Anyone who simply plonks a property on a portal and then waits for the phone to ring is not an estate agent.
Ed Mead, director of upmarket London agent Douglas & Gordon and a key mover behind OnTheMarket, said that the two big portals are about leads, not sales. He also claimed that online agents do not sell property.
He estimates that only about 1% of his firm’s sales are made to people who actually saw that specific property on a portal – and it could be even less.
The other enquirers are leads that go into the firm’s database for future sales, with six in ten of all buyers coming through portals. However, that still left 40% of buyers not coming through portals.
Mead said that access to an agent’s database of buyers is what sellers actually pay their fee for.
He said it was “utter rot” that selling property is simply about listing on a portal.
He described as “minuscule” the number of times his business sells to someone who first sees that property on Rightmove.
Mead said: “Rightmove and Zoopla are a medium for advertising, but it’s not where properties get sold.”
Mead admitted that in dropping Zoopla, his firm had lost some leads – but that the slack had been taken up by Rightmove.
He said: “OnTheMarket is designed to bolster what estate agents do – online estate agents do not sell property.”
EYE asked about the original strategy of building a portal by agents for agents, with the key pillar being to split listings between Rightmove and Zoopla. This has clearly not worked, but Mead said the strategy had not changed.
He said: “We have no power over individual agents – no one does.
“Agency is the last bastion of the true entrepreneur. How does anyone imagine for a moment they would agree to do anything someone else suggests, especially as the majority of agents are one-office operations?
“Rightmove now has the market power. Neither Zoopla nor OTM has market power.”
He added: “Clearly the portal has to stand on its own merits. From the agent perspective nothing has changed – build a clean, attractive and simple portal that advertises clients’ properties to best effect and to their best interests.”
He emphasised the lack of external shareholders or third party advertisers.
Mead also said that agents who expected OTM to become a Rightmove or Zoopla overnight ignored the fact that they had huge budgets for marketing, plus SEO traffic gained over an extended period of time.
Mead said: “OnTheMarket on behalf of its members is proud of what it has achieved in 15 months. And despite headwinds from competitors, momentum is good and it’s here to stay.”
Regarding Mead’s claims that such a very tiny number of Douglas & Gordon’s eventual buyers have first seen the property on Rightmove, he said: “We’re starting to track that number, but less than 1%. Those are our initial figures. The leads we get are not as qualified as those who call us – they tend to be browsers”
Mead said that OTM could become more than a portal, and grow into an industry resource for people wanting to know about property.
He said: “If you want to know about property, you talk to people who know about property. That’s agents. OTM is by agents, for agents. The professionals who own the website understand property.
“Zoopla and Rightmove don’t know property. They just advertise listings.”
Ed Mead is also on the board of the Property Ombudsman.
* Eye would like to make a request: we spoke to a number of agents for this story and all had no data tracking the source of buyer leads that eventually bought or rented a property. Is there truth in the assertion that ‘properties aren’t sold online’? We’d like to find out.
The agents we spoke to all agreed to start tracking that data for the next month.
If you’d like to take part in this industry survey, please email ros@propindustryeye.com for details
Comments (10)
We have recently done various trials including one with a large agent where 1/2 the applicant viewers came from other agents 5-12 miles away from the main agent.
Portals have a lot of value, but agents B2B equally carry a lot of weight
This is the most ridiculous article I have read to date on this website. I understand that he does not like online EAs, but suggesting that less than 1% of sales are direct enquiries from Rightmove/Zoopla on that property is stupid. I would say it is well over half, and has been growing for the last 10 years!!!
I hand on heart say that I would bet my house that this statistic has been manufactured as anti online EA propaganda!!!
Last year RM declared they had some trillions of hits on their web site for that year, with record month on month millions of hits and yet only 1.2 million properties were sold from a population of just under 70 million which on average only 10% or less are home movers? Put that in perspective to agents who go out and get the business to those that are waiting for the fish to bite, they aren’t hooking much.
80% of our lettings comes from walking into our office. 65% of our sales applicant list has no email contact either because they do not have the internet (people forget about that) or do not want contact via that medium. Of the 35% that do, we get to them before they see it on the internet through instant email/SMS. Applicant lists evolve every week and more often via us putting them on it through their telephone contact to us or walking into our offices.
The main thing that has happened is the applicant list has grown smaller from pre-web portals which on looking back would suggest many (not all) previous applicants were time wasters as they can log on and off in their deck chairs at their leisure. We have seen an increase in applicants using smartphone/tablet apps ….. desk top PC’s sales are dwindling.
Ed has some very good points which go back to what estate agency is about. Anyone who has been in the industry long enough will agree with his comments, it is the young guns who I see as being less experienced and believe that IT is the new “holy grail” and is the only way forward. Instead of being proactive, a generation are becoming reactive and taking short cuts to try and make as mush money as possible at the cheapest expenditure. How many agents will remember board counts was a measure of perceived market standing (same principle applies today with the public), newspapers never sold properties (web sites are digital newspapers!) …. it produced market branding/awareness. IT has become a distraction/corruptor dependent on views of how one uses it. It has greased the cogs but the wheel is still round!
A pro-active, focused and determined agent will always outshine on-line agents who can offer nothing more than reactive advertising business ventures.
Excellent post, something for the young ‘uns to mull over.
Tech is seen as something to delegate the selling to; having oven ready applicants appearing on a desktop each morning.
The advanced system training most firms don’t usually bother with is normally aimed at taking Agencies beyond learning how to operate a system and learning how to use it. it’s the difference between processing sales and selling.
I think he’s lost the plot. 90% + of buyers ring agents having seen a property on a portal. Nearly all buyers nowadays sign up to alerts from the portals so see the property first in that email. Deluded IMO.
The entire story doesn’t make sense. Right now, OTM offers nothing different to the other two, but Ed is suggesting agents that signed up to OTM are the cream of the crop. How bizarre!
You could even make an arguement that OTM has been the victim of adverse selection, and that the majority of agents on there are those who couldn’t afford to continue using Z & RM long term because they were so poor at their jobs.
I doubt this is correct for any firm. He’s saying 60% of applicants come from the portals. So he therefore believes that nearly all of these applicants then suddenly stop looking on Rightmove once they register?!