A recent study by Ryan C. McDevitt of Duke University lays claim that plumbers who bid on Google’s PPC ads have a high likelihood of being poor quality plumbers.
The article makes a comparison of PPC ads to the former yellow pages. The argument begins with the home based services whose names begin with the letter ‘A’ or a number. They found plumbers with ‘A’ or numeric names charge a 8.4% price premium. They used a study from 2005 based on the Chicago yellow pages which documents ‘A’ names and number names by percentage of total listings in each category to point out plumber’s beat the average 9.3% of business with ‘A’ names. This study they used is pretty eye opening.
Rank Yellow Page Headings by Percentage of “A” or # Names |
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1
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Locks & Locksmiths | 65.90% |
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2
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Towing-Automotive | 28.90% |
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3
|
Taxi & Limousine Service | 21.20% |
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4
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Convenience Stores | 21.20% |
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5
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Plumbing Contractors | 21.00% |
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6
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Associations | 20.80% |
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7
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Insurance | 19.90% |
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8
|
Roofing Contractors | 15.20% |
|
9
|
Cellular Telephone Services | 14.90% |
|
10
|
Art Galleries & Dealers | 14.90% |
|
11
|
Employment Agencies | 14.80% |
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12
|
Automobile Repairing & Service | 14.50% |
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13
|
Electric Contractors | 14.10% |
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14
|
Travel Agencies & Bureaus | 13.50% |
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15
|
Painters | 13.30% |
Source: American Business Disc,2005
Does it correlate that yesterday’s Yellow Page spammers are today’s internet spammers?
The fact that Locksmith’s tops the list reminds me of the notorious Locksmith spammers in today’s SEO world. Albeit it may not be entirely fair to suppose an ‘Automobile’ category is gaming the system by using ‘A’ names as the category itself begins with ‘A’. It is also insightful that roughly 6.2% of competitive categories use ‘A’ or numeric names. If name selection for a business were unbiased we would likely see an average closer to 3.9% ‘A’ names, which is where Lawyers and Attorneys fall due to regulations requiring firms use names that match the lead attorney. Pizza companies actually fall below that mark with a 3.4% ‘A’ name ratio.
My Thoughts
The idea that plumbing spammers are more likely to bid on google PPC ads is intriguing. However I found that the study by McDevitt of Duke makes a lot of assumptions. Further, it used Yelp as a primary source for counting reviews and comparing complaint averages. I highly doubt that the data included Yelp’s obnoxious filtered reviews. Plus, as Larry Kim added, 25% of Yelp’s reviews are suspected as fake.
And if the conclusion has some merit among the plumbing industry, I find it hard to believe it is applicable to all home service industries. Granted I am a bit biased to the pest control industry, but even still, I find it hard to imagine a business model that could afford the current cost per ‘pest control’ click and not retain customers.
The study does have some tenable findings in the yellow pages with regards to A and numeric names associated with quality. I believe the choice to take the AAA name for phone book ranking is an indication of choosing short term gains over long term strategy. A well developed quality service takes more careful aim with long term strategies in the crosshairs.
But… “Hey, I am just the pest control guy.”
for further discussion on this study visit HBR : http://blogs.hbr.org/2013/11/beware-the-plumbing-firm-that-advertises-a-lot/
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