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WEB/DIGITAL Which revenue model should I be going for?

GreasyGinger

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I'm currently developing an App to link trades people with customers .

Basically a customer will enter details about jobs they need done and get quotes sent to them from local businesses.

Originally I was going to charge a fee to the customer and take a cut of the total bill from the business .

This leaves me processing payments, both incoming and outgoing, although I feel this could make more money per transaction .

Now I'm toying with the idea of charging the business for the service monthly under the promise I will drive customers there, and allowing the service to be free for the customers . I feel I would need to give the businesses a free trial period but after its proven they could start paying.

Second model means recurring revenue, not as much, and no revenue for the first little bit, but could be more appealing to both sides .

Any thoughts?
 

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Andy Black

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I'm currently developing an App to link trades people with customers .

Basically a customer will enter details about jobs they need done and get quotes sent to them from local businesses.

Originally I was going to charge a fee to the customer and take a cut of the total bill from the business .

This leaves me processing payments, both incoming and outgoing, although I feel this could make more money per transaction .

Now I'm toying with the idea of charging the business for the service monthly under the promise I will drive customers there, and allowing the service to be free for the customers . I feel I would need to give the businesses a free trial period but after its proven they could start paying.

Second model means recurring revenue, not as much, and no revenue for the first little bit, but could be more appealing to both sides .

Any thoughts?
Maybe these might help?
 

Andy Black

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GreasyGinger

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Thanks for the quick replies Andy .The stop building stuff one I just had a quick look through and I think is exactly what I needed to see. Will have a listen to that interview on the way to work tomorrow.

Lead gen for mechanics is exactly what I'm doing. It's a business I know back to front and it helps when you can speak the lingo fluently.

Again much appreciated and I will let you know once I've had a good listen .
 

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Consumers don't generally expect to pay to access these type of things.

The ones that go on those type of sites are the ones that

A) Don't know anyone themselves, then
B) Don't know anyone who knows anyone

otherwise they would not go on them would they?

So they are usually structured like your second model.

You would need to demonstrate why you are better than existing models.

As Mechanic what would you have wanted from a lead generation company?

I will hazard a guess that it would be a solo lead (ie not shared with 2 other garages as you may be under a car when it comes in and find you were beaten to it) who is not a price only buyer (what most people are when they use these sites as they have no first hand info to go on due to my 2 points above.

Will your site generate what you would ideally have wanted? And if so, as Andy above say, can you not do it for people in your line of expertise?

If I contacted a mechanic they would know I was not one of them. If you did they would know you are one of them. Your credibility is much better.

On a secondary tack, and not to divert you from trying this one, 6 figure mechanic sounds quite successful to me. Some of your equipment probably cost a lot of money.

Could you see about improving the marketing for some of those suppliers you already have deep business connections with and help them with directed sales/marketing to people like you?

If I told you that Hydaulic Platform A is better than Hydraulic Platform B you had better change, you would always have the thought, 'What does he know?'

If you said the same the customer would know you know what you are talking about.

Just a thought.

Dan

PS: I type so slow I just saw you replied and covered the mechanic bit :blush:
 

MJ DeMarco

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You charge the business, it's an advertising expense. It's such an easier sale.

Consumers won't pay for this as they don't expect to pay.

Sounds like something I was doing years ago.
 
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GreasyGinger

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Dan, the type of customer in the automotive business is really any customer that comes through the door. I had a manager years ago who would go on and on about logging new VINs in the system as being the ultimate goal. The whole reason tire rotations are free is to sell you brakes.

MJ, just once again TMF was inspiring and I pretty much preach about not trading time for money to everyone I meet. It's funny the original concept of the business was a platform to help independent mechanics find side jobs. Now that I'm developing it though it has turned into a type of business you're very familiar with .It must mean I'm on the right track then .
 

Andy Black

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Just remember: the mechanics pay you, with money they get from consumers.

It’s the consumers who have your money. Focus on getting them to give their money to the mechanics and everything else will fall into place.
 
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GreasyGinger

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Just an update I've listened to a couple of your AndyTalks episodes and I'm hooked on them. Lots of good advice for when I'm at the marketing stage.

Since this post I've shifted gears (can't help it) and decided to make the platform more appealing to the businesses I want to sell to. Making it super simple for them to use hand in hand with current systems used by any major service center. Something they can flick over to in their downtime and that a commissioned service writer should really get down with.

After thinking about everything said here I know which way I want to go. A monthly fee and paying a percentage of the quotes agreed too. If the percentage gets higher than the monthly charge then the monthly charge is waived. I think this will help me do an initial sell and say for the first couple of months you only pay for actual leads and it's "free" to hand out as many quotes as you want.

The value I'm adding is sending you customers that are highly targeted. People who are actively looking for work to be done. Instead of the standard radio ads for 1 dollar oil changes being listened to by people who walked to the grocery store.

The app and business web platform are almost written and ready to be put through some testing. Then it's onto reading a book or two about copy writing and getting some kind of marketing ball rolling.

I think the first $400 I can make from this will be going to your Adwords course Andy
 

Andy Black

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Just an update I've listened to a couple of your AndyTalks episodes and I'm hooked on them. Lots of good advice for when I'm at the marketing stage.

Since this post I've shifted gears (can't help it) and decided to make the platform more appealing to the businesses I want to sell to. Making it super simple for them to use hand in hand with current systems used by any major service center. Something they can flick over to in their downtime and that a commissioned service writer should really get down with.

After thinking about everything said here I know which way I want to go. A monthly fee and paying a percentage of the quotes agreed too. If the percentage gets higher than the monthly charge then the monthly charge is waived. I think this will help me do an initial sell and say for the first couple of months you only pay for actual leads and it's "free" to hand out as many quotes as you want.

The value I'm adding is sending you customers that are highly targeted. People who are actively looking for work to be done. Instead of the standard radio ads for 1 dollar oil changes being listened to by people who walked to the grocery store.

The app and business web platform are almost written and ready to be put through some testing. Then it's onto reading a book or two about copy writing and getting some kind of marketing ball rolling.

I think the first $400 I can make from this will be going to your Adwords course Andy
What were your take-aways from the chat with @Contrarian?
 
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GreasyGinger

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My two biggest takes were to remember that I'm connecting people. I want to get customers in touch with businesses and that is what the end goal here. Before my whole thinking was that my goal is to take money from all these people, which the more I listen to you and other successful people is that I need to put the people first. Make something that is going to both make the customers life easier, and make the businesses happy.

The second was to keep things simple. I was in the category of building that amazing thing with all the flashy buttons and latest tech and it's going to make you dinner and whatever. I've really simplified things and will be able to get it out there and up and running much quicker doing it this way.

I really connected with the not knowing what a lead is, as a trades person myself, it wasn't until I read TMF and started reading this forum that I had knew that lead generation was something people pay for. I also spent an hour in a google hole on the term vertical, ha.

It really changed my mindset and I'm truly grateful with you pointing me in that direction. I'm very new to all of this entrepreneur talk and sometimes feel like I'm trying to get into something that is way over my head, but with your simple idea of connecting people, I get that, and I feel in person I'm good at that.
 

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Contrarian

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Glad you found it useful @GreasyGinger

One step at a time, as long as you're making progress that's all that matters.

As long as you're doing that, it'll probably look something like this:

"I'm in way over my head, WTF do I do now?" >> "Oh, cool, that's how that works" >> "I think I've got the hang of this connecting people thingy now" >> "Cool, MONEYZ!" >> "OK, so now I kinda know what I'm doing, maybe I can build a better version while knowing it will be worthwhile"
 

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