Technology in the property industry - it’s just getting started
Monday, May 27th, 2019
2004 heralded a property venture by co-founders Mark Readings and Graham Locke that introduced low, fixed estate agency fees and operational centralisation via a non-branch approach. UK coverage from just one place.
Soon, Russell Quirk’s Emoov and Adam Day’s Hatched followed and thus we witnessed the birth of the online estate agency sector.
Progress was slow and, in the early years, clandestine even as far as the traditional industry’s reaction was concerned. Indeed, in the slightly paraphrased words of Mahatma Gandhi:
‘First they ignored us; Then they laughed at us; Then they fought us... And then we were supposed to win’ – But a long, many would say arduous, 15 years later we are (probably) witnessing the rise and then fall of the online agencies’ attempts at domination.
Early traction was strong, the early players doubling in size annually and with PurpleBricks wading into the throng of participants in 2014 with deep, deep pockets and a ready built team and technology platform. Over the next three years the Bruce brothers’ efforts were rewarded with a phenomenal growth in customers, employees, local ‘experts’ and territories as they bagged thousands of listings each month in the UK and quickly (too quickly as it turns out) turned their attention to Australia then the USA, followed by Canada and then Germany. Global disruption beckoned and the by now listed business enjoyed stratospheric share price increases culminating in a peak market capitalisation of over £1bn and then a £125m investment by Axel Springer, the European property classifieds giant.
However, in 2018 the mask slipped. First Hatched, then Homeseller, Emoov, Tepilo and, most recently, House Network all fell on their swords and shut up shop due to a combination of competitive pressure (too many runners and riders by far); a need for big investment cheques ongoing at a time when investors became spooked by Brexit’s shenanigans; a slow down in the domestic property market and, the death knell, PurpleBricks’s share price collapsing from £3.60 to £1.80 in a matter of weeks then falling even further on various revenue target misses, management departures and, as of the beginning of May, the admission that Australia had begun to turn the company’s fortunes literally upside down and was being closed down forthwith. Coupled with the departure ‘with immediate effect’ of co-founder and CEO Michael Bruce, this all amounted to the commercial equivalent of the Zombie Apocalypse for the online space.
Traditional estate agents celebrated. The storm clouds had passed and they could now get back to business as usual undisrupted by the disrupters. And with that, a seeming attitude that with the demise of the onliners also comes the eradication of any need for technology innovation within the property industry as a whole. After all, if the online threat has been slain, with that goes the noise that they made around technology, surely?
Well, no. Online estate agents and #PropTech are not the same thing. In the same way that the passing of the Blackberry into communications history did not spell the death-knell for the iPhone. Far from it in fact.
Estate agents that believe that tech is no longer ‘a thing’ are sadly misguided. And by this, I don’t mean run of the mill CRMs such as Reapit and PSG products. Rather my belief is that technology is absolutely, 100% definitely a significant factor in the future of the property industry and whether that be software that assists agents to do their jobs quicker and better; communications tools; automation; lead management or, at the very least, enhancing property listing visualisation tools such as Vyomm’s Showcase, tech is the number one asset that all estate agents must invest in.
Customers expect continual improvement, accessibility, transparency and the ongoing ‘wow factor – this is what they expect from other purchase experiences whether it be automotive (Tesla and its long-tail of motor firm followers); Apple (and its dominance of communication products); Uber (and its revolution in getting from A to B) or Netflix (it’s transformation to on-demand entertainment). These companies set the benchmark and reinvent their sectors. And they do so continuously and which is why we queue for each latest iteration of the iPhone and is why Tesla is worth more than some of its more traditional competitors combined.
Online agents may have been put back in their box. However, technology in the property industry is just getting started.