So when agents are faced with a ‘free’ tool or technology, how should they decide whether the unmentioned costs are worth it?
For a product to remain free, it’s very likely that the company offering the service has found a way to make money from its users in a different way. In a clip which caused much mirth across (ironically) social media, a confused US Senator asked how Facebook remains a free platform. Facebook CEO Mark Zuckerberg responded, somewhat incredulously, that: “Senator, we run ads.”
To some, Zuckerberg’s response signalled a ‘duh’ moment, highlighting the disparity between older and younger generations’ understanding of digital platforms. More broadly however, the instance ignited numerous debates on the issue of advertising regulation, highlighting the gap in the knowledge that exists when it comes to how digital companies make their money. Spoiler alert: it’s you and your data.
Facebook’s users provide value (and later, revenue) by offering up reams of data which is analysed then used to drive ad sales. For this reason, it’s by no coincidence that a quick Google search for ‘Halloween decorations’ will result in multiple advertisements for retailers specialising in these items on your Facebook newsfeed.
And Facebook is simply the most famous example of a company making its money like this. From Silicon Valley giants through to UK based start-ups, huge swathes of companies are playing this game while you, the consumer, laps up the freebies.
While the use of their personal data may not be a major concern for everyone, the potential it offers companies to influence consumer behaviours (and in some cases, their voting intentions) should serve as a prime example as to why free services should be approached with caution.
Likewise, given that digital service providers are able to bring in millions of pounds in revenue from their users data alone, it’s abundantly clear that free digital services are skewed in the service provider’s favour, and most certainly do come at a cost.
Your data is wildly valuable. So who’s the one giving something away for free?
It could be also argued that the abundance of free services available is leading to both consumers and businesses losing sight of the value found in making an investment into a service.
Often, when a financial investment into a digital product is made, a mutually beneficial, trust-based relationship between the provider and consumer is established.
As a result, consumers can measure their return on investment against these expectations with clarity. In many cases, paying for a service provides enhanced returns compared to those obtained using free platforms because, crucially, the transaction is not mired by unspoken or under the radar motivations.
When it comes to the property market, the uptake of digital tools - or PropTech - has not been without its issues. As one of the most traditional industries out there, the adoption of paid-for tech has naturally been met with some uncertainty, leading many businesses to instead opt for free digital services as a ‘low-risk’ alternative.
As the market has got busier and the pressures on agents and landlords more intense, the promise of free digital services has never been more appealing.
But, as I’ve outlined, getting something for free doesn’t mean you’re not paying.
Property professionals unknowingly sacrifice crucial elements of their business - such as valuable client information and tenant data - to the lucrative benefit of their ‘free’ service provider.
Given that a large portion of the industry is built on trust - both when it comes to tenancy agreements and the software employed by agents - the consequence of using a digital platform that could be putting tenant and client data at risk, or using it for unknown gains, could cause irrevocable damage.
Likewise, having been a letting agent for 12 years before launching Vouch, an online referencing and utilities platform, I appreciate the value found in cultivating client relationships and investing in services that I feel proud sharing with these clients and that I know offer value.
Embedding this outlook into the business, I’ve been fortunate to build a platform which enables agents to make and save money at the same time, on their terms.
With so much at stake, it’s imperative that businesses have the freedom to operate according to their own values, and are never left in the dark regarding the hidden costs incurred by ‘free’ platforms.
Overall, navigating this sticky marketplace is by no means an easy feat, but putting trust and transparency at the forefront of decision making is a great place to start.
*Simon Tillyer is director of Vouch