Russell Quirk, chief executive of Emoov, says his agency is now one of the top seven in the UK following its merger with Tepilo and lettings operator Urban.
In an interview with EAT Quirk says that with an annualised 13,000 listings between the three brands, the combined operation is now “a grown up business.”
He says that the three brands can individually benefit from some economies of scale but will remain separate for the indefinite future.
“Urban is a terrific agency that we’ve been talking to for two years. It’s built some user-friendly technology of its own and has a superb business model. I’m not sure sales and lettings can really work together in one operation anyway so that will remain separate” he says.
“As for Emoov and Tepilo - we’ve got long-established brands and it’s unlikely we’ll give that up. It’s possible that we might do slightly different things in the long term, perhaps one going up market, but we’ll see” he adds.
Quirk says some the benefits of the economies of scale of the merger - announced last week and widely interpreted as an Emoov acquisition of the two other firms - are already beginning to be seen - for example, many of the Urban staff have already moved over to Emoov’s office close to The Gherkin building in the City of London.
But Quirk says the most significant benefits are still to come.
“We only need only overall management team - no need for three CEOs and the like - and there will be more smart working. All three of us have efficient ways of working but Emoov may be able to spread our Hero [sales technology platform] across to Tepilo too. This will improve Tepilo’s offer to its users, allowing them to do things like make their own price changes - generally better customer accessability.”
He also says the TV spend available to him as a result of Tepilo’s media partnershps and the involvement of Channel 4’s start-up tech fund programme, combines to create a £9m marketing war-chest.
“Building brands and consumer education as to a new business model are expensive. Having such a media pot is pivotal to growth whilst we push along our path to profitability. TV spend can take time to work, time that limited cash may not allow” he says.
On the wider online/hybrid agency landscape, Quirk is characteristically upbeat about his newly-enlarged Emoov moving to second in the league table behind only Purplebricks.
Can he see any others merging as the digital side of the agency industry continues to shake out? “Not really - what would they create? The others haven’t really got technical or managerial weight to overtake where we’ve moved to now, they wouldn’t bring anything new to the table for investors. Something will happen but it won’t move beyond us” he insists.
However, he admits that with most of the sector accepting that online/hybrid still accounts for only 7.1 per cent share of the overall market, previous forecasts of growth made by himself and other players have been over-optimistic.
“Progress is definitely slower but that doesn’t mean it’s not happening. We’ve learned not to give timescales and exact figures but there comes a point - that’s probably when online/hybrid takes 12 to 15 per cent share of the market - when everything accelerates and it becomes mainstream.”
Quirk says there will always be a place for High Street agencies and there will always be people - “possibly many people” - who’ll pay for the service that traditional operators provide. “The tipping point is taking longer than people thought, longer than I thought, but it’s still on it way” he insists.
However, he says the past big names of traditional agency - Countrywide and Foxtons - had better be making more preparations for digital than they appear to have done to date.
“I’m an old-fashioned estate agent so I’ve admired these companies for a long time. But they need to learn from the newer agencies about customer accessibility and the experience sellers and buyers want. The potential savings they’d make on serving customers better through our sort of digital marketing, technology platforms and so on would be great. These big firms can’t ignore technology forever” he says.
“They regard us as a kind of Death Star Anti-Christ. We’re not” he concludes.