPL services will charge a flat rate for some combination of views, clicks and qualified leads, the specifics of which depend on the provider and the agreed upon terms. Many PPL providers offer projections on multiple forms of PPL (leads, clicks and/or views) but only charge based on one of the three metrics. Some providers may do a combination of monthly rates and additional PPL, PPC or PPV rates. Again, it all depends on the providers and how they structure their plans. 

HVAC & PPL

Successful as some may be, local HVAC companies don’t have the nine-figure marketing budgets required to saturate every screen in America with their ads. Like most small businesses, every penny put towards advertising needs to count. For many, the ROI they see from their marketing efforts could be the difference between turning a profit for the year or needing to take out loans to cover payroll in the off-season, which is why finding the right PPL services to invest in is so crucial. 

Fortunately, HVAC contractors have added incentive when it comes to investing in PPL marketing, because any leads they convert have the ability to generate multiple returns over time. So while they may see an initial return of just $50 if a converted lead schedules a service call, that same lead could very well circle back and add thousands to that ROI the next time they need a new system replacement, and more again any time they call you for annual tune-ups, inspections and repairs.  

As stated in reports from the US Department of Energy, “Acquiring customers through marketing can represent a significant expense for HVAC contractors. Industry sources estimated that acquiring a single customer costs an HVAC contractor between $200 and $300.” Keep in mind that this average isn’t the same as cost per lead, but rather an overall average cost per converted lead that also factors in any money lost to unconverted leads. 

Top PPL Services for HVAC Contractors

After narrowing down our research to focus only on the PPL marketing services most relevant to HVAC contractors, we ended up with a list of the top 8 options. These include Google, Home Advisor, Angie’s List, Thumbtack, Next Door, Yelp Talk Local and HomeGuide. All of these options have their own respective advantages and disadvantages, as well as basic costs and considerations, all of which we’ll break down by service. 

How do PPL services work

Google Local Services Ads

With Google Local Services, ads for your business will show up on Google searches for local service providers, and only charges you for leads when a customer calls you directly through the ad. In addition to being quick, intuitive and user friendly, Local Services allow you to set your own monthly budget. To find out how many leads you can get a month for any given amount, all you have to do is tell them how much you want to spend per month, where you do business and what industry you’re in. 

The fact that this service is run by the world’s largest search engine can go either way in terms of being a positive or a negative. On the one hand, everyone uses Google for everything. On the other hand, this means your competition is likely using it for the same exact purposes, and it can be hard to stand out when there’s always a bigger company with a bigger marketing budget and a higher Google rank. However, the service does provide opportunities for businesses to stand out by earning Google Partner badges.

Home Advisor 

Home Advisor is a website that connects homeowners with trusted professionals for general contracting, home repairs and other local services, which makes it a good fit right off the bat for HVAC companies. It also means that anyone using the site more than likely plans to do business, and for a variable fee you can make sure some of that business gets filtered to you. Since their PPL service offers such highly targeted and qualified leads, it is a little more costly than some of the others on this list. In addition to a $300 annual membership fee, HVAC companies can expect to pay anywhere from $15-$60 per lead. 

The varying prices from lead to lead are determined by type and quality, with the highest quality leads being the most expensive. Unfortunately, Home Advisor charges for the leads they give you regardless of whether or not that lead is converted, so a low conversion rate means a much higher average cost for successful leads. Their service allows you to set a monthly spend target and turn off leads if you’re no longer accepting new jobs or don’t want to be charged for leads you know you won’t use. Home Advisor may charge you slightly more or less than your exact monthly spend target depending on how the costs of all your leads add up. 

Angie’s List 

Angie’s List is similar to Home Advisor in that they are both internet databases meant to connect service-based businesses with local customers (the two are actually owned by the same parent company), but there are a few notable differences. Angie’s List functions almost like a social media site in that businesses can create a profile for free and grow their business on the site at no cost just by soliciting good reviews. This isn’t easy to do, however, and any business that really wants to stand out should sign up for their PPL advertising service. 

Advertising on Angie’s list isn’t cheap, but the leads are high quality and highly targeted. In addition to a $50 per month flat rate fee to sign up, leads from the service can cost anywhere from $7-$100, with the average monthly bill for business owners being right around $200. 

Thumbtack 

Thumbtack is another site geared specifically towards connecting local customers with local businesses for a variety of jobs, from DJs to landscapers, and of course HVAC pros. Like Angie’s List, Thumbtack allows businesses to create free profiles where they can showcase their work, list services and raise your rating on the site by racking up positive reviews. They also have a paid PPL service, where businesses who sign up for Thumbtack Pro can essentially pay for a certain number of leads each week. One of the best features of this service is its relatively low costs, with no monthly fees and an average CPL of $3-16. 

However, there are a few downsides to the way their service is set up. For one, the site may send the same leads to multiple businesses that match its targets, which creates a sort of bidding system for jobs in which the lead will more often than not just go with whatever company offers the lowest price. There is a feature that lets you automatically bid on leads who meet a certain criteria based on your targets, but getting consistent results on the site can be difficult and time consuming nonetheless. Studies have shown that only around 16% of leads you bid on will actually go to you. The upside, however, is that you aren’t charged for anything until you ultimately win the lead, and Thumbtack even has a Price Assurance feature that provides businesses refunds if those leads don’t convert for you. 

Next Door

Next Door is a web application designed for hyper-local social networking between people living in the same neighborhood or community. A popular tool for homeowners associations, the app is essentially a hub where neighbors can discuss local issues, make announcements, look for recommendations and (most importantly for our purposes) hire locally for everything from odd jobs to big home renovations. As an advertising platform, Next Door makes the most sense for businesses who only operate within a certain geographic radius, which includes HVAC companies looking to reach customers within a specific service area. 

Local businesses can easily create free profiles on Next Door, but your profile won’t be visible to users on the site until you have at least one recommendation (the metric by which your rating on the site is determined). To get leads on the site, Next Door offers businesses the ability to pay for zip code sponsorships and Local Deal advertisements. 

With a zip code sponsorship, businesses can pay a monthly fee of anywhere from $25 to $1,000 to be one of a select number of local pros in a given category that the site will recommend to users searching for (the prices for these sponsorships tend to stay toward the low end of that range unless you’re in a metropolitan zip code). With Local Deals, businesses can advertise discounts and special deals for local goods and services. These Local Deals are priced at a straightforward $25 per thousand views. As mentioned above, pay-per-view PPL is inexpensive, but there is no guarantee any of those views will turn into clicks, leads or converted sales. 

Yelp 

Yelp is one of the largest and most widely used online databases for business recommendations, and business owners can easily claim their free page on the site and benefit from positive Yelp reviews. Businesses can also upgrade their profile for just $5 a month and start advertising relatively cheaply at just $0.30 per click. 

Despite this low price, PPC advertising doesn’t come with the same quality leads that you would get if you were paying per lead. Additionally, Yelp has a lot of traffic, which can be a good thing in terms of getting the most eyes on your business, but it comes with its caveats.  The sheer number of users means the site uses relatively broad filters to determine what they define as leads, which could mean high click rates but low conversion rates. 

Talk Local 

Talk Local is a highly targeted leads services specifically designed for local service professionals. Customers using Talk Local will fill out a service request form detailing the work they need done, and Talk Local will connect them with a trusted local company. Due to the way the service is set up, these leads are highly qualified and should garner good conversion rates. With no long term commitments necessary, paying for leads with Talk Local is relatively straightforward. After a free trial period, businesses pay a rate of $16 per lead (or “call introduction” as the site refers to it). 

The only downside to this service is that there’s no guarantee on the number of leads it will generate, as the service is still relatively new and growing. This is a great service if you’re looking for quality over quantity, but if your main goal is to generate more leads, you may have better luck elsewhere. 

HomeGuide

A sort of hybrid between Talk Local and Thumbtack, HomeGuide is an online service where businesses can bid on customers who have submitted requests for quotes on specific projects. As such, leads from this site are highly targeted and should make for easy conversions if you can win them. HomeGuide uses a credits system, meaning businesses technically pay for credits, which they then use to bid on jobs by submitting quotes to customers. The current price per credit is only $1.67, but the number of credits it takes to bid on a job depends on the size of that job and the number of competing bids. 

HomeGuide doesn’t have the same traffic or number of users as other sites, and a smaller network of users will inevitably mean fewer leads. However, this also means fewer local competitors already using the service, which could increase your chances of actually winning the jobs you bid on. And while the credits system may be confusing, the per credit charge system actually makes the breakdown of how you pay for the service much simpler. 

For a simplified breakdown of pros and cons for each of these PPL services, as well as costs and tips for how to succeed with each service, check out the graphics below! 

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