With 95% of all property searches now beginning online, the property portal space is incredibly valuable and hotly contested. But can any of the other major players such as Zoopla or On The Market actually compete with Rightmove and be serious contenders for the
According to BBC news, Rightmove recently reported an annual pre-tax profit of £198.6m in 2018, an increase from £178.3m in 2017. Operating with a market share of 74%, it’s the leading property portal with over 1.2m properties and is one of the most visited sites in the UK – 139m visits each month. Zoopla in comparison (including Prime Location)
Rightmove’s huge growth has led to it becoming the go-to site for anyone looking to buy or rent, with a brand that has itself become synonymous with the estate agent industry as a whole. With more than 20,000 advertisers and over 1.2m properties in the UK alone on the site, Rightmove has embedded estate agents and developers into itself to the point where it is no longer viable for these companies to operate without its service.
Because of this grip, Rightmove is able to charge estate agent offices a monthly subscription fee of between £1000 – £2000 per month, significantly higher than Zoopla’s fee.
Rightmove’s subscription model enables it to constantly grow and achieve high profit without the need for much investment. Furthermore, its momentousness as an advertising platform means that it is largely unaffected by a poor property market. Where estate agencies may be suffering and making losses, their reliance on Rightmove is so great that these losses are not passed onto Rightmove except in the most extreme circumstances.
For example, if we look at the current uncertain Brexit market where several estate agents are experiencing losses, the property advertising market is still going strong. While Zoopla does benefit from this position as well, if the situation arises that an agent must choose between either subscribing to Rightmove or Zoopla to reduce overheads, Rightmove is likely to come out as the favoured portal as it further monopolises the space.
Sources: BBC News (2019) ; Investors Chronicle (2019)