Angie's List backs away from the Trough

[dusty88]

Actually, the whole idea that Angiest List is broke is a huge fallacy. I know current and former people over there. They are far from broke. They don't post a profit because every dollar gets reinvested into marketing to increase the user base. When they turn off marketing, the place prints money.

The simpletons assume that if a company doesn't post a profit, they must be broke!

That said, it's still a shady company that preys on the elderly who have a harder time canceling their account and forcing people who want to cancel to mail in a letter.

If that's the case, then they've done a good PR job of bamboozling the Indiana taxpayer.

Either way, this is unacceptable behavior for an Indiana-based business.

As for these boycotts, I'm not surprised at the politicians and organizations that are blowing with the PR wind. I don't for 1 second believe the truly profitable companies are giving up $$ to make an altruistic statement.

For an Indiana-based company, it's not even a good PR move. Your best "move" is to continue not to discriminate, and perhaps suggest political change. Abandoning your employees in Indiana would include some gay employees, presuming you weren't discriminating in your hiring.

 

[PistolBob]

How many Ex-Cons work at Angie's List? Just curious. Since they love everybody...and all.

 

[BehindBlueI's]

Actually, the whole idea that Angiest List is broke is a huge fallacy. I know current and former people over there. They are far from broke. They don't post a profit because every dollar gets reinvested into marketing to increase the user base. When they turn off marketing, the place prints money.

When they turn off the marketing they die. Heavy marketing is the only thing that keeps them afloat. Look at their financials. They spend on average $70 of marketing for every customer they acquire. Nobody spends that sort of money just because they enjoy not printing money.

Their total liabilities exceed total assets by nearly $20 million. Total annual gross interest expense is over $2.5 million.

They aren't broke in that they have no cash on hand. It's just the cash on hand is all from borrowing. They've made gains in paying off debt and decreasing their losses, and they may eventually be profitable, but right now they are still deep in the red. They will have huge marketing outlays for the forseeable future though, because they are still competing against free services. I can't convince you that my paid service is worth the cost vs a free service if I don't advertise and engage in "consumer education" messaging to both gain and retain customers.

 

[dusty88]

When they turn off the marketing they die. Heavy marketing is the only thing that keeps them afloat. Look at their financials. They spend on average $70 of marketing for every customer they acquire. Nobody spends that sort of money just because they enjoy not printing money.

Their total liabilities exceed total assets by nearly $20 million. Total annual gross interest expense is over $2.5 million.

They aren't broke in that they have no cash on hand. It's just the cash on hand is all from borrowing. They've made gains in paying off debt and decreasing their losses, and they may eventually be profitable, but right now they are still deep in the red. They will have huge marketing outlays for the forseeable future though, because they are still competing against free services. I can't convince you that my paid service is worth the cost vs a free service if I don't advertise and engage in "consumer education" messaging to both gain and retain customers.

That's the case with many American companies these days. Or they have "profits" from cutting expenses, not from revenue growth.

A healthy company has growing revenues while maintaining a profit margin, and they have a low debt to asset ratio. Unfortunately not many companies are "healthy" and won't withstand increased interest rates.

But I digress....

I am sick of Angie's list calling my business to market. I've also found them less useful as a consumer. It's rare now to find new listings reviewed; it's just a promotion of the few that pay them money.

 

[Leadeye]

I have zero sympathy for this company considering they started looking for this expansion only a few months after a ton of layoffs. Don't let the door hit ya on yer ass on the way out Angie...

How could the door miss?

 

[DRob]

AL is currently being sued (3rd time I think) by contractors who claim others get preferential treatment and have negative feedback hidden.

Aren't they originally from Ohio?

 

[Twangbanger]

I have zero sympathy for this company considering they started looking for this expansion only a few months after a ton of layoffs. Don't let the door hit ya on yer ass on the way out Angie...

My thoughts exactly. "If you give us public money - we might hire back some of the people we just laid off." The cynical side of me suspects they want to make one last, big, publicly-financed marketing rush to save the company with this expansion, and if it fails, they cite "a tough competitive environment," move to an inexpensive location half the size down south - and we'll be holding the bag.

Once they started offering sales pitches from "highly rated companies," that undermined the whole independent concept of the business anyway, in my opinion. It was like an admission that subscriptions couldn't support the company, and they needed revenue from right where we always expected they would - the companies themselves. Angie's List became a seller of advertising, with a (supposedly) more detailed screening process determining who can place ads. Angie is working both sides of the deal, and I'll be damned if I'm going to pay money to see advertising from "sacred cow" companies who are paying to be listed.

I don't enjoy seeing anybody's private-sector job leave town. But if they're going to be gone in the long run, anyway, I'd prefer they take their influence out of our politics (and pockets) sooner, rather than later. (Maybe Chapel Hill will build a cricket field for your cool-kids to enjoy).

 

[Leo]

I am tired of companies wanting taxpayer money to "improve" the tax base. Afterwards taxes go up because they cause expense that IS NOT offset by them being there. Let the multi millionare ball clubs pay for their own facilities too.

 

[ArmedProgrammer]

AL is currently being sued (3rd time I think) by contractors who claim others get preferential treatment and have negative feedback hidden.

Aren't they originally from Ohio?

Angie certainly is... don't know if the company is.

Rotten company with a shortlived business model.

 

[Mister K]

I was watching the IRL race this afternoon, (Montoya won BTW) they were promoting the Indy Grand Prix race, I found the sponser of the race interesting:

 

[BehindBlueI's]

I was watching the IRL race this afternoon, (Montoya won BTW) they were promoting the Indy Grand Prix race, I found the sponser of the race interesting:
View attachment 37259

That probably helps explain the $70 customer acquisition cost. I'm sure that wasn't a cheap sponsorship, and how effectively targeted was it?

Just on a bit more background info:
Report: Angie's List hires bankers to explore sale

Then:

More to the point, Angie’s List has been forced to scale back the amount charged for each membership as Yelp, Google+ Local, TripAdvisor, and other user review sites have flourished with an open-to-everyone, completely free business model. The most recent Angie’s List report states that from 2010 onward, the average annual membership fee was just over $12, down from more than $36 a decade earlier.
And the amount members pay continues to drop. A Wall Street Journal post published a year ago detailed Angie’s List’s plans to cut membership fees in several key cities to around $10 annually. Today, it’s a cinch to head over to an online coupon site to find offers for 30% or 40% off, bringing the cost of a one-year subscription down as low as $5.39.

source: Why Angie's List Keeps Getting Mixed Reviews - TIME

Now they make money in other ways besides strictly on membership fees. Advertising, from the service providers, etc. However you don't have to be a financial whiz to see an issue. If you are spending $70 to acquire a customer and that customer is only paying you $12 a year, those other sources need to be really kicking in the cash or you need that customer to stay on the books a looong time to have a positive return.

Institutional investors seem to agree. The high point for the company was in July of 2013 when shares were at nearly $26. Now they are floating around $6.

 

[pudly]

Please let us know how it goes; I've heard cancelling your account with AL is not easy.

I just cancelled my AL account via phone. It was very easy and per their policy, I got a 110% refund. Bite me Bill Oesterle!

 

[churchmouse]

I just cancelled my AL account via phone. It was very easy and per their policy, I got a 110% refund. Bite me Bill Oesterle!

I would bet you are not alone.

 

[flatlander]

I figured we just saved $18,000,000 !!
**** 'em

Bob

 

[JettaKnight]

Their idiot CEO was on TV saying how now they can't guarantee they can fill those 1000s of jobs due to the new business climate in Indiana! BULLCRAP! They can't fill those jobs because they don't have a viable business and so don't have any money to pay for this so-called talent they need.

This company is in a death-spiral already. If they are so serious about how bad things are in Indiana, they really should be packing up and moving out of state NOW!

Really? Can't fill the positions here in IN? That's wierd, because according to Lowe0 in the other thread, Hoosiers are going to be starving in the streets because they won't be able to find work.

So which is it liberals? Too few jobs or too few workers?

 

[Kutnupe14]

Really? Can't fill the positions here in IN? That's wierd, because according to Lowe0 in the other thread, Hoosiers are going to be starving in the streets because they won't be able to find work.

So which is it liberals? Too few jobs or too few workers?

Liberals? Aren't the founders of Angie's List Republicans?

 

[Kutnupe14]

What liberal sponsors Rush? Lol.

 

[Alamo]

Unfortunately there are plenty of liberals wearing an "R". And people who put business first will donate to whatever politicians are in power and are amenable to being persuaded by donations. That's why the party of big business corruption is the Democratic Party, not the Republicans. See President Goldman Sachs, 1600 Pennsylvania avenue.

More: Don Surber: What they are not saying about Angie's List boycotting Indiana

 

[DoggyDaddy]

Am I remembering incorrectly? Didn't Angie's List start out on the premise that they wouldn't accept money from the companies that they rated? Obviously that is not the case now, but I swear I remember Angie in her commercials making that claim several years ago.

 

[churchmouse]

Liberals? Aren't the founders of Angie's List Republicans?

Is there any differences these days......