Purplebricks has got itself into a bind due to its addiction to brand awareness over addressing the customer experience of paying upfront for an unsold home, a marketing expert claims.
Speaking exclusively to Estate Agent Today, former Fine & Country global chief executive Simon Leadbetter said Purplebricks had a marketing budget that most executives would dream of but said the online agent’s Achilles heel is the pay upfront model.
Leadbetter, who now focuses on his own marketing consultancy, said: “From a pure marketing perspective, Purplebricks has built an incredible brand
“There is something a bit troublesome about the business model though.
“Unsold houses still mean that people have to pay.
“Unless that is addressed, I don’t know how the brand can succeed.”
Leadbetter has previously worked as global head of marketing, communications and digital for Knight Frank LLP as well as chief marketing officer of Keller Williams UK so he knows a thing or two about brand awareness.
He admits he even came across prime customers who considered using Purplebricks, adding: “With huge brand awareness you could bring something incredible, but unless you address the customer experience of taking people’s money and not selling house, that will be their Achilles heel.”
Leadbetter suggests Purplebricks has got itself into a bind by spending so much on marketing while addressing an issue that doesn’t need to be fixed.
He said: “Purplebricks has reached a point where it is addicted to brand awareness and if they take the pedal off then there is a fear that awareness will decline.
“It has paid to fix the toilet door but not the plumbing.
“The one thing that didn’t need to be fixed in agency was no sale no fee, that is a fantastic deal for customers.”
Leadbetter suggests the area of agency that needs addressing is regulation and professionalism, adding: “Purplebricks won’t abandon fixed fees as it has bet millions on it but it may have to come up with a compromise if a customer doesn’t sell.
“It could say it wants to clean up the industry and qualify its agents.
“Then it could make an argument for value for money and agent quality.”
It comes as Leadbetter wrote a LinkedIn post this week that claimed there is still value in the brand when it comes to public awareness.
He highlights that Purplebricks has an awareness rating of 82% among agents, according to YouGov, while the next highest national brand is at 47%.
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They don't care about their agents, how are they supposed to care about their customers
A confused message, a confused business, severely out of it's depth.
Attention and Awareness count for nothing. what matters is engagement - when they get it, they don't know what to do with it.
Purplebricks is a marketing company not an estate agent. Business model is fixed on how to get funds out of clients BEFORE doing a job. Pay upfront whether we sell your house or not, (once we have money no real incentive for PB to see the sale through - only incentive to see sale through is the other agents in the chain as they dont get paid unless the chain completes) if you don't use our conveyancers, pay upfront. House sells because its a strong market - all the other agents in the chain make it happen. If a vendor has a choice of offers, I personally would avoid choosing any purchaser selling through Purplebricks. I work hard enough for my client, I should not have to do the work for a non-customer who doesn't see value in the services of a proper estate agent. Only seriously motivated individuals who are prepared to do alot of work themselves (which if they calculated how much that work actually costs would realise using a traditional estate agent would have cost less). I would always be wary of a purchaser selling through PB.
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