OPINION: How agents can make the big portals redundant within a couple of years

I had high hopes when I first heard about OnTheMarket.

However, as I learned more about the project my optimism vanished and I concluded – before it even launched – that it would be a failure.

Nothing that’s happened since then has changed my mind. Far from it in fact.

It’s not the point of this article to go into why that is, but I’m confident that EYE readers who have been following the saga over the last few years can work out why I think that OTM was a massive red herring and is doomed to irrelevance, even if they don’t agree with my conclusion.

So, what to do instead? Certainly not to let Rightmove and Zoopla continue to have their way.

I am an agent who has owned an estate and letting agency for the past 14 years. It happens to be online, but I regard this as an irrelevance: our section of the industry is affected by high portal costs, just as the high street is.

I believe it is perfectly possible to achieve what OTM purportedly set out to do and make the big portals redundant within two to three years.

Achieving this worthy goal will not even take a great deal of time, money or effort from individual participating agents.

The years are going to pass anyway, whether we do something or not, so better to do something than to carry on griping and handing over the money.

Before anyone asks: yes, it involves creating yet another new property portal, and yes it also involves doing some of the things OTM set out do, but with some differences, obviously.

Success will come from the things we do differently. I’m not trying to reinvent the wheel, but if my plan is followed then it will not fail.

Here it is, in simple steps:

A company is created. Every agent that wants to participate (which should obviously be every agent) buys a share for some nominal amount (£1, £5 or whatever). One share per agency, not per branch. Every shareholder has the same rights and is contractually bound never to sell their share except back to the company. The company’s sole purpose is to create and maintain the portal website for its shareholders, with profits to be kept as low as possible (e.g. by reducing listing fees if money starts to build up too quickly).

Agents/shareholders spread the word to other agents in their locality – both friends and enemies. It’s agents we need first, not end users, and so it’s in everybody’s interest (assuming they’d rather not keep paying out to RM and Z) to get everyone else on board. Agents will know who their local friends and rivals are and so can pick up the phone, send them an email, hit them up on social media and so on. This small commitment by members makes a mass marketing campaign to recruit agents unnecessary.

Next the hardest part: a new portal is created. It has no premium listings, no featured properties, no featured agents, no microsites, no adverts, no way for one agent to pay more as a way to get a leg up over his rivals. It just lists properties with the usual ways for agents to upload and manage them and for end users to sort and save results and to enquire. All data captured by the site belongs to the member agent concerned. I call this bit the hardest part because a site offering the functionality that Rightmove and Zoopla offer will run to around half a million lines of code or more. I can deliver this and in fact have delivered something similar in the past. The existence of my previous project will save a lot of time, money and effort as I can reuse a lot of the code, albeit with significant reworking. This is still much better than having to start again from scratch and will shorten the time to going live considerably.

In the beginning shareholders will need to ‘loan in’ funds towards the development of the site. Once enough members are signed up the amounts can be tiny. If there are 12,000 member agents each loaning in £2 or £3 per month it will be enough to get things moving fast. These loans will be the first thing to be paid back.

The company charges a fee per listing per period of time. For example, £1 pays for up to 28 days (regardless of whether the listing is live for 28 minutes or 28 days) then if the property is still live on the 29thday another £1 is charged, and so on. This method is the fairest in my opinion and doesn’t favour an agent for being either larger or smaller than average.

Now the crucial part: when a ‘critical mass’ of agents have joined then all members agree (contractually if necessary) a date to turn off RM and Z. At this point the news media will publicise the site for us. A mass exodus and the effect it will have on RM and Z will be a big story. That’s why there’s no need to spend money on marketing the site. People will know the big switch off is coming and besides, once the agents and their properties have gone to the new site, browsers will naturally follow because it’s the properties they want and the new site is where they will be. Member agents can hype the ‘big switch’ for free/low cost via social media, posters in the window etc.

No individual agent has to do very much at all in order to make this a reality. All that’s needed is the desire and it’s definitely there; I’ve never met another agent who wouldn’t like a way out of the current situation with the portals. I’d love to read your opinions in the comments below and even more than that I’d love you to join me in making this a reality. Register your interest at zrexit@outlook.com and we’ll get this show on the road

EYE regularly publishes opinion pieces. The opinions expressed are entirely those of individual contributors. The author of this piece has chosen to use a pseudonym

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61 Comments

  1. ArthurHouse02

    “John Smith” what company do you currently run?

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    1. Property Poke In The Eye

      Some brewery 😉

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  2. WestMidsValuer97

    Not really sure what the point of this article is….the principal is ok I guess but could you imagine the accounting nightmare it would be….

    Support OTM!! They are doing great things and there is no reason why, after their reform last year, that it won’t work…and infact is already proving to work.

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    1. smile please

      Apart from their end goal is to charge what RM do. 

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      1. zrexit

        The whole point of this is to stop that happening. Wake up! OTM has enriched a few people and done nothing to topple the big 2. It’s soaked up a load of money and gone nowhere.

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        1. NotLikeTheTrolls86

          zrexit – where’s your evidence for these people ‘enriching themselves’? People seem to mention this in relation to OTM but no one has got ‘enriched’, quite the opposite. Can you tell us all please how you know this, and if you can’t prove it then SHUT UP and stop peddling falsehoods.

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      2. WestMidsValuer97

        Not at all…its majority shareholding is independent agents – therefore, it would end up costing their businesses which is the precise reason they invested in OTM in the first place, to prevent that happening. They sold 30% of the business as part of the reformed businesses plan – speak to them, they are very open about how bad it was and what they did to change it last year.
        zrexit What are you on about? Have you got any idea abou their business model, have you been to speak to them to see how they aim to change the outlook from when they first set up – NO – therefore I suggest you SHUT UP and get off your high horse. The fact is that OTM is owned, by majority, by independent agents. If you were a resepected industry professional maybe you’d get behind the one company that are trying to bring down the power two that as an industry, we solely rely on. 

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  3. Hillofwad71

    Sounds inviting !.The Cooperative .OTMP Rinse and repeat – Ian Springett ! .Shades of Animal Farm?

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    1. zrexit

      That’s the last thing I want. It will be easy enough to prevent constitutionally.

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      1. Hillofwad71

        “Before you call a spade a spade dig a big hole for yourself ”

        “Can cynicism and altruism coexist ?”

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  4. Proper Tea & Meds

    The big portals will be redundant in a couple of years anyway! Their business model is outdated. It is possible today to create a profitable portal that is completely free for agents to list an unlimited number of properties.

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  5. smile please

    It sounds in theory a plausible idea.

    how many more times can we all invest in yet another portal?

    I think we need more clarity who you are and what your track record is.

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    1. zrexit

      As I suspected when I wrote this the negativity is palpable. Nobody except me and few developers will have to take any risk, do any work, or spend much money and yet still the gripes come and any positivity is absent! There’s no way I will stick my head over the parapet to be shot off by Rightmove unless this becomes a functioning entity.

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      1. smile please

        Without coming out stating who you are and your past achievements it’s hard to give you credibility.
        Also your tone of responding has probably lost you the backing of the majority of people on here. 
        Failed at the first hurdle, however I sincerely hope you prove me wrong. 

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        1. WestMidsValuer97

          Totally agree – clearly has no credibility as he/she feels the need to publish what are probably non-existent achievements. Funny really, as the postings are displayed you get a feel for who actually understands the industry and those who simply have not got a clue. 

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  6. Light

    Don’t quit your day job

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    1. zrexit

      Carry on paying your portal fees forever more then.

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      1. PeeBee

        GREAT situation recovery line… I think not.

        Don’t get a job at Samaritans, Mr Smith, whatever you do…

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  7. J1

    Suspect it is not John Smith

     

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  8. Breckland Agent

    Love the email address!

     

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  9. ARC

    You can’t herd cats just watch them fight and keep hiking up the fees!

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  10. Mark Connelly

    Oh Dear, looks like it’s all gone horribly already and that’s a shame.

    The theory is pretty sound, although the biggest obstacle was always going to be the very agents complaining about RM.

    I always see agents as I do fellow golf club members. We bitch about the state of the course, the condition of the bunkers, whinge incessantly and then renew our membership because none of us actually want to leave.

    This is yet another great example of how it’s always easier to find problems with solutions rather than solutions to problems.

    John smith you do have to develop some thick skin if you are going to put yourself out there. These comments were completely predictable and should never have solicited the reaction they did from you.

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  11. Jimmy Independent

    As Mr Smith says – the negativity is palpable…so predictable!

    IMHO there is actually no need to build another portal – when OTM came into being the solution was already provided…if only our industry had the ability to quit sniping at each other & for once collectively think as one.

    WE drive OUR product to portals of our own free will. What should have happened (and still remains available to us as an option) is everyone cancel their subscription to RM & the Zoo (and any others you subscribe to) leave your feed to OTM in place & VOILA, your customers will only have ONE place to look for property.

    Problem solved, or at least it would have been if everyone had embraced the OTM concept at the outset. However, now OTM has morphed into another PrimeLocation scenario rather than the ‘portal owned by the agents, for the agents & not for profit’ concept.

    So Mr Smith, the concept is is solid, the costs sound fair and reasonable, making a profit is how a business survives (OTM take note) the question is:

    How does one get our industry to work together?

    I would have thought if each & every one of the 12,000 or so agencies in the UK could reduce their annual (but actually not fixed) outgoings by many thousands of £ every year without having to DO anything is except be connected in their thinking, why wouldn’t we?

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    1. zrexit

      Indeed. In fact they don’t even have to do that – they just have to become part owners of this and pay up 2 or 3 quid a month for a couple of years and the job is done. OTM has now departed from its original concept it cannot deliver what is needed, and sure as eggs are eggs it will turn into another RM if it gets all agents aboard. What is needed is for us to acknowledge what went wrong and have another go, laid out in the way I described.

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      1. WestMidsValuer97

        I think you’ll actually find that OTM changed it’s business plan because of it’s failings – this is known as good business sense. They were caught up in litigation about 18months ago which led to a complete restructure. 
        If you actualy took the time to understand their approach you would realise how effective it will be – hence why in the space of about 8 months, they have nearly 2/3 of the industry signed up – I believe it to be around 40% of those paying full membership which, is capped in the agreements in order for their business plan to work.
        Why do we need to look at yet another portal killer when OTM are doing just what we need!? 

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  12. Property Paddy

    for fear of repeating myself

    this wont work and whats more your thinking like someone from the last century (which you probably are) in world evolving in a different millennium (which we are)

    You talking websites The world has already moved on. Look at Uber, that should give you a clue to the next big thing in property. Its not web based in mobile app based.

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    1. zrexit

      You’re right I am from the last century. Maybe you’re right in the long-term, but times are tough for agents NOW and this situation needs addressing in the short-term (3-5 years). Even so I’m not at all convinced that you’re right and Uber is not a good comparison. Entities that serve the requirements of the end user well tend to hang around. E.g. ebay and Amazon. The sellers on those sites gripe about fees too but nothing can be done because they are too disparate a group. We on the other hand can find each other, talk to each other and take action as a unit. In theory at least!

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      1. Property Paddy

        just re-read your idea.

        IT WILL NOT WORK

        I cant be bothered to go in to the whys etc, I am not developing a mobile App version as an alternative but I have got close to understanding it’s functionality.

        The main reason it wont work is because you are approaching this from existing technology that’s been around for so long that it’s almost out of date before you start.  Even Z & RM will have moved on before you launch

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  13. NAL4726

    I think old John Smith is brave and also honest to offer a solution to what appears to be most Agents gripes, the cost of property portals. His solution is an opinion. On here we have many opinions and of course some self agenda’s.

    Rather than do as most do on here, which is moan and do nothing about it, he at least is thinking out of the box which unfortunately most agents don’t as we tend to be herded sheep.

    Give the guy a chance to express an idea that in theory would probably cost 10% of your current spend, no idea is a bad idea.

    If not, log out, and go and do some canvassing and sell some houses.

     

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    1. zrexit

      Thank you. I realise people here are cynical and maybe worried about getting their fingers burned but that shouldn’t stop you trying. Think about the very worst that could happen: 12000 agents pay out £3 a month for 2 years and I disappear with all the money. I ‘make’ £850k and have to spend my life in hiding and no individual agent is down more than £72!!!  Since anyone who contributed could be a share holder of the company and therefore control what happens I think my ‘game’ would be rumbled way before then anyway!
      Alternatively let’s assume that I’m honest, hire some developers and deliver what I promised. Each agent is £72 ‘down’ but now with a way out of a major problem!

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      1. NAL4726

        Most agents on here probably bought (literally) into the failed OTM proposition, hence the support you read for it on here, as they are still hanging on to the principal which has fallen wayside anyway. Matter of pride i feel.
        I have approaching 30 years in the industry and i am probably one of the youngest here. An old boys club exists in this industry, look at the ‘awards’ cash cows, sorry evenings (price of a table a months RM subs), take a peak at the ‘panels’ and look at the actual ‘winners’. Same fingers in same old pies.
        So acting under your alias they are wary as they are not sure if you are in their actual club, and that makes them feel uncomfortable, unless you are willing to share your pie of course 🙂
         

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        1. WestMidsValuer97

          Nothing to do with pride – they changed their business plan and restructured before they relaunched with the new advertising campaign – I hate to say it but it just goes to show how little people on here actually know and understand about the industry they actually work in!
          Totally agree with your other point though. 

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      2. zrexit

        Not only am I willing to share the pie, I’ll give them the ****** thing! I’m definitely not in their club though, and if that’s enough to stop a good idea from becoming a working entity then that’s deeply disheartening!

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  14. RichardHill61

    I had a dream!!!

    OTM will never be repeated..

    There was a hidden financial agenda in its model which was never mentioned at the original meetings I attended!

    It remains the best option to break the duopoly but I think it will fall on its **** as individual agents migrate away from it!

    Coventry & Warwickshire Homes was a regional early model of OTM and it worked without having the vision to expand nationally but it failed because so many individual agencies couldn’t work in unison for the greater good!

    I’d give OTM 5 yrs tops before it starts to wind up and the duopoly will continue with their price rises during this time because they are better, bigger, stronger businesses and they can get away with it because agents will pay!

    They are both much cheaper than newspapers ever were!!!

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  15. Peter

    “A company is created. Every agent that wants to participate (which should obviously be every agent)” 

    Count me out. So, that puts an end of that idea then!

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    1. zrexit

      Would you be kind enough to elaborate on why you wouldn’t be interested? Maybe I/we can learn something?

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      1. Peter

        Fantastical
        I could go on, but I do not see much support from the comments so far.

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  16. agency negotiation

    What’s with this fixation about having a portal?  On which every agency can participate.

    An alternative for each agency might be to establish an independent media company.  One that is wholly owned by the agency concerned. Where content and data is wholly controlled by the agency.

    Since press is being replaced by industry-specific blogs, radio by podcast and T.V by video, a media company could be set up using these three platforms at the front-end, to drive business to the agency at the back-end. Then what is required is the ability to drive the local community to that media company. Interesting content that engages isn’t all about the business of selling homes. It’s about having permission to deliver anticipated, personal and relevant messages over time. That attention gives you enrolment.

    Whilst a portal provides reach, community gives you power. Too many agents relinquish that power to the portals and, in doing so, pay a heavy price.  And I know there will be many that say an agency can’t survive without them.  Just as many say that drug addicts can’t survive without their fix.

    Setting up such a media company doesn’t require a tech background. Everyone knows about blogging.  It doesn’t cost anything.

    A podcast costs £15 month or less to host and less than £100 for a decent microphone.  Video, the same.  So a media company isn’t expensive or technically difficult. What’s difficult is having something interesting to say that makes the community listen and follow.

    And within that media company lies a distribution opportunity that allows your message to go viral. The simple act of collaboration with other local businesses is a win/win situation. Then, relationships spread the message instead of advertising.

    Seth Godin puts it this way:

    “Time to get off the social media merry-go-round that goes faster and faster, but never actually getting anywhere.  Time to stop hustling and interrupting.  Time to stop spamming and pretending you’re welcome.  Time to stop begging people to become your clients. Time to stop feeling badly about charging for your work. Time to stop looking for shortcuts and time to start insisting on a long viable path instead. There’s a lot of ways to embrace modern marketing, but there’s no doubt that you’ll be better off once you do.”

    Start a media company and eventually,do away with the purgatory of portal fees.

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    1. zrexit

      You’re not thinking like an end user – they will not look in 20 different places in order to find the property they want. They’ve become accustomed to this model and I can’t blame them – it’s miles more convenient.

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      1. agency negotiation

        I’m thinking like an estate agent. How do I attract loyal members of the local community that will trust me. Not by uploading details to the portals. Which Agency shall I instruct? Not the one most prolific on the portals.

        Build a loyal following and you will see instructions rise. Vendors will call you as will buyers to see what you have. People aren’t that lazy if you’re good enough.

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  17. sanctuary45

    Personally I think it’s a decent idea. Everyone is constantly moaning about RM and their continual hiking of fees, yet when someone comes out with a suggestion for a solution they get slated by the very same agents that are on here constantly moaning about the RM fee hikes! This just goes to show the main problem surrounding the whole RM fees issue – this industry can’t and won’t ever come together as one and do something to resolve the problem and for the greater good, instead all we’ll continue to do is constantly moan and whine about how unfair it all is whilst still handing over our hard earned money to RM.

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    1. zrexit

      But why is that? That’s what utterly stumps me. I would seize any reasonable opportunity to move away from something that pains me and towards something that doesn’t.

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  18. bobonacus17

    You’re not wrong but I’m not sure how you would get enough agents to sign up … isn’t that part of the reason OTM is not working, there was not enough backing to start with? (I’ve not followed them much recently)

    You are right that with nearly every agent signed up there would be less need for marketing but I don’t think you should underestimate the power of a tv campaign … new news vanishes fast

    I think it would need a per branch licence model to generate enough funds, keeping one share per agent though

    I guess a board would be voted in, one vote per share, to control the direction and prevent hidden agendas from emerging

    You would have to get the big agents on board first with probably an agreement for some seed money to get it up and running which would represent a risk, I can’t see how it could be done without initial seed money

    I’d be interested in talking more about your plan to get the agents on board, that’s the difficult bit!

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    1. Ostrich17

      “You would have to get the big agents on board..”

      Exactly the problem that OTM have – the corporates will not sign up unless you give them control.

      Even though OTM have a tranche of FREE shares to entice the big boys, they have yet to make any major new signings.

      If they don’t get them on board in the next few months, large numbers of the original agents will head for the exit as soon as their lock-in period expires.

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      1. zrexit

        There’s no way it could work if any particular clique could gain control. It would need to be specifically designed from the outset to stop that happening. I know nothing about the big corporates but they must be handing over big money to the portals so it’s just as much in their interest as anyone else’s to upend the current situation.

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        1. bobonacus17

          Yes, big money indeed! Which is why I don’t understand why the larger agencts didn’t get behind OTM in the first place as I would have thought it would have been worth the tiny risk in the first place.

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        2. Ostrich17

          “I know nothing about the big corporates…”  
          You may want to revise your business plan then.  
           
          Who do you think cashed out big chunks of shareholdings in RM & Z?
          And would, no doubt, like to do the same with OTM.    
           
          Your idea makes some sense. The time to do it was when members were voting on the AM/OTM de-mutualisation – but it would still have required agents to shift from RM/Z to twist the corporates’ arms.

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  19. Robert May

    “The author of this piece has chosen to use a pseudonym”  why?

    As a service supplier  honesty and integrity are vital. Anyone can look up who I am  and what I have done and  I am opened right up  for all my ghosts to haunt me!

    Without that some people are perpetual start-ups who keep coming up with quite good ideas  but which fail to launch because of the people involved.

    There is one chap building a very similar system to mine, it will fail because  when he left the industry last time he made the mistake of calling agents “a bunch of  thick ****s!”

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    1. Tim Hall

      Well, at least the chap was honest 🙂

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      1. Robert May

        I disagreed with him and  I’m guessing you Tim.

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        1. Tim Hall

          Yes, ignorant and self-centered would be much more accurate 😀
          Of course he is entirely wrong – generalisations are never accurate and usually reflect more poorly on the person who made the comment than the people about which the comment has been made.
          We as an industry, however, have a wonderful ability to make rods for our own backs and then spend the rest of our time complaining about it.
          I try and refrain from commenting, but sometimes something makes me smile and I just have to say it.
           
           
           
           

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          1. Property Paddy

            your not wrong Tim, we treat vendors and buyers like spoilt children: “can I have some more please?”
            Or Can I have a lower commission?
            Can I have a higher asking price for my home?
            Will you have open days on my house for the next 4 weekends?
            Can I offer 30% less than your asking price because you estate agents always overprice everything?
            Etc, Etc.
            And guess what, even if you say no, someone will say yes too all of the above.
            We’ve made a Rod for our backs, Cement shoes for our feet and shooting targets on our fronts.
             
             

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            1. htsnom79

              Property Paddy, I relate to this, have often thought B2B must be so much easier than B2C, sure is for Rightmove!

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  20. surrey1

    He’s basically re-running the Agent’s Mutual/OTM plan far as I can tell.

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    1. zrexit

      Yes but with significant differences as outlined in the article.

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  21. KC54

    Mr Smith.  Great pricing.  Great thought process….  until you tell me that I may be contractually obliged to ditch RM and Z.  Its a bit like the protesters saying boycott BP or Esso for a day so they will change their ways – no one bothers.  The reason I didn’t sign up for OTM at the outset was because after 30 years I was being told how to run my business, where I could advertise, co branding etc.  Why would I cut one leg off in favour of a then unproven portal/business.

    If you look at the advertising spend of PB, E Moov and even the “household” names of RM and Z, they have to keep that spend up to keep name awareness in front of the public.  So will you in the longer term as the whole reliance of the success of this portal would appear to be on one day of press coverage and the assumption everyone switches off RM and Z at the same time, which like the petrol scenario will not happen.

    However, if you can deliver another portal for £3 per week plus £1 per property for 28 days, then I suspect most agents would be happy to take a punt (although I feel your cost of administering these payments will outweigh the payment itself).  Then when results start coming in, they may review their RM, Z and OTM subscriptions themselves.  It is a big risk and a lot of work for you and I have no doubt that in time you would be seeking some reward for your efforts along the lines of Ian Springett, which would then come with increased costs, which together with swanky offices, programmers, staff, compliance and other overheads will eventually lead towards the same cost position as RM, Z and OTM!

    All I can say at this juncture is Good Luck

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    1. zrexit

      Hi KC,
      Thank you for your considered reply. The reason I suggested it may be necessary to get people to agree contractually to dump the other portals is to instill trust that everyone will do as they promise. If it can be done without then so much the better. The motivation of the ‘boycott esso’ crowd is different, and they are disparate members of the public, not a single interest group as we are. That still doesn’t mean you ARE wrong of course. Just that you SHOULD be!
      Regarding the lack of advertising: the reason I believe it won’t be necessary is because this – presuming the steps are followed – the agent-owned site will be the ONLY place that ALL the properties are, and that’s what consumers want. Agents can keep awareness up with window stickers etc., the same as they do now for the portals. Besides, what I’m saying needn’t be set in stone – the agents will own the portal so they might decide that promoting it with some national campaign is actually worthwhile.
      Results won’t come in without agents. Every other portal has failed to dislodge the big 2 because they wasted money trying to persuade the public to use them instead. Why would they when the current ones function perfectly? It’s utterly fruitless to yet again try to do it that way. Especially when there is another way.
      Regarding administering the low individual payments it can be managed with automated systems to a large degree. I agree that if someone had to do that kind of work manually it would be uneconomic. I anticipate (maybe naively!) that there won’t be any (or many) cheaters trying to avoid payment.

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  22. Lil Bandit

    Sounds like the socialism to me, I love it! Could be great if it worked!

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    1. zrexit

      Yes. Although I’m far from a socialist in real life this is one situation where collective ownership of a particular means of production could actually work! Although this morning’s comments have shown a reason why it generally doesn’t; trying to get people to agree is the devil’s work!

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  23. J1

    I am not entirely sure that it is legal to create a cartel to destroy another’s business…..

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  24. GPL

    Just picking up on this before bedtime zrexit ……sad, I know.

    Credibility is all, at least that’s my view …..so, until you step forward and stand in front & behind your portal proposal …….you simply lack credibility.

    If you haven’t the faith to step out of the shadows, why should we take you/your proposal seriously.

    I’m not knocking you, merely being “Frank” … . even although I’m actually Graeme.

    ……and with those few lines, it’s bedtime for me as it was a long day at The Estate Agency Coalface today.

     

     

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