Zoopla confirms loss of almost one quarter of agency membership

| Rosalind Renshaw

In its first results delivered to the City since the launch of OnTheMarket, Zoopla said it had lost 23% of its UK agency members as at March 31.

OnTheMarket, with its “one other portal” rule had launched two months previously.

Zoopla said it went on to lose another 106 agents in April.

As at March 31, there were 12,449 member agents, down from 16,261 the previous year.

Zoopla’s total membership – which includes developers, overseas agents and commercial firms – stood at 16,076, down from 19,239 the previous year.

However, Zoopla insisted that “churn levels have slowed significantly over the past few months and are returning towards normal historic levels”.

It made more money from its member agents (ARPA), £353 in the six months to the end of March compared with £311 the previous year, a rise of 13%.

For the six months to the end of March, Zoopla announced record revenues, up 10% to £42m.

It made an operating profit of £18.2m, up 12% from the year before (£16.2m).

It also announced traffic up 11%, with an average of 44.2m monthly visits.

Zoopla also highlighted its proposed acquisition of uSwitch for £160m plus a performance-based earn out of up to £30m.

CEO Alex Chesterman said: “We had a strong first half with both revenues and profits seeing double-digit increases and ARPA at record levels despite the reduction in members during the period.

“Our audience continued to grow with average monthly visits during the first half at 44.2m and mobile devices accounting for over 60% of these, up 34% year-on-year.”

City analyst William Packer of Exane BNP Paribas said that it expected membership churn in May to “still be negative”.

He went on: “Additionally, traffic data is tepid. Visits +11% vs H1 14 but down -3% vs H2 14, the first half on half fall since the group started releasing numbers, although Zoopla argue seasonality makes comparison more difficult. We expect market share loss to Rightmove.

“We expect a broadly neutral reaction on the in-line numbers and comments from management on churn returning to normal in the ‘coming months’. We remain cautious. We note that consensus expects a sharp positive rebound in agency membership by end of 2015 and 2016 which we see as unlikely.”

 

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40 Comments

  1. IndAgent
    May 20, 2015 at 07:38

    Less customers, more traffic and more profit. I’d be happy with that.

    Report
    1. hardly impartial
      May 20, 2015 at 07:53

      Not sure about that Indy….4 of the 6 months of this trading period were before OTM got going…..I wonder how the February / March figures compare 2014 to 2015. Negative growth ? Next set of figures will be revealing.

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  2. Robert May
    May 20, 2015 at 08:14

    Wow! what a  brilliant read between the lines story!  The unsaid bits and the fact Alex has picked this one up says a lot. One- nil Ian!

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    1. Robert May
      May 20, 2015 at 09:16

      Go on ! whack that dislike button now! thing is I am right! If all was good there this story would have Lawrence Hall’s name on it. The fact this has come from Alex means Alex blinked first. He will be liking that, and the realisation  it is so apparent, even less than you like my observation.
      I am desperate to see a remake of the Hips/ Bunker spoof, it has to be done!  The appalling aggressive rhetoric  that has opened a gulf between AM agents and  Zoopla is inappropriate,
      What seems to have been forgotten is that not all AM agents have left Zoopla but Lawrence is carrying on as if they have, that is hardly endearing  or necessary. I have previously said Rightmove is the beast that needs taming, that won’t be done if firm defending second position is  constantly battling with No3.

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      1. The Outsider
        May 20, 2015 at 09:41

        Why are you reading anything into this not coming from Lawrence Hall?  He’s just the Head of Comms as far as I know.  It’s the job of the CEO to give city updates, not an internal stooge.

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        1. Robert May
          May 20, 2015 at 12:37

          You are probably  both quite right. In my head I expect it to be Lawrence who is there as the mouthpiece chucking his weight about with stories knocking  the paying customer base that built Zoopla.  He is the one either working under direct instructions to  irk agents or is the  one reassuring the board  that attack is an unusual but ultimately successful way of ingratiation. Either way it is a very peculiar way for a service supplier to carry on
          I don’t usually bother with the likes and dislikes but you can have a like for the word stooge.  A synonym search for stooge elevates your post to laser guided comedy gold.   For the second time you have top trumped me; I would have gone for henchman or heavy but stooge is perfect!

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          1. The Outsider
            May 20, 2015 at 14:00

            I’m on a roll now Robert.  Lets hope tomorrow brings more Zoopla/OTM news for me to comment on!

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            1. Robert May
              May 20, 2015 at 14:18

              You have commented on other stuff too; you’re ‘bull5hit bingo’  comment on houser was a classic.

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              1. Robert May
                May 20, 2015 at 14:20

                Full blown dullard today folks! your

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      2. the message
        May 20, 2015 at 10:37

        robert, have to agree with outsider here. This is a formal update to the stock market. Chesterman has to give it.

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      3. 1stTimeBuyer
        May 23, 2015 at 20:21

        Blar blar,  zzzzzz…. like clock work

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  3. Disillusioned
    May 20, 2015 at 08:33

    To say Z have had such a battering over the last 12 months those figures are better than I would have expected. Chesterman must be concerned though at losing another 106 agents in April, which is what, 150-200 branches? If they have all headed the way of OTM and continue to do so, at that rate it will be Springett with a smug grin on his face come the turn of the year.

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  4. James Morris
    May 20, 2015 at 09:08

    So they have made £18.2 million from simply listing OUR properties on their website to the general public. Quite happy I don’t pay Zoopla membership anymore. Perhaps they could reduce membership fees for the agents still left with them? Since it’s a service that without agents and their properties is pretty much pointless..

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    1. PeeBee
      May 20, 2015 at 09:17

      So… whose profits DO you contribute to for simply listing YOUR properties on their website to the general public, Mr Morris?

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    2. smile please
      May 20, 2015 at 09:17

      Which ever portal you are on they make money off you.

      As for fees if you or anybody did want to go back or renewal is coming up negotiate with them, we are paying just over £200 p.m now

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      1. James Morris
        May 20, 2015 at 09:23

        Not a chance of going back. OnTheMarket can have our money, at least we aren’t filling pockets of share holders

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        1. the message
          May 20, 2015 at 10:36

          just filling springetts pockets!!! 🙂 and the pockets of ITV with their marketing.

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        2. HarryN
          May 20, 2015 at 14:03

          Such a stupid comment.

          Yes, you are filling the pockets of shareholders. Every business has shareholders.

          In the case of Rightmove (and Zoopla), their shareholders are retail investors, pension funds and other investment firms – along with management.

          So who are these greedy shareholders? In many cases they are exactly the same people that you are serving every day in your business – i.e. your vendors.

          You just don’t like that you’re not keeping the cash – this is pure greed speaking.

          Horrible, horrible, horrible.

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      2. PeeBee
        May 20, 2015 at 09:25

        Hi, smile please – here’s a question I know you will answer honestly…  is that two hundred-odd quid a month good or bad value for money and why?

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        1. smile please
          May 20, 2015 at 09:52

          For me its good value,

          Reason why it is good value for me (which may not be the case for everybody)

          1. More recognised brand to sellers and purchasers

          2. More agents in my patch are on Z and they local sellers want to be on it

          3. Controversial one but sellers and buyers i have spoken to do not like OTM

          4. I think the volume of leads we get from Z is high.

          5. The cost is about half of OTM

          I will also through in the negatives for balance.

          1. I don’t like the third party advertising

          2. I HATE the valuation tool

          3. I think their profit margins are too high

          4. I dont like the fact they take onliners and bedroom agents.

          I think both Z and OTM agents are happy with their choices nobody is on this forum or others expressing a dislike for their chosen second portal.

          What it has made me think about is do i need a second portal? What OTM has shown me is RM is by far ahead of any competition. I think if i was to leave Z it would be just to be on RM but at £200 p.m. per office i may as well continue to advertise with them.

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          1. Disillusioned
            May 20, 2015 at 12:21

            Id go along with most of what you say SP, I pay just under £200 pm sales only and although some leads leave a lot to be desired, at the end of each month I feel I’ve had value for money.

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            1. smile please
              May 20, 2015 at 12:55

              Yes we have rentals (even tho we do not offer it!)

              I think the quality of leads is the same on all portals, its what we make of them. Every lead is an opportunity even if its just calling them to introduce yourself / the company. Even if they are dreamers give them good service helps build you brand and reputation, they may even know somebody looking to move and put a good word in for you

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    3. Fencesitter
      May 20, 2015 at 11:22

      Once again, they aren’t OUR properties…

      Report
      1. smile please
        May 20, 2015 at 11:28

        Not our properties but they are our stock that we have spent money on obtaining.

        Marketing, Valuations, taking of details etc

        And then we as agents to pay to advertise with the portal why they then try and cross sell.

        I am not naive enough to think we should get the advertising for free or in some ways they will not be cross sold to but they are OUR properties and OUR stock.

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        1. the message
          May 20, 2015 at 13:57

          I thought they were the vendors properties that you are charging a fee to sell. You are paying a part of that fee out in advertising the property and your brand, totally your call in which way to spend it.

           

          Before the portals WE spent OUR money on local papers, I really don’t see a difference. I didnt try and set up my own, because it is trickier than it looks.

          Running an online property portal is as well, hiring and keeping happy top quality IT staff, building a trusted brand and consumer proposition. I am not saying Z or RMV are good, or cheap, but there is much more to it than you think – and the arrogance/stupidity of some agents believing OT will be successful just because it has properties is staggering, and the reason why most of us stayed away, and are happier with that decision

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          1. smile please
            May 20, 2015 at 14:13

            I cant speak for others but i find it wrong the likes of RM making 74p in every £1 profit and continue to increase prices yearly.

            I also find it wrong Z and alike market to our customers, This never happened with the papers (or at least to the same extent).

            Even though i do not advertise with OTM, i like that they are not looking to take business away from agents with offering mortgages, selling customers details, offer solicitors.

            And yes setting up on your own is tricky, when i opened my first office i had savings of 60k which i thought was more than enough. ended up dangerously close to having nothing left in the pot, then thankfully the exchanges started coming through but took 6 months. Still all good now! 🙂

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            1. Robert May
              May 20, 2015 at 14:55

              I really wish you would get in touch with me  Smile Please. It would make  me smile as requested

              Report
              1. smile please
                May 20, 2015 at 15:45

                Ha ha, i am not as brave as you Robert i like my anonymity. Some of my comments are controversial at times and i always stand the risk of upsetting somebody 😉

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                1. PeeBee
                  May 20, 2015 at 18:12

                  sp – your continued anonymity is a guarantee with Mr May – I am only one of the ‘living proof’ of this.

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                2. Robert May
                  May 20, 2015 at 19:39

                  I am the president of that club Smile

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  5. Paul H
    May 20, 2015 at 13:08

    Agent members down but profit up.

    Makes you wonder how much it costs to run one of these portals.

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    1. Robert May
      May 20, 2015 at 13:40

      I did the calculation last June (2014) about £120/ branch per month is enough to deliver normal healthy profit.

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      1. smile please
        May 20, 2015 at 14:37

        Playing devils advocate, Why are people paying 3 times that with OTM Robert, Have you had a chance to crunch the numbers on what agents should in your opinion be paying them?

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        1. Robert May
          May 20, 2015 at 15:17

          That is  the portal domain understanding  price of  what is required to buy awareness. Essentially it is the experience of Primelocation and what is  possible to squeeze out of agents before they squeal price. It is an established standardised cost of a G3 portal, so why charge any less?

          I want to show you a G5 sortal which I reckon should cost £36/ month with £10 going to Agents Giving as a charity donation or Tenant’s Voice to support proper representation and education of tenants.  From a net receipt of just over £21 I can run an agent centric system  whose first job is to tackle rogue letting agents. My 1 year target is 3500 branches which would mean giving £35,000 to good causes each month.

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          1. smile please
            May 20, 2015 at 15:40

            Robert £36 per month with £10 going to a worth while cause i dont need to see it. Just let me know when you are going live and i will happily sign up

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            1. Robert May
              May 20, 2015 at 17:40

              I went live  with  a restricted feature version on Monday evening.  There is still work to do but I am able to show agents what they need to do in order to take advantage of what I have built. You can Rummage4  me on twitter or ask  Ros to forward an email. I have been desperate to talk to several of you. but so far everyone is been a bit wary of doing so.

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              1. PeeBee
                May 20, 2015 at 18:09

                He doesn’t bite… honest!

                What the H£ll have you got to lose?

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  6. Typhoon
    May 20, 2015 at 14:32

    If I was an investor, I would have been keen to see in this report the long list of the dozens of companies flooding back to them as quoted in their propaganda this week. Or even just a  total would have been better than nothing.

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  7. Helen B
    May 23, 2015 at 13:40

    I onlyuse one portal RM. I don’t like OTM’s two portal rule – I don’t like being told what to do with my own business.  I’ve been watching and so far for my agency I have found no reason to go on either OTM or Zoopa. I don’t like RM prices and annual increases but so far the OTM two portal rule seems to be strengthening RM and giving less reason to use a second site. I think the two portal rule is a mistake and not very well thought out.

    I’ve spent money recently on updating my own web site instead of spending it on a second site. It’s worked for me.

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    1. PeeBee
      May 23, 2015 at 22:31

      I’m absolutely fascinated by the complexity of this comment.

      You actually only use ONE portal – but resent being ‘told’ by AM you can’t use two if you also use OTM – but don’t like what the one you are with does to your bank balance every month… and that it is gaining too much ‘strength’ – so you refuse to join the one portal which is actually committed to returning ownership to Agents.  On principle.

      All over the UK, “principles” like yours are currently being sucked dry by RM and Z.  But you DO have a choice – and you are exercising that choice – so you see no-one is actually telling you to do anything.  Or if they are you’re not listening or doing what you’re being ‘told’ to do.

      But thanks for sharing the exceedingly convoluted reasoning for your not joining a portal you state you don’t actually want to join in any case.

      Report
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