The boss of a regional independent which is opening six new offices this year says that the idea of online versus traditional is a nonsense.
Rob Sargent, CEO of The Acorn Group which operates in south London and north Kent, said: “The real battle is upfront fee versus full ‘no sale no fee’ service.”
He said: “It’s almost an insult to call high street agents ‘traditional’. Most agents, like ourselves, have been online a lot longer than the newbies in the market.
“I would be surprised to go into even the smallest high street agent and find they are not spending as much online, if not more, than an online agent.
“There is the cost of Rightmove and other portals, our own websites, and most agents would be very active on Twitter, Facebook and Instagram.
“Online agents often present themselves to the public as a solution – but I am not sure what it is a solution to.
“Nor are online agents very transparent about delivery of completed sales.”
Acorn is proof of faith in the high street – and full service.
It has already opened three new branches this year. It is due to open in Sidcup, Kent, on July 14, with two more offices to launch by the end of 2018.
It will bring the network up to 35 offices and headcount up from nearly 400 as of now to about 430.
And expansion will not stop there: “We plan to roll out another ten offices in the next three years,” said Sargent.
However, the business’s online strategy is equally important.
Social media is used to stress Acorn’s involvement in, and knowledge of, the communities where it works, rather than a platform solely through which to market properties.
“We are fully involved in the places where we work – in local schools, charities, golf clubs – and we get very involved with individual families over a long period.
“We’ll offer them property advice, knowing it won’t generate fees at the time but eventually; conversion rates are high because they know they can trust us.”
He believes there is no substitute for the fullest possible service: “In the current climate especially, you cannot just list a property and stick it online. It will sit there unless real people are there to sort out problems, market it properly, negotiate and see it all the way through to a sale.
“This is a people business, and customers will pay for a premium service. Our fees are holding up well and we’re probably the most expensive agents in the areas where we operate.
“Our branches are open six or seven days a week, 12 hours a day, typically from 8am to 8pm, and all our viewings are accompanied. Although not all our offices are open Sundays, we’ll do viewings seven days a week. We like to think that we have met all the buyers on our books, and get to know them.”
The business operates several brands, and is highly diversified, offering commercial agency, estate management, surveying, mortgages and conveyancing among a string of services.
“It is a big driver across the group that we have different income streams: in 2015, 43% of our revenue came from sales. It is now about 37%, and that is deliberate. We have recently expanded into leasehold services, including leasehold extensions and management, and we have built up a good Build to Rent business.”
Sargent has experimented with out of hours live chat, but thinks that online availability 24/7 is over-played: “People are making important, life-changing decisions – they find the time to come and talk to us.”
He does come across a “smattering” of Purplebricks boards in the Acorn areas, but says it is really about getting across to vendors that it is not the perceived savings they will make that is important, but their net sale price after fees.
He said: “The price model for online agents generally seems to hover around the £1,000 upfront mark. Clearly the problem for the upfront model is the more you do for the customer after you have taken the money, then the more your profits are eroded.
“We see residential sales as labour-intensive if you want to do it well. The more that agents go down the cheap fee route, the more we will go in the opposite direction.”
A keen supporter of OnTheMarket, Acorn is also an investor in tenancy deposit replacement business Zero Deposit, which he says is proving very popular: “It’s not that tenants can’t afford to pay deposits, more that they don’t want to tie up substantial sums of money for perhaps three or four years.”
Sargent has been watching the Countrywide crisis unfold with concern: “The back to basics strategy is obvious – but I do wonder if there is a real understanding of what the basics really are.
“Countrywide needs to get its senior management team to the frontline of the business – talk to the staff, listen to them, support them, and make sure they really know what is going on, and how to deliver the quality of service that historically they have been synonymous with.”
Comments (47)
Industry is in the process of modernisation. The important questions of the online versus established will be answered in 5 years, everyone’s current argument is framed by their own biased vision.
Service,service,service will always win!!!
I’d say the difference between an online agent and a traditional agent is the level of functionality offered. For me, with online agents, the “business” is done online. Booking appointments, messaging between buyer & seller. Offers and counter-offers, modifying prices, modifying property descriptions, etc.
Agents need to be careful. There are a lot of scam artists out there who will tell you SEO and PPC will provide you with a huge amount of leads. I imagine PPC is very competitive by now (but could be wrong because the estate agency sector seems to be about 10 years behind when it comes to the internet) so whether you get value for money will depend on individual cases so buyer beware!
I think you are wrong with your 10 years behind sarky comment. Within three years I think the independent estate agent sector will be leading other industries on ‘internet anything’.
Where were you yesterday when your mates were in trouble?
BSOS23PC
>Within three years
Selling something perhaps?
>Where were you yesterday when your mates were in trouble?
Had a doctors appointment and generally busy with other things. No mates of mine though, but I appreciate you find it difficult to see things other than black or white.
Perhaps you would enlighten readers of your own brush in with the ASA seeing as you were lucky to escape publication of the case involving your company misrepresenting the proportion of properties that were really recently completed as opposed to more than 6 months earlier.
And thereby. Laydeez and Gentlemenfolks, is revealed the true colours of this particular web-footed foul in that last paragraph.
Oh, dear – bl00dy autospelljobby…
…that ought to have read “web-footed foul”.
What the…?
It won’t let me correct that typo.
Maybe the computer knows best…
Your hypocrisy knows no bounds PeeBee.
#notnowTerry
I beg to differ.
If it walks like a duck, sounds like a duck and looks like a duck, its probably a duck, sorry cyberduck your team are worth nowhere near 100s of millions of pounds as a business, not good enough for the client, not good enough for those that trade with them in related, analytics and do your own research be damned, they are not only not good enough but they have no ambition to be better at the job, grow market share yup, increase foot print yup, be so very clever at driving the business yup
good at the job? Nope
and not one article I’ve seen in either hostile environments like this or in their own niche that suggest they have any trajectory in trying to get better, at all
Cyberduck….you won’t bait me I am afraid….because I know I always do the very best for the vendors I represent and who ultimately pay me.
That is my nature, my fiducial duty and my masonic principles.
I also know when I see greed at any expense. So carry on with your crusade for the dark side, the multi million pound grab for a few, at the expense of small local independent family supporting businesses.
At the end of the day, we all have but one short existence on this planet. I am determined to do as much good as I can before my existence expires….do you truly believe you can say the same about the companies you support?
BSOS23PC
“So carry on with your crusade for the dark side, the multi million pound grab for a few, at the expense of small local independent family supporting businesses.”
Not to mention the thousands of unsuccessful hopeful home-movers that litter the path and get pushed to the sides like spent matchsticks…
Of course……. the CONlateral damage
Cyberduck
Perhaps you would enlighten readers of your own brush in with the ASA seeing as you were lucky to escape publication of the case involving your company misrepresenting the proportion of properties that were really recently completed as opposed to more than 6 months earlier
Just watching the football, and thought I would answer this question a second time (as I am sure I have answered it before). After stalking our little family supporting business, doing your best to discover anything we might possibly have ever got wrong followed by your subsequent complaint, the resultant letter was almost apologetic about contacting us.
This is because I am sure they realised the property that was left on our website too long, in their opinion, was just a simple oversight.
However as you want to believe differently…..yes of course Cyberduck we deliberately left a property on as long as we could to deceive everyone coming to our site that we had sold it more recently than we had. We took a deliberate contrived decision to do that because we knew that it would get hundreds of people to use our sales service. We have been doing it for years because people coming to the site look and say ‘hey they’ve completed five sales recently, if they had have only completed four I don’t think I would consider using them, but that fifth makes all the difference….lets call them straight away.’
BSOS23PC
If ‘Traditional’ means Proven, Tried and Tested (i.e. the dictionary definition) then I’m very happy to be called a Traditional Agent, even if that is meant has an insult by the Unproven, Untried, Untested, Unwashed, Unreal agents.
Just noticed a PPC ad from Hunters that leads you to a page that gives a £15,795 saving on a £500,000 property due to the higher price achieved by high street agents over online agents using the info below.
This is exactly the type of proactive advertising that I am suggesting to combat PB, Emoov etc.
* 95.85% the average value an online estate agent sells a property for compared to their original asking price.
* 100.35% the average value a high street agent sells a property for compared to their original asking price.
Statistics source: HomeOwners Alliance
I totally agree, but maybe we all need to join in collaboration collectively. Are you interested?
I’m wondering if there is a portal/agent relationship to be created like “just eat” so the portal gets a commission after a deal is done, like the agent does.
To police it would require some cleaver software but could be doable.
just think the agent no longer pays upfront to advertise on a high profile website but pays the portal when a deal is done.
My guess is all the agents would need to sign up in each area so which ever agent converts the enquiry to a sale pays the fee.
just a thought
PP.
In principle what you suggest is something I have previously considered setting up nationally.
However, having generated leads in many markets for years the issues will inevitably be…
a) getting volume traffic to the portal will initially have to be funded through PPC.
b) it could be months before the portal earns any significant commission due to the time between for sale and completed.
c) who pays for the initial significant outlay?
d) how do you define/establish if the buyer came directly from a portal enquiry, board, RM or Z?
e) in my experience a % of companies will do whatever they can to wriggle out of payng commission often on spurious grounds.
You could run your own agency version simply through Google advertising and ‘commission’ payable would be your PPC cost – my average click cost was 17p.
Actually every lead generated is easily tracked back to point of origin, if the agent clicks to download the applicant then they accept automatically they are liable to pay a fee if the applicant then buys through them.
If there are 20 agents in your area and 10 get the same applicant they are all liable to pay but only one would because the buyer would only buy the one property. Whilst there are investors who might by several, they are relatively too few to be worth policing.
The buyer can just as easily update the system when they stop looking or have found etc. It’s workable, just not easy.
Property Paddy.
Have you got time or resources you could invest in this type of project?
nope
This is 100% on the money.
High street agents ARE online, and have been longer have ‘online agents’.
‘online agents’ is just a term created to describe a low cost agent, Guess what? These have also been around for ages!
So nothing really has changed here, it’s just that investors have decided to pump loads of money into these ‘low cost agencies’ thinking they are going to break the market, in much the same way as something like uber.
To deliver a quality service, you cannot get away with not charging a decent fee, if you do you will be a loss leader and eventually have to increase your fee to deliver profits, which in turn undermines your ‘low cost’ business model.
I assume the head count is due to all the associated services, 430 on payroll from 35 outlets seems a lot, that’s a monster that needs feeding
From my perspective the divide is the blurring of the line between a passive intermediary listing service and estate agency.
Most people aren’t aware of the duties and obligations of a contracted agent and how that differs from someone who whacks a property on the internet and waits for it to sell.
I am proud of my traditional agency roots, there’s is a lot to be said for honesty, integrity and respect. They really shouldn’t be USPs but as they’re there and available it makes sense to use them!
Have to say, I enjoyed reading this article, a lot of common sense highlighting how the best service will always win out in the end.
“There is the cost of Rightmove and other portals, our own websites, and most agents would be very active on Twitter, Facebook and Instagram.
Why no mention of SEO and particularly PPC?
Rob Sargent clearly has a successful business but no mention of search advertising – as opposed to social media advertising – tells me that here is another agency that is not using or prioritising one of the best lead generating platforms available.
I would ask any PIE reader a question…
Where do you go to if you want information on practically anything from comparing car insurance, to booking a flight or finding a local plumber to unblock a drain?
Google.
Not, Twitter, or Facebook or Instagram.
So… where do your potential clients go when they want to sell their house or buy?
Google.
The difference between the ‘online agents’ and ‘traditional’ agents is that whilst both are on the portals 100% of the former are strong on Google advertising whilst only a fraction of the latter are – AND THIS IS WHERE THEY ARE POACHING YOUR POTENTIAL CLIENTS AND BUILDING TRACTION.
But, of course, social media is free ‘advertising’ and Google isn’t + there are so many charlatans constantly calling to promise “we’ll get you to the top of Google”.
That doesn’t mean PPC is a waste of money, it just means you need to do it properly.
Done correctly it is, without question, the quickest way to dramatically increase valuations, market share and speed of SSTC.
I am interested in PPC in the near future….never really got into it, so don’t know where to start to maximise the results at a reasonable cost. Do you have experience you would be willing to share? Would be good to make contact
in@agentv.co.uk
Me too, unless of course you are a charlatan Retired-agent28?
If you are prominent in your local area, involved in the community, and have a strong board/portal presence, then you will find yourself on the short list of most sellers. In fact, I think the majority of sellers have a good idea of the agents they’re going to speak to way in advance of selling.
You only search for something if you don’t know the answer. If you live in an area, do you use Google to find out which restaurant to visit over the weekend? No – because you already know the answer.
Although I accept that ppc plays a part, I really don’t think it’s as significant as you suggest.
Shaun77
Although I have recently sold my agency my professional background is 30 years in marketing.
Most small businesses dramatically overestimate the public’s awareness of their brand and whilst I agree with eveything you say about boards etc., the key word you use is ‘most’.
How many is ‘most’? 50%, 60%, 70% or more? If you don’t know, how can you be happy that ‘most’ is the most you can get?
The analogy with restaurants is not comparable to contacting an agent. People go to restaurants regularly, they only sell their house once every Xyears. You have to contact an agent for a valuation and most people will get three or four vals. People will have their favourite restaurants tel no’s on their phone to book, they will have to search for the agents no. etc.
I ‘fell in’ to running an estate agency six years ago on the back of a lead generation site I ran for property investors.
Initially the agency was a national fixed fee agency but I quickly changed it to a local high street agency and PPC allowed me to become the market leader in my town within 6 months increasing to an average for sale inventory of c300 properties.
And that was in a sparsely populated area of the North East – although I did target a radius of 30 miles.
PPC alowed potential clients to see my ad and visit my site no matter which local agent they had Googled for a telephone no. After that its just a question of giving them a reason to include us in their list of valuating agents. And after that… its up to the neg to convert.
I completely understand the scepticism about PPC, as an internet marketer I’ve handled that scepticism from CEO’s in big businesses down to sole traders. But done correctly, it is THE best advertising medium ever.
I tried PPC
don’t think it helped
now rely on WOM
PP,
The only reason PPC doesn’t work for 95% of businesses is because 95% do it wrong.
For example I had 3,500 keywords I bid on but just as importantly c13,000 negative keywords that prevented my ad showing for searches that weren’t relevant ie., estate agents jobs, salary, training etc., etc.
Also – if the page you direct clicks to isn’t designed right you won’t get potential clients contacting you.
My average click cost was 17p and PPC directly contributed 60% of my valuation appointments and 35% of my sales. Average spend was c£1000 per month.
It helped me build a 300 property for sale inventory from one branch – PPC works fantastically well and is one of the most cost effective, high ROI marketing investments you can make (in any business).
If…. it is done right.
From one Adwords marketer to another, what was your preferred option Display or Search?
Of course, I always advise a mix of both but did you weight your budget in favour of Search for the high quality or Display for the high traffic?
Eagle60,
I only used search, for my estate agency campaign, I use both for some of the other campaigns I do.
Bless you rob. Need some more balanced pieces on here . It’s up to us to fight this evil that is pay any way.
Great one I heard is that there is often £10,000 difference from first offer to last offer.
If your negotiating yourself u could lose £1000’s Not save £1000’s.
The onliners need forums like this to infiltrate Google searches… stop printing their rubbish and they will disappear.
#OnLine #OnThePhone and #OnTheHighStreet the only way forward always has been.
Online Only agents, are mainly failed High Street agents who could not create their own leads and make an office a success, so now hope to catch the cheap skate DIY vendors. You can have them!
Happy Thursday everyone and come on Engerlund… it’s coming home.
#local
Could somebody please explain this #local to me? I’ve seen others misunderstand what it represents but no explanation of what it does mean fully.
#local is my twitter hashtag for local agency. It represents the activity centre an agent knows well and is known in. James Benning is #local to EX33 BUT not local to EX31. He has been selling in the area. The nearest internet lister isn’t #local but claims to be.
I have about 3500 #local activity centres each with at least 3 #local agents.
Am internet listing agent can fairly describe themselves to be #local one activity centre but they can’t have enough experience of multiple centres to ever claim an sort of genuine expertise in all of them.
Sorry Robert, can you explain that so that normal people can understand.
I’m not big on twitter so could be mistaken but my understanding is that hashtags are used to group similar tweets together so when using twitter you can click on the hashtag and all tweets on the topic will be shown.
This is what wikipedia says “A hashtag is a type of metadata tag used on social networks such as Twitter and other microblogging services, allowing users to apply dynamic, user-generated tagging which makes it possible for others to easily find messages with a specific theme or content”
So it begs the question why you are posting hashtags on PIE which has no such functionality. Please explain. Also, please explain why so many diverse tweets come up when you click on #local in twitter. This suggests you’ve chosen a very poor hashtag for whatever purpose you have (if any).
Buyer beware!
Here’s what wikipedia has to say on hastags:
“A hashtag is a type of metadata tag used on social networks such as Twitter and other microblogging services, allowing users to apply dynamic, user-generated tagging which makes it possible for others to easily find messages with a specific theme or content”
So according to them it’s so you can group tweets together under one topic and twitter users can click on the hashtag and see all related posts.
Not sure how this fits in with your use Robert, could you explain? Click on #local in twitter and you see a diverse range of tweets.
Also, why would you post hashtags on PIE which doesn’t have the same functionality as twitter?
Cyberduck46 #GiveOver the use of hashtags in forums like this is sometimes just setting a tone/feeling for the debate. Hashtags are quite relevant to the people who support shopping local and save the high street. The would promote the #shoplocal and #savethehighstreet where ever possible by using the hashtag.
Oh AND use the search facility at the top right hand corner of EYE – If there is a story where a hashtag has been used then it will appear. Try #local it will return a story.
That said… I would agree #ShopLocal has to be the hashtag in relation to this debate or maybe #ListLocal if we are going to nit pick as I am sure buying a house in area, automatically means you have “shopped locally” if that makes sense.
god its hot… predictions for tonight…. 2-2 Engerlund (Kane and Rashford) you heard it here first #WorldCup 🙂
Here’s what Twitter says https://help.twitter.com/en/using-twitter/how-to-use-hashtags
Using a tag like #local defeats the purpose, you’re not going to categorize with such a broad term. #shoplocal and #savethehighstreet are much narrower in meaning.
It would have been nice to have had a clear explanation from Robert May. I must admit his explanation above sounded like “sales speak”. Without clarification I will have to file this one with much of his other comments under #waltermitty.
#notnowTerry!