Specialist
Managing director at Chestertons
Agenda
- Transaction volume outlook
- Evolution of agent marketing budget and portal wallet share
- Portal spend trends and pricing vs lead generation dynamics across portals
- Evolution of portals’ adjacent product offering beyond core listings
- ARPU implications and attach rate of value-added products
- Agent consolidation impact on portal pricing power
Questions
1.
How healthy do you think the UK property market is? What broad trends are you observing as an agent?
2.
Have you noticed any impact on the sales market from the current national lockdown? How have the new restrictions impacted viewing volumes?
3.
How durable could the current market frothiness be? Has the stamp duty relief pulled forward demand?
4.
Do you think the fortunes of sales-led agents and lettings-led agents have bifurcated? Do you expect smaller lettings-only agents in London to struggle?
5.
How much smaller do you think the tenant pool is now vs this time last year?
6.
Could you estimate the normal conversion rate of enquiries into applicants for sales and lettings?
7.
Could you comment on the sources of enquiries? How significant a share of enquiries do you think are generated through Rightmove and Zoopla?
8.
Could you comment on any significant changes in the agent mix or the market’s overall structure in the last couple of years? How could the pandemic impact the agent composition of the market?
9.
Do you expect continued consolidation given Connells has put in an offer for Countrywide? I assume that the larger groups can negotiate a lower fee with the portals, making them less profitable per brand or per listing to Rightmove or Zoopla than the independents.
10.
How different do you expect the market to be in 3-5 years’ time? How could the largest chains’ market shares shift vs smaller, local, independent players?
11.
Do you expect agent volume to decline given prevailing industry margins?
12.
What would you say are the most notable changes in marketing budget allocation?
13.
Do you think the biggest challenge for a property portal start-up would be replicating the traffic Rightmove and Zoopla can provide agents? While replicating the portals’ functionality seems quite easy, I imagine their audiences are tremendous strategic assets in their own right.
14.
Do you doubt that there’s an agent large enough to strike out alone and come off the large portals? Would the critical mass of listings and agents required to effect meaningful change be significantly higher than that of any one agent at the moment?
15.
How do you think about the portals’ share of the typical marketing budget vs other channels?
16.
Would you say marketing budgets have declined in absolute terms due to the shift to portals?
17.
Do you think the portals can walk marketing spend back up to a similar level to during peak print advertising?
18.
Rightmove and Zoopla seem to take significant YoY price increases regardless of prevailing market conditions, notwithstanding this year’s payment holidays. Could we reach a natural ceiling to those increases?
19.
Would halving portal spend involve paring right back to the core listings product?
20.
How would you size Rightmove and Zoopla’s respective shares of portal spend in your P&L?
21.
Do you think OnTheMarket has the highest ROI out of itself, Rightmove and Zoopla, as measured by leads per level of spend?
22.
You mentioned that only 5% of your valuations come from Zoopla, with a smaller amount coming from Rightmove. Where do the rest of your instructions come from?
23.
Could you estimate the share of enquiries you receive from Rightmove, Zoopla and OnTheMarket?
24.
What premium of your wallet share do you think Rightmove has over Zoopla?
25.
Do you predict any changes to Zoopla’s product offering that may encourage you to spend more on it, perhaps beyond the core-listings product?
26.
Do you think Rightmove and Zoopla’s product capabilities are broadly comparable?
27.
Could Zoopla’s core listings product be treated as well-priced even if the leads aren’t as good, if as much as half of the spend on Rightmove is on the value-add products? Would it nevertheless be more expensive per lead if the quality is lower?
28.
How much overlap is there in the inventory you list across the portals?
29.
Would you say the incremental leads from Rightmove over Zoopla are a function of the additional promotional spend on featured listings, rather than the lead-generation capability of the portal itself? Would a like-for-like featured listing on both portals still generate more enquiries on Rightmove than Zoopla? Have you ever done that experiment?
30.
Do you think there’s any appeal in the cost-per-lead model? Other classified media businesses and verticals have flirted with it. Could the portals promote this business model, especially the number two or number three portal that needs to stay in the game?
31.
Would you say Zoopla is better set-up for generating instructions and valuations than Rightmove?
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