“Talk to the organ grinder, not the monkey” is a great saying. Its meaning is “talk to the decision-maker (ie the organ grinder), don’t waste your time with someone who just does the work (ie the monkey)”
..and today, I want to talk about the balance of power between Estate Agents and the Portals (in particular Rightmove) .. on what side does the balance of power lay in that relationship? Who is the Monkey? Who is the Organ Grinder? Is it equitable? Does one side have too much power and the other not enough?
These are my thoughts .. and as it’s me .. I always like to look outside Estate Agency for the potential answers
Think about Car Insurance. You pay the swine’s £800 a year and then if you have an accident .. they decide if you are worthy of a pay-out. But they are clever. Yes, they hold all the cards and the power but they don’t make you feel that way. Instead, they say things like,
“Your wheels are in safe hands".
“Careful Insure for Careful Drivers”
“Clever Car Insurance for worried parents”
“Whatever happens .. we have your back”
“Our Insurance is here to take care of you”
The insurance firms have all the power… instead, they make you feel like you have the power .. very clever
Now, let’s look at another form of power.
Burberry Handbags .. Seven hundred bl**dy quid for a handbag … what is it with these Luxury brands? You can buy the same coloured handbag on the market for £30. Ray-bans £180 when you can buy a similar looking pair for a fiver. My mate has just paid £5k for a Rolex … 5 bags of sand for a watch .. so why do people pay that sort of money for luxury brands?... Its just a leather handbag, a pair of sunnies or a thing that tells the time … its because they give the owner of the luxury item power over others in certain social situations.
Burberry, Ray-Bans, Rolex and the other luxury brands are allowing you to buy power over someone else
The movies .. that is a power game. There is no equity or ‘give and take’ when you watch a horror movie. You watch the film and they frighten the bejesus out of you
Rightmove (and Zoopla)
… and that in turn leads me to the portals
Rightmove (and in parts Zoopla) have over the years made a lot of enemies and adversaries in UK estate agency as they are perceived to have monopoly power.
Some agents deride Rightmove for their constant uplift in charges. Their charging model makes some agents blood boil
Looking at what the portals have charged over the years .. they might have a valid point .. look here
Some agents believe Rightmove’s attitude has been, "We're are the bosses of this relationship, and you have no choice but to be on our portal... and let’s keep ratcheting up the costs ."
..and from that, Agents Mutual was born.. yet Agents Mutual hasn’t worked? (another topic for another day)
So, the question is do Rightmove (and Zoopla to a lesser – yet growing extent with their ever creeping acquisitions of software firms and now more recently last Friday -Ravensworth) have too much power over UK estate agency?
Are Rightmove Too Powerful?
Are estate agents the ‘monkey’ and Rightmove, the ‘organ grinder’?
Some say Rightmove charge like wounded rhinos – and the graph does show some impressive growth.
Have a look at this graph which shows what the average monthly Rightmove bill would be if it had risen at the rate of inflation since 2006
Every capitalist person or company gets to make a choice when it comes to the relationship with their clients, and that person or company gets to make his or her choice, a choice of three:
- We have the control over you
- You have the control over your choices and your competitors
- The stuff we sell gives everybody control
Some agents think it’s the first .. and in some respect I can see that.. but I don’t think it’s as black and white as that with Rightmove.
It’s kind of expected to be on it.
.. because here is the weird thing life .. some people .. in fact many people in life, like to be told what to do.
£900 and all your properties are in one shop window. It’s an equal playing field , you Joe-Blow-Real estate can put your property next all the big boy agents. You might say, they can afford Featured agents, Home page banners, Local Home pages, Featured property, Optimiser package, Valuation alerts etc etc … trust me every single one of those add-on’s is a complete waste of money .. (except for one). One of them is worth twice the price Rightmove charge for them – which one – I am currently writing an article now and I will spill the beans on that in a few weeks on my blog
Rightmove is cheap
Rightmove and Zoopla represent fantastic value for money for the vast majority of agents that use it .. for the cost of half a negotiator - you've got your properties in front of millions.
Some agents object to Rightmove because the amount of money they make.
Well if that's not the point, is it?
It's the value of the service they provide to us Estate Agents?
So, it might cost £900 per month and it was only a couple hundred pounds 10 years ago…but does it give us more than £900 per month in value and worth?
In my humble opinion, my intuition tells me it does because we used to spend £250 a week on the local newspaper advert… and we all moaned about that …at least with RM we have something we can measure and knows it works.
So is that the reason OTM was set up ??.. yes it was. On The Market was built to create a unique audience for traditional agents .. only to make that audience so big we didn’t need RM or Zoopla… but it didn’t work (or hasn’t worked so far) – (again- another story for another day)
Rightmove – Reassuringly Expensive
I believe the portals are genuinely trying to do a good job for the estate agents. Yes, it could be said there's a little bit of profiteering going on in certain aspects.
I have never met the senior team from Zoopla, so can’t talk for them, but the senior people I have met at Rightmove over the years are all very good people. They seem to genuinely want to improve the website and offering to agents. True, I think if they could show a slightly more caring and understanding towards their charging models for the little agent when compared to the big boys.
You see I believe Rightmove is a no brainer, especially when you use the magic one weapon in their armoury (mentioned above and if you can’t wait for my blog article on the subject – ask your Rightmove Rep – quite a few of them know which one of their add-on products is the magic weapon - because I told them when I have met them over the years!)
Many agents I speak with respect the power of Rightmove. It focuses the attention of the agency and offers the promise of quick headfirst motion into the housing market with little responsibility on the part of the agent. Every human gets to choose what sort of marketing they respond to and if Rightmove was a true bully – OTM would have worked.
If Rightmove and Zoopla weren’t here tomorrow.. our work as agents would a million times harder. Agents would need to work really hard to sell their property, they would think outside the box to market their properties and themselves ... agents would have to be creative and challenge the status quo
Some agents persevere in thinking that estate agency marketing is about adverts, landlords wanted, we have sold this many houses or low fees. Sorry, that ship sailed years ago - It's not. Estate Agency marketing is all about us a human being.. its about human-nature and capacities and capabilities we tell ourselves we do (or don’t have). Its all about who we perceive to be and how external thigs in life can help us on our journey in life.
People buy a £700 Burberry handbag instead of the £30 one from the market, £5,000 Rolex when their £5 Timex will do the same job or the Audi A3 for an extra £4k over the Skoda because they believe they are worth it, the product is worth and the perceived power it gives over others.
Rightmove gives you the power and control .. but like most things in life .. its how you perceive that power and control and how you use it that matters.