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The online challenge: Why high street must wake up to the fact that vendors’ habits have changed

ON THE MARKET

Paul Smith’s opinion piece in EYE this week focused on the easyProperty and Guild merger.

In it, he criticised the deal and advised Guild agents not to “devalue” their brand.

However, I believe that this is looking at the opportunity as a problem.

Similarly to the Guild and with considerable cross-over, we have a client profile that is drawn from the type of agencies that may well be second or even third generation. They are agents who are ethical, professional and well known in their locality for expertise and knowledge.

As pointed out in Smith’s commentary, 78% of vendors are primarily motivated by achieving a higher price when they sell, so they would use this type of agent profile for sure.

Unfortunately, behind the statistics is the reality of what’s happening.

Having researched vendor habits with our clients, the solution became clear and is the reason that we launched an online affiliate brand for our clients, Openview Online, two months ago.

The point is that vendor habits have changed.

The culture of searching online for property mainly via Zoopla and Rightmove, waiting for property alerts and then researching on Google, now extends to not wishing to engage with the agent at all.

Visiting the branch to be sold financial services, whilst getting a parking ticket, for no additional perceived gain, when you can just book an appraisal online, is simply not on the agenda of hugely time-stressed digitally-savvy vendors.

They can see the eye-watering multi-million pound advertising and marketing campaigns of the online agents that tell them they are the same as traditional agents but much much cheaper. (Or around the same price in the north, but much more cool.)

Simply put, vendors are first footing online agency and this means that the traditional agent doesn’t even get the chance to talk to sellers about “increased price”, “service levels”, “issues with sale” and all the other great stuff that makes traditional service so much more cost-effective.

This situation is only likely to get worse.

Our goal was not to create a cheap alternative to the high street, but an offering that took advantage of all the millions of spend in raising awareness of online and then filled in the last brick in the wall.

We are all naturally afraid of something new, but if we can try that with the security of a safety net, then we’ll give it a go.

By using the online affiliate brand to match the offering of the big onlines, our clients can then add the assurance of the locally trusted, professional property expert, to provide that security.

We did try the Countrywide model originally but as this was so deeply ingrained into the brand it did tend to tarnish the whole model.

By keeping it as an affiliate that is really just an education platform to gain the opportunity to speak with vendors, 80% did go with the full fat service as eventual price was the key driver. However, 20% engaged with the online system, to start with anyway.

So, in summary, I believe that managed correctly, the Guild and easyProperty may be showing us how the relationship is likely to work, certainly in the current market (those of us who have been around for 30 years in property know it won’t stay this way) and certainly for the next few years.

http://www.vtuk.net/openview-online/

  • Peter Grant heads up software supplier VTUK

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