There seem to be plenty of people prepared to say that they know what is coming down the line for agents (even if yesterday’s ban on letting fees caught the entire industry completely by surprise).
I have to say that having lived in my own company bubble, and had a busy day job – although nowhere near as busy as now! – I had my own ideas but precious little evidence of what other agents’ thoughts were.
Roger H Simpson (nope, me neither) said there are two rules for success – never tell anyone everything you know.
This industry is full of great sales people and plenty of cynical, opinionated types for whom giving anything away to the competition is anathema, hence why whatever is often said between competitors, even if close, can be convincing obfuscation at best.
Getting an objective view is, for the reasons stated above, difficult, but my travels have undoubtedly shown that the appetite for opening new offices is waning – hardly rocket science.
Unless you are buying a solid rental portfolio as part of the package (and maybe that will change after yesterday), getting a fresh office up and running can be ruinously expensive in a marketplace seeing fewer transactions and more competition – indeed it’s not untypical to hear of three years to profitability.
Even with rental portfolios included there are some bulls out there willing to pay far and above accepted valuations, up to 1.7 times turnover in some cases, making sensible acquisitions difficult. Even consolidation if you have a struggling neighbour is difficult to plan for.
So it’s been eye-opening to find that many well-known and respected brands are well down the road in looking at filling gaps in, or expanding, their offering with Local Estate Agents or Local Property Experts (LEAPERs).
Many have great marketing machines with infrastructure capable of supporting more, as well as negotiators who live in these surrounding areas and are more than capable of rolling out the brand so long as they have a cogent marketing campaign to penetrate the new area.
This works with LEAPERs in adjacent areas, but moving further afield comes with the knotty problem of finding people who are genuinely knowledgeable, and giving them enough to do, something one or two of the bigger digital agents have struggled with.
Maybe they’re just trying to do too much too soon.
* Ed Mead is now a director of outsourced viewing service www.Viewber.co.uk and an independent property consultant / commentator: ed-mead.com
Comments (6)
I think the mistake most of us make is thinking of the property market as one market when we actually know there are many sectors out there and we need to treat them differently. Prime central London is not Milton Keynes or Bristol, first time buyer land is not retirement bungalow jungle etc they need different things. Have the courage to focus and not be all things to all men/women.
The argument for and against trad and online agents is not clear cut; if you live in an area where there are many similar properties then valuation may not be that difficult and an online agent might be all you need. I am not suggesting valuation is the only service we provide but you can see where I am going.
In this digital age virtually all businesses are splitting along the ‘full service’ versus ‘simple & low cost’ divide and we need to think along those lines. However the sticking point is that some think that they can survive offering the full service but not delivering it, ie the status quo and they are going to suffer. You dont have to go digital but sure as hell if you offer full service you need to provide a brilliant service but using tech to save money (probably wages) and improve communication with your customers. Think about other industries, travel agents for example, look what has happened there and translate it to our industry.
Appreciate that digital businesses have users not customers, they cross sell and have multiple income streams, probably use the data collected to sell to others who will advertise to those customers and done well and with sensitivity this can be welcomed as helping them through a complicated process that many dont do very often and dont understand. Trad businesses can and do do this too and it helps the bottom line, it just needs to be done differently.
Most of the time it is a question of lifting your head from the desk looking around seeing what is going on outside the agency bubble and adapting for your situation, embracing change and providing a focus to your business (not from your perspective but the customer) if you dont stand out you are invisible.
unlike the retail market with their bricks and clicks roll out, the property industry is not able to merge these two markets so easily.
For example Tesco baked beans can be bought either on interweb or in their shop.
You cant list a house on both traditional estate agency and on line only simultaneously as both market their stock on line in any event so it would just be repetition. The argument between the two types of business is simply service level V’s fees.
To expand with more offices is difficult if the On line business model gains traction.
Looking for a third way is equally full of pitfalls (where you offer the two models under one identity as you in effect subverting from one to the other and quite possibly in a bad way too.
You could try increasing market share geographically using this model but a chap called Mr Smith will tell you this ain’t a clever idea neither. The cost of marketing two business models using two different brand names just increases your marketing costs by twice and still you are in danger of undermining your original business and lets not forget our original goal is and always has been to make a profit !
Should have mentioned that the system works equally well if you want to increase market share in your existing area.
The chat is definitely worthwhile. I can vouch for that.
The low risk cost effective way to expand your marketing reach into new areas is through Google PPC.
No rent, rates, utilities, refurbishment, staff costs etc.
I have perfected my PPC marketing over five years and I believe a slick PPC campaign s a big opportunity for independent agents to steal a march on their competition. My system can be replicated anywhere and for any agent.
If anyone is interested in talking to me contact me at agaentpink92@yahoo.com
Hi Pink, Pinged you an email Monday.