Innovation rather than Regulation

Why the likes of Zoopla are better instigators of change for the industry

So the OFT have decided that the industry doesn't need further regulation. Some may feel that is a bad thing, but you only need to look across the road to the financial services industry to see how toothless and ineffective regulators can be at keeping an industry in check.

The process of buying and selling a property in the UK has much potential for change and improvement, but surely it is better for that change to be embraced and developed by the industry, rather than imposed on it?

To provide an effective prescription, you need to have a good diagnosis. And the anatomy of the property industry is very poorly understood by those outside of it. That is why we have endured years of 'consultation' with Government, only for them to fudge it with HIPs.

While committees have been debating the nuances of first day marketing and formulating pages of tick boxes for purposes only known to them, others with a better understanding of property have been thinking long and hard about ways to do things better. Change for the better is usually achieved much more easily through innovation than regulation anyway.

One such innovation came good last week. 57 properties were sold last Sunday having been on the market for just 4 days... 4 days? 57 properties? Sunday??

This was the result of Zoopla's first online property auction. The first time property has been auctioned online in the UK and with 1,000 registered buyers, a robust proof of concept for them that has spurred the announcement of more auctions starting next week.

At this stage, Zoopla's auctions are focused on repossessed properties, but having spoken to them about their plans for the service, they told me that they will be enabling member agents to put any property into an auction for free up to 30 days prior whilst continuing to market it conventionally. What's more, Zoopla will actually pay agents whose properties successfully sell at auction an additional 0.25% commission on top of what they get from the vendor!

The objectives for most vendors will always be to sell a property for the best price in the least possible time and it strikes me that by making it accessible and lucrative to agents, Zoopla may have a very viable mainstream alternative to treaty sale to help achieve that ubiquitous vendor objective.

From a buyer perspective, I think it also ticks a lot of boxes. As Omid Djalili points out in the current Moneysupermarket.com adverts, we don't like to haggle as a nation. As an agent, you might love it, but your average buyer will approach negotiation over price with fear and trepidation. They would probably feel the same about raising their hand in an auction hall, but when they are sat at a computer in the comfort of their own home, they are much more at ease and quite happy with the idea of bidding online. We are, after all, a nation of eBayers.

So Zoopla seem to have come up with something new that works for buyer, seller and agent. Finding new ways to keep that trinity happy should be the job of every agent too. Continuing to do it the way you do it, just because that's how you've always done it is a dangerous mentality to adopt.

Darwinian theory applies as much to business as it does to nature. Even big companies fail when they are too slow to adapt to changing marketplaces. You only need to look at the speed at which change has affected other agent industries like travel and insurance to see how quickly the game can change radically. Those who are aware of change, who embrace it, influence it and ultimately, exploit it are the winners of tomorrow. The legislators will catch up eventually and if you still need to smarten up your act by the time they get around to sorting out theirs, then you will probably find yourself part of property paleontology sooner rather than later.

Tepilo and the curious case of 5,619 missing valuation appointments

A few months ago, I questioned whether Tepilo; the self-sale portal being fronted by Channel 4 Property presenter; Sarah Beeny could have any impact on the UK property market. Having already seen a fair bit of anecdotal evidence that they were doing okay, I was still surprised to learn that Tepilo has listed 5,619 properties to date (they launched last summer) with apparently 50 to 100 new listings per week now coming on to the site. A small percentage of the total marketplace, but that's still a lot of unneeded valuation packs by anyone's standards. I remain unsure about how self sale can be profitable regardless of the number of listings, but for the purposes of this article, I would like to park all that. My interest today in them is more in their success in gaining instructions than their delivery of sales. If you must sate your appetite for FSBO bashing, look no further than Peter Rollings from Marsh and Parsons who made the case against the self sale route very eloquently in a recent blog post.

What Tepilo does very well is to advise and inform, they provide a lot of help and advice on the site and their PR machine is churning out all manner of interesting articles on their behalf regularly. If you are a potential vendor with questions about moving, then you will feel much more informed and confident after a bit of reading on Tepilo. I know of very few estate agency websites that are kept as up to date or so comprehensive when it comes to providing consumer advice. An agent will traditionally depend on the valuation appointment as the opportunity to advise and demonstrate their expertise, but I think there is a strong argument to say that saving your gems of insight until you are face to face with vendors is no longer particularly sensible. A decision on whether or not you are worthwhile calling, never mind inviting round is being made off the back of what people can see about you online. Yes, having lots of listings on Rightmove will serve that purpose nicely in the same way board count always has, but if your website is dated, devoid of insight and focussed on talking about you rather than your customers, then you may find that others are influencing customers more effectively than you.

It's not just what's on the website either. The press plays an important role in influencing consumer behaviour and Tepilo's aforementioned PR machine is doing a pretty good job on this front too. The Telegraph, in particular, has mentioned them repeatedly (and objectively) in recent months. Each mention has no doubt resulted in a fair few more listings for them and less for agents. Beeny's involvement has probably opened doors that others would find firmly shut, but this is also a well considered aspect of their marketing. Their usage of Twitter to engage with their target audience and influencers of their target audience and build relationships in advance of custom is also commendable.

This leads me to one of the interesting dynamics of using social media in property marketing. Many people have told me that they think Twitter is a waste of time for selling property and I would simply counter that with; don't blame the medium without first examining the message. You will actually find it very easy to connect with prominent property journalists on Twitter, but they, like the rest of us, aren't going to pay attention to you unless you have something interesting and you pitch it in the right way. That doesn't necessarily have to be something you're listing either. Go back to that core objective of getting instructions and consider how providing insight and advice can serve that purpose just as effectively as showing off your most newsworthy listing. We can't all get published in The Sunday Times, but every week there are PR's (for agents as well as Tepilo's) tweeting, blogging and doing some of the good old fashioned PR stuff with this objective in mind.

If you can't bring yourself to look at Tepilo, then an example of an estate agency getting it right on this front would have to be Chesterton Humberts' House Historian; Melanie Backe-Hansen who was recently commended in Primelocation's blog awards. An engaging and interesting read that is absolutely on brand and relevant to their target audience.

Social media and blogging (they are not the same thing btw) have given rise to legions of citizen journalists and the amount of 'insight' being churned out is frightening, but it is not too late to join the party. Fortunately, those producing a load of obvious sales propaganda or bad advice are easily filtered out. You can label Tepilo's PR as propaganda too if you like, but whilst you were busy getting all indignant about it, they probably robbed you of some more listing opportunities by their focus on helping prospective customers. In the age of fickle consumerism and media fragmentation, influence is a valuable, but very free flowing commodity and the best rates on it are available to those who can tell a good story and provide great advice, not just ply their wares through any given channel.