Wannabe online estate agent Homeseller entered the market in 2015 with one of the most expensive advertising campaigns the sector has ever seen for a start-up.
In addition to expensive London Underground adverts, they hired an Oscar nominated director to create a series of TV adverts that were screened on prime time slots in between the X-Factor on Saturday evenings.
The adverts starred Peak Practice and Doctor Who actress Sarah Parish, who played a Sherlock Holmes-like character who solved mysteries surrounding property sales. According to industry insiders, a 30 second advert slot during The X Factor ranges from £90,000 – £130,000 dependent on what stage the show is in, combined with audience rating metrics.
Homeseller used London ad agency G&MP, who said at the time of release in 2015, “the first mysterious TV spot, The Block of Ice breaks tonight at around 8.15pm within the X Factor commercial break. The spot will be followed by 3 more TV ads in the campaign as well as press advertising, digital advertising, London Underground advertising and several other channels.”
A peek into the listing history of Homeseller reveals a modestly growing business that would struggle to compete with other online agents, let alone pay for a national Television campaign.
By the time the first TV ad aired they had approximately 16 properties listed for sale, a few weeks later that rose to 25 and by April 2016 they had a grand total of 50 listings.
If we price their X Factor advert plus 2 further adverts and a London Underground campaign, DMZ calculates thats the AWOL agency spent an eye-watering £4,000 per acquisition of each new property for sale.
The current king of online and hybrid agents, Purplebricks CEO Michael Bruce, allegedly said that it would now cost north of £100 million to set up a successful online agency, taking into account all marketing, advertising and infrastructure spend.
DMZ understands that its difficult starting any new venture, but we can’t understand why a start-up company with little to no business history would plough the best part of £250,000 into a nationwide, premium marketing campaign. There are numerous less expensive opportunities to reach the end consumer, like Facebook advertising based on age, interests and life stage – targeting those in their early 30’s who might be looking to move outside London – for example.
Another effective strategy is the one adopted by the aforementioned eMoov CEO, Russell Quirk, who ensures his emerging agency are kept in the public eye by featuring regularly in media outlets like The Telegraph and The Daily Mail. The exposure to his business is effective, nationwide and most importantly – free. Given a £250,000 budget, we would advise investing the capital into the business’ infrastructure and being more savvy with any precious advertising spend.