The New Wave of Property Websites
Posted: Thursday, July 31, 2008
by Lauren Pritchard-Gordon
PropertyIndex.com
How every estate agent could benefit from the new wave of innovative property portals.
Tradition versus Innovation
As many estate agents know, Rightmove has a near monopolistic position in the market for online property searches. However, the new wave of property search engines and pay as you go, cost per lead property websites will apply increasing pressure to the traditional monthly subscription model.
Display advertising, feature positions and sponsored links are just some of the added value products the newer sites offer to make their money and drive more leads for agents.
Doing the Maths
So far, over 1000 UK estate agency branches have signed up to list with PropertyIndex.com. Many have told us that while major traditional subscription portals do offer value for money, paradoxically, they are also seen as too expensive.
To explore the issue of value for money, we advise estate agents to monitor the cost of each of the property websites they use by dividing how much they are paying by the number of leads they receive. This establishes the cost per lead which is a vital statistic when it comes to determining value.
Applying the conversion rate, i.e. how many of those leads are turning into sales or new instructions, to the number of leads generated, will provide an accurate cost per sale. Divide this number into the average commission achieved on a deal to arrive at your return on investment.
After performing this analysis for some of our clients, we found that the top websites can indeed provide value for money, as shown in our results table below. However, a results-based payment model, such as the one used by PropertyIndex.com, can offer more value.
Traditional Portal
Monthly Subscription: 300.00
Number of Leads: 100
Cost Per Lead: 3.00
Conversion Rate to Deals: 2.50%
Cost Per Sale: 120.00
PropertyIndex.com
Monthly Subscription: 0.00
Number of Leads: 33
Cost Per Lead: 1.00
Conversion Rate to Deals: 2.50%
Cost Per Sale: 40.00
It appears to us that the value perception is distorted by the rigid one size fits all' approach inherent in the subscription model. Most notably, monthly rates do not tend to reflect market conditions; seasonal fluctuations; house prices and regional differences, nor do they take into account such factors as agents having varying numbers of listings.
The Alternatives
So what are the alternatives? Agents could sign up to the smaller, lower cost subscription portals, however these work on the same commercial principles as the bigger websites. Agents still have to navigate around the same issues and would actually need to be on two or three more sites to get the same coverage, pushing up the monthly budget.
Another option is for agents to build and promote their own website. Yet we know this is fraught with difficulties; not only is it time consuming, it can also be extremely costly and require substantial investment in search engine optimisation and pay per click marketing.
Therefore we advise all estate agents to try out all the new portals with equal enthusiasm. They should list with as many as possible in order to grow the total volume of transactions they are achieving through non subscription channels. Over time, agents may find that they can afford to reduce their monthly subscription budget or at the very least build a stronger negotiating position for a better renewal rate with their existing portals.
Minimum Effort, Maximum Results
There are a few simple strategies agents can use to make the property websites work for them. The first is to prepare a regular feed. This ensures agents maintain control over their listings and the frequency of the updates, plus they will not have to redesign their website to make it spider-friendly.
They could also ensure their listings are up-to-date and include high quality images and substantial information. Lastly, agents should support their listings with banners and feature positions which will increase visibility and boost their potential lead generation.
Article by Lee Bramzell, the managing director of PropertyIndex.com
About PropertyIndex.com
PropertyIndex.com is the UK's fastest growing overseas property website. Over 700 agents and developers have chosen to list their properties on PropertyIndex.com since launch in September 2007, so that the site now features over 150,000 properties for sale and rent across 4,000 destinations worldwide.
Agents choosing a cost per lead campaign on PropertyIndex.com only pay for results. There are no monthly subscriptions, no set up fees, no minimum term contract and no commission on sales. Qualified leads are delivered direct to the agent's inbox.
Backed by a multi-million pound investment fund, PropertyIndex.com is an independent company offering a one-stop solution for anyone looking to buy, sell, rent or let property anywhere in the world.
Please visit http://www.propertyindex.com and have a closer look at what we do.
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