Our business model captures our strategy for growing and evolving with our markets. Some elements are cultural: having the right people, values and behaviour in Purplebricks. Some are logistical: making sure our infrastructure and technology allow us to continuously scale and improve. And some are about our proposition: the unique blend of people and technology which creates inspirational experiences for our customers.
All of these elements need to work together at real pace to drive high growth through restless innovation in our products and services, technology, marketing and content, while strengthening our long-term sustainability. Our continual velocity is intrinsic to the way we operate. As is our commitment to delivering a much more convenient, transparent and cost effective service for sellers, buyers, landlords and tenants. Purplebricks’ strategy is to build upon its market leading proposition and increase its share of the estate agency markets where it operates for both sales and lettings.
The attainment of our strategy is based on the following key pillars of the Purplebricks offering:
We believe that traditional estate agents have been charging too much, for too little for too long. As a result of combining the powers of people and technology and eliminating the unnecessary costs associated with outdated high street estate agency, our customers pay much less on average without any compromise on service. We want to save everyone in each of our markets from that feeling of “commisery”.
We believe that customers are not yet ready, and may never be ready to hand over the sale of their property entirely to technology. They still value the advice and support of an experienced estate agent. The Purplebricks model has been developed by consumers. They want a dedicated person, not someone who they meet just once and never again. They want that person to have detailed knowledge of their respective area and market. They want someone who genuinely cares about them and the sale of their property and they want someone who is accessible and available. Purplebricks has a growing number of experienced Local Property Experts (640 as at 31st October 2017) who have contributed significantly to the thousands of positive reviews from customers.
Prior to Purplebricks you could book a hair appointment or a table at a restaurant but you couldn’t do anything to do with the sale or purchase of property outside office hours or without contact with an estate agent. Our technology and service enables interaction 24 hours a day. Customers can instantly know what is happening with their property, they can book valuations, arrange viewings, see feedback from viewings, offers can be made and sales can be agreed, customers can get performance reports and can contact Purplebricks 24 hours a day. We’re open when most other Estate Agents are asleep.
Purplebricks has grown a strong reputation for delivering a fantastic service for its customers. Just because we have combined the powers of people and technology and eliminated the unnecessary costs associated with outdated high street estate agency, and as a result offer a cheaper fee, it does not mean customers gets an inferior service. We offer an end to end full estate agency experience for all our customers. They benefit from a dedicated Local Property Expert, a large 24/7 support team, the Concierge Team that will make sure they are getting a great service and plenty of marketing activity and a highly experienced Post Sales Support team that help customers with any issues whatsoever that arise from sale agreed through to moving home.
Purplebricks has spent over five years developing and building its technology and has a large team of developers who work on new features, maintenance, security and new launches 24 hours a day. We want to continue to be at the forefront of end to end industry technology that makes the lives of our customers and our people so much more convenient, instant, transparent and effective. We have a continuous focus on innovation and customer experience and actively assess new and improved ways of a selling, buying and letting property.
We have grown to be the most recognised brand in the UK according to the independent brand tracking research agency The Nursery. We have over 30% spontaneous brand awareness which is greater than the likes of Rightmove and Zoopla and as much as ten times more than any other competitor. Making an engaging, thought provoking connection with prospective customers in a way that resonates and drives them to our website is something that has been a key part of Purplebricks success to date. We coined, and trademarked, the term “commisery”, the misery you feel when you have paid too much in commission and got nothing more for your money. We continue to invest heavily in that moment of realisation for consumers by creating highly effective, single minded, yet simple campaign led creative performances.
We believe in relentless learning and understanding of our customers experience of our service. We seek and welcome feedback on every aspect of the business. Customer satisfaction and referral is critical to Purplebricks’ growth. We are proud to be the most positively reviewed estate agent in the UK by independent review site Trust. We are rated “excellent” and have a score of 9.5 with over 32,000 reviews from customers. We have recently extended the choice of review sites we recommend to include the highly regarded and respected Feefo. In addition to review sites we have a culture of across the board internal feedback and we are also proud to have a Net Promoter Score (“NPS”) of +78 which is as good as brands like Disney, ebay and Amazon.
Purplebricks has a competitive and transparent, flat fee pricing structure of £899 inc. VAT for a sale anywhere in the UK other than certain defined London and surrounding area postcodes, where there is a charge of £1,399 inc. VAT. There is an additional one-off charge if the customer wants Purplebricks to undertake the viewings on their behalf of £300 or £399 in London and surrounding areas. We also sell energy performance certificates, Home Reports (in Scotland) and Rightmove Premium Displays and Feature Properties . The Company also derives revenue from conveyancing, mortgage referrals and insurance.
The average Purplebricks’ fee per customer including all other sources of revenue is £1,138 (plus VAT) as at the 31st October 2017. Our customers can choose to pay upfront on instruction or they can delay the payment until the earlier of, the sale of the property, withdrawal from the market or ten months from instruction. The customer does not enter into a consumer credit agreement, does not enter into an arrangement with a third party lender or bank, is not charged interest and only agrees to the Purplebricks Service Agreement. We do however have an arrangement with a third party who pay our customer invoice the next working day and collect the money from the customer or their conveyancer when due. If a customer wishes to delay payment, they are required to use Purplebricks conveyancing services for the sale. In return for instructing Purplebricks the customer will get a full estate agency experience.
Purplebricks has a competitive and transparent flat fee pricing structure of $8800 AUD incl. GST for a sale anywhere in Australia. Sales by auction cost an additional $660 AUD incl. GST. The Marketing fee is $4400 (inc GST), with the remaining $4400 (inc GST) Success fee due on settlement. In Western Australia the respective fees are $2200 and $6600. The Company also derives revenue from conveyancing, mortgage referrals.
Our customers can choose to defer their upfront marketing fee for 6 months on instruction. The service is provided by Duologi who us a UK based personal finance lender. Duologi pay Purplebricks when an advert is published and collect the money from the customer when due. In return for instructing Purplebricks, the customer will get a full estate agency experience.
The U.S. process of selling a property is different from the U.K. and Australia. The basic premise of the traditional process in the U.S. is as follows: customer appoints a listing agent and agrees to pay the listing agent a fee of around 6 percent, in return for which the listing agent will normally receive half and offer the other half to a buyer’s agent via what is called the “Multiple Listings Service” (“MLS”). When a property is placed on the MLS, every agent in the territory can introduce a buyer. If this occurs, and the buyer’s agent introduced purchases the home, he or she will receive the other portion of the commission, as per the terms outlined in the agreement. In other words, everyone can sell each other’s listings. If the listing agent lists the home and sells it he or she keeps all of the commission. If the listing agent only lists it, he or she will keep the amount as agreed upon with the seller and the remaining amount will go to the buyer’s agent.
Purplebricks has a competitive, transparent, flat listing fee which is variable by location and paid upon success. If the seller (or his/her agent) doesn’t offer a competitive fee to the buyer’s agent, he or she receive little to no attention on the MLS, which most customers tend to require. There is no additional one-off charge for viewings in the U.S. because they are either undertaken by the listing agent if they are showing the home to their buyer client or they are undertaken by a third-party agent if they are introducing their buyer client. In essence, the opportunity in the U.S. is to list and sell your own property stock and to also introduce sellers to other agent’s listings and receive half their commission. To incentivize buyers we give them a $1000 cashback if they use Purplebricks to represent them in the purchase of their home.
Our customers only pay the fee on the successful sale (defined as “closing”) of their property. The flat listing fee due to Purplebricks will be paid during the disbursements of funds to all parties during “closing”. Under the Purplebricks agreement, the customer does not enter into a consumer credit agreement, does not enter into an arrangement with a third-party lender or bank, is not charged interest and only agrees to the Purplebrick’s Service Agreement. In return for instructing Purplebricks, the customer will get a full listing agency experience.
The U.S. had launched in the LA DMA of California in September 2017 and quickly expanded to other parts of California along with other parts of the country in 2018. The Company derives revenue from their escrow and title business and will in due course expand to other ancillary products, with the commitment to delivering excellent services to all Purplebricks customers.