A note from the editor: On Wednesday, Sept. 15, CoreLogic announced it had acquired Next Gear Solutions, sparking much debate throughout the restoration industry on what this could mean for restorers, data, and software integrations. In this link, you can find all the facts about this acquisition, plus links to other interviews with industry experts and Next Gear Founder and CEO Garret Gray, the RIA’s official statement, reaction from Xactware President Mike Fulton, and other opinion pieces like this one.
One of the hottest topics in the world today is the power of data and the invasion of privacy used to collect it. The hunger for data and the power of it has completely transformed most industries, especially those more technologically advanced. As consumers, we become the product … or at least our information does. In fact, those of you reading this article are the product. You probably found your way here through social media, where algorithms are analyzing your interests, demographics, hobbies, purchasing behavior, and much more. These algorithms continuously collect and report who we are and what we like, using the information to their advantage for one specific reason: to sell us more products.
You’ve probably heard the term big data over the past couple years, but you may not know how it impacts you. In short, it refers to tech giants like Google, Facebook, and Amazon constantly tracking our online behaviors to leverage them to their advantage. From the apps on our phone to the web browser we use, these companies collect and then sell this information. We may not even be aware that almost every aspect of our lives is available for purchase somewhere in the ether we call the internet. It fuels a trillion-dollar industry of data brokers and buyers to sell and purchase our most sensitive personal information.
The restoration industry has significantly lagged behind other industries when it comes to data and technology. Very few restoration companies use advanced data for social media/digital marketing targeting or digital imaging like Matterport and DocuSketch. Heck, many restoration companies still use nothing but pen and paper! Doing so comes with certain cons, such as lack of speed, consistency, automation, and optimization of processes, which adds up to lost time.
The biggest pro to this lack of technology is that data in the disaster restoration industry has been very hard to gather. Having spoken to many marketers, most agree that trying to find data on the restoration industry is a daunting and challenging task. Even a simple search of How many restoration companies are there in the U.S.? reveals completely different results.
Data on the restoration industry is also rapidly changing. Consider this:
- In 2017, Verisk, a leading data analytics provider for the insurance industry, purchased Restoration Manager.
- Matterport, the most-used 3D imaging technology, describes themselves as “the spatial data company leading the digital transformation of the built world.”
- In 2021, CoreLogic, a leading provider of property insights and solutions, announced the acquisition of Next Gear Solutions, the largest provider of restoration job management software.
Notice the trend? Chances are that a huge percentage of restorers are linked to one of these three companies. What product are these parent companies selling? Information on us and our customers, commonly referred to as data analytics.
Now, before you think I’m sitting here wearing a tin hat and creating some sort of conspiracy, let me just say that I believe data can be used for good. Well, it’s at least possible …
Big data has revolutionized many industries, helping consumers reach innovative products and making all our lives easier. At minimum, it has managed to sell us more products quicker, but at least they’re ones we wanted!
Let’s hop down this lovely rabbit hole and try to understand what big data in our industry is all about. Verisk, Matterport, and CoreLogic have significant ties with insurance carriers. Yet, none of the data that they are collecting is really helping contractors or their customers, the insureds. If it is, I couldn’t tell you how. Instead, the data these giants are collecting helps carriers understand how to more efficiently underwrite claims to minimize losses while maximizing profits. Currently, the other side of this coin only helps the insurance carriers, who are already profiting billions of dollars from insurance claims.
So, what can we do?
Be aware! Every restoration company using these new technologies is freely consenting to having their data collected. That could, in turn, potentially be used against the industry to benefit third parties at the cost of our margins.
We shouldn’t have to accept that the restoration industry is at a competitive disadvantage due to the power and access of these third parties. This only adds to the competitive disadvantage that has existed from the beginning, as insurance carriers have completely dominated our end clients.
Business owners also shouldn’t have to decide between efficiency, automation, and advancement over privacy. There are other options. The first step is awareness and acceptance, the next step is action! There are companies providing technology to the restoration industry that do not collect data. They don’t sell it to the highest bidder or use it to lower our profits. We have the freedom to not accept the status quo and use technology that was only created to benefit us and our industry. The companies are out there if you do your research.
Now, more than ever, it is time (as the RIA’s AGA has stated) “to unite as an industry and level the playing field.” It’s time for an industry organization that has our consumers’ best interests in mind. And that organization should be armed with a similar amount of data, if not even more.
Imagine consenting for our data to be used for the purpose of bettering the industry. What if there was truly a fair restoration market pricing analysis done that had nothing to do with the carriers?
Who will do this? How will this be done? That’s a topic for another time.
