Posts
Zoopla has hogged headlines with its launch of an online auction service starting in February and eventually leading to weekly auctions, each lasting four days.
It sounds innovative and if Zoopla cannot make a success of it, then it’s unlikely any other British residential player can do better. Zoopla possesses, after all, a top table consisting of some of the best brains behind the likes of LoveFilm, Amazon and Gumtree, so its online credentials are impeccable.
It has also covered all property bases, giving an incentive for estate agents to put some of their stock to auction – in addition to their usual fees from the client sellers, agents will get 0.25% of the final auction price from Zoopla, too.
But property observers of a certain age will know we have been here before.
Back in 2001 (yes, nine years ago!) I wrote of three online auction sites - thePropertylot, Propwatch and Homes4Living - all experimenting at a time when internet penetration and awareness was extremely low compared to today’s levels.
Unsurprisingly, all failed.
One excuse at the time was that the marketing budgets for the websites were very low - true, and not a problem that Zoopla suffers from.
Another excuse back then was that buyers were too cautious. This may plague Zoopla, too, but the firm is auctioning low-price, low-risk repossessions so buyers have less to lose if they make a bad purchase. In any case, wary purchasers can visit a property before bidding.
Yet despite these scrupulous preparations, Zoopla’s highly successful PR campaign and its all-round nice-guy image, success for the online auction is not guaranteed.
It is deliberately excluding private sellers, so misses out on any new Tepilo-style market. If its four-day auctions end with the ‘minutes-to-go mayhem’ that often happens on eBay, some buyers may end up paying more than they really wanted for a property - with the risk of bad publicity that this may bring the service.
Time will tell on these points, but whatever happens three things are certain.
Firstly, Zoopla has a more innovative, thoughtful approach to online auctions than any residential player to date, so more power to its elbow.
Secondly, rival services (like www.bidprop.co.uk, now testing) are waiting in the wings to follow suit.
And thirdly, the rest of the world will be watching to see if Zoopla changes the way we buy and sell property forever. No pressure, then.
If you would like to to comment on this article, click HERE to e-mail Graham.
