Tradies turning to tech to get the industry back on track in 2021
The impact of COVID-19 has been far-reaching for many industries with the trade industries seeing a 19% decrease in activity in April 2020 compared to pre-COVID-19 levels according to hipages. The online service provider points to technology as the way to get the industry back to its former numbers.
Research conducted by L.E.K. Consulting in tandem with hipages looks at the initial impact of COVID-19 and reports how tradies have adapted to the challenges posed, turning to technology to boost their order books, communicate with customers and conduct contactless jobs, where possible.
Aside from the reduction in jobs during the pandemic, half of all trades nationally considered that COVID-19 had ‘significant’ or ‘moderate’ impacts on their ability to fund business operations and retain employees – especially prevalent amongst trades in metro Melbourne. To keep their businesses afloat, tradies took immediate cost-saving actions including reducing prices and employees, as well as taking lower margins, to respond to decreased demand as a result of COVID-19.
The industry was able to commence recovery swiftly thanks to crucial support from the government, in the form of grants and schemes.
Despite the softening of restrictions in March due to a combination of consumers lacking confidence with the changing health regulations and uncertainty about engaging tradies, hipages saw a rebound in the market with job volumes returning to normal – between April and June hipages experienced 43% YOY growth.
The job volumes delivered in May 2020 suggest that the acute effects of COVID-19 on the on-demand tradie industry had largely subsided. This is also reflected in the study, which noted that the overall level of trade activity across the country recovered somewhat in June, with 84% of trades maintaining activity, or becoming busier, as most states eased their initial ‘lockdowns’ between April and June.
“In Q4 of FY20 we saw fluctuation in work volume as Australians adapted to the changing environment and new health measures from the Government. However, Australian tradies remained an essential service for households around the country during the pandemic, with particular categories experiencing spikes in demand to make homes safer, cleaner and suitable for working from home. We believe that this prompted homeowners to quickly shift towards online channels, such as hipages for their maintenance needs,” hipages co-founder and chief executive Roby Sharon-Zipser says.
Approximately 75,000 tradies (29%) increased their use of digital platforms in light of the pandemic. Using tools like hipages is the most popular way tradies engage with their clients, followed second by social media as another common way – approximately 69,000 tradies (27%) say apps such as hipages improve their productivity and efficiency.
The research also finds that in 2020, tradies shifted their investment in marketing, bringing greater focus to digital channels. On average, tradies are expected to have spent 60% of their discretionary advertising budget on online channels and 40% on offline channels. The online share of residential trades advertising spend is expected to increase to 65% in 2024.
“The hipages business has found success in leading the on-demand tradie economy, providing a digital platform that streamlines the booking, quoting, communication and payment process between Australian tradies and consumers. The uptake of the platform amongst tradies during the pandemic has shown that we are helping our tradie members streamline their communications with clients and their job acquisition process, providing a safer way to source jobs and compile quotes,” Roby adds.
A full copy of the L.E.K./hipages Australian Tradies Survey 2020 is available to download here.