Two separate reports by City analysts suggest that portal switches by agents since the arrival of OnTheMarket have now left Rightmove in a still-stronger position than before.
Andrew Ross of Barclays says that whereas a year ago the concern for Rightmove shareholders was that OTM could alter Rightmove's longer term pricing power, or erode the very high margins, the reverse has turned out to be the case.
It has become clearer that Agents' Mutual's impact is being felt predominantly by Zoopla and the (perhaps unintended) consequence has been to reinforce the number one position of Rightmove. 2014 results were a confirmation of this says Ross.
Meanwhile Matthew Walker of Nomura takes a similar view under a briefing to clients called Rightmove Streets Ahead.
He says the five per cent growth in Rightmove's agent numbers reported last week in the firm's annual results were higher than the three per cent growth we expected.
He goes on to say that with Zoopla suffering a 20 per cent loss of UK agents as a consequence of this Rightmove's pricing power is not only unaffected but possibly even strengthened. It has not had to discount to retain members. This leads us to posit the possibility that the entry of OnTheMarket could turn out to be a good thing for Rightmove.
Walker also says that is Nomura's view there is not yet sufficient evidence that OnTheMarket will build enough traffic to keep most of its agent members happy and it is possible the non-founders of OnTheMarket will return to Zoopla over time.
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Comments
If RM wanted to secure their position long term they could have reduced their fees slightly as a "thank you" for agents sticking with them. IF OTM genuinely does take off agents will not think twice about leaving RM as the prices are continually rising. Online agents will set up to then be bought out like the digital media group were by Zoopla. Its all good fun at the moment - hopefully good old customer service will prevail!! After all we are RM OTM & Zoopla's customers not the public - the public are our customers and they are the oes that count! ;)
Well done to Mr Springett and all the sheep who went down this road making decisions based on zero common sense.
How much has been burned on adverts so far Guess it's millions that has been earned by the hard working agents and then, in a puff of smoke, Springett has burned the money!
@Brian - I currently use Rightmove and Zoopla - my opinions are based upon experience of using both RM & Zoopla. I haven't moved to OTM yet - may or may not..its my decision and it will be based upon who promotes themselves the best as that will influence how the public find the sites. No doubt Zoopla will be reducing their advertising very soon as they have and will continue to lose revenue. FYI I spend 1200 per month on RM & 700 per month on Zoopla. I can get OTM for around 300 per month. You can see where the motivation is to change - however 300 on a site that no one knows about is better off going elsewhere - like a leasing better car :)
PH - I use to put up agents boards. Never heard of the site. We may soon sell. But I wouldnt see OTM as a well known site. So you wouldnt get my sale. Sorry. Its just not known. Id want best price. OTM just isnt being seen
Is anyone actually shocked by this It was so inevitable.
The advert is everywhere. They've certainly put some serious monies into their PR drive since they launched, it's just a bit strange they didn't act earlier. I'm still not sure, if you asked ten random people on the street, that they would know what OnTheMarket is. Obviously it's going to take a while for the new portal to creep into the nation's consciousness, but there's always a danger that it never will. People in the industry have definitely heard of the new kid on the block, but have the public at large
You can't deny the reach of their advertising campaign either. I've seen them in the Metro, Evening Standard and various other papers in the last week or so. But it will take them a while to become a recognisable brand in the same way as RM and Zoopla.
More to the point, Rightmove will overwhelmingly be number one with the other portals all lagging behind in a distant second. OTM and Zoopla about the same level.
OTM will have successfully turned Rightmove into a monopoly. Bet it was worth all those millions to achieve that, eh
What a surprise!
2014 results - before the launch of OTM
RM was always going to be number one, certainly in the shorter term - who will turn out to be number two is the question and that will not be known for some time. The High Street agents will decide that!
Surely with all the recent changes to property web portals where all properties for sale are on all sites, means a buyer will have to look at all sites rather than just their favourite. As a Zoopla & Primelocation agent on a tight budget, I am very happy with that!
The only loser is zoopla. And rightly so when they tried to l grow by buying up other portals they have offered nothing new and their data reporting (which they tried to use as a USP) is always wrong. Don't forget many agents have only ever used RM and will stay with them until OTM is a big enough player so they jump ship to save two thirds of their portal costs. If OTM doesn't become as big as RM it will just replace zoopla as number two by the look of things.
To 'one of the experts'.
This is getting really boring now. I am genuinely happy with the marketing mix I have both on valuations and for viewing requests. Signing up to the OnTheMarket was one of the best things I've done.whu not just let us get on with it, I don't have a go at you for how you decide to spend our money.
As predicted OTM is doing more damage to independent agents than good.
It's had it's peak and seeing some franchise owners leaving OTM to return to RM and Z is showing that OTM was and is bad news (for it's own members). Sooner the blessed site falls the better.
The OTM TV advert is also getting boring as the mans voice un-enthusiastically beats out a much about nothing message.