One of the founders of online agency Purplebricks says his aim is for the firm to become the "first choice" for people looking to sell their properties within the next five years.
"We continue grow on a consistent basis and in the right direction. In the next five years we hope to become the first choice for people looking to sell their property in the UK. Our overall objective is to get every person who is considering selling their house to think of Purplebricks” Michael Bruce has told business-to-business publication Insider Media.
Purplebricks will next week make its latest trading update to the City, the first since a long ‘bull run’ of share price improvement. The May 11 statement will be a pre-cursor to the full year’s preliminary results which are expected to be announced on June 16.
Purplebricks’ share price closed for the Bank Holiday weekend at 174.11p - a world away not only from Purplebricks’ mid-December floatation price of 100.00p but also from a low of 72.50p reported in the second half of January.
"The problem with the estate agency industry is not the people, it's the model. I wanted to offer something that was much more convenient, transparent and cost effective and deal with the issues that customers find difficult about the whole industry" Michael Bruce told Insider.
"Our technology acts as a perfect, professional estate agent; it's never ill, it's totally reliable, never on holiday. It arranges all the valuations and viewings for our local property experts, gets feedback from customers and generates information and reports. Customers usually get one or two traditional estate agents to evaluate their properties before instructing us so they have a balanced view” he says.
Meanwhile Purplebricks has become the first-ever customer of a brand new marketing agency called Snap. Four companies were initially interested in getting Purplebricks’ business - Snap, Now, Lucky General and Karmarama.
Until earlier this year Purplebricks had been a client of ad agency BMB but a split was announced citing “creative differences.” In March, Purplebricks contacted rival advertising agencies to get them on board before new campaigns are launched.
Kenny and Michael Bruce, the traditional estate agents who founded Purplebricks, have long emphasised the importance of marketing to the company.
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Could someone please tell me how NOT stating in their adverts that clients WILL pay their fee regardless of whether their property is sold transparent?? Their marketing states there is no estate agents commission, which is patently untrue, and they do not declare that if clients do not use their conveyancers they must pay the fee up front and extra besides. The Bruce's have a slightly different idea of transparency to me.
Purple bricks admitting that their customers use one or two traditional estate agents to gain the correct market valuation before using their services what a shame they have to use the traditional estate agents to help their business.!!!!
As the old saying goes- turnover is vanity profit is sanity. I still question where the actual margins are in this sector. With no 'person' to maintain a relationship, they will always rely heavily on huge market spends to maintain a stream of new clients. With small fees and huge advertising costs I just don't see where the profit is. With around £8m losses last year, I am intrigued to see what their latest stats state. Share price is all well and good- until people finally become weary of a business that remains upside down.
Amazon got away with poor performance in profitability for years but that was because they were (and continue to) invest in a framework that enables them to dominate the marjet going forwards. Purplebricks are not doing this. They are merely spending a ton of money on advertising.
The fact remains, that whilst people love to balk at agency fees- with many agents in the UK charging 1-1.5% for sales (not forgetting no sale, no fee) these are some of the lowest rates worldwide. When people see their property sell for 10,20,30% or more, for doing nothing more than living there for a few years, they dont tend to mind giving away a small percentage of that for a hassle free sale through a qulaity local agent with personality.
Dont forget- agents are local businesses. They bring business to other local services, eat in local cafes & restaurants, etc.- Purle Bricks will never be part of a local community as it gives nothing back.
In the Birmingham area the so-called "Property Expert" has priced property for sale by asking the vendor how much they want for it.
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