OnTheMarket has thrown down the gauntlet to Rightmove by announcing that it will not increase listing fees next year for any agents on full standard tariff contracts.
It has queried whether Rightmove will follow its pricing lead and also resurrected references to its ‘One Other Portal’ rule.
Agents choosing to list on only one other portal will get a discount.
OTM last night also confirmed it will continue its attempts to convert free contracts into paying ones.
Additionally, it underlined how strongly it encourages agents to revert to the highly controversial ‘One Other portal’ rule – the subject of lengthy and expensive litigation with Connells brand Gascoigne Halman, but which OTM ultimately won.
OTM says that it is not raising its prices because agents are facing considerable headwinds.
It says these include low transaction volumes; reduced lettings fee income; the possible onset of recession; the increasing likelihood of a no-deal Brexit; and a strong sense of uncertainty and a ‘wait and see’ approach amongst buyers and sellers.
The OTM ‘pricing pledge’ announced yesterday evening means that agents who entered the new five-year listing agreement in February last year will have a price freeze for their listings fees in 2020 rather than being charged an increase of up to 5% as allowed for within the agreement.
In addition, said OTM, those agents on that agreement who currently have a 10% discount for choosing to observe the ‘One Other Portal’ rule can continue to do so for a further year.
Agents on that agreement who revert to operating with ‘One Other Portal’ before the end of January will also be eligible for the 10% discount for the year.
For agents on their original Gold and Silver agreements, it means that they can roll into a new contract for a one-, three- or five-year term with no increase in 2020 if they choose to continue to advertise on a maximum of one other competing portal.
CEO Ian Springett said: “OnTheMarket is the UK’s agent-backed portal. We recognise the challenges facing agents right now and the outlook for 2020 is a continuation of the uncertainty which is slowing the market.
“We have seen before that the best firms come out of such periods stronger and better able to compete and serve their clients.
“Consistent with our commitment to sustainably fair pricing, we have decided to remove at least one element of uncertainty for the agents who have loyally backed us. We believe that now is the time for the agent-backed portal to back agents with this 2020 pricing pledge.
“It will be interesting to see whether or not Rightmove follows our lead on this or chooses to continue imposing double-digit percentage fee increases on the path to its stated objective of average fees per advertiser of £2,500 per month.
“We believe the latter course would be unjustified in any market conditions given that Rightmove’s monthly leads per advertiser have fallen inexorably from a high of 210 in 2015 to 168 in H1 2019.*
“Agents may remember how Rightmove behaved in the difficult years following the 2008 banking crash.
“UK annual housing transactions fell 44% from over 1.6m in 2007 to 0.9m in 2008 and did not begin to recover until 2012. Between 2009 and 2012, Rightmove increased its average fees per advertiser by 72%, taking its profit margin from 63% to 73% in the process.
“In any event, OnTheMarket is continuing on its own path to becoming a market-leading alternative to Rightmove, delivering fair prices to advertisers and making other portals compete for agents’ business rather than simply dictating terms to them.”
Comments (26)
If you’re going to be a successful agent, you have to look at where you spend your money. Over the course of 12 months throughout 2018-2019, we analysed our portal expenditure against the returns we were getting, i.e. how many enquiries actually became discernible leads. The result was not surprising.
In March 2019, every Rightmove enquiry that resulted in an actual lead equalled £151. If you can justify that, then good luck. We also analysed how much time was being spent dealing with Rightmove enquiries. You will note that I use the term enquiry and not lead, which is Rightmove’s preferred use of phrase. This analysis was compelling and resulted in us leaving Rightmove in June.
Have we noticed anything different? Yes, we have more time to focus on important business issues, we are not dealing with complete timewasters and, above all, we have taken our rightmove fee and are spending a small proportion of it more wisely and attracting better results.
Rightmove is a behemoth. A giant property referencing service, not a property portal. You have to search through 000’s of new homes, various agents’ banners and other such marketing gimmicks. For them to say “we’re too big to fail” or “we’re Rightmove, we don’t negotiate” gives you some idea of the arrogance driving their business model. The Titanic was unsinkable and the Captain didn’t think the iceberg looked that big, Woolworths was an “institution” and BHS was a mainstay of the high street.
It takes guts to walk away from a dictatorial supplier who thinks you need them more than they need you, but when you do, and many more will follow, it is a truly wondrous feeling. For one thing, you don’t get some scripted sales person telling you that you’re not using RM properly, even though you were an agent long before they came along and will be an agent long after they’re gone.
4.8% of their customer base can’t all be wrong.
If you think the portals are bad , what do you think the CRM providers are like?
Are you all OTM reps?!?!??!!
Down with Rightmove!
We came off RM at the end of July.
The quality of the leads we are getting from OTM is excellent, and none of the junk we were getting from RM. Can’t say we are unhappy with the £1500 per month saving either.
Well it looks like we all have choices! continue accept rate increases with Rightmove and support the online agents and corporates, or use the cheaper and more effective method of marketing such as Social media, own website and cheaper portals like OTM and/or Zoopla.
Bless You
SEPTEMBER 3, 2019 AT 08:54#2
Wouldn’t need t.v. advertising if agents would all come off rightmove for 3 months.
Everyone should have left om the second they went public.
You ve all been taken for a long ride.this is taking longer then brexit.
Bless You Many agents are quitting Rightmove and have set a date for the end of October they have called it RMEXIT, I agree with you and the general consensus is that if they leave for at least 3 months they will save a packet that will cancel out any price rise they may suffer if they ever went back, I think they won’t as by then they will have learnt to sell better and will continue to save.
Looks to me like Springett is very worried about losing those valuable founding gold and silver members in early 2020 who they abused so badly by tying them into the one other portal rule on full membership rates whilst offering free contracts to 1000s who came along much later and all because they wished the portal to remain wholly owned by the membership as originally intended?
yup! That will be me.
If anyone wants to sell their estate agency business in the next 5 years DO NOT SIGN UP FOR A 5 YEAR AGREEMENT!!! They have a clause that states if any business acquires them they too have to list their business and any others within the group. Even if an agent pays the full term to come out of the contract, On The Market will not release them from this contractual obligation and due to them suing Gascoigne and Halman 2 years ago large agents will not enter into this risk. I have personally seen many businesses want to retire or exit and unable to do so because they have to wait until this contract ends. I thought that OTM were for the independent agents but I have seen first hand how difficult they make it for people that have worked so hard in the industry and didn’t realise the contract they were entering into would have such a negative impact if they want to sell. The only way a business can continue to sell is to switch the type of sale and leave the contract behind which has huge financial implications to the owner of the business.
Surely this doesn’t stop retirement?!
I don’t trust them and never have. They aspire to replace Rightmove and will be every bit as bad as them.The way they’ve treated V1 members, says a lot in afraid.
I’m in full support of OTM but I must agree with the first comment, how did they get that cringeworthy advert passed the decision makers? It’s embarrassing and that’s from someone who was brought up with Chas & Dave! You must make your image more professional and dare I say, learn from your competitors. It’s hard enough making our clients recognise OTM as the portal of choice, so please help us help you.
Wow, something more boring than Brexit.
If they said ‘price freeze for five years’ they might stand a chance of succeeding.
I’ve used OTM from the beginning and the leads are of far more quality than Rightmove. Just wish they would import into Jupix !
I had a call yesterday from someone who saw a for sale board.
Better quality lead then all portals…
So true!
Zoopla will not allow Jupix to link with On the Market as they are a direct competitor to Zoopla and Jupix is part of Zoopla
5 years ago we had to pay only to two portals and now we have to pay to 3 portals!
Did onthemarket impact Rightmove? ——-NO.
Are my portal costs down? —-NO
Have I made money from onthemarket shares?—- NO
Who did well? ——- A couple of executives
well done… we just managed to create another Cost item for ourselves!
You didn’t have to do anything, you chose to pay for 3 portals?
Supporting OTM shouldn’t be about making money on the shares, that’s a complete secondary.
Much the same as agents will blame Brexit for poor performance, agents will say they need to be on every portal to do the business. Meanwhile lots of agents, just crack on and do the basics well, work hard and earn a living, on only 2, 1 or even none!
Honest Bloke, otm has definitely had a positive impact on the lettings market, and the amount we pay towards portals.
This is like Budgens saying they will not increase prices next year, and then putting out a press release asking if Waitrose will do the same.
Good one 🙂 However the quality leads coming out of this Budgens is better than the Waitrose version.
Another example of people being fooled into believing Waitrose (RM) is better, but in reality the Budgens and Lidl’s of this world deliver more for their money and in a lot of cases better quality.
That’s why you’ve got Waitrose closing stores and Lidl moving into them, people have cottoned on to the fact that there is better out there.
They’ve just taken a long time to get over their snobbery and are finally brave enough to be seen going into Lidl in the daylight!
OnTheMarket should have been banging its “We’re the UK Agents Portal” much harder and for much longer, however, it’s a start…..
If they address their p*ss poor TV/Media Marketing, dump Chas n’ Dave and come up with a much punchier/positive campaign …….then I may just consider not leaving OTM in early 2020.
Wasn’t it surprising to see those “original Gold & Silver” members mentioned in despatches from Captain Springett.
Come on OTM, reinvigorate your whole marketing campaign!
Wouldn’t need t.v. advertising if agents would all come off rightmove for 3 months.
Everyone should have left om the second they went public.
You ve all been taken for a long ride.this is taking longer then brexit.
We left Rigtmove at the end of July. Saved £2200pcm and spent £350 on Social Media and Facebook Boosts. If any of you have thought about it, i cant tell you how relieved we are not to pay them another £. When is the penny finally going to drop for you all. Come off Rightmove, stay with OTM and Zoopla, as soon as the public work out that there are virtually no properties on Rightmove by default they will go to Zoopla or OTM or both. Rightmove goes down the drain where they belong, shareholders get what they deserve and every Agent saves a fortune, then Business as usual.