How Zoopla Helps Rightmove and Did DMGT Get it Wrong?
August 16, 2009 by Simon Baker
Over the last month Zoopla has clearly signalled to the market its intent to be a major player in the UK property portal market. It has snapped up Thinkproperty and Propertyfinder to clearly position itself in the top three UK portal businesses behind market leader Rightmove and DMGT’s The Digital Property Group.
In the process there have been some winners and some losers. However, it is Rightmove who is likely to gain the most from this move while questions have to be asked if DMGT truly missed a game changing opportunity.
Firstly, it looks like most traditional media companies in the UK have been sidelined in the UK property portal race with the exception being DMGT. GMG has exited the market with the sale Thinkproperty to Zoopla, News International now only has a 50% stake in the 5th placed Globrix, and Trinity Mirror has investments in the minor players Fish4Homes and Smartnewhomes.
The real winner appears to be Rightmove. The market structure in many ways has been maintained. For Zoopla to take on Rightmove, it has to get past DMGT’s sites – Findaproperty and Primelocation. DMGT will therefore have to compete against both Zoopla and Rightmove. Assuming Zoopla maintains an aggressive (read low cost) pricing model, pressure will be placed on DMGT’s ability to rapidly grow revenues.
If DMGT had picked up Propertyfinder, the market would have consolidated around two players rather than three. DMGT would then have been able to price under Rightmove’s pricing umbrella and therefore DMGT would have been able to increase revenues.
It seems that DMGT may have lost a unique opportunity to consolidate the UK market and to position itself as a real challenger for Rightmove’s market leader title.
- Zoopla Confirmed as Potential Propertyfinder Buyer
Last week it was revealed that the Propertyfinder's management buy out attempt had failed and that the REA Group and News International had entered into a heads of agreement with a mystery party. This mystery party has now been confirmed as being Zoopla. Zoopla is a relatively new entrant to the UK online real estate market having initially launched a site around home prices and more recently moving into advertising homes for sale in the UK using the pay per lead model. Earlier this year Zoopla closed out a £3.75m capital raising. Check out our coverage of Zoopla over the last year. On reflection, this deal makes sense by providing Zoopla with a boost into being a serious competitor in the market and it gives propertyfinder.com and its team a new lease on life....
- Propertyfinder MBO Fails But …
The much talked about management buyout of propertfinder.com in the UK has failed however a new mystery buyer has emerged. In a late announcement on the ASX, the REA Group & News International have entered into a non-binding heads of agreement for the potential sale of their UK online business. Internal sources say there were three “very detailed and strong bids” however the while the existing management put in a “very impressive bid”, they were not the preferred option. A period of exclusivity has been entered with the preferred bidder so that they can undertake due diligence and the identity of the preferred bidder might be revealed as soon as the end of next week. Given the comment in the ASX release that “if this transaction successfully proceeds to completion, it is unlikely to have any impact on the guidance (already) provided”, the offer being considered is likely to be small. The REA Group and News International have also kept the door open to close the business or just sell the assets to the preferred bidder as they continue the consultation process with staff – a prelude to closure. So who is the mystery bidder?...
- propertyfinder.com Sold to zoopla.co.uk
The rumours of REA Group owned propertyfinder.com's potential sale to zoopla.co.uk have been confirmed, with the two companies issuing statements today....
- zoopla.co.uk Acquires thinkproperty.com
Not only is zoopla.co.uk rumoured to be in negotiations to purchase REA Group owned propertyfinder.com, but the UK property portal and property information website has announced today that it has acquired thinkproperty.com from Guardian Media Group (GMG) for an undisclosed sum. ...
- zoopla.co.uk Grows 25% in July
A statement from UK property portal and property information website, zoopla.co.uk, reveals that their audience growth figures for July were 25 percent higher than June. ...
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It would be very interesting to understand why DMG didnt bother with Propertyfinder.
maybe they did but lost out …
DMGT’s progress does not need PF to close in on RM. Zoopla will need extreme agression in order to stop DMGT’s progress, and in this market only when the markets will really pick up will we see who the winners will be.
I thnik Propertyfinder was as dead as a dodo for a while technology was so behind when I look at property to aquire i found they can not deliver like rightmove findaproperty not forgetting new comer globrix which do a fantastic job.
Propertyfinder was losing hideous sums of money and the management buried their heads in the sand thinking that REA and News International would continue to fund irrelevant to the fact of major losses can not be sustained in any business.
,Zoopla should have just let the company close it would have automatically stepped up rank. REA where pulling out of Propertyfinder,as the business model was extremeley non cost effective after 3.5 years they could not turn it around even with the help of news international…
Even if the management buy out went ahead then they had too many from microsoft.. who thought they could run a property webiste having failed spectacularly after a year and a half at it , Zoopla grow your brand name without flogging the dead horse Game Over.