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There is always a fierce debate from both sides as to who provides the best service, best value for money and who will sell your property the quickest. These three things are, generally speaking, the most important factors to both Sellers and their Agent; so how do the two business models compare when they use such vastly differing methods?
A report carried out by The Chat Shop (in Jan 2015) has delved a little deeper into the differences between Online and Traditional – focusing particularly on the digital presence and services offered by the two business models.
The research concentrated on five Online Agents: eMoov, House Network, House Simple, Purplebricks and Tepilo alongside five Traditional high street agents: Foxtons, haart, Kinleigh Folkard & Hayward (KFH), Knight Frank and Your Move.
‘Traditional Agents are Old Fashioned in Terms of Technology and Don’t Embrace the Internet and Social Media’
According to The Chat Shop findings, Traditional Agents’ own websites attract much larger volumes of traffic, with Foxtons having 970,000 visits in one month alone (300% higher than the five online agents put together!), Your Move was second with 440,000 visits. Whilst Foxtons is London based, haart and Your Move are across 150 locations in the UK and so it would suggest that brand awareness is still the number one drive in attracting web traffic.
In fact, it is the Traditional Agencies that are leading the way when it comes to social media, with high-end, high-profile estate agency Knight Frank the most prominent user on Facebook and Twitter.
Focusing on Facebook likes, the highest figures were recorded by two of the traditional agents (Knight Frank with 5,427 and KFH with 3,542). Online Agents are generally more prolific tweeters, but traditional agents have more followers – again pointing to greater brand awareness for the high street agents.
And whilst the Online Agents are usually on Rightmove and/or Zoopla – they are not on OnTheMarket (now one of the biggest property portals on the web and tipped to eclipse Rightmove and Zoopla in the future).
‘Lower Levels of Service from Online Agents’
The research found the perception that because of the lower costs involved the level of service and customer satisfaction is drastically reduced when using an Online Agent, would not appear to be true in some circumstances as the levels and speed of response was found to be similar for both Online and Traditional. Where Online Agents do score points is the fact that many of them are ‘call centre’ based; their opening hours are much more flexible and they offer additional channels of communication with ‘Live Chat’ options. Indeed, PurpleBricks offers a 24/7 call centre.
Where there may be a problem with the Online Agents is where buyers want specific, local information and to speak to someone in detail about a property. The Online Agents cannot guarantee to have someone available who can do either. Also, many buyers, when visiting an area of interest like the fact that they can walk into a local traditional branch set up and have a chat about the local market, what’s available and build a relationship with an individual Agent. The same goes for Vendors; not many would argue that they would not prefer having a dedicated Negotiator who knows them, their property, the locality and is in the office whenever they need them.
Viewings and Fees
Generally, Buyers prefer that viewings are not conducted by the Vendor. However, few Online Agents can offer this service so it does fall to the Vendor. On the whole, this is a service that the Traditional Agents always offer (albeit, sometimes for an additional fee) – which leads us to the issue of fees.
There is no getting away from the fact that Traditional Agents struggle to compete with the fees charged by Online Agents. But, you literally do get what you pay for. For a £500 flat fee; is sale progression included? Are you paying extra for a board/EPC/advertising/floor plan? Will you receive clear, concise feedback and updates on a regular basis? Will accompanied viewings by someone who knows your property be included or even offered? There is also some argument that once you have paid your upfront fee, what incentive is there to the Online Agent to secure a sale – unlike Traditional Agents who work on a commission basis?
With a market share of around less than 5%, the Online Agents are still in the early stages of growth, however, this recent growth has been rapid so maybe they are just what is needed to keep us on our toes and continue to be at the forefront in what is becoming an increasingly challenging industry!
[team-member name=”Lucy Osborn”]