Rightmove’s raison d’etre is to make ‘home moving easier’ – but what people might not realise is that Rightmove has a pretty easy time of it too, a City analyst has said.
George Salmon, equity analyst at Hargreaves Lansdown, said: “That’s because Rightmove’s business, running a website, doesn’t cost a lot. As the group underwent huge expansion, costs were kept to a minimum, and as such margins are around 77%.
“That’s among the highest in the FTSE 100.”
Salmon goes on: “The other string to its bow is the fact it’s a must-have portal for traditional estate agents, which allows Rightmove to keep pushing its prices up.
“Last time we heard from the group, it was raking in £1,077 per branch, per month.
“That pricing power is particularly important, because it’s offsetting declines in the number of estate agents on the high street – down 3% at the half year.”
Salmon says that “if agents keep closing and are replaced by online competitors” the group may need to rethink its per-branch pricing although of course Rightmove does have a pricing structure for both online agents and for traditional agents who cover large areas from one branch.
Salmon concludes: “Still, it’s hard not to be impressed by Rightmove’s market domination . . . when all’s said and done, we think Rightmove is an impressively efficient business.”
https://www.hl.co.uk/news/articles/three-reasons-to-understand-how-a-company-operates
Comments (16)
Up until very recently Hargreaves Lansdown have been telling all their clients that Neil Woodford is a genius. Says all you need to know about their opinions. Rightmove are losing customers every week which is not good news for their investors.
Ahhhh the fall of Rightmove has begun. Greed is a sin.
If your moaning and still advertising with them, or take one of their ‘discounted packages for six months’ to stay with them you are part of the problem. Fair play to those that consider what is now more like £1,200 per month as fair to advertise their properties, its their money to spend. But don’t moan about it and still perpetuate the issue by using them!
Great agents sell and let homes, not websites. We left some time ago and won’t be returning and we have been more profitable without it.
RIGHTMOVE are on the way out all this publicity is a smokescreen to try and convince people that they are needed. I don’t need them and have ended my contract many more leaving on mass 31st October is a date for RMEXIT! get on the train and back yourselves save around £1000 a month and spend it on the other half.
How much were agents spending on local press before Rightmove and did it have a fraction of the reach? RM has every right to charge what it thinks it can and clearly the vast majority of agents see this as a cost they will pay.
From a media buying perspective, it is a no brainer to use RM compared to any other offering.
Wow, so insightful. You’ve converted me, rightmove really are a truly innovative company, charging fair and manageable prices and doing everything it can to help its clients. I can’t imagine advertising property anywhere else*.
* Comments only a village idiot would make
Boo Hoo,
You should try promoting a business where your customers are surfing across 1,000’s of different sites without really knowing exactly when they’re engaged in what we’re shouting about.
You have flyers (no one likes them by the way) knocking on doors and 3 or 4 websites that you know everyone spends their time on, must be tough….
Pre-tax profits for the current year likely to be in excess of £200m! For running a website where the content is supplied by members who spend a small fortune to acquire said content. How are they not being looked in to?
Look into what? Nobody is forcing agents to give them money.
Your Username should be NotAnAgent32.
surely its supply and demand??
Wow.
Rightmove became Wrongmove.
Any goodwill it had with Agents evaporated some considerable time ago.
In life, if you keep overcharging for something eventually customers will desert you …….the FTSE may think Rightmove are floating on their own ocean of perpetual success …….if they look a little harder they’ll see a large torpedo on the horizon, heading their way.
The tide has turned, clients don’t demand Rightmove anymore – that day was always going to come.
Estate Agents Sell Homes – Rightmove Don’t!
There must come a point when RM has to look at a ‘per property’ price for listing on the portal. Over £1000 per branch of any size is not sustainable – and it must be costing come agents money to sell properties. Once agents leave the site and realise they can get along without RM they’ll not rush to go back.
Agreed. We won’t be rushing back, we don’t need to and redirecting the spend to social media has achieved so much more!
They make browsing easier, they don’t make moving easier.