When the concept of Agents’ Mutual as a business was first mooted a decade ago and subsequently OnTheMarket.com as a brand was born a couple of years later, many estate agents hoped that it would shake up the online property portals sector – dominated by Rightmove and Zoopla.
OnTheMarket, backed by a consortium of heavyweight high street agents, including Savills and Knight Frank, launched in a bid to challenge the dominance of the duopoly.
Supported by a multi-million pound marketing media campaign and its ‘one other portal’ rule – which at the time banned its agents advertising on both Rightmove and Zoopla – plus prohibiting online agents from listing, OnTheMarket increased market share, mainly at the expense of Zoopla, but it appeared to strengthen the position of Rightmove in doing so.
Having established itself as the UK’s third largest portal in terms of consumer traffic and agent support, OnTheMarket firmly believed that it was on course to replace Zoopla as the number two property portal by the end of 2016 on its way to achieving its medium-term objective of challenging the market leader, Rightmove.
But while OnTheMarket has made some inroads to dislodge Rightmove and Zoopla as the two biggest portals over the past few years, a lack of consumer traffic ultimately meant that it has never quite managed to succeed in regaining power over the homebuyer audience in this highly competitive market, and in turn return control to the traditional high street brands, as intended when it launched. But that could be soon be about to change.
The sale of OnTheMarket to CoStar Group, which is listed in New York and worth $33bn (£27bn), sent shares in Rightmove down by more than 14.3% yesterday.
Analysts at Citi believe CoStar’s entry into the UK property portal market could spell bad news for Rightmove on several fronts.
Rightmove’s value plummeted as CoStar pledged to invest £46.5m into OnTheMarket during the first year of the deal, while also setting out plans to outspend Rightmove in the long-term.
Jason Tebb, chief executive of OnTheMarket, said the partnership with CoStar will allow the business to accelerate its strategy “with the clear target of becoming the market leader”.
CoStar founder Andy Florance added that the Washington-based business will provide OnTheMarket with the tools to “compete with the dominant United Kingdom property portals”.
But while news of CoStar’s bid for OnTheMarket may initially be taken negatively for Rightmove given the risk of OnTheMarket securing the backing of a potent owner, the Bank of America points out that Rightmove dwarfs OnTheMarket in terms of revenue.
The broker also pointed out that Rightmove is trading close to five-year lows relative to the market, weighed down by weak housing market concerns.
“History has shown unseating incumbents in the classified space is no easy feat,” said Bank of America, highlighting that Rightmove is a major market leader even by classifieds’ high standards, with 86% share of consumer engagement.
As many agents will testify, dislodging Rightmove as the number one portal will not be easy.
“Rightmove dwarfs OnTheMarket in terms of revenue with 2022 sales of £33m compared to £34m” ???
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Let’s face it. The Rightmove beast we agents have created is way too big to fail. The only way it will fail is if at least 50% of agents come off completely and go and support either Zoopla or On TheMarket. Which in my opinion just won’t happen especially when the property market is on it knee’s as agents want Good Quality leads, which again in my opinion are provided by Rightmove.
NoStar and Loopynet won’t any impact with what they are planning on investing.
So friends, keep on bending over for now and line up for that Rightmove Slap!!!
Currently the prices without the bells and whistles
£1250 – Rightmove
£220 – Zoopla
£199 – On The Market
OTHERS NO POINT LISTING!!
It would be good to find out what others agents are paying.
Have a lovely and blessed day my friends.
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It’s taken some time, but it’s finally happened. All those screaming we hate RM fees and we back our own portal have won rejoice.
You’ve now taken a loss on the loan notes, the shares pay back a small amount paid, and Co-star will come and spend £40m+ on growing OTM, because they know you pay £1600+ pm To RM and they want it! They’re not spending £150m+ on thinking what a good job they’ve done, they want the £6bn+ value and high MRR that RM have, the difference is the last 8 years agent’s have brainwashed themselves in to loving OTM and forcing the public to accept it.
So we leave RM, OTM becomes the #1 and the fees go there instead of RM, rejoice we toppled the beast and replaced it with another
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You make a good point matey. They aren’t in in it to be charitable.
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I’ve made a big profit on my loan notes!
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Quite right. US investors aren’t in it for anything other than $$$ & who wouldn’t want to be the new Rightmove? RM will have created their own downfall, though: Short term greed as opposed to long term client partnerships. That never won any friends. I’m bracing myself for the inflation busting OTM fees to come….
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I am sure it is regional, but we find we get a load of rubbish leads from RM, a lot do not even answer or respond to an email, OTM gives us less but of better quality.
It has been especially bad this year with RM leads which has lead to my team questioning whether they are genuine.
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I agree. The volume is higher with RM and agree they are people that don’t respond. My leads from OTM tend to be more serious.
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Agreed. As a rule we don’t use RM, but one landlord likes RM so lists it via another agent friend to pass leads to us and the leads have been appalling, it certainly didn’t tempt me back!!!
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OTM announced their their new 3 tier cost structure in their preliminary results 3 months ago. £299, £399 & £550. I wonder if this will change.
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Not initially
They will come in and honour the deals, this will be a 5 year play, get the hearts and minds, grow the market share then grow the revenue as the hearts and minds become reliant.
Anyone looked at the feeling towards costar in America their big market? Averages at about $2000 a month
Funnily the same amount that RM is here, what’s the difference in value between them? America has a bigger audience
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You all always comment in a manner that suggests you all get to decide.
Jo Public decides what you do.
Rightnow, even family pets know that to search for a house, you go to Rightmove. It’s almost as ubiquitous as Google.
Any challenger needs to topple that. That’s before worrying about what agents do want, don’t want, will pay or won’t pay.
To date, OTM, and recently Boomin tried public facing campaigns. They didn’t even put a fingernail mark on Rightmoves bodywork, let alone a scratch.
You can talk fees, hopes, dreams and desires all you want but the challenge isn’t just mighty, it’s herculean.
You’ve all got more chance of a co-ordinated mass exodus of agents, frankly.
I think you’re all in a thoroughly naff position and I don’t envy you.
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