Purplebricks: The rise of the hybrid estate agency model

What’s your entrepreneurial story - where did it all begin?

It all began when I was very young. My school was over two miles from where I lived and from the age of 5 I would walk to school. I would think about owning my own company, who I might employ and what I would do. Not the most sophisticated or strategic thinking at the time but I certainly knew I wanted to run businesses.

I have always worked hard and by the age of 13 I started work at 5am delivering milk. I later qualified as a Solicitor but never really wanted to be a lawyer. It was just a stepping stone. 

How did you come up with the Purplebricks idea?

Being the CEO and later Chairman of an estate agency group that I grew and developed, with my brother Kenny Bruce, to be one of the largest independent estate agency businesses in the UK, I was constantly looking at ways in which we could add real value for our customers.

I knew that there was a fundamental issue with the high street estate agency model and that the way in which people were engaging with the process had fundamentally changed. The industry were not fully embracing the internet and technology because to do so would have a dramatic impact on the very foundation of their business, resulting in a substantial reduction in fees and no need for high street premises that are rarely if ever visited these days.

Making the process more convenient, transparent, cost effective and controlled less tightly by the estate agent would break the model. As a result I wanted our business to be at the forefront of a change in direction that is in the best interests of the customer and not in the best interests of a commission and where the experience was positive and stress free.   

When did you know the time was right to launch the business?

Prior to launch we did extensive research and development with customers. We spoke to thousands of sellers, buyers, landlords and tenants to understand more fully the bits they liked about the process and the bits they did not like. We had to adapt our model at times to meet the findings and when we were sure we had the right mix and everything had been tested and the infrastructure was in place we took the plunge. It took 2 1/2 years though!

Has it been difficult to launch with the property market quite flat?

Whilst the property market will always have its ups and downs, peaks and troughs, one thing that is clear is that customers will give their business to those who are going to look after them the best, make everything convenient and stress free and charge them a fair price. It is easy to say all of these things but every thread of our business is about delivering on these promises.  

We are therefore getting a much greater share of the market, much quicker than anyone else. As we grow and the word spreads we will be less and less exposed to the movements in the market. 

What reaction have you had from traditional estate agents?

Mixed. A quiet respect from some, a disrespect from others and expressions of concern over the strength of our offering from the remainder. What we have found though is the very best agents are looking to be part of something that will make a big difference in our industry and see us as the way of achieving this. Recruiting great people has been easier than I expected.   

What’s the business model and how does it work?

We combine the human face of the traditional estate agency model with a unique, online platform allowing customers to have control over buying or selling, at the click of a button, 24 hours a day!

After registering on Purplebricks customers selling their property can book a free valuation, provided by a highly experienced Local Property Expert, before paying a fixed VAT inclusive fee of £665, which includes a comprehensive written description, floor plans, professional photographs and a listing on all major property websites including Rightmove, Zoopla and Prime Location. 

Customers will also have access to the unique Purplebricks online platform that will provide them complete visibility of every stage of their property sale allowing them to receive real time feedback from and the ability to safely and securely communicate with potential buyers through the system.  

Everything on Purplebricks is 24/7 to make life easier for our customers. If you want to book a Local Property Expert you can do that from your phone, you can make an offer at any time 24 hours a day, you can make an offer at 10pm and you can change your price with the click of a button. You can make things happen instantly without waiting for your high street estate agent to open.

And the USP?

The revolutionary eZie platform that enables things to happen instantly 24 hours a day.  

Why did you think it was important to offer a 24 hour service?

Since the inception of Rightmove and Zoopla the days of people going into an estate agents office, registering with them and taking a load of paper details off him to look through and decide what they want to view are long gone. The way in which buyers engage with the market is very different today. They go to the property portals, see what they like and they decide when and with whom they will engage.  

Most people are looking on Rightmove between the hours of 6-10pm at night and at weekends and estate agents are closed. They cannot engage with the market. They cannot arrange a viewing. They cannot make an offer.  A sale cannot be agreed. Over 60% of our traffic happens when an estate agent is closed.  

What does 2015 hold for the property market?

There are wide number of variances that could have an impact on the property market, interest rates, the election, sentiment, mansion tax to name a few. Pockets of the London market will slow further and have some price re-adjustment. All things being equal the regions outside of London and the wider UK market could benefit from the London market slowing as people move to more affordable areas to live and work. 

In all likelihood the market will remain flat with a reasonable first quarter, a slow second quarter and for the first time in over ten years the second half of the year being better than the first.  

Why do you think there’s been a rise of the online estate agent?

Online agents have been around for a while, some for over 8 years. Whilst we are not an online agent, we are a hybrid model that has the human face of estate agency coupled with a never before developed technology platform that makes the process so much better. Online agents have been under capitalised and have not been taking a strong forward thinking approach to marketing and building a brand.

Since we launched with daily TV, radio and heavy marketing campaigns and our exposure from a PR perspective together with the birth of easy property and key investors coming into the space there has been much more attention and focus on the future of the industry.  

Is this the end of the high street estate agent or is Purplebricks targeting a different audience and market?

It could be the beginning of the end but don't expect to see mass closures in the short to medium term. Agents will adapt and become more niche in my view. We will continue to offer a great service at an unbeatable cost and the customer will be the ultimate deciding factor.  

How have you found the first seven months of business?

Extraordinary. We have built a real fan base of customers who are enjoying this whole new experience and for me that is the most important part. They enjoy our service, they love our people and our attitude to looking after them and they love what we charge. We are growing month on month and will grow considerably next year.  

With the success of Rightmove and Zoopla, is the future online for this market?

Yes definitely. Why should customers subsidise a high street premises that is expensive and nobody goes into. People prefer not to engage with estate agents unless they really have to and only then on their terms. If they can get access to everything they want instantly 24 hours a day and talk to someone whatever the time, day or night, then the future is bright for a model like Purplebricks.  

What does the future hold for Purplebricks?

We are expanding rapidly. We are buying key strategic businesses in the sector and we are developing the next stage of our platform that will make the whole process of moving house even simpler.   

Visit purplebricks.com to learn more about their revolutionary platform. You can also follow them on Twitter or like them on Facebook.

 

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