Rightmove most profitable in world – DelPrete
28 Sep 2017
Top British classified Rightmove.co.uk is the world’s most profitable real estate platform. Mike DelPrete, an industry expert and senior consultant of the AIM Group, made an in-depth analysis of global property sites (full report here) and concluded that Rightmove’s 75 percent EBITDA margin (on earnings before interest, tax, depreciation and amortization) made it the world’s most profitable real estate site.
Rightmove was also the clear leader as measured by two other indicators: revenue collected per $100 spent (chart below) and revenue per employee (chart at bottom). These, taken together, give an interesting perspective on its performance and role in the market.
Rightmove is a target for anyone with an axe to grind in the U.K. property market. At the beginning of September, Agents’ Mutual members voted to float OnTheMarket.com on the London Stock Exchange, to challenge Rightmove with the fresh capital. In July, OnTheMarket won an anti-trust case by claiming its own “anti-competitive” practices were justified as a means to compete against Rightmove. In the wake of a recent advertising rate hike, agents complained that Rightmove was abusing its market dominance to “milk the existing members”.
Even anonymous internet petitions have called out Rightmove for not doing enough to police “rogue estate agents and fake, speculative property listings”.
Not, presumably, that the sniping causes much anguish at Rightmove HQ, or to investors pocketing their latest dividend check.
DelPrete’s analysis highlights a fact that gets lost between the praise and blame: Rightmove is incredibly efficient. It collects $410 in revenue for every $100 that it spends — more than double its nearest U.K. rival Zoopla.co.uk. Its revenue-per-employee figure is a whopping $580,000 (also double Zoopla).
Rightmove obviously does its job very well. Price hikes drive revenue, but not necessarily efficiency. Regardless of what its detractors think, being the most efficient real estate classified in the world suggests highly refined strategic capabilities.
It cannot perpetually increase revenue by raising prices, but its efficiency suggests Rightmove has more plays in its book.
Click here for DelPrete’s full analysis of the world’s top real estate portals.