Needaproperty goes out of business saying it could not compete

| Rosalind Renshaw

Challenger portal needaproperty has ceased trading.

It went out of business this week, the latest in a long line of would-be giant killers who instead became casualties.

Its founder, former estate agent Scott Green, said the decision to close had been taken because of the “huge costs” involved in driving traffic, compounded by the emergence of a “credible entry” into the market.

Green said that he had always tried to offer agents a cost-effective platform as a viable alternative to Rightmove and Zoopla.

“I am just sorry that we couldn’t in the end deliver what we set out to do,” he told Eye.

He said that his site had been unable to compete with the huge marketing budgets of Rightmove and Zoopla, and that OnTheMarket’s “one other portal” rule had “not helped”.

Needaproperty launched in June 2012, announcing that it was “designed to provide a viable and cost-effective alternative to the established competitors in the market”.

It started by offering membership at £100 per month, but also ran a series of free trials and cut-price offers to agents.

Properties listed on needaproperty appeared on a number of other sites, including East-WestPlc.com, a site for Chinese investors buying in Britain.

It also signed an excluding deal with magazine publisher Hearst, powering property portals behind the likes of Cosmopolitan and Company.

Green said yesterday that he had learned a lot from his time in the property portal market – not least the importance that agents place on getting valuation leads.

“Rightmove and Zoopla get agents all the buyers’ leads they will ever want – and I am not sure there is space for another player in the market.

“But what agents struggle with is valuation leads and that is what is needed.”

Asked if he thought OnTheMarket would succeed when it launches on January 26, Green said he did not know.

He said: “The problem is that you have to have very deep pockets.

“I don’t know whether OnTheMarket will succeed, because it all depends on its marketing strategy, its budgets and its IT – and I don’t know the detail on those.”

He added that the cost of driving traffic should not be under-estimated: “You can have the best product in the world, but if no one knows about it, what is the point?”

It is understood that few jobs have been lost in the closure of needaproperty, with the company – whose directors include Stephen Conway of developers Galliard – having already made cutbacks.

Green said that he is now exploring other possible avenues for his own future.

He added: “I would like to thank most sincerely everyone across the industry who has given us their support.”

Scott Green

x

Email the story to a friend

More top news stories



32 Comments

  1. Paul H
    January 9, 2015 at 07:07

    Anyone who still thinks that the one other portal rule is not required to succeed should simply read this article.

    Report
    1. Robert May
      January 9, 2015 at 10:09

      Sorry to challenge you on this Paul but what are you talking about? I have read this article and it has not failed because of AM or OTM, being blunt that is just a "padding it out" excuse. It isn't possible to replicate old school property sites ( RM and the likes) and hope to compete without the same budget (or more) as the sites one is emulating.
      There is a unique set of skills required to design any product and it is all too easy to save a few quid spend on that domain knowlegde by simply copying what is already out there or has been done before ( that is the weak point of this project) It wasn't budget, spend, SEO any of that and the pity for Scott he has understood the issue to overcome too late and hasn't realised how simple it is to fix the issue he has identified.
      What you have to bear in mind Paul is that 80% of the industry isn't convinced they can drop both main portals and as yet the sucessor failure of the one other portal ( plus a few other portals decided on a case by case basis) has yet to be tested.

      Report
      1. Paul H
        January 9, 2015 at 10:23

        I think you may have mis-understood my point Robert which was that Needaproperty failed because it tried to compete with the duopoly from a standing start, it is fairly clear to many that this approach will no longer work as stated by Mr Green himself who is quoted as saying…" that his site had been unable to compete with the huge marketing budgets of Rightmove and Zoopla," Quite simply the only way a new entrant can enter such a market now is by entering in a position of strength, the 'one other portal' rule gives OTM a clear advantage that Needaproperty did not have.

        Report
        1. Robert May
          January 9, 2015 at 10:47

          I think you have missed my point Paul, it is possible to compete and beat stronger competition but only by doing something different or doing the same better. AM as a co-operative or affinity group is succeeding because it believes in itself but how OTM will fair as a Portal will only be known once the site is live.

          Report
          1. Paul H
            January 9, 2015 at 10:50

            Robert what i'm saying is that due to the (current) strength of the duopoly any portal that launches now without a unique advantage such as the 'one other portal' rule will fail. My point was aimed at those who felt that the 'one other portal rule' was and is a bad idea, Needaproperties failure to gain traction proves this to be the case.

            Report
  2. Jonnie
    January 9, 2015 at 07:45

    Never nice for a business to go pop and people loose their jobs but I'm pretty sure if you go through the responses to the press release when it launched this was the widely predicted outcome back then – Jonnie

    Report
    1. Taff
      January 9, 2015 at 17:34

      True, but how many people did it employ?

      Report
  3. JWVW
    January 9, 2015 at 07:46

    Not surprising, but was a nice looking website. It is a reminder that we agents want portals that provide a return. Anything that is free or cut price is going to find it difficult to provide an effective service.

    Report
  4. Property Ear
    January 9, 2015 at 08:27

    'Also rans' in both portals and estate agents, esp. those on-line will be very much up against it in the challenging year ahead, where the provision of a high quality of service and sufficient funds to serve it will be essential to survive

    Report
  5. Estate Agent W1
    January 9, 2015 at 08:36

    What a shame, good idea, nice site and a nice guy but I guess nice does not cut it anymore.

    Report
  6. Shaun77
    January 9, 2015 at 09:16

    “You can have the best product in the world, but if no one knows about it, what is the point?” – Simply not true. Buyers will seek out a portal that offers them something they can't find elsewhere. Needaproperty had no USP's at all.
    Think about Google, Facebook, twitter etc. They have all grown to be huge global entities with virtually no advertising spend at all.
    However, in the case of OTM plenty of people will know about it. Not only from their ad spend (inc TV advertising) but also from the enormous promotion provided by the agents that have signed up (OTM will feature on all property details, window displays, email alerts etc).
    You simply can't compare OTM & NAP at all.

    Report
    1. smile please
      January 9, 2015 at 09:22

      You are right you cannot compare. OTM has a number of agents tied into 5 year agreements. If it does not work these agents will be hit hard.

      Report
      1. Ric
        January 9, 2015 at 09:44

        Although you assume smileplease these agents CAN afford to and have calculated the 5 year risk!

        Report
        1. smile please
          January 9, 2015 at 09:51

          I am sure they have calculated the risk (otherwise pretty poor business acumen) but as you say its a 5 year risk.

          Report
    2. davidbamforth
      January 9, 2015 at 09:26

      I have been conducting my own brand awareness tests in the past few weeks for OTM and will continue to do so.

      So far out of fifty people over the past week I have had two consumers respond, both negative opinions believing they are making it harder for consumers to find their properties, the rest haven't even heard of OTM.

      I forecast a very slow start for agents on OTM especially for valuation leads.

      Report
      1. wilko
        January 9, 2015 at 09:38

        @davidbamforth….I'm sorry to have to say that you can't be that bright if you are carrying out public "brand awareness tests" on a brand that hasn't launched to the public yet !!!!!

        Report
      2. Ric
        January 9, 2015 at 09:49

        oh please tell me you didn't survey this before lunch and you made this up.

        Report
        1. Ric
          January 9, 2015 at 11:55

          sorry having an odd day…. I meant "oh please tell me you did not do this survey before launch and you have made this up"

          Report
          1. NewsBoy
            January 10, 2015 at 13:18

            I must admit that I am amazed at how many people have heard of OTM. I expected the response that Banforth had but nothing could be further from the truth 🙂

            Report
    3. PropertyManagement
      January 9, 2015 at 09:42

      They have all grown to be huge global entities with virtually no advertising spend at all??????????? — No, totally wrong Google spent $6.1 billion in sales and marketing expense in 2012, Facebook spent $2 billion etc. Every company needs to continue spending in order to drive traffic.

      Report
      1. Shaun77
        January 9, 2015 at 11:07

        I'm talking about from launch – not once they had become recognised entities. None of the firms I've mentioned had huge above the line budgets at launch. They grew organically with very little "ad spend". This is because their products were unique and offered something new. Word of mouth, below the line activity, PR etc did the rest.
        Incidentally, I assume the £6.1b you mention for "sales & marketing" isn't ad spend for their core product. It's the cost of running and promoting a sales team to sell their product, advertising and promoting B2B, ad spend for their additional products (e.g. Google Play) etc.
        Google launched in 1998 – tell me how many TV/Radio/Press/Outdoor ad's you can remember solely promoting the Google search engine?????? Same goes for Facebook et al

        Report
  7. Trevor Mealham
    January 9, 2015 at 10:54

    No portal that simply tries to mimic what RM and its 2nd place zoopla do can hit 2nd/3rd slot without £100m behind them.

    All said portals as we know them today are not the best configuration for better agency. The UK data schema for data flow has inbuilt flaws tgat allow broadcast of listings but not access.

    By looking closer at legislation and resculpting the way data flows there is a alternate better way.

    Roll on property live 2 come Jan 26th. But I fear its fate in copy cat areas may end alike Needa after a couple of years.

    Report
    1. JWVW
      January 9, 2015 at 11:03

      Where did you get £100m from? Complete twaddle. Quality agents backing OTM properly will drive traffic to the website. PS. Have a go at using spell check.

      Report
      1. Harree
        January 9, 2015 at 14:14

        'Quality' agents will drive traffic to OTM?? Now that IS a load of twaddle. What are you actually saying – 1) that all OTM agents are quality agents? 2) That some aren't and only the quality OTM agents will drive traffic? 3) Non OTM agents not quality agents? Pick any answer from three and they are all twaddle.

        Report
        1. Property Pundit
          January 9, 2015 at 17:36

          Welcome back Harree. Still trying to work out the pint of this latest post. Maybe it will come to me over the weekend.

          Report
      2. Trevor Mealham
        January 9, 2015 at 16:54

        @ JWVW – have a look at the RM and Z T/O each year. Behind them are backers with deep pockets plus vertical searches in place. I wish you well, but as the saying goes a fool and their money . ……….. Good luck

        Report
  8. Woodentop
    January 9, 2015 at 15:46

    We have done our market research every month for years. If you ask a member of the public where did they hear about RM or Z 90% always respond, from the high street estate agents marketing who keep shoving it in their face. Not believe it or not from media TV as it is so spare and non-existent in some areas. People only really start to look for these web sites when they have the need to buy or sell or rent and the first point of contact is your local agent marketing, as they are who they will be using at some time or other. We were the first local independent agent on both these sites when they first started and business was abysmal until the other agents came on board years later and started pushing the promotion. Same will happen with OTM name awareness by proactive estate agents. Doing market research before the baby is born with the public is a joke or an idiot.

    Report
  9. Cardiff Agent
    January 9, 2015 at 16:03

    There are several features that give OTM an edge and will enable it to eat into the markets of the 2 big Portals. Firstly, the one other Portal rule will mean that the public will not have seen the whole market, unless they look at all three. Secondly, OTM has a fresh, clean and easy to use appearance and layout with no distractions (adverts, 'Premier Properties' etc) and thirdly every property ad leads directly through to the Agents own website and even more choice.

    Report
    1. smile please
      January 9, 2015 at 16:17

      Admire the optimism but are they really USP that will make the "Consumer" want to use the site? Your first point is not correct most agents in most agents signing up to OTM will drop the same portal, just like wales! second point OTM is a clean website, not sure I have ever heard a person complain about the Z or RM website. Third every ad leads to members website, beneficial to agent but again cant see what in it for the public, if anything more annoying being taken away from search results. OTM great idea lets see what it will offer but some of the USP's people are talking about are scrapping the barrel!

      Report
  10. Jonnie
    January 9, 2015 at 16:31

    Cheery little lad is still grinning like a fool and wearing what looks like a £2 grand watch so it cant have hit him that hard? – Jonnie

    Report
    1. Benay
      January 9, 2015 at 16:38

      Now now Jonnie, the fact his hand has been re-attached so neatly is reason enough to smile. A bit of Bio oil on that scar and the redness will fade too.

      Report
  11. NewsBoy
    January 10, 2015 at 13:21

    Roll on 26th! Sorry to see them go with this looks like the first of many. Who's next? Z?

    Report
X

You must be logged in to report this comment!

Log In Register

Back to Homepage

Comments are closed.

Thank you for signing up to our newsletter, we have sent you an email asking you to confirm your subscription. Additionally if you would like to create a free EYE account which allows you to comment on news stories and manage your email subscriptions please enter a password below.