14 Oct 2013
Words
Tim Admin
Owner to pay to market properties
RealEstate.com.au has over 70% of market share for property traffic in the country. All the other portals, combined, don’t even come close to matching RealEstate.com.au’s reach. Basically, if your rentals and residential sales aren’t on RealEstate.com.au you’re neglecting almost the entire market. All that reach does come at a cost, and RealEstate.com.au’s management has been scathingly criticized by agents for many years over its aggressive price increases. The bottom line is, if you want quality, effective, advertising… you pay for it. Until now, however, that payment has been largely in the form of a flat-fee, all-you-can-eat style model with agency promotional tools (that rental managers rarely care about) like logo placement, banners and feature listings coming as optional upgrades. That may well change, however, as this month RealEstate.com.au unveiled their new pricing structure – I caught up with them for a sneak peek, and it’s a game changer. Firstly, they’ve dropped the initial subscription rate but included a clause where rental agencies are ‘obligated’ to buy a minimum of 10 FEATURED listings per month. The cost of these listings with the base subscription adds up to slightly more than what a subscription was before they reduced it, so managers are not really any better or worse off than before, but now they have a bunch of FEATURE listings that need to be used (else they are charged for them anyway). That means that a lot more rental listings on RealEstate.com.au are going to start appearing as features in the next 12 months, and in the same process, STANDARD listings are going to be less effective. It seems to me, that RealEstate.com.au is creating an environment where, in order to be effective, managers have to pay for each rental they advertise on the portal to get the same sort of results they have today as basic listings. John Cunningham of Cunninghams Property was quoted in REBOnline.com.au as saying: “The key to me is that they are putting us against each other - it is the competitive nature of what we do.“ RealEstate.com.au is encouraging managers to recover this additional marketing funding directly from their owners. Glenn Batten of First National Coomera, describes it on Business2.com.au as this: “Realestate.com.au account managers attempted to train sales teams to sell the base listing as well as addons. So this is a big stick type motivation. The model now makes it imperative that agents recoup the fee from an owner before listing. If you do not recover this cost then as realestate.com.au increases the financial pressure on your business will be immense” My agency never really had to feature a rental listing to date (in the last 8 years) and at the moment I still don’t think featured listings for rentals will be too important. But it seems to me what RealEstate.com.au hopes to is create a paradigm shift in the entire rental marketing segment with owners becoming more ‘educated’ about the importance of investing in rental marketing. Considering 3 years ago, most managers were happy to simply sit a sign out the front of their complex to market their rentals, I’m not sure the typical onsite manager will be too fast to commit to paid featured listing rentals. I’m also not convinced it will be necessary to do so, but be assured there are big changes afoot, and time will only tell.
