Eight out of ten house hunters in the UK start their search for their new home online. Yet the Internet represents only 4% of all house sales. This amazing pairing of bits of data was provided this morning in the BBC Radio Five Live programme, Wake Up To Money.
What this information tells us is the fact that the online estate agents must be doing something wrong. If the vast majority of people head to the Internet to search for a new home, yet only a minority of people actually buy their property online, then something, somewhere is going wrong with online estate agency.
The estate agent speaking on Radio Five Live was from Brightsales. So, off I go to their web site and imagine I am looking for a house. Before you see the “search” button (in the wrong place according to eye tracking information anyway) you see the words “log in/register”. These two words are known to be amongst the most off-putting words online. They appear to prevent engagement with a web site, rather than enhance it.
Even so I plod on and search for something in my home town, Reading. Nothing available. Never mind, I think, I’ll use UK Property Shop. Take a look at their web site where they list properties by town – nice and handy. Except Reading is not listed. Now Reading is the largest town in the south of England outside London. It has the European HQ of Microsoft there, nearby is the world headquarters of Vodafone, plus Oracle’s Europe base is there as well. In other words, Reading is a large thriving town, with plenty of people with high disposable income, and property prices that rival London’s. This should not be a place that is ignored by online estate agents, yet it is.
Most people who want to move home have an idea where they are going to move to. Either it’s because of job moves, or they want to be closer to family, or they’ve decided the town is no longer for them and they want the countryside. Whatever the reason, almost everyone knows the area they want to move to. Yet online estate agencies are frequently taking a national approach, as though we want to move anywhere.
True, they have search facilities, but if the search proves fruitless, as in my Reading example, I may well end up going to High Street estate agencies because my Internet search has failed to find anything. So what do the online estate agency failings tell us?
Firstly, at first sight it seems that the world of online estate agency hasn’t yet realised how its customers behave on the Internet and is therefore failing to match their requirements. Secondly, it reveals one thing that many online businesses have failed to grasp – most business in the world is local. Business owners set up their web sites full of excitement that they can gain customers from anywhere in the world. Few seem to realise that their targets are the people just down the road from them, where most of their business has come.
For example, what kind of printer do you have attached to your computer? Is it a Hewlett-Packard one, for instance? If so I bet you didn’t buy it from HP in Palo Alto, California. I got mine from my local Staples store, eight miles away – just like most people whose experience of buying things is local, not global. Few online businesses have realised that our buying behaviour is local and are phased by the global attractions of the Internet.
If your business wants to do well online, do the reverse of the estate agents. Do not think national or global, think very local. It’s niche marketing all over again. So anyone want to set up an online estate agency just for properties in Reading? There’s obviously a gap in the market..!
5 thoughts on “Estate agents provide great example of how not to do Internet Marketing”
Hi Graham,
You might be interested in our report 'comparing online estate agents' if you ever do a follow up to this piece: http://blog.thebigpropertylist.co.uk/compare-onli…
Some of the agents mentioned in this article are no longer – but the report shows that the survivors (some since the mid-nineties) have now quite a large client base.
Since the OFT report on Estate Agency business this year (http://news.bbc.co.uk/1/hi/business/8520338.stm) opened up the market for online agencies and Internet House Sales we may see a faster pace of change in coming months and years.
I think that maybe you've missed the point of online estate agents. You've focussed on the buyer rather than the seller. The chances are that if you are going to buy a property in Reading then you will start your search on rightmove, primelocation, zoopla or findaproperty rather than an individual estate agent's site such as http://turtlehomes.co.uk.
A reputable online estate agent will list their properties on all of these sites to ensure maximum marketing coverage. The real purpose of an online estate agent is to provide a value for money estate agency service to sellers. Todays Which? report shows that vendors can save on average over £3000 in estate agency fees.
Thanks for your comment – but I don't think it is me that is missing the point…! The point is if SELLERS of homes only achieve a 4% success rate online, then the online estate agency system is not working…! Sure, a reputable estate agent will list their properties on all online directories – but rather like estate agents have been doing for decades, that's no more than listing it in a local paper. It is NOT the way people are using the internet to search for houses these days.
The online estate agency only works for sellers if the house is sold online or found online. The research shows that in spite of the plethora of online estate agencies, most houses are sold in the traditional way. Which indicates that online estate agencies haven't yet properly worked out how to sell properties using the internet. But there again, I don't think they really know how to sell in the "real world" – their marketing methodology is out of the ark…!
In repsonse to your last comment Graham, i have to disagree. I am also an online estate agent; http://www.findahomeonline.co.uk.
In addition to advertising on all the major property portals, i also use traditional methods. We advertise in our local newspaper and get very little repsonse from it. 90% of my enquiries and sales are generated from the internet.
I come from a traditional estate agency background, when launching my business i had a choice of whether to go onto the local high street or to trade online. I chose to become an online agent as this is the first place people look for property these days.
Tom, thanks for your comment. Whilst I think it is fantastic you are getting 90% of your sales from the internet that does not mean everyone is. Some 96% of all houses sold in the UK are NOT sold online. The vast majority of houses are still sold traditionally. If as you say, that the first place people look for property is online, then if so much is sold offline, it can only mean that the vast majority of estate agents are failing to use the online world effectively. Perhaps you could teach them a trick or two.
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