Purplebricks has launched a new PR offensive in Australia, accusing traditional agents of being archaic commission collectors.
However in America, it has ditched its business model and will now charge only when a property sells. The ‘pivot’ was implemented yesterday and brings Purplebricks closer in line with traditional business models.
The campaign in Australia is headed by property expert Barry Du Bois, and while it lacks the wit of the ‘commisery’ adverts, it certainly takes its message straight to the battlefront in what is a very tough market.
The national campaign encourages Australians to question the traditional ‘commission collecting’ model which it says has not changed for 30 years and benefits only agents.
It asks whether agents really deserve to walk away with thousands of dollars by taking a slice of the selling price, as opposed to a fixed fee.
Purplebricks has already had to change its charging model in Australia, so that vendors pay a proportion upfront with the rest of the fixed fee payable on sale.
Neil Tavender, Purplebricks Australia CEO and ex-Rightmove executive, said: “Since launching, we have saved Australians over $50m in commission fees.
“This campaign is about educating Australians about the real estate industry’s archaic business model that only benefits agents.
“We won’t rest until every Australians understands they can sell their home with a fixed fee, get a great result and not fund ‘commission collectors’ lifestyles.
“The market has cooled and as a result Australians are more closely examining every aspect of the sale process.
“The fixed fee proposition is resonating with sellers who want to find different ways to maximise their returns.”
Instructions have been slipping for Purplebricks as the housing market in Australia has toughened.
According to its own website, it had 1,315 listings in October 2017, which climbed to 1,570 last June, but which which yesterday totalled 1,264.
Meanwhile in the US, Inman is reporting that Purplebricks is changing its business model significantly.
Purplebricks will no longer offer a flat fee across America, but charge varying listing fees by region. The publication says it will now only charge if and when a home is successfully sold.
Inman says: “It’s a pivot that brings Purplebricks US closer in line with more traditional models.”
In a statement US Purplebricks CEO Eric Eckardt said: “These changes have been informed by customer and agent feedback and are designed to drive increased market penetration and support continued growth.
“Our customers enjoy even greater peace of mind while still paying well below the national average commission of 5% to 6% and our agents benefit from more flexibility to build their businesses.”
UK-listed Purplebricks launched in Australia in 2016, and in America in 2017. Yesterday, the share price inched down about 1.3%, to finish at around 161p – a long way down from the height of 511p it hit in August 2017.
Below, how the media is reporting changes to Purplebricks in America, and bottom, the new advertising campaign in Australia