Facing pressure from declining membership revenues and a takeover bid from IAC’s Home Advisor, Angie’s List will end its paid membership this summer, allowing it to be in a better position to defend its leading 3.3 Million membership base against increasingly aggressive competitors in the home services referrals space, including Home Advisor, Thumbtack, Amazon, Google, Porch, Serviz and others.
While access to its reviews will be free, the company will offer paid tiers at $24.99 and $99 a year that will provide such options as its Fair Price Guarantee and an Emergency Services Hotline.
Paid memberships accounted for less than 20 percent of company revenues in the last quarter, down from roughly 50 percent of revenues just a few years ago. In a statement, the company said that it had concluded that the paywall “had limited our growth,” which it suggests will come from more advertising, direction transactions and premium services. The company ambitiously said it expects its moves to more than double its revenue to $750 million by 2020. It expects to make $345 million to $355 million in revenue this year.
In a conversation with me just after he came on board in November, CEO Scott Durchslag said he expects to build on the company’s “great base experience with advertising and service providers.” The business will see growth by building platforms with service providers and advertising partners, and becoming more of a marketplace. With a presence in 240 markets and 720 categories, and powerful data signals, “the company is ”poised on the final frontier of ecommerce,” he said.
While the basic service will now be free, Durchslag told me that he sees new opportunities in new premium offerings (which were not yet finalized.) The fair price guarantee strengthens value, while putting the company in a strong position to help direct bigger projects.