Breaking Property News – 09/08/24
Daily bite-sized proptech and property news in partnership with Proptech-X.
So Rightmove v OpenRent is over & worryingly quickly too.
Thought Leadership by Mal McCallion – CEO of Modelprop
‘The first inkling that all was not well in this long-standing – and mutually-supportive – relationship between hashtag#Rightmove and hashtag#OpenRent was spotted by Nigel Lewis of hashtag#TheNegotiator. His exclusive story, that OpenRent had removed Rightmove’s logo from its product offering last week – days before any clarification statement from either party – set in train this entire public standoff.
It was fitting, then, that Lewis also broke the extraordinary news last night that OpenRent and Rightmove had kissed and made up.
Whoa – so what happened, to change from Rightmove’s statement a couple of days ago that yes, we’ve lost 8% of our letting property stock by executing OpenRent but everything will be OK, to welcoming their errant ‘partner’ back in to the fold?
Bad news everyone: OpenRent bowed to pressure
Rightmove piled on the pain, releasing a statement to the stock market emphasising that OpenRent had chosen not to renew on their terms – but, for investors, that was OK. They would continue to execute all refuseniks.
And so, painfully, OpenRent buckled. It’s fair to say that their business model is so predicated on simple, blind distribution through portals that to lose the main one was always going to expose their product as a bit rubbish. (Picture Mal McCallion)
However, OpenRent’s capitulation to Rightmove should worry us all
If a business that has 8% of Rightmove’s lettings’ stock won’t escape, despite a terrifying uplift in charging, what other agent can?
It’s hard to cry for OpenRent, who have been pulling the tightest landlords out of the market for a while and giving them cheap access to portals that other agents pay much more for. However, their outright humiliation at the hands of Rightmove will only serve to embolden a business that – let’s face it – doesn’t need any more reason to confidently uplift its charges in 2025.
From here on-in, Rightmove will have relatively little fear that any individual agent can swerve its price rises. If OpenRent capitulated, they believe, then you’re going to too.
Or are you? It’s the collective narrative that’s the thing. If everyone keeps saying that Rightmove’s essential then Rightmove will remain essential. However, if everyone starts ensuring that a marketing mix of social, other portals, AI, hyper-local is more important then that’s going to start to carry some weight.
If you’re interested in finding a way out of this let me know at mal@modelprop.ai as this is a really critical moment. There has to be – there will be – another way.’
Analysis – by Andrew Stanton
Is there confirmation that OpenRent blinked first Mal?
Could CoStar Group which has a market cap, 10 x’s Rightmove’s not have been a factor? As they are now racing down the track with OTM – their amount of new ‘traffic’ climbing at an alarming rate month on month? Rightmove’s stock was cruising at 576, then OpenRent debacle hit lowering it to 518 just yesterday – my thoughts are it is no certainity that OR buckled, the last thing Rightmove needs right now with the departure of their CFO Alison Dolan this week who went to M&S is more bad news.
I do agree Mal that many Saas services do hitch themselves to a portal play as the distribution channel – which gives portals a whiphand, but now portals are no longer the ‘masters of the universe’ when it comes to ‘digital marketing’ as a tech savvy 12 year old can now put together quite a formidable marketing strategy for an agency … we might see that tech unsavvy agent who was led like a bull by the nose to pay over the odds for newspaper advertising pre-2000, now realising that they have the power in their own hands to be a ‘Digital advertising marketplace.’
Monetising the applicant lead – the renter/buyer/vendor/landlord by portals BEFORE that lead goes to the agent – has always been p—–g in the soup, if agents are the first point of contact for people requiring property services then they get the chance to scoop far more revenue each and every time.
Full disclosure Mal McCallion – CEO of Modelprop is not a client of Proptech-PR, but he is a man who has seen into the future and knows what it looks like – so if you really want to be the leader of the pack start by having a few chats with someone in the know.
Andrew Stanton Executive Editor – moving property and proptech forward. PropTech-X
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