I wonder under which "in-home" service out-call escort services will masquerade as.
It's only a question of time.
When I was at Yell I wasn't that surprised to see how frequently such services would appear on our database, initially as massage and then moving on to ever stranger personal services (with the real service buried in the description or provided by a phone call later).
I'm curious what (if any) startups will be build around this.
For example, what if there is a service that enables you to take your Amazon ratings to another platform but not have to pay the 20% cut. You can imagine the service providers would be willing to pay for the cost of verifications where their Amazon ratings is verified and transformed to platform B where it charges only 10% or 8% cut.
Other interesting angles would be around services and tools you can create to help the service providers market themselves better, engage their customers for reviews, return for repeat business, etc.
Very exciting time!
It certainly is, though with Amazon's token lack of finesse and personality. Could become something akin to Odesk for real-world services, and would likely suffer from the same maladies: low average quality, race-to-the-bottom pricing, and impersonal customer service
- For example, if you install car audio, your services would be listed alongside car audio components.
The real benefit for some, not much for others. iPad Repair can't benefit from iPad sales
- Amazon creates pre-defined scopes of work based on common customer requests which you are then able to pre-estimate and offer... Before a job begins, you can review a customer’s specific scope of work and process a change order if needed.
Isn't this too complex? Also, no mention of procedure if customer does not get satisfied by the service. But anyway, it's very interesting to see Amazon trying to standardize service business. It's too complex, I want them to show me how to do it.
iPad repair certainly can benefit from listings next to iPad sales. There's an obvious case where someone has broken their iPad, goes to look for what a new one would cost rather than sending it in to Apple, sees the cheaper repair option and purchases services.
On the second point, it looks significantly simpler, particularly from Amazon's standpoint, to start the capability only using predefined service offerings. Such commoditized services can be more easily and confidently associated with products, whereas open service offering definition would be significantly harder to support (leading to a poor user experience and adoption rate).
But Amazon's brand do benefit from this whole concept if executed well. And it's pretty hard to copy by competitors.
Also one of the big issues with buying amazon's stuff globally is the lack of warranty. Now if amazon decides that a certain product Y that is currently not bought in country X would be a good deal there, it could work with a lab to offer a repair service for it, and could guarantee promotion of said product, to make it worthwhile for the lab.
Assuming Amazon can manage this complex process well, this could become quite a big differentiation for the in many global markets.
> Also, no mention of procedure if customer does not get satisfied by the service.
Whether amazon cover the service with a guarantee or not, the killer feature will be the reviews. This could wipe out 'find a tradesman'-style web sites over night.
If you consider that the service provider pays nothing to acquire the customer and close the sale, plus Amazon brings the platform and payment processing I think it's very reasonable.
As they rightly point out in the benefits these aren't leads, they are closed sales.
It's high. They're not first to the scene. If you look at Elance, it's 8.75% for exactly the same thing including payment processing. On the high end, I've worked with agencies that charge 15% for everything. 20% is steep.
I think that's a little hard to say genially. In some industries (eg mechanic) repeat business is common pretty so it's really just 20% of the first sale. Other industries tend to spend a lot on customer acquisition anyway, eg personal injury lawyer.
In some industries 20% is a money losing exercise.
Depends if the Amazon->Provider model is more like Yell->Advertiser or Uber->Driver.
If Amazon provides leads but the service provider still does marketing, customer service, accounting, payments, sets prices, insures against fraud, closes the sales and so on, you'd expect Amazon's margin to be pretty slim as they're basically a telephone directory.
But if Amazon manages the customer relationship, does all the advertising and customer service, sets the prices, makes the final sale and all that, so the service provider just turns up to do the job, they could probably make a much better margin.
Good point - that could definitely be worth 20% when done properly. But I can't help think of eBay which does all that and still feels like a hella rip-off. My last eBay run had some international sales and when I did the final sums, taking into account FX charges and PayPal fees, the eBay machine sucked up near 40% of the final sale price.
It depends if they charge a premium or not ... if they charge 20% more than market rates I'd be happy with it. But yeah, that's pretty unlikely - its more likely to be a race to the bottom on prices for some services.
indeed, 15% to 20% is very very stiff. 8% to 10% would have been okay for a matured line, while 3% to 5% during promotional/inauguration period would have been better suited.
What is this? the 90's ? Anyone can set-up a simple free website and offer his services, of course a little bit of marketing and patience is still required, but for a smart man, that doesn't cost anything.
Yes, anyone can make a website, anyone can accept payments, and anyone can promote their site and reach an audience.
(and it'll take time and money; people are free to use another service or build it themselves - isn't this what a free market is all about?)
Amazon is the e-commerce juggernaut; Amazon.com is the 7th most popular website in the world. (4th in the U.S.)
The dominant player in a market sets the price. (apple & google play take 30%, uber & lyft take 20%, think amex/porsche/jetblue/nike...)
yes, definitely. also beyond Thumbtack, see Homejoy, Handy (both doing extremely well with lots of capital), even TaskRabbit, and a handful of other younger attempts that are late to the party. should be interesting.
This is amazing. They've created the arbitrage market with reputation management that we need -- it suddenly builds a platform for Cherry, Homejoy, Exec, etc..
I wish they introduced the ability to have structured bids / sell orders for things like food delivery, and even transportation service.
> I wish they introduced the ability to have structured bids / sell orders for things like food delivery, and even transportation service.
Yes! That would be very interesting to see. If we could, sort of, commoditize a certain service (eg. transportation), and build a bid/ask order book for it (potential customers are bidders, and transportation services provide the asks).
The problem, as I see it, is defining the base unit. In order to have a unified order book, we need a base unit for this order book. What are we selling? Is "1 mile of transportation", or is it necessary to build different order books for different locations? I suspect most transportation service have a base fee plus a $/mile rate. So now you have two variables, and the price of "1 mile of transportation" will depend on the quantity of miles, which makes it a non-commodity (1 ton of iron ore in the spot market will cost roughly the same as 100 tonnes).
Agreed, food / grocery delivery and transportation services would certainly be interesting, but defining the rates based on some sort of a base-cost-unit like mileage and speed of delivery would be extremely challenging to do smoothly for the end user. I think it would end up being non-satisfying for the customer and the sellers.
Besides, amazon.com has amazon fresh for the grocery delivery service needs. Why cut into their own business?
Sure, but restaurants have special needs relating to getting groceries. When they want "avocados" they don't just want any case of avocados. They may want a case of "locally sourced Haas 40's with 4-5 day ripening time with a USDA Grade of #2 Combination, or #2, but not #1". Not just avocados. Instead of wanting "bread" they might need an artisan bread with a gluten free recipe that's standardized to 16oz weight for their lunch sandwiches. So it's not as simple as it seems, which is why there's dozens of huge billion-dollar companies who do this such as Costco, Sysco, US Foods, Shamrocks, etc. You just shop around and stay on top of food costs. And if you're a medium-large chain you lock down trade agreements much farther up the supply chain (producer level) to very low fixed prices for 6 months at a time. So if amazon wants to try to tackle dozens of intricacies for thousands of types of perishable goods that will have variable quality in a market that is heavily regulated by the USDA, more power to them. Source: I own a restaurant on the side.
Is this really something Amazon wants to do? Yes, it's the natural evolution of Bezos' ambitions, and services are really the only category Amazon hasn't quite touched. But it's a lot harder to control people than it is books. Do they want the people who have come to expect toilet paper delivered in 2 days exactly, without fail, to associated with never-on-time plumbers?
Services (unlike products) are typically constrained by the number of personnel available.
How does Amazon determine a company's availability when a customer books a job?
Most of these business I'd guess are probably in the 1-10 people range and probably not the most tech savvy. I can't imagine an adequate solution unless Amazon provides scheduling software and enforces adoption.
If you look at the list of services, it's basically a list that does not include any service that requires an appointment. My company does scheduling for small businesses and, in industries like auto, there's just a maximum number of appointments each day that we're allowed to book.
It looks like Amazon punted on the hard part by constraining the availability to only specific services.
The 20% fee seems ridiculously high.
I suppose this has to get passed on the customers, but the review system alone will probably keep people going there.
On product reviews, I know some are juiced but I still look at Amazon reviews when examining something (and try to figure out which ones appear authentic). I imagine most people take these reviews at face value and reviews are worth a lot when having a service performed. I've never been on Angie's list but it seems a bit scammy from the little exposure I have had. Amazon likely appears more trustworthy, so I grudgingly predict success for this program.
If you consider the amount of time it would take a typical contractor, say an electrician, to land a job if this comes in as more pre qualified business then the extra cost will save having to bid out and spend time on jobs that never pan out. People typically get prices from multiple sources. They don't always follow through on work that was quoted. If this type of work is "shovel ready" that's a great cost savings to the person doing the work. Not having to spend time on sales and marketing at least not as much as if they got calls from an advertisement. (Rating system means people have less doubt about using them).
I do local IT tech on the side. Usually two or three calls a week. If I can get 50% more appointments though the Amazon service without having to do word of mouth advertising locally, that is a win in my book, even if I write off 20% for Amazons insane fee.
Though I think they are trying to use their size to their advantage here. If they wanted to be really competitive 10% would be much more reasonable. 20% strongly motivates me to get new customers to work with me off the Amazon service to avoid that overhead.
But given this seems like a next step iteration from Amazon MTurk platform, it's not that far fetched a leap to see where this could lead to. I believe we very well might soon see a similar marketplace platform for mentioned high-skill services like SEO, Design, Software Development, etc...
If they can crack this problem for local services (which I think is a harder problem), extending it to other services might not be difficult and given it's Amazon they would probably go for it soon(IMHO).
For the most part, it's still pretty hard to get good reviews for service businesses. It's even hard to get prices. How much does it cost to get a car painted?
My question is why would you pay online? It might turn out that for every sale that goes through amazon 3-4 clients just use this like yelp. Read review/prices and just pay the normal way.
Enforcing quality-standards for services rendered sounds nightmarish for either the end user or for the service provider. It's going to be interesting to see how this pans out for amazon.com.
To be honest I have been wondering how long I'd have to live to see "service as a service" come around, about as much as I've wondered the same on the invention of "Awareness Awareness Month".
Seriously: Isn't this the inevitable conclusion to "x as a service"?
Is that fee that bad compared to companies that are doing exactly this? I assume places like HomeJoy and Handy have greater than 20% margins on the services they sell. So if all the service providers start using this instead of Handy they would see an effective increase in their income.
if it's anything like their marketplace, Amazon will keep all,contact information and all of your customers will be the property of Amazon. As a business owner, this is scary, because you can get banned or dropped by Amazon at any time.
It happened this month with DVDs on Amazon. If you aren't a wholesaler or someone that sells a lot in bulk, you can no longer sell DVDs. so if you are a small seller and you build up your customer base over a view years, you now effectively have to start completely over. Still least eBay allows you to keep your customers and build an actual business.
Now with services, I'm not sure how they will enforce this. If you are meeting with the customer, you could easily just tell them to start purchasing from you directly (and avoid Amazon fees). But I suppose if Amazon saw you only getting 1-time customers, they might get suspicious.
Either way, I would steer clear of doing any business with Amazon, unless you are fine with the fact that you aren't building yourself a business. You are building up amazon's
"Either way, I would steer clear of doing any business with Amazon, unless you are fine with the fact that you aren't building yourself a business. You are building up amazon's"
The type of people that will use this (an electrician as an example) will be like lambs to the slaughter. While many of us know about the mercuriality of places like Amazon and Google (dropping projects and services when they don't pan out or when they get bored) most "normals" are not aware of the dangers of having their eggs in this type of basket. And the risk that is involved.
Any many are probably earning a good deal more money as well. The wealthiest self-employed people I know are in trades, and they make a lot more than a web developer does.
when you sell services, you have real contact with the customer. i.e. they bring you the car, you repair it and deliver the service. amazon is going to be more like yellow pages/payment platform.
i agree that this has a high probability of falling into the same zone as Marketplace. For businesses, this implies all the difficult choices of using someone else's platform (customer lock-in, rule changes, etc.). It also brings the benefits of Amazon's reputation and innovation (e.g. allowing Prime customers special benefits).
But I think no one is focusing on the benefits to customers and not businesses. Amazon has historically been awesome for the consumer - bringing a high quality product at low prices. If it can do the same for services, I (as a consumer) will be very happy.
This is a really big deal. I have several times sourced handymen through Angie's List only to get very odd and sometimes bad service. This despite those contractors having mainly good reviews. I applaud Amazon for being one of the few who don't doctor their reviews which allows me to actually rely on them.
They could set their sight on controlling the services, or they could just treat the services availability/price as a gateway to selling bulkier and more expensive products.
Buying anything like refrigerators, pianos, dishwashers, or car audio systems involves some (sometimes heavy) amount of pre- and post-delivery service.
Sometimes that friction might prevent the consumer from clicking the "Buy" button, as shopping around, contacting and then scheduling haul-away, delivery or installation jobs is not something people get excited about.
They could go Fiverr route - sharing contact info is prohibited and they allow only use of their own messaging central. The system is created to protect buyers, not sellers, but sellers in exchange for fee and obedience get platform to advertise.
It seems only certain sellers can. I know I tried to sell one of my used DVDs on Amazon recently (and I sell used stuff there fairly often, so I know how it works). They let me enter all the details but when it came time to list it, they said, "Oh, sorry, you can't sell DVDs here." No explanation was given.
Almost certainly due to the prevalence of fake DVDs. I had a high school buddy who would rent DVDs from Blockbuster, rip them, and sell duplicates on eBay. There's also a steady flow of high quality copies from East Asia which you can find all over New York. I can totally understand why Amazon would want to restrict sales of this specific category.
One of my friends bought Agriya thumbtack script lately. He's targeting micro workers and heavily using SEO. So, I think, he may not be affected with Amazon. Can anyone share some thoughts here? Anyway to handle Amazon?
It's only a question of time.
When I was at Yell I wasn't that surprised to see how frequently such services would appear on our database, initially as massage and then moving on to ever stranger personal services (with the real service buried in the description or provided by a phone call later).