RE: Agents leaving30 Apr 2020 19:43
Thanks Macminchus. This is the full note from Jefferies mentioned in the article, in case of interest to anyone.
The campaign's momentum is accelerating: Currently 1,350-1,450 owners, equal to 2,700 branches are signatories: 60-70 sign-up per day - line of sight on another 1,000 offices; the Acorn board has approved funding for the campaign - the team is now almost 8 full-time staff (4 in PR, 3 in admin, 1 hire coming in technology); trade press and word of mouth is driving awareness - the team has not proactively solicited support thus far; latest survey of members finds that 10% left RMV already, 71% will leave if there is no extension to the 75% fee suspension, 7% will leave no matter (just waiting to exit contract) and only 2% are happy.
Sargent doesn't fear a lack of support from the corporate agents: The corporates have less to gain given they pay a significantly lower ARPA; they are "sympathetic to the end goal" but are unlikely to join the campaign; this won't kill the campaign - it is the 10-12k branches (c.65% of UK total) owned by <5 branch agents that are the lifeblood of the campaign; these agents are where Rightmove's economic land grab has been most viciously felt (some single branch agents are paying £3k per month to Rightmove, c.4x a large corporate); these agents are therefore comfortably >65% of Rightmove's revenue and have been looking for an "Agents Unite"-type organisation.
Next steps? "Focus on the now": The campaign is using the 4-month period of 75% Rightmove fee suspension to build membership, learn agents' issues, institutionalise that feedback and decide on how to best deploy the collective power it has created. It is unlikely that a grand single act of disruption will take place (though a fee boycott was suggested by some agents, but not supported by Rob). The guiding principles are to: 1. Let agents be the agents of their own disruption; and 2. Tell Rightmove that agents "won't be bullied by a supplier".
"Rightmove needs to change its business model": The current fight is a fight Sargent foresaw 10-years ago, mentioned to Rightmove even back then, and then did nothing to address (Acorn, paid RMV £488k in 2019 and has yet to give notice pending the end its current contract). Sargent believes the best path to a sustainable relationship between agent and portal is a more equitable pooling of risk (mentioning, inter alia, a "fee on success" model). The "cost per lead" value proposition that Rightmove "bangs us over the head with" isn't that relevant, especially not at £1,000 per month - the value-added functionality RMV highlights has "little credibility and the industry hates being charged for it". The sweetspot ARPA is £300-500 - but Sargent thinks the opportunities in data and advertising means a portal could thrive without charging the agent any fee.