A company with a Unicorn valuation and $613.6M funding, Houzz is acting like a corrupted small business. With an irritating sales strategy and apathetic customer service, it’s getting tons of negative reviews which will impact its future forecast. According to Bloomberg, Houzz is planning an IPO in 2019.
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How slowdown in the housing market will affect Houzz?
Houzz is an online platform for home remodeling, architecture, interior design, decorating, landscaping, and home improvement.
The housing market has been experiencing drops in sales for the past three years already, slowly sinking into what appears to be a bubble waiting to burst.
Slow home price appreciation active for quite some time now, combined with lower mortgage rates are surely bringing the housing market out of the overheating market, while housing sales fell by 1,2%, touching the lowest performance in the last three years.
Problems With Sales Strategy / Customer Service
Terra Granite has reached out to us first about their claim:
They have renewed the contract without our permission, charged $600 to cancel. We have made a one-year advertising contract. We paid up front, and we clarified that its only for one year, so we are paying in total. After a year they charged a monthly fee. We have written an email asking why they are charging. A lady called saying its auto-renewed. We said we didn’t want. She said they will stop the service. Next month, they charged again. When we called, this time they said we cannot stop. We need to pay an extra 4-month cancellation fee, even though we haven’t renewed the contract. They say it’s written in the contract even though sales guy said at first it’s only one year contract. Now they are asking 4-month extra to stop the service. Don’t be fooled into advertising with Houzz. This is a disreputable company. You will not have any conversion. They just fake the numbers. You pay 30x more for what you get other places.
SiteJabber Rating: 1.5 – 714 reviews
Glassdoor Rating: 3.4 – 566 reviews –
3 Star Rating With Trustpilot
DO NOT ADVERTISE WITH HOUZZ. THEY ARE A SCAM!
Dear fellow designers- Don’t be fooled into advertising with Houzz. This is a disreputable company. They auto-renew your contract with no notice. And if you haven’t explicitly told them that you don’t wish to renew 20 days prior to the end of your contract, they won’t let you cancel for at least 4 months. Everything they do is designed to deceive and trick. And you can never reach anyone by phone. I think we should start a class action lawsuit against them. This shouldn’t be allowed to continue. https://www.trustpilot.com/reviews/5c5a3dee97afa107f0e7f48d
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Could not cancel my account
Could not cancel my account. Charge me over $1000@ $250 a month. Would not refund after I canceled my account. I suggest not signing up with them as a Remodeler or any type of vendor for them to list. They do not support there Professionals!!! https://www.trustpilot.com/users/5c51b5cc1c36618ccb49f2b6
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Don’t advertise with them
Don’t advertise with them! They lock you in lengthy contracts that require “written cancellation” within 30 days of annual renewal or they will automatically renew your contract FOR A YEAR ($3,000). This after calling twice to cancel within the timeframe. F rating st BBB for a reason. Total shady practices and waste of money. https://www.trustpilot.com/users/5c4797866c87026ebc5b8449
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1.5 – BBB Rating
According to Better Business Bureau, here are some problems reflecten to online:
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High pressure sales, no results, refused to refund money, kept charging card on file $750 per month, never called back to follow up, wasted time/money We have signed up as part of our investigation about SCAM Alert on HOUZZ.COM We have recorded phone conversation with high pressure sales calls and promises that never were delivered. Conclusion: Worst service for the contractors. High pressure sales calls with lots of promises to bring you leads and exposure. $**** late not a single job, not a single phone ****. Advertisement for contractor simply don’t work. Stop ripping contractors off. Contractors should unite and start class action law suit to get our money back. What a rip off!!!
Desired Outcome
We want all our money back. No benefits to the business was added, no value, no phone calls from home owners, no leads. We requested all money back.
Problems with Product/Service
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I received a light fixture that upon opening didn’t look damaged; however, when it was installed by a licensed electrician it didn’t work. I received a light fixture that upon opening didn’t look damaged; however, when it was installed by a licensed electrician it didn’t work. I was past the return window. When I called they told me there wasn’t anything they could do because I didn’t return it within the appropriate timeframe. They told my credit card company that I never tried contacting them, and they said they were clear about the return process. When you’re building a house you can’t always predict exactly when all stages of the build are going to happen. I had no way of knowing that electrical work was going to be delayed. And regardless of that the light fixture should work beyond the return window and it doesn’t.
Desired Outcome
I want my money back. I received a light fixture that doesn’t work.
Removal of photos for privacy reasons Last month, I signed up on the website’s forum and posted 3 threads over a period of a few weeks. The threads contain photos of my residence, interior etc, Also posted information regarding location, possible sale and such details. Now am apalled to know I cannot delete the photos and even requests to the customer service were rudely rejected. Even social media sites like Facebook allow the user to delete the threads or remove pictures etc – in-fact, other than shady sites, websites allow user to remove the discussions in the their forum. Even if they don’t, they honor the user’s request when they explicitly request so. That’s the assumed and common practice. I would think reasonable person agree that its fair and basic decency. Now am in a situation where anyone can find, search my residence using the pictures. This affects not just privacy, but potentially impact the sale of the house too. Apparently this website is building contend from user’s posts and photos and cannot let go of that. I am even willing to pay a a nominal $10 for them to remove the photos. (an extortion fee)
Desired Outcome
Delete the three threads I posted. Remove the pictures from my posts, at the very least.
Response: All users on the Houzz site have the ability to edit or remove their own posts for a short period of time after they are posted. Once that time has expired, content is not removed to prevent disruption to the community
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Hacker Steals 127M User Records From Houzz, Ixig
According to TechCrunch on February 15, 2019, A hacker who stole around 620 million user records last year has struck again, this time taking another 127 million records from eight websites.
According to reports, the hacker gained access to 16 websites last year, stealing more than 151 million records from MyFitnessPal and 25 million records from Animoto, among others. Although financial information was not breached, the criminal was able to gain access to names, email addresses and scrambled passwords, and in some cases, other login and account data.
Now the same person has hit eight additional websites, including Ixigo, YouNow, Houzz, Gett, Coinmama, Roll20, Stronghold Kingdoms, and PetFlow. The hacker is now selling the data for about $14,500 in bitcoin.
Houzz Inc. settles privacy-violation case
Palo Alto-based company illegally recorded customers and businesses
by Sue Dremann / Palo Alto Weekly, Oct 8, 2015
Houzz Inc., a home-design and remodeling website headquartered in Palo Alto, has reached a settlement in a privacy lawsuit filed by California Attorney General Kamala Harris on behalf of the State of California. Photo by My Nguyen.
Houzz Inc., an online platform for home remodeling and design headquartered in Palo Alto, has settled a lawsuit with the State of California after violating state wiretapping and eavesdropping laws, Attorney General Kamala D. Harris announced.
Houzz’s Irvine office secretly recorded calls that were intended for training and quality-assurance purposes, but it did not notify people that it was making the recordings nor obtain their consent, according to an injunction filed by Harris on Oct. 2 in Santa Clara County Superior Court.
Court records show the company settled the lawsuit on the same day it was filed.
The number of recordings the company made are unknown, but the state’s injunction asked for $2,500 per violation. Although most of the secretly recorded calls were with home improvement and remodeling professionals, Houzz also recorded customers’ and employees’ personal calls, according to Harris’s office.
The recordings occurred between March and September 2013. After being notified by the California Attorney General’s Office in September 2013, Houzz stopped recording calls and voluntarily cooperated with the investigation, Harris’ office noted in the settlement.
This company doesn’t take responsibility for anything and makes you as a seller look like an idiot. They did something on my seller account recently that changed my address, either manually or algorithmically. So now this mistake is costing me as a self-employed family business as customer’s returns have been going to the wrong address as of late. Of course, according to Houzz, it’s my fault that all of a sudden the returns are now going to a different address. Imagine your mail being rerouted 10 miles away from you all of a sudden without you even contacting your local post office to request a change…
There are other things that are irritating about selling on Houzz, too.
Communicating with customers is a hassle on Houzz, so no business can really shine there when it comes to customer service. You’re also required to respond to every single message. Great when you actually have something to say to a customer, not so great when you have nothing to say back and the thread is supposed to be done and resolved. This part makes me really feel stupid sometimes and I bet it confuses and irritates my customers to get empty, meaningless messages from me.
The irony in this is that Houzz makes you reply to every single ticket message your customers fill out, yet when you contact them as a seller, they don’t reply to you. The last time I checked, they worked for me too since they take 15% of my sales.
I contemplated quitting selling on Houzz and have decided to phase out my products after the final straw, which was waiting around for my pending products submitted in December 2018 to finally be approved after endless nagging just a few days ago (March 2019). It doesn’t make sense to wait for your products to be approved this long. By the time this happens, half of the products end up being sold out elsewhere.
Sure, you may make a little bit of extra money, but once you add up all the obstacles, it’s just not worth it.
If this thing IPOs, I’ll be shorting the heck out of it. I went through something similar when I had a direct experience with the way another company operated (Dendreon, stock ticker DNDN) and made a lot of money there as the company went into oblivion. Houzz is eerily similar.