Amazon Beats Google To The Professional Home Services Market

In a move that some believe Google should make with Places or Maps, Amazon announced Monday the launch of Amazon Home Services, a marketplace for on-demand professional services. 

Amazon Home Services Launches with 700 different services, from the ordinary to the not so ordinary. It gives consumers the ability to search, purchase, and schedule hundreds of professional services from gardening and wall mounting a new television, to installing a garbage disposal or housecleaning.

Last year, Google made a move to fund Thumbtack, nearly $100 million. Thumbtack helps to connect consumers with local services. "In general though, Google seems more focused on offering ads that can be feed-driven, like products, airfare, hotels, mortgages, etc.," said Daivd Rodnitzky, CEO of 3Q Digital, recently acquired by Harte Hanks. "I'm not sure that home services fits that model of Product Listing Ads. I could, however, see them enhancing Google Places and Google Maps to allow more advertising opportunities for these companies."

For Amazon, the idea is to connect consumers with experts willing to offer pre-pricing on packaged services, with Amazon willing to verify the contractor before listing their name as a reference. The site offers reviews from customers who have made purchases. A Happiness Guarantee backs service purchases. The company wants to make purchasing professional services as easy as buying products. The service is available in major U.S. markets like New York City, Los Angeles, San Francisco and Seattle.

Piper Jaffray views the "nascent" marketplace as a service that could support the estimated $500 billion services market, per stats from the U.S. Census Bureau and Piper Jaffray. "We see Amazon Home Services as meaningfully more profitable than Amazon's retail," Analyst Gene Munster wrote in a published report. "Assuming in 2017, Amazon services 1% of the market, this would add [about] 5% to our EPS estimate."

Amazon will take a cut of the profit for every service arranged through its site. Profit for recurring services, such as house cleaners, are on the lower end of the spectrum.

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