Zoopla, the No. 2 real estate vertical in the U.K. in terms of traffic, will offer agents who leave Rightmove up to nine months with Zoopla for free. The move is a strategic response to Rightmove’s Covid-19-inspired payment deferral offer.

Rightmove, the leading British property portal, reacted quickly by offering agents a non-repayable discount of 75% for the next four months, superseding its heavily-criticized payment deferral offer.

Zoopla, which has often struggled to poach members from Rightmove, saw the deferred payment offer as an opportunity to win over agents. Agents reacted strongly to the offer and threatened to leave for rival platforms, which some ended up doing.

While Rightmove is expected to take a substantial financial hit from the discount, the company has clearly decided that it’s worth it to avoid member attrition.

The deferred payment offer was wrong, Rightmove admitted in a statement to agents. The “situation in the U.K. has changed rapidly and we’re sorry that it was too little and now inappropriate for the challenges we all face,” the company said.

Zoopla’s offer

Zoopla is offering new and existing agent customers, who commit to leave Rightmove at the end of their contracts, nine months of free access to its portal. Agents must sign on to an 18-month contract and pay normal fees after the free term expires.

The company is also offering another option, which doesn’t include an obligation to leave Rightmove. Under that option, new and existing agents sign an 18-month contract and get three months for free. The term may be extended to five months, depending on whether government limitations to control the Covid-19 pandemic are still in place.

Agents have until the end of April to sign up for either deal, which will take effect May 1, 2020. Zoopla said it will not raise fees above the retail prices index inflation measure for the duration of the 18-month contracts.

“This isn’t something we wanted to rush; we have taken the time to speak to our customers to get these options right for them. We know each agent is different, which is why we have two compelling offers available,” said Zoopla CEO Charlie Bryant. “Both options are simple, concise, and there are no hidden clauses. Available to new and existing customers, we hope that they provide a financial cushion for agents.”

Rightmove’s response

Rightmove’s revised offer for agents will mean all real estate agents will automatically see their bills cut by 75%for four months, starting April 1. Rightmove said the initiative will likely cost the company between 65 million and 75 million pounds ($75 million to $87 million U.S.) in lost revenue.

In an email to agents, CEO Peter Brooks Johnson said: “I can only apologize that we didn’t move fast enough and do enough, especially given where the U.K. is now. Agents and developers are now having to make really difficult decisions to keep their business going and to plan for the coming months.”

In a statement to the London Stock Exchange, Rightmove said it reacted in response to a significant slowdown in property transactions and that government measures to protect tenants may put additional pressure on agents.

“The duration of these market conditions is unclear but this rapid action is in the long term interests of our shareholders,” the company said.

Print Friendly, PDF & Email

Related Articles