Fact: Rightmove has started trialling direct sales; and a challenger portal has had five years to overtake Zoopla and failed.
Fact: Agents should never need to sign lock-in corporate contracts or be induced by so called equity.
Why are corporate and "free" portals never going to compete? "Free" portals always have a hidden cost - usually exit strategies for investors or advertising, all of which compromise independence - and who controls the data? Similarly, all corporate portals raise cash from investors, sell their independence, dilute control, chase often unrealistic targets to satisfy analysts and investors, burn cash and in OTM's case report poor subscriber growth2, increased losses and fail to make a difference.
Why is a genuine mutual the only business model that can make a difference? The corporate business model was never designed to be a member organisation. Legitimate mutuals never sell their independence or principles to the highest bidder and only work in the best interests of their partners - period.
Who owns and controls the data? What is the most ethical way to preserve the security and access to a vast data lake of consumer and agent data? A public corporation controlled by external investors, sliced and diced for their benefit; or an ethically run and managed mutual, dedicated to acting in the best interests of its partners?
Why will PropertyMutual succeed? We are here for the long haul, have none of the restrictions imposed by other portals, will never relinquish our independence and, with sufficient support from the industry, can generate £30m per annum marketing budget, year on year, without ever having to raise cash from external sources
Agents now have another choice and PropertyMutual issues a call to action to unite and end the era of the corporate dinosaurs – Rightmove, ZPG and OTM2.
The corporate portals do what you might expect of them – optimise investor value. Which is fine – except if you’re a fee-paying member. Their only offer is transitory discounts, ever rising rate cards, “lock-in” contracts… and nowhere else to go.
PropertyMutual is here to end that era for good and offers agents real choice – to choose no restrictions plus guarantees on mutuality, rates, profit distribution and more.
Corporate portals are “take it or leave it”. The only way new corporate or non-mutual portals can prosper is by requiring existing and new members to sign lock-in, long-term contracts with transitory discounts or induce membership with "free shares". However, there is no such thing as a free lunch. These portals sell their independence and control to their external investors. Shares are effectively rendered valueless as the only hope of maintaining agent control against external ownership is by locking members into long term share retention. With property shares hitting record lows and margins under pressure, do agents wish to repeat history, assuring revenue to shareholders in return for losing control over their own destiny?
This “Hobson’s choice” offers nothing new and guarantees agents nothing as PLC’s ultimately cannot stop investors selling their shares. History shows external investors acquire these shares seeking to emulate Rightmove’s historically high 76% profit ratio.
No industry should tolerate such restrictions and lack of choice from suppliers claiming to be their ally.
Quite simply, the corporate portal’s model is obsolete as its profit motive is incompatible with guaranteeing to operate only in the best long-term interests of its members
In contrast, PropertyMutual & Partners reminds agents they have an ethical and credible choice. No shareholders means immunity from stock market influence and no diverted profits. Indeed, as a social enterprise mutual, 50% of any profits generated can be voted to charitable or socially worthy causes.
Founded solely for the benefit of our partners we are independent, and, with sufficient partners, we can generate a £multi-million turnover free from external influence.
There are no business or marketing restrictions, no lock in contracts, and one partner category paying the same minimum subscription – no “mates’ rates” or regional variations.
Low overheads and a live portal mean we can transition from free feeds to nominal subscriber fees to begin with – just £10 per office per month to grow our inventory until we reach critical mass, the price of a single coffee a week.
When we gain momentum, rates will go up but to minimum commercial cost and we will always spend 50% of our subscriptions on marketing for the benefit of our partners.
Our targets and rates are transparent and published online3 and all profits generated will be available for redistribution by our partners through reduced subscriptions or bonuses, for charitable donations, for social impact schemes or however the agent partners direct – in other words PropertyMutual is Properly Mutual!
PropertyMutual & Partners is about choice for all, so we welcome any business which markets real estate on behalf of a client - both high street and online agents. Given we do not restrict businesses or listings in any way and ask only a £10 a month start-up fee we encourage all agents, whoever else they may currently list with, to join with us in building a credible long-term challenger in which they alone have a genuine mutual stake.
So what have you got to lose? Now is the time for the agent community to unite, embrace change and empower their own Property Mutual. Help us build a modern, long-term business that delivers what consumers want and the industry needs – one that does well and does good.
Your Mutual Needs You!
1. CREVALA Ltd, a UK mutual, has been re-launched in response to the de-mutualisation of another portal. It is the only genuine mutual, can never demutualise for profit (see charitable assignment clause) and is owned by and run for its agent partners. PropertyMutual.com was launched by CREVALA and whilst currently paying a third-party supplier for most of its data feeds is transitioning to a subscriber model to build a long-term property marketing solution for professionals and consumers.
2. Rightmove ARPA is now £1,005 per month and will have to increase prices by £100 pm just to maintain its current growth. OTM, with its target of being the No. 2 portal by January 2016 long forgotten, continues to burn external investor cash at an alarming rate. By June 2019 average revenue per agent dropped from £198 to £130 during the 12 months to its year end on January 31st. Group revenue increased by only £600,000 post IPO and operating loss rocketed from £3.9 million to £14.5 million. Only 52% of its members were paying customers on an ARPA of £337pm. Of these paying members, a number are disaffected OTM v1 members locked into 5-year contracts who are likely to leave in January 2020 when their contracts start to expire. We believe OTM does not have the broad industry appeal or business model and has failed to take on the corporate portals.
3. Subscribe here
PropertyMutual is legally structured to be never-for-sale in order to be a partner run and funded digital marketing business for property professionals and developers. We are the only portal where property professionals and developers can confidently subscribe, in the certain knowledge that we will never sell out, float on the stock market or change our business structure. Such practices have pushed up property marketing prices to the detriment of our partners and their clients, and for the sole benefit of portal founders and shareholders.
‘To be recognised as the ethical and equitable mutual property portal, operating in the best interests of our partners and consumers, setting and enforcing professional standards of property listing, and delivering innovative property related services for all’.
PropertyMutual believes that the UK consumer, whether house hunting for purchase, rental or sharing, is either unaware of, or indifferent to, the property industry debate about a corporate duopoly dominating the industry and imposing upwards-only pricing on property professionals.
The British public will not be told where they can and cannot market their own property. Nor do they want to be made to go to a multitude of different property portals, some allowing only High Street Agents and excluding online agents, some allowing developers and others excluding them. The British consumer expects to be supplied with what it wants, namely -
This means that a property portal must be focused primarily on the needs of the consumer, whilst providing a trustworthy, cost effective and permanent property marketing partner for its partners. These professionals partners have to be unafraid of competing on their own merits in a free market and open portal in the 21st century.
It is estimated that there are at least 15-20,000 estate and letting agents in the UK regularly listing property with the big two portals. This does not include property developers, or commercial and agricultural agents. The maths is simple and transparent. Charging "at cost" subscriptions will still provide us with a £multi-million marketing and operational budget. We have no loans or interest to repay, no IT start up costs and no property portal to build from scratch.
Placed alongside the marketing budgets of the duopoly our ambitions are lofty but we believe the industry is crying out for a credible mutual guaranteeing that it is never-for-sale. With a motivated and committed partnership advertising PropertyMutual in their windows on the High Street, and through word of mouth and targeted media advertising, we firmly believe there is sufficient scope to grow PropertyMutual as the only trustworthy, transparent, and not-for-profit property portal so desperately needed by both the consumer and property professionals.