« Back to all posts

Entering property portal market easy – but to do it successfully is difficult, Zoopla’s Jon Notley tells hearing

fIXFLO news story

The QC representing Gascoigne Halman, Paul Harris, re-examining, asked Mr Livesey if he agreed with Mr Maclean’s description of the plans presented by Ian Springett at the Leighton Buzzard meeting as being ‘stylised scenarios’.

Mr Livesey replied: “It was a very clear business plan, it wasn’t stylised in any way.”

Mr Livesey also conceded that he did help to get the meeting put in place.

But he added: “It was very clear it wasn’t my suggestion.”

Mr Harris also asked what Connells’ shareholding in Zoopla was, which Mr Livesey said was just under 3%.

Tribunal member Peter Freeman QC asked Mr Livesey what he believed “fair competition” was.

Mr Livesey said it was coming into the market with a portal proposal and winning clients because of the nature of that new competition.

He added that it was “building business in competition, rather than saying to potential customers ‘if you join us you cannot use your other suppliers’.”

Jonathon Notley, chief commercial officer of Zoopla Property Group, then gave evidence to the tribunal.

Mr Maclean initially asked Mr Notley if there were “few people in the country with as long and successful an association with the property portal market as Ian Springett”.

Mr Notley replied: “There are not many, but there are a few. Some of the guys at Rightmove, some of the people involved in the early portals like FindaProperty.”

Mr Notley described Tesco and Google’s brief forays into the property portal market as purported attempts to enter the market.

He noted that the Office of Fair Trading had deemed Tesco as an agent, rather than a property portal.

Mr Maclean said: ‘They weren’t purported attempts, they were real attempts that failed.”

But Mr Notley said that Tesco had been “put off” by being judged to be an estate agency and “didn’t want to be subject to the legal ramifications”.

Mr Notley conceded that entering the market is “not difficult at all”, but that doing so successfully was.

He said: “If you don’t have something that’s compelling to house buyers or vendors or agents, you are going to struggle.”

He added that the reason he joined Zoopla from the Digital Property Group in 2011 was because “it was clear Zoopla had a winning position.

“It was actually a smaller team, smaller revenues, smaller customer base, but it was a winning proposition.”

Mr Maclean said that in 2014 Zoopla began “reacting to OnTheMarket’s impending arrival and [were] offering better deals’ to those agents already signed up with them.

Mr Notley accepted they had offered better deals, but added that “We have had these group negotiations in the past, therefore we are preparing to give better terms”.

Mr Maclean suggested that this was an example of “competition at work”, in that OnTheMarket’s impending arrival was causing Zoopla to offer better terms that they otherwise would have done. He said: “This is a classic example of competitive pressure from Agents’ Mutual entering into the market.”

But Mr Notley said: “I think that’s carving value out of Zoopla,” adding that Zoopla was “defending our position in any way we could at the time”.

He continued: “It is because we had a competitor coming into the market whose sole purpose was to carve value out of our business.

“We are competing with OnTheMarket and we are competing with Rightmove. All this does is set Zoopla back [relative to] Rightmove.”

Mr Notley said that the effect of OnTheMarket’s entry was “weakening Zoopla, widening the competitive gap between Zoopla and Rightmove [which] serves no one other than Rightmove”.

Mr Notley also dismissed claims that Zoopla and Rightmove constituted a ‘duopoly’ in the portal market, but admitted Zoopla were “a long way behind Rightmove”.

He said: “We don’t exist in a duopoly.’

Mr Maclean then mentioned an October 2014 letter from Zoopla to a house seller which went “viral among the estate agency industry”.

The letter, addressed ‘Dear Homeowner’, read: “You are missing out on exposure to millions of active property hunters.”

Mr Maclean accused Zoopla of “trying to set their clients against them”, adding that it was a “competitive reaction to the new player in the game”.

Mr Notley denied it was targeted at OnTheMarket’s clients, saying: ‘That’s just marketing, it wasn’t targeted necessarily at anyone.”

He added that many people selling a property had signed up to any given estate agent because they listed on Zoopla, saying that “in many cases agents would have felt obliged to have written to their customers that they had left [Zoopla]”.

Mr Maclean suggested the reason the letter had been sent in late 2014 was because Zoopla “knew OnTheMarket was coming to the track”.

But Mr Notley said: “No, I don’t accept that. It isn’t true.”

Mr Maclean asked: “You sent the letters out because you could?”

Mr Notley replied: “Yes.”

Mr Maclean asked: “Like climbing Everest because it’s there?”

Mr Notley did not respond.

The hearing continues today

ON THE MARKETMY DEPOSITSHamilton Fraser NSHUNTERS NS - to June 2017EXPERT AGENT NSKAPTUR NSjobs board nsproptech nsTM trainingNFOPP SkyscraperArena Push news story pages

[ comments ]

Source:: Entering property portal market easy – but to do it successfully is difficult, Zoopla’s Jon Notley tells hearing