The Australian online residential real estate market is dominated by one player - realestate.com.au. Since September 2000, realestate.com.au has been the most popular site in the country with domain.com.au consistently in second place.
realestate.com.au's dominance of the Australian market can be seen in the following facts:
Over the years a number of new entrants have entered the market and each time they have failed. The market is clearly a 2 player market with realestate.com.au being the leader and very profitable (51% EBITDA margin) while the number 2 player (domain.com.au) is estimated to achieves a 5 - 15% EBITDA margin.
Online advertising covers advertising by real estate offices on portal sites, the franchise group sites, SEM (Search Engine Marketing) and their own sites (web development).
Over the last 8 years, the online real estate advertising market (residential + commercial) has grown quite quickly.
|$m||FY 2001||FY 2002||FY 2003||FY 2004||FY 2005||FY 2006||FY 2007||FY 2008|
|Est Market Size ($m)||12||17||25||40||63||95||141||195|
|Year / Year Growth||39.9%||44.8%||61.3%||56.9%||51.4%||48.0%||38.6%|
It is estimated that the total spend on online advertising was just under $200m in FY 2008. Of this, residential online advertising captured around 90% - or $180m while commercial online advertising captured $20m. The total advertising market for print and online is estimated to be around $1bn in FY 2008.
What is interesting, is that the REA Group, through its Australian operations (realestate.com.au, realcommerical.com.au and Web Design Services) is estimated to capture around 60% of the total spend.
|Residential Offices||Est. Total||% Total||Portal Ads||Web Design||SEM/SEO|
|Commercial Offices||Est. Total||% Total||Portal Ads||Web Design||SEM/SEO|
|Total Online Ad Spent||Est. Total||% Total||Portal Ads||Web Design||SEM/SEO|
Nielsen Netratings provides good coverage of the residential portal sites in Australia. There are two major players - realestate.com.au and domain.com.au and a number of smaller players. In July 2008, Nielsen Netratings tracked 12 sites. These sites are:
|Name||Publisher||UB||PI||TT ('000 secs)|
|aussiehome.com.au||aussiehome.com Pty Ltd||20,619||431,062||15,175|
Note: UB = unique browsers (akin to a visitor), PI = page impression, TT = total time on the site
In addition, there are a number of other smaller players not tracked by Nielsen Netratings. They are:
Source: REA Group FY 2008 Financial Reports, Nielsen NetRatings, PPW Analysis