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TODAY'S OTHER NEWS

Bank says OnTheMarket has 'disrupted' but will be merely a blip

The Hamburg-based Berenberg Bank is the latest to send a briefing to investors on the so-called portal wars - and while it says OnTheMarket has successfully disrupted the portal sector it will ultimately be merely a “blip in the growth trajectory” of Rightmove and Zoopla.

The bank says OTM traffic has now reverted to pre-October levels and that the challenger portal’s update on usage last week - when it described October’s visitor numbers as constituting “a record month” - was down to having ‘bought’ traffic.

“We believe that the recent spike in site traffic (to 900,000 visits per week) was the result of incremental Google spend, rather than an underlying increase in consumer traction. In fact, it is clear from more recent Hitwise data that since OTM turned off its Google spend at the end of October the traffic levels have reduced significantly, back to the pre-October levels of 500,000 visits per week” says the bank briefing.

It goes on to say the it does not believe OnTheMarket offers a sufficiently differentiated product to succeed in the long term.

“In the first three weeks of November, Zoopla has averaged 15 times the number of visits to OTM (at circa 8.2m visits per week versus OTM’s 500,000) whereas the costs to advertisers per month are similar. While emotions may keep agents paying in the near term, we believe that in the medium term this will prove too inefficient, and agents will return to Zoopla as it provides a substantially improved value proposition” says the bank.

Since the OTM update based on its October figures another bank - Credit Suisse - told its investment clients that the new portal’s “growth in contractual membership has all but dried up.” By contrast yet another institution, BNP Paribas, has described OTM as displaying “a healthy resilience” across its membership base. 

  • Trevor Mealham

    More to the point its disrupted many agents businesses.

    Another this week has said to me that consumers don't know about it and its losing them instructions with its silly one other portal rule.

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    It may have disrupted Zoopla, but it has turbo-charged Rightmove.

    On behalf of Rightmove shareholders across the globe, I would like to thank and congratulate the 5,500 agents in the UK who have made their 2015 so successful!

    You shall now and forevermore be known as the 'I shot myself in the foot' brigade!

  • Rob  Davies

    "and while it says OnTheMarket has successfully disrupted the portal sector it will ultimately be merely a “blip in the growth trajectory” of Rightmove and Zoopla."

    Yep, pretty much. Even then, it was only a blip for Zoopla. RM remained completely unaffected by OTM's arrival and still do.

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    As much as the OTM plan supports estate agents and has a feel good factor for the future, the request to only use one other portal is total stupidity within the current portal landscape! The aim was to disrupt Rightmoves hold on estate agents but in most areas of the UK, Rightmove is the superior portal and will thus be chosen = Total fail!

    To add salt to the wound, the only plausible future competitor to Rightmove is Zoopla who have been working tirelessly and at huge cost for the last 5 years to mount a noticeable fight against Rightmove which has its name searched as a synonym to "Moving house"! Tough task given that Rightmove is like Cellotape or Hoover, so ingrained we can barely think of the verb.

    In addition to the above, the portals are consumer driven and consumers expect a great online experience. This means the portal with the most properties wins! Even if OTM reach 50% of estate agents (~9,000!!!!!), this is still only 50% vs Rightmove which will 'probably' be the ‘other’ portal and thus will still be leading the consumer driven experience. #Fail

    Good luck to all involved!

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