Purplebricks to test new pricing models next year

Purplebricks says it’s to continue to test new pricing models next year - and has not ruled out completely moving away from its existing up-front fees model.

In a statement to shareholders this morning - announcing its performance over the past six months - it says: “Whilst our first half [year] performance has confirmed that the up-front fee model still resonates with consumers in the UK, we continue to look at ways to evolve our proposition, exploring new pricing models and introducing new proposition bundles that will help us to expand our target market.

“We started in-field tests at the end of August and these will continue in 2021. Early lead indicators have provided valuable data on the penetration of new customer segments but it's far too early to assess the likely outcome of our trials, especially given the current lag in the time it's taking to completion.

“Further iterations of pricing tests are being launched in calendar Q1 21 and we look forward to reporting back on those tests at our Full Year results.”

In terms of its trading performance, the agency is upbeat in its statement to shareholders.

It claims: “Trading has been strong since the market opened up in May, and our first half performance is ahead of our upgraded expectations. We have seen a strong market recovery during the period - overall we delivered an eight per cent increase in instructions, with a 20 per cent increase in instructions for the five months since May. Meanwhile, our overall share of the market has remained stable at 4.8 per cent of properties sold”

Purplebricks also claims to have improved the performance of its Local Property Experts with the use of real-time analytics and market data which it says “will improve sales conversion in the living room, and, by getting closer to our customers, we are confident we can sell more ancillary services.”

Following the restructuring its LPE activities in March, it has also redesigned its agent support structure, “ensuring that we start to deliver a more consistent and improved performance across all regions.”

Chief executive Vic Darvey says: "We are now emerging from the pandemic in a strong competitive position. During the first half of the year, we have continued to simplify the business and focus on the delivery of our House Strategy ... This has included the disposal of our Canadian business, which has considerably strengthened our cash position and allowed us to focus fully on our home market once again. We have also strengthened our leadership team with the appointment of a number of new hires across the business to ensure that we have the right capabilities to continue to deliver our digital transformation program."