An online agent has claimed that the big players in his market are making it all but impossible for newcomers to establish themselves.
He claims they are doing so by driving up the cost of Google Ad words as they bid against each other to be listed on page one of searches.
The agent – who has asked for his identity and that of his business to be withheld – said the cost of a Google Ad word is escalating sharply.
He explained: “I run an online/hybrid estate agent model.
“We are enjoying building up a good reputation locally and online. However, a way of advertising is Google pay per click, which generates quite a bit of revenue.
“It appears the big ‘cash-backed’ online estate agents are forming a monopoly and trying to cut off the market to newcomers.
“It is now £5.85 per click on Google for the term ‘online estate agents’.
“This is a lot higher than many key market terms and bids by the online estate agents are driving up the prices to get on the first page of Google. Two months ago, it was £1.20. At this rate of escalation, it might soon hit £10 per click.
“This makes it impossible for newcomers offering alternative choice to realistically compete in the marketplace.
“Yes, we can build up a business, but are established online agents trying to squeeze others out?
“But this is not just hurting smaller, newer online agents but also driving up costs for high street agents.”
He went on: “I was approached by a specialist business that can run your Ad word campaign for you on Google, and was advised that it would me £3,000 a month for just one set of search criteria.
“There is absolutely no way that a new business could find £36,000 a year – but clearly it is no problem to the well-funded online agencies that have recently raised enormous sums.”
On Google pages, a number of paid-for entries are at the top and bottom, marked “Ad”.
These ‘pay by click’ spots are bought after bids have been placed, while all the other listings on Google are organic and cost nothing.
We carried out a number of searches and found that it is not just a search for “online agents” which shows how the wealthier online agents are dominating Google property pages.
The Ad spots can and do change, but on Saturday afternoon, a search for “estate agents UK” showed Purplebricks, Rentify and Tepilo having the first three spots on the first page.
A search for “online estate agents uk” showed HouseSimple, eMoov, hatched and Purplebricks with the first Ad spots.
The second set of Ad spots at the bottom of the first page were taken by Rentify, Settled and Tepilo.
Searching for estate agents by town or city also shows how active the online agents are in using Google Ad words.
For example, a search for “estate agents Leeds” on Saturday showed Ad spots for Purplebricks and housenetwork at the top of the first page.
A similar search for Manchester showed the first Ad spots taken by Yopa, housenetwork, and hatched.
Searching for “letting agents uk” showed that rentmyhome, rentify and Purplebricks took three of the four top Ad places.
Comments (32)
1. £5 a click seems a steal in comparison to some video production related Ad Words which regularly run at £50 or more per click :-} Rumour has it, insurers can pay £100 or more per click for some keywords. Is it worth it? It depends on your perceived lifetime client value really. One way to avoid these very high PPC ad words costs is to use multiple keywords that are perhaps searched less frequently, but can be equally successful, after all, who just types one word into a Google search? Think in phrases. Also, a lot of times, a keyword could be ranking high because non-customers search for it, for example, ‘drone operators’ ranks very highly in search results due to the multitude of would be operators researching the term rather than actual opportunities. Do your research carefully.
2. It’s not always about having big budgets, I find agents look at internet marketing on a component basis – they go to one person for website design, another for SEO, another for copywriting, another for PPC, another for social media etc. etc.. This usually means that a business is not benefiting from available (usually free) organic growth opportunities.
3. Video is exceedingly good when used for more than property video tours, use video for marketing your actual businesses! A website with the right kind of well made, optimised video can achieve a page one ranking on Google very quickly – days rather than the many months it takes with trial and error keyword optimisation, including ranking well in local areas. It costs a lot less than £3k to commission a decent video that would be effective for much, much longer and give a greater ROI. Video should be your new best friend – use a mix of professional videos and DIY videos on your website and social media, but you will need to learn how to use video for marketing, there’s more to it than just uploading a video to YouTube.
4. PPC campaigns can be a rip off especially if you find the wrong partner and take the DIY approach without fully understanding what you’re doing, but there are still times when a PPC campaign can be very useful. Find an official Google Partner because Google ensures that every Google Partner ad campaigns is well researched using the very latest data. We use Ad Words and YouTube ads to support clients so our PPC campaigns for clients are not only cost effective, but they really do deliver results and our Google manager is a former estate agent.
Is anyone else getting a slight whiff? L’eau du rat perhaps
Try longtail based on local search terms
Collaborate and drop some portals. Could put many £100’s of extra funds in your pot to promote each month.
I used to own the domain name onlineestateagents.co.uk and it did not really generate that much traffic, it was number 2 for ages on google, most popular searches were ‘private house sale’ and ‘private house sales’.
Was the site correctly meta tagged and did it offer any real content ?
Two months ago ‘online estate agents’ was £1.20? Maybe back at the start of 2014
Yes but it only takes one company to receive their funding cheque and they blast the price up.
It is impossible without a very large budget to build a national brand in a large market place. Therefore you must FOCUS your company. So for example with a “online/hybrid estate agent model” focus on the areas that you have a member of staff on the ground in.
Use more targeted search terms for example “cambridge hmo letting agent” has no adverts on google.
Or offer a service that other agents will not, like a “Out of hour” cover for landlords that self manage. Then target EVERY properly that is listed on RightMove to rent with the likes of UPad.
If everyone searched “online estate agents” then clicked on all the google adwords, how much money would the online agents lose to our malicious behaviour ?
at £5 a hit I suspect they would be thousands out of pocket if we were to stoop so low.
This comment is specifically not a call to action.
Oh yes it is! I understand from agent friends that they get their staff to click on these ads to drain the advertisers coffers.
???
They are wasting their time. Google has a system that picks up click fraud very quickly and doesn’t charge the advertiser.
If the offending company is identified they will be banned from advertising. Your agent friend is not only pretty stupid but pretty crooked as well.
Three times is the limit of clicks before it does not charge the click through. If you refresh the search page you can do another 3. Not that i know people that do this 😉
As far as i am aware google have never banned anybody. What are they going to do ban them from the internet or ban them from spending money?
I’m guessing if the average estate agent has 5 computers in it’s office, each one would have it’s own IP address therefore if each one clicked on three different adwords and this was done by 7,000 branches across the country.
Like I say this is NOT a call to action.
What is it a call too then?
Your estate agent friend (or is it you really?) will be in big trouble if one of his staff leaves and tells the other agent about using up their adword budget or they tell a friend and they tell the agent.
The stupidity and underhand practice of this means they deserve to be caught and outed.
I quite agree one really shouldn’t be so underhand
Companies most definitely have been banned from adwords advertising by Google for click fraud. If the harmed company picks it, reports it to Google and it can prove the source Google will ban them from advertising their own business. Why? Because worrying about click fraud is one of the biggest reasons why potential advertisers don’t set up an account.
If Google can send BMW to the ‘sin bin’ for a few months for buying in SEO links which they did a few years ago, Newsboy’s naughty little agent doesn’t stand a prayer if caught.
The adwords company wants £3000 a month?
Of course they will, many charge between 15% & 25% of a clients monthly spend and, as someone who has 10 years experience in adwords, I can tell you that the majority of adwords companies offer a very poor service. The problem for anyone running their own adwords campaign is that their own campaign is probably even worse so it isn’t hard for a company to make an improvement. The client is happy and the company is even happier.
Running a highly efficient cost effective adwords campaign takes an abundance of Google knowledge and experience, marketing nous, copywriting skills, daily performance reviews and a tested and proven webisite design that converts clicks into enquiries. Adwords companies can only scratch the surface charging the average small business £300 to £500 a month. And that’s exactly what they do.
The good news is that even the likes of Purplebricks and Emoov have huge gaps in their adwords advertising and keyword strategy and genuinely smart PPC operators can, and do, exploit this.
I am an estate agent with a high performing adwords campaign and I am looking to roll this out in the next few month’s to one agent in every area.
Tilly
Keep us posted, maybe in the arena,
We do PPC but to be honest i think we are just throwing money away, you talk to google and they think you want hundreds of clicks, i dont and they cant understand that. I want sellers, i really do not care about finding buyers i have thousands!
As for outside companies tried that and yes you are right they just add a top up and get the same results,
Be interested to hear anything else you have found out.
The cost per click is irrelevant, the only number that counts is cost per completed sale compared to return on investment.
And because low cost onliners charge low fees, their model means they lose money. Show me one making a profit.
And a PPC bidding war means that businesses with a bad PPC strategy pay a google stupidity tax.
Oh dear the bedroom agents have found out you need more than just a RM subscription!
I thought for a moment it was April 1st 😉
Instead of Google Adwords, Rightmove Featured Adverts are proving to some of my clients very good to get listings. I have been told the average number of clicks a Rightmove Featured Ad gets is only 25 per month, but if you change the advert around slightly and instead of saying things like ‘Free Val wanted’ or ‘Landlords Wanted’ or ‘How much is your house worth’ with a logo .. you change the wording and pictures subtly, the worst are getting 200 clicks a month and the best 700 (not a typo – 700) clicks a month. I find instead of buying the expensive phrases, like the whole town, buy the suburb names on RM, the costs come crashing down and the click thru rate goes through the roof. If you are on RM – you are reasonably motivated. The agent in essex (who has the 700 clicks a month) – we worked out his cost per Click was in the order of 20p and he swears blind a lot of his growth has been down to a decent RM featured agent ad. If anyone wants to know what he does – drop me a note
Hello Chris, I would love to see a good example
ron@lennardhill.co.uk
thanks
Chris do you have an email address you have peaked my attention on this if true.
This is hilarious. I am a small independent estate agent and these big well funded corporate estate agents with big money backing them keep leafleting, writing and ringing my vendors from their dedicated call centre until they crack and succumb to their false promises. It’s impossible for the small agent to survive……………….but hang on, it isn’t, my business is thriving, why? Because my business isn’t based soley on heavy TV and internet advertising to generate customers. It’s based on service, relationships, a high profile office for customers to come and have a chat with a coffee, taking part in local charity events, a face to a name and supporting the local community. Customers have a choice. I note you are a hybrid, perhaps you should develop the side which isn’t online?
Wise words Noel
Don’t tell them your name Pike !!!!!
Here’s an idea, get your self a nice premises, kit it out right and use it as a 24 hour billboard on your high street, it will also double up to do the job of a Regus suite as a meeting venue, place for the staff to work from, key cabinet, archive, place for vendors and landlords to visit, registration venue for tenants and purchasers……..and various other things.
Full service agents don’t go blithering on about the cost of rent, what we can judge about this wally as an onliner moaning about the cost of Google?
Jonnie
Couldn’t agree more Jonnie
#RaceToTheTop/#RaceToTheBottom
This elephant in the room has been here all along, right back in 2013 this very point was raised to Adam Day. The cost of replacing the subliminal presence of an office agency far outweighs the cost of the office itself. Here is proof that the cost of saving £10k-£12k is £36,000; Genius scheme! Even better when Agents the cut fees to reflect the £12k savings but not the costs.
Welcome to the world of business! Go into another field if you cant keep up, or go an generate £5m in investment and plunge it on adwords and TV.