How are property portals getting closer to the transaction and what are some of the best strategies for achieving this?
Property Portal Watch founder and former CEO of the REA Group, Simon Baker, gave delegates at the recent PPW conference in Lisbon some top tips for leveraging the value they get out of their portal and how to apply these to a landscape which has changed dramatically from the days of print classifieds.
In his presentation, which examined what it means to get closer to the transaction, Baker outlined the necessity in thinking stragtegically in order to generate revenue by moving closer to primary and secondary transactions.
"I think it’s very poignant and important for us to understand, how much do we, as an industry, extract from the ecosystem that we operate in," he said. "To date, we’ve really just been chipping at the surface of the true value that is there."
Watch Simon Baker's Closer to the Transaction' video
Primary and Secondary transactions
Baker explained the challenges prevalent in the current online classifieds ecosystem such as increased competition from players such as Facebook and potentially Google; slow revenue growth and fluctuations in the housing market, with an emphasis on how this presents a challenge for current portal players.
He outlined that the portals gaining the most from their business are the bigger players such as Zoopla, who have acquired businesses such as uSwitch and Money.co.uk in order to move into secondary transaction streams.
REA Group have also claimed their stake in the secondary transaction market by acquiring a stake in the mortgage broking franchise Smartline, alongside entering a strategic mortgage broking partnership with the National Australia Bank. In addition to this, REA Group has also recently moved into primary transactions, with their Marketplace platform - a product that connects residential real estate agents, project managers and financial planners with developers and builders to sell off-the-plan property.
The portals who invest in these strategies, are going to come out winners, says Baker.
“The point is, eventually portals with very high marketshare, very strong brand loyalty, capping out on where the revenue streams are, are going to go after the bigger pool. It’s absolutely logical," he said.
How can portals move closer to the transaction?
For portals to move closer to the transaction they really need to focus on key points such as clarity of strategy, data and preparedness to take the 'leap' into new revenue streams, Baker said.
"The skills you had to build whatever portal you have today, are not the same skills you need for secondary and primary transactions."
So how do portals acquire these skills?
"The more you cross-sell, the more you get people to buy a financial product, you get them to buy a switching product…the more they engage and buy, the better off they’ll be," he concluded.