Brian: Well, we’d like to welcome everyone to our 32nd podcast. On today’s episode of the home service toolbox, we are joined by Mischa Fisher and he is the chief economic officer for Home Advisor, along with Angie list, Angie home services, and home advisor is one of the trusted companies that connects consumers directly to home service providers, which has been extremely important during this unprecedented time that we find ourselves in. And today we’re going to take a closer look at the economic impact that COVID-19 has had on small businesses and specifically those in our home service industry. So stay tuned for the 32nd episode of the home service toolbox.
Intro: Welcome to the home service toolbox, a podcast dedicated to helping home service providers every Wednesday, your host, Brian, and Olivia will interview leading experts in both the home service field, as well as companies who support the small business owner, our guests will help you nail down what will and what won’t work to grow your business, whether you’re on a job site or taking a break, there’s no better time to sharpen your small business skills.
Brian: well, Olivia, it looks like you have a new background, that we were talking about last week. Did you make some move last week?
Olivia: Yes, I moved right across the street from our office, which is very exciting. So once everything officially reopens, I can walk to work. But there’s still quite a lot to do. A lot of boxes still have to be unpacked. This is the one presentable room in the house. So it was like, all right, this will be my setup for recording for the time being
Brian: Well, talked about lightening last time, the making a zip line. So you don’t even have to walk you just like zip line from, your, your place to over to the office.
Olivia: Yeah. But I’m on the first floor, so I don’t necessarily have the window access. I dunno I’m going to have to talk to the leasing people about installing something on the roof for me. We’ll make it happen I’m confident.
Brian: Well, Olivia, we are joined today by, a guest, Mischa from Home advisor, Mischa. How are you today?
Mischa: Great. How are you doing?
Brian: We’re doing well. We’re doing well. And it looks like, from, pre conversation you recently moved as well. I think all three of us, have experienced moving in the past a little season. But you are I think you were saying that you’re in your guest bedroom, we’re all remote. We all have different backgrounds. How has remote life for your business where you remote prior to all of this or is this something new for you in working with Home advisor?
Mischa: This is something new for us and, our company, I think we’ve all been extremely proud of our tech teams for enabling it so quickly and so smoothly for everybody to just go remote and, it’s worked better than I think most people expected. And, we’re all getting to know our own homes a little bit better since we’re no longer spending time at the office.
Brian: Well, I think that’s an interesting point. and a great leading question, being that everyone is at home right now, and they’re noticing the things about their homes that they didn’t even notice before, because the reality is if we were working outside of the house, we were probably spending more time outside of the house than we were inside the house. And now we’re in our home kind of seeing the things that maybe need to be repaired, need to be broken, or not needing to be broken, but need to be repaired because they’re broken or service. So how is that impacting kind of the reality of the home service industry and kind of demand for our audience right now?
Mischa: that’s a great question. And I think the toughest thing in understanding what’s going on sort of that broader macro perspective is that the most recent big economic shock that everybody remembers was of course, the 2007 to 2009 great recession and the financial crisis, and that was centered around the home. And that was sort of unique to that particular crisis. So everybody is now thinking, well, could we see a similar sort of situation here, but I don’t think one can compare the two because the root causes of them are so different. And I suspect what most of your listeners have seen was that there was probably a pretty big initial shock to their demand in, mid-March or so, right around the time the NBA cancelled their season. That’s when everybody went, oh; this is a really serious thing.
And then they’d probably start to see that recovery over the last couple of weeks as consumers didn’t step back into the water there. In terms of what’s going on with home services across the board, the last recession, what happened was people’s wealth disappeared very, very rapidly. All that equity, they built up in their homes and home values crashed. And as a result, that was a big hit to not only the home building and home sales industries, but the home service industry too, which is the one that we care about. This is completely different from that in the sense that home values are not deteriorating. The mortgage forbearance system is allowing people who have faced that economic shock of losing their jobs to put off, having to make mortgage payments, which is a nice way to keep people in their homes and to protect both people’s living situations and also preserve home values across the board.
And what it also is doing is it’s driving up a certain amount of demand for home services, because A we’re all spending more time at home. So we’re just noticing problems, but B it’s also increasing the amount of utility, the amount of value that we get as consumers out of our homes. And so both those reasons are focusing our attention on, hey, maybe I should spend more time at home this year. I don’t know what the summer is going to be looking like. Maybe, that family trip that we had planned is no longer going to happen and I haven’t been able to eat at a restaurant so I can put some of that money back into the home. And that has, I think being one of the reasons why this has been so different. And so for listeners, I imagine that some of your listeners have probably seen their business returned to almost the same volumes they have before, if not higher for your listeners who are still looking at that volume, that is, 50 to 60% lower than it was before.
I would say, hang in there, the consumer demand will return eventually. And the main thing is if you have employees take care of your people as best you can, and make sure that you are ready to engage with, consumers in every way possible. And so actually on the home advisor front, we’ve recently launched a couple of new tools to try and make that easier. We’ve launched both, in-app video chatting as well as a payment tool to smooth both the beginning and the end of that project cycle for pros. So the idea is now you can engage with consumers remotely until you don’t have to have the riskier face to face contact the big plus side there being that that’s actually a big time saver and a money saver for a lot of pros because you no longer have to drive around for house calls. And the other piece, the payment piece is saving people, writing checks and invoices and delayed payments and trips to the bank and allows people to just pay in-app and pros can get paid that way. So both of those things are recent pieces that we’ve launched to try and address that issue of consumer demand is still there. It’s just a matter of making sure that you are ready to, to capture it.
Olivia: I think you’re completely right, because consumer demand definitely hasn’t gone away during this time and moving forward. Do you think there are specific industries within the home service industry that are going to see even a surge in, leads or potential new customer base moving forward into 2020 because they’re spending additional time in their homes?
Mischa: Yeah, that’s a great question. I think the most natural response is all of the outdoor projects that people can do. So this is one where the weather’s getting nicer across the country and people can really focus on making their outdoor spaces, family ready, or, there’s never been a better time to put in an outdoor kitchen, for example. Because restaurants are still not necessarily open in most parts of the country and the weather’s getting nicer, but in the long-term, I think everything is going to face it. So what if for your astute listeners’ sort of pay attention to the housing numbers, the housing numbers for new home construction came out yesterday and it was a 30% month over month drop in the month of April for new home starts. So this is the start of completion there for, construction and about a 20% month over month decrease in permitting and home construction, will recover because there’s still underlying demand for new homes, but the leg defective, that means that we’re going to in, around 9 to 12 months, the rough period of time, it takes to construct a home.
We’re going to have a shortage of new homes being completed in that timeframe. And that’s coming right into the 20, 21 season. And that is going to result in higher prices for new homes. (09:42inaudible) equal because there’s going to be fewer of them And that’s going to cause people who are in the market for a home to bid up the price of new homes that are coming on the market, but also existing homes that are already there. And that can actually boost something like remodelling. And a lot of people have thought remodelling by be impacted as a result of COVID because it’s harder to have somebody working on your home when you’re in there. And it’s more of an intimate face to face thing, but in the end, people have underlying demands for a space that fits their family situation and their working from home needs and all those sorts of things.
And so I think even something like remodeling, even if it’s a little bit slower on the uptake right now could be really well-positioned for 2021 because that shortage of homes means that if you weren’t even thinking about moving prices, being bid up is going to remind people who are in homes that they’ve got more home equity than they otherwise had, and that can help pay for a remodel. It can also result in people who were planning on moving, but see the price of home saying, well, I’m going to remodel instead because the price of homes is being bid up. So rather than moving, and it can also result in people who have to move into a new home saying, well, the price of homes have being bid up. So I’m going to go into a cheaper home and just remodel it to suit my needs.
And so for all three of those reasons, even something like remodeling could face an uptake, but right now, I think across the board, I suspect most of your listeners who are doing a lot outdoor projects, we’re seeing a lot of their work has returned to normal. Obviously if an HVAC goes out and the weather’s getting nice, I mean, that is something that consumers really need to have fixed because they’re spending more time at home. If your AC goes out, that’s not really something that’s optional to have working. In the good parts of the country I know we’ve been using ours and we’re in Denver, which isn’t as hot as other parts of the country. And our system has been getting a lot of work over the last week or two. So it’s a, it’s been across the board.
Brian: Well, I think it’s really interesting and I think it’s really helpful and encouraging for, our listeners, even outside of the remodeling. I mean, you think of things that you do when you have equity in your home. And it’s one reason why our family moved is because we had so much equity in our home we didn’t want to lose it. And so, we wanted to actually put it into something that we wanted. So I think it’s going to be helpful for our listeners to understand, okay, how can they pivot, and take advantage of things that people are going to be doing to invest back in their home even a roof, even HAC not traditional, remodeling, concepts, but those are obviously, very important pieces, to invest in when you’re trying to sell your home. It’s the first thing that people are asking. How, how old is your roof How old is your HAC unit?
People that are buying homes don’t want to invest in that. They want the previous buyers to invest in it. But certainly, if you want your house to be sold, that, is definitely something, to consider as well. So I think that’s, as we’ve had lots of people, on the podcast over the past couple of weeks talking about the impact. And I think, what you’re really bringing to this conversation is this the hope, the (13:12inaudible) of where, this challenge that’s obviously impacting, the globe is going to actually have some positive impact 6 to 12 months down the road, for this particular industry. so, prior to getting into Angie’s List and Home Advisor, you’ve done a lot of different, things, you were working with the governor, as a chief economic officer, I believe, and, so I’m curious, lots of people have been, trying to follow all this PVP and EIDO and all of these things, but, as someone that’s, really tuned in the finances and making sure that we’re having a good economic impact, with our own businesses. What are your thoughts on businesses and how they should be taking advantage of some of the resources that are out there, that are being provided to them?
Mischa: That’s a really good question. So, I mean, I think the main focus that policymakers had was trying to limit the employment losses. The idea being that when recovery happens, we want to have those really seamless frictionless capacities for people to return to work. And this is a great reminder that, the economic system, we’re all connected. If a business can’t bring its employees back, and those employees are no longer around to be consumers for that business or other businesses. And so that was the main purpose. So I think that for pros, it’s important to be informed and to be educated and to pay attention to what the main programs are in terms, of doing that. And the pay check protection act was one of the big ones. And this program is, simplifying a little bit. The main structure was you get a loan from the government to keep, most of your employees on payroll. And then if you keep them on payroll after a certain date, then the loan is forgiven. So basically works out to a grant`.
And there’ve been some recent focus that that should have been an even bigger priority in the initial response to COVID that was passed by Congress in terms of trying to really mitigate the negative harms of this. I think, the main thing is make sure you are, it’s very common for a pro to say, I’m working with my hands, I’m doing really good, honest work, that’s meaningful. I can see my product at the end of the day, but it’s also important to think about, okay, well, what is going on with my medium and long-term finances? Make sure that you’re, you’re charging enough to, you can put something aside. So don’t just cover your costs on a job. And, an earn a small profit really think about the long-term health of your company. And if you have employees, the responsibility to them for both up skilling and training, but also, as sort of a shepherd, as it were to make sure that you are being, the most responsible and beneficial you can be to your community. And that means having a relationship with, some sort of banking entity or multiple banking entities. They’ve obviously been following this a little bit more closely.
I’d take advantage of things. These programs are out there. There can sometimes be a natural reticence to say, well, that’s out there, but it doesn’t apply to me, but it probably does. So make sure you’re out there and trying to participate. The entire system was caught off guard by the scale and magnitude of this shock. And so I know a lot of people went through a lot of frustration trying to, if, if they were aware of the programs, you could try and participate in terms of actually getting access to funds, but make sure that you’re then communicating with your elected officials. That’s what they’re there for, so do it constructively and politely, but, do engage with your elected officials and let them know that the system isn’t working if it’s not working.
One of the things that we’ve asked Congress to do is make sure that they are thinking about platform providers as a potential Avenue to distribute things. Because a lot of the private sector is pretty nimble and it’s used to distributing funds and so that’s something else that hopefully is considered in the future. So there’s a range of different responses, but I’d say the main takeaway for, for pros is make sure you’re not just thinking about doing the work that’s, a normal, positive attribute saying, well, I’m going to be the best provider of whatever service you’re providing is, but also make sure you’re thinking about your banking relationships and your relationships with your elected officials and participate in both of those things proactively,
Olivia: That’s really great. For small business owners or home service providers who might not have a qualified or been accepted for some of these federal aid loans, besides maintaining contacts with, their local government and the federal government, what things do you think they can do during this interval of time to sort of stay on top of things and keep their finances in order until the business starts to balance out?
Mischa: I think as always look for the areas of inefficiency and make sure you are thinking about the ROI of every dollar that’s going out the door, but also, think about how you can pivot to attract more consumer demand. So I know for pros that use Home advisor as a platform, for example, expand your geographic coverage area. Traffic is lower, it’s easier to get places and you also have these video tools. So it’s easier to look at a client’s project without having to go all the way out there, which means maybe you can cover a larger area than you were before, and that can make up for diminished demand in your area and make sure you’re keeping revenue up. Also make sure that you’re continuing to think about, medium, and long-term what your project mix are and whether or not you can pivot out to doing other types of projects that you weren’t traditionally doing before.
And obviously licensing can complicate that in some areas, depending on the nature of the task, but still make sure that you’re proactively thinking about all those things. And then also, explore multiple banking relationships too. Make sure that, you can, get any hold over assistance that, you might need. And there’s never been a better time to make sure that your bookkeeping practices are sounds or that you’re really, thinking about yourself as an entrepreneur, not just as a service provider, but as an entrepreneur who has a business and that whole business system,
Brian: I’m glad you mentioned the tech part. you mentioned that earlier in the conversation, but I mean, we’ve spoken to multiple, different people on the podcast and being that we’re a tech company, we live and breathe, with video chat and, technology, but, as you said, pros, home service providers are not necessarily used to necessarily using tech as a form of communication, from a video standpoint. And so, I think the businesses that are choosing to embrace this and still do quoting, but in a unique way are really going to benefit. Because as you said, if you look at your margins, how much time and energy is wasted on going out, giving a quote that does not ever turn up. And, the reality is you got to quote you can’t get away from quoting to get business, but this situation has provided, this industry, an opportunity to even have more margin in their quoting process if they embrace it.
So for those businesses that are just like nervous to think about, because, as I mentioned earlier, I just moved, I’m doing some renovations, I’m doing some on my own. I’m hiring some people, it’s been interesting to watch this process, those that are like, I have to come to your house. And those that are like, well, just tell me about the project, send me some pictures. Can we jump on the video? And I can tell you the people that are on the video side and more engaging in that way, are getting the work for me. So as a consumer, that’s interesting to me, but obviously some service providers are just like, nervous about that. So what are some things that you can kind of say to kind of get people over that hump, to really embrace something new for them?
Mischa: Pros, I think deserve, first off, like, I think we’ve seen about 85% have made at least one major change to how they communicate with customers in terms of the polling and sampling that we’ve done. And, people should be, proud of that. And I think the industry has been doing its best to, adapt in terms of video chat particular, we’ll say we’ve seen around 40% of pros have used video chatting technology in place of in-person meetings. And that’s fantastic. I think those, those pros probably releasing the ROI and switching to that and building it into their workflow. If you’re in that 60% who haven’t yet, I think you need to really, you’re competing with, with the 40% who have, so you should make sure that you are using that to not only compete, as you said, in terms of, you might just be more likely to go with a pro who you view as taking that extra time and effort to adapt.
B it’s gonna potentially save you a lot of time and money in terms of going around and doing quotes and spending all that time. As cheap as gas is, your time is still money and you don’t want to spend that much time in the car going around. So make sure that you are being really intentional about it. I know that adding any new thing to establish workflow, especially a complex one can be a very daunting task, but it’s worth it. So just carve out some time, make it a formal thing on your schedules. Say, I’m going to carve out these three hours to figure out how to do this. If you have employees, get everybody on the same page, crack a beer and just, figure out what the best way to do it is in terms of incorporate into your normal project workflow. And then the same thing goes, obviously, on our end, we’ve also added a payment tool, which, helps with that back end piece. So it’s also solving all those problems on the backend and both of those things, regardless of, how you’re managing your projects, or if you’re on a platform or not on a platform, those are things that I think you’ll find are necessarily right now, but even the absence of a global pandemic are great things to add to your normal business workflow.
Brian: I think for those that were on the fence when you said beer, crack a beer and, get everyone together and figure this out. I think probably you got the other 60% that haven’t made that shift yet. So they may not have thought about that.
Mischa: That’s a great thing. And I find that, it really is, it’s such a simple step, but certainly, for anything that I ever try and do, just carve out the time, put it on your schedule and say, this is my dedicated time to do this. These are my deliverables; treat it like any other project. You’re going to figure out all the different ways to incorporate that into your workflow and, make sure you’re doing it in an efficient way. This is a great time to make your business run more efficiently. And then when consumer demand is even stronger in the future, you’ll be a Well-oiled machine ready to really capitalize on those opportunities.
Olivia: I couldn’t agree with you more, clearly based on hearing you talk, you’re super passionate about the home service industry, but based on your background, you obviously consulted and worked for the governor of Illinois. So could you kind of speak to why you decided to pivot careers and what compelled you to enter the home service field?
Mischa: It’s a great question. So now for all your listeners, I’m going to, I’m going to pick on the government, which is, which is usually pretty popular. I spent a bunch of time working for Congress. It was not intentional. I had planned to go there for a couple of months and it turned into the better part of the decade. There are a lot of people there that are doing good work and really be well and want to improve things. But in the end, you’re not directly, I think providing immediate value to, people’s lives, you’re not delivering a good or a service that people can enjoy in their homes. And then, the same story, it was really meaningful and impactful work in, Illinois working on trying to, improve, the economic machine there in terms of making it work better for everybody.
Both of those things were really important, but in the end, homes are, they’re really intimate places and is where we spend all of our time and raise families and now work and cook and eat. And so, operating, I think people should be really proud of the home services industry. It doesn’t get as much attention as home sales or home construction, but in the end, those things are sort of one-off transactions, but home service is it’s a service economy. It is something that is repeated. And as a director, people immediately received the benefit from it. And the consumer dollars that are spent are going directly into people’s pockets. I mean, mortgages are really important, but they are not, they’re mostly debt changing hands. It’s not dollars going directly into somebody’s pocket, whether that’s a service provider doing the service or manufacturer who just created the good.
So there’s a really compelling story to be told there. And it’s really important that we look at the 120 plus million occupied housing units in the United States and say, hey, this is a big, robust service economy. And taking these structures and protecting them as financial instruments, protecting their value is important. And it’s also really important that we optimize them for how we live and work and raise families and all that sort of thing. For me, I grew up on a farm. So I really enjoy, trying to be as handy as possible. And so it’s also kind of fun to be back closer to, sort of skilled trace things on the weekends. I like to do a lot of woodworking and furniture building I’m making a Walnut slapped dining table at the moment. And, being closer to the hands-on trades is, I think, it’s really rewarding work.
We actually, we go out and we ask pros who are on our network, what brings them the most meaning in their work? Like why do they enjoy what they do? And overwhelmingly people say it’s the value in their work? Not necessarily they like to pay, but what they really enjoy is the value in the work they’re doing. They’re not, sitting in front of a computer all day, they are outside or inside, wherever they’re doing the work, but they are out and about doing constructive things with their hands and seeing themselves build or maintain something. And that’s really valuable in the morning, I think just on a, on a human psychology level.
Brian: It’s one of the reasons why we, as, an agency chose to focus on home service because, family is so important to us and, as a marketing company, we’re like, well, how do we get even the more involved with the family? And we thought, we kind of looked at all the companies we had worked through, for the past 20 years and, 70% of them were in the home service industry. And so we were like, well, that makes perfect sense. We can help a family member. We can help, a husband and wife and kids, enjoy their home even better, through the connection of the work that we do in helping getting them connected with the right home service provider. But you mentioned earlier, I think it was in our pre, show that, the average home in America is about 35 years old and it’s getting older and older. And so I think speaking to that, really is an interesting fact, as it relates to the need for home service providers. so why don’t you speak to how that plays into kind of the demand, that we’re not only seeing now, but we’re going to continue to see as we go into, the middle part of the twenties.
Mischa: Yeah, that’s a, a really good question. I think it’s actually the most important question in terms of how you think about the market and that is the demographics and the actual physical attributes of the structures that we’re living in. So as you said, depending on what part of the country and whether or not you’re looking at high rises or single-family homes, your average age of the structure that we’re living in is between 35 and 50 years old, depending on how you kind of classify or bucket those, or look at different parts of the country. But the main thing is that none of them are five years old, right? None of them are, are zero to five years old. That’s a very, very small subset of the overall number of housing units that are out there so most need seasonal maintenance and upkeep and preventative maintenance to prevent, minor issues becoming major ones.
But they also require a lot of updates to just sort of maintain what people value in terms of style and layout and those sorts of things. And so that’s where the demographic piece comes into play. And so we’ve seen, for example, millennial who grew up with, Instagram and cooking as sort of a theater with YouTube shows and lots of, cooking competitions, those sorts of things, you see a greater importance on the kitchen and having a really nice kitchen because that sort of builds into that lifestyle with these. If you go to the opposite end of the demographic spectral if you’re looking at boomers and the silent generation, lots of people want to age in place in their homes, right? I mean, COVID has obviously been devastating for people who are in nursing homes, but independent of that, lots of people didn’t want to go into nursing homes. They prefer to stay in their own home. And so if there are updates that are made to their home, that makes it a lot easier to stay where you are in your community. And that’s really important, I think for mental health as we age.
And so there are lots of trends driving, both of those needs, particularly on the remodeling side, but also on the other sorts of service side. Obviously, if you are a busy working professional and you’ve got kids, then it can be really, even if you’re not talking about remodeling, even if you’re just talking about, something as straightforward as home cleaning, or grounds keeping type maintenance, those are both very relevant pieces of what you want in terms of your, service needs. and the same thing is true on the other end of the age spectrum you are someone who’s aging in place, maybe, getting up on your roof is no longer as easy as it used to be, and you want to pay somebody else to do that.
We see millennials, for example, as a cohort, or are more than twice as likely as any other age group to say financial ROI is the primary driver of why they are renovating and upgrading their homes. And that’s because as a result of the last recession and outstanding student loan balances and all those sorts of things, millennials as a cohort are not doing as well as, prior generations in terms of wealth accumulation. And so for them, there’s a certain amount of demand that’s being driven by the need to boost their, overall home value to get that equity bonus. So there’s a bunch of different things that are driving it and those things aren’t changing. So, I think that the outlook for home services is still really strong going forward.
Olivia: What’s one thing that you wish, entering the home service industry after your previous background; you knew entering the field that you can share with our listeners.
Mischa: That’s a really great question. I think the main thing I wish I knew is what we’re now trying to get other people to know. And that is that home services is a distinct industry. A lot of people just sort of lump it in with the housing market, but they’re different. I mean, they’re related and they’re both important, but they’re different. And so one of the things that we’ve been trying to do is tell the story of home services as a distinct industry As I think I mentioned at the beginning, we put out recently, if people go to home advisor.com/research, they can pull up some of our market research that we put out there and there’s consumer insights and insights on the surface pro side. So there’s, there’s an insight to the whole market. And so we put out a new estimate that the market’s around 506 billion coming into 2020.
Obviously, we’ll see how consumer behavior shakes up over the year in terms of what the size is going into 2021, but that’s a little bit bigger than some previous estimates. And so that’s one big part of the story is that this is a big industry and there’s a lot of positive spill overs. And so I wish I had known that just the general person going around life. And so we’re trying to make sure that everybody starts to think that way in terms of recognizing we all have to live someplace and that place should be making you as happy as possible, and it should serve you as a tool to raise your family or to, whatever part of your life cycle you’re in, whether it’s as a young single person or as an older single person, or as somebody who’s retiring or raising family, whatever you’re doing, the place that you live should really serve you really, really well. And so I wish I had a greater respect for that going into, into the industry.
Olivia: I completely agree as a new person who just relocated. I mean, I had no idea the value of home services and maintenance and caring for something as much as I have. And I’m not even a homeowner I’m just renting, but even then the little things that you have to put forward to invest in your space and make it your own and find the value in it. I mean, I feel like as an early gen Z or end of a millennial era, I don’t know. I fall in that cusp, I guess I never really realized the true value up until working for new and, really being more hands-on in the home service industry. So finding a way to communicate that to younger generations, I think is going to be, the next big hurdle, I think for people who are my age and understanding of the earlier age, like the impact and the significance in putting value in your home when you don’t think about it until it’s too late.
Mischa: Yeah, exactly. And we will our consumer material this year is going to be carving out gen Z or two for the first time.
Mischa: So we’ll get some love from gen Z or,
Olivia: cool much appreciated from a gen Z here
Brian: well, speaking about that I want to bring your website up. And, if you just want to point to a few things, that maybe people could find on here that really helped them, dive into some of the things we’re talking about.
Mischa: Sure. Yeah. Thanks for pulling that up. So obviously top line, we try and break out what are the main numbers that you want to care about as somebody who’s operating in the industry? So the four that we chose to highlight are, we update these as frequently as we can update them the size of the overall market. So 506 billion as the 2020 estimate, what people spend on maintenance spending on average, what they spend on home improvement on average, and then the number of housing units that are out through the U.S so that’s kind of our big top-line numbers that we’d like people to be aware of. The most recent post is actually quite interesting. That’s something that we were looking at. How do people prioritize maintenance versus remodeling spending? Because right now, obviously there’s been some talk about, well, what’s, remodeling doing versus maintenance spending.
And so we actually break out in there how, for every additional dollar that somebody earns, how do they allocate that between maintenance and improvement and people pull it households below 75,000 put significantly greater weight on maintenance than households above 75,000. And we think that that’s actually a really wise budgeting point on those households, because, maintenance is really important to sort of preserve the value of an investment, but also to prevent a really expensive, costly emergency repair. And so it’s one of those things that people don’t talk about, but it’s one of those wise budget decisions that individuals tend to just make. And so, so that’s on there. If you look at that, that mapping the driver’s home service spending post on your right. That’s, an interactive map that people can get by state. And so you can toggle what some of the major demographic drivers of things. So if you zoom in there, you can click on age or income or, divorce rates, or commute times all those things are going to sort of impact how people choose to engage with their homes, right. So commute times probably means people are living in bigger structures, farther away from downtown, which means, more yard work, more rooms, those sorts of things, divorce are gonna impact your household formation. Yeah, that’s the sort of material that we’re making available to people.
Brian: Well, that’s great. I mean, for me, I love data and, everything that we do is driven by data. So I think it’s going to be really encouraging for, even our own team to be able to dive into this, because you, mentioned, that the different ages have different things that are important to them. And I think that’s going to be really helpful for home service providers, as they’re creating content, knowing who they’re talking to. If they have a wide range of audience from millennials to baby boomers, you described a wide range of cares and needs. And so I think really pairing down the content and the marketing for your own business is going to be really important because, they have different needs.
I never really thought about the whole YouTube, TV show, watching kitchen thing, but that really makes sense. That’s an interesting thing, I think another thing, you talked about aging in place and you have a situation where maybe you had a two-story home and now you need to be thinking about how to bring your bedroom downstairs. So you can, not necessarily have to climb those stairs. My mother had knee surgery and, she’s relatively young. I mean, she’s watching, she’s turning 65 soon. She’ll hate me that I tell her that, but the reality is she really struggled. She had to be downstairs in her living room and not a very uncomfortable place for, a month or two as she recovered from that. And so I think knowing your audience is going to be really important, and understanding just like, as you said, me, so this understanding, where, what these demographics actually really want from a remodeling or maintenance standpoint.
Mischa: Yeah. Yeah. I mean, it’s very, know your customer, that’s sort of, one of the oldest axioms in businesses is know your customer and, people need different things at different stages of their life cycle. We’re obviously putting out research that people can go and look at to sort of get the big picture empirics of it. But, somebody doesn’t necessarily need those things to think about the people that they know in their lives and what they’re likely to need and how they want to, to adapt and change. And there probably will be some, shifts in how people choose to engage with their living spaces as a result of, the current global situation. I think that, we could see a greater demand for larger structures marginally further out than they were before. And, that’s, I think good people who are making those choices, and it’s also good for home surface pros because there’s, there’s more demand there. And we don’t really empathize with where your customer’s coming from and engaging early and really thinking about how you market yourself as is very important.
Olivia: Right. My final question is what’s the very best part of your job, What do you love about being a part of the home advisor community?
Mischa: probably I’m going to do a cop-out and give you two answers. And, the first is it’s a great company. I really, we’ve got a great team, love, everybody that we work with. Everybody is really passionate about building the best products for, pros and consumers as possible. And so that’s very rewarding, but the other number one answer is the industry, right? It’s a great thing that is; we all have to live someplace. This touches everybody, and doing that as efficiently and as good as possible to sort of maximize the amount of consumer good we do its little warning. And, it’s a lot of fun because who doesn’t have an opinion about the living space they’re in, right. We all have opinions. So it’s, it’s a lot of fun to get to engage with those things.
Brian: Well, Mischa, thank you so much for joining us and taking time to out of your, day to day life in your home, not in the office right now, just to be able to share your wisdom and your, data and, just encouragement. I think that that’s one thing I kind of took from this entire episode, just, the hope that we can see, moving forward from, data trends for, this particular industry. So, thank you for sharing your wisdom.
Mischa: Well, thank you both for having me so much. It’s a lot of fun.
Brian: Well, on next week’s episode, we’re going to be interviewing, Samantha Heald, the corporate sales manager for postcard mania. And we’re going to unpack how, going a little old school, back in back before. We just, when we actually, when we started our business, we were a printing company and we recently sold our printing, division. But direct mail campaigns are still a great way to, get in front of, consumers and can set a really positive tone, as you consider to reopen your door, and get back into their home. So we’re really excited to have, Samantha from Postcard Mania on our episode next week.
Olivia: And as always, if you guys liked the content we put out every week, please follow us on our Facebook page. You can find our episodes on Spotify or Apple podcasts. And if you have any feedback or reviews, please leave them in the comments. We really appreciate anything you guys have to share with us. And until next time, we’ll see you guys
Outro: Rick times over, but thanks for listening to the home service toolbox keep your marketing toolbox up to date by subscribing to our podcast we’ll be here every Wednesday hammering out solutions to help your business.