Words: Ashley Rigg
Published: 25th September 2008
30 million-pound man
Darren Richards grew Dating Direct from nothing into the UK’s largest dating site with over 4 million monthly users. He sold out to French dating giant Meetic for £30 million in 2007. He talks to Globaledge about his plans to repeat his success in the property portal market with
PropertyIndex.com:
Ashley Rigg: Hi Darren, thanks for taking the time to speak to me today. I wanted to start off by asking you how running a dating site compares to operating a property portal?
Darren Richards: The challenges are actually very similar. Both businesses are about using the internet to bring people together, either on a date or introducing buyers to sellers in the case of property.
AR: You had first-mover advantage back in the nineties with Dating Direct. It must be very different working in such a saturated market?
DR: It was a bonus but I wouldn’t say it was the most important factor. It was our ability to stay close to the market and constantly innovate and evolve that made us successful. We always put the user at the heart of the online experience and stayed two steps ahead of the competition.
AR: How do you plan to do this with PropertyIndex?
DR: We celebrated our first birthday last week and we have over 150,000 properties from over 1,000 agents. We still have a long way to go but one of the biggest challenges was offering consumers choice and we’ve done that. We offer agents very competitive pricing but we realise that we need to be more innovative, both in terms of our offering to consumers and agents.
AR: For example?
DR: On the consumer side, we have a number of Web 2.0 innovations in the pipeline and we plan to go further than anyone else in this respect. I’m a big fan of sites like
TripAdvisor.
AR: So local reviews and photographs, that kind of thing?
DR: All our content on Dating Direct was generated by users and I’m a big fan of web 2.0. I can’t really say any more than that at the moment.
AR: Sure, I understand. How about translating property listings into multiple languages? Any plans in this area?
DR: We have a number of initiatives in the pipeline to enhance our proposition. Again I can’t go into detail right now.
AR: I’m intrigued. Is there anything you can tell me about your plans to improve your proposition to agents and developers?
DR: Our lead numbers are growing rapidly at the moment which is ultimately what agents judge us on. Leads were up 70% between July and August and so far for September, we are 25% ahead of where we were last month. In terms of improving the proposition, we recently introduced featured positions and branding on a cost-per-click basis which is something most other portals don’t do. Pay-per-performance is generally what agents want and we’ll continue to innovate with this in mind.
AR: In the final analysis, you’ll be judged on your marketing. How are you going to close the gap on your rivals?
DR: Google is king. We have extensive experience in internet marketing. We ranked number one for “dating” at Dating Direct so we have the skills to make it work but as you know these things take time. We have two full-time people in-house working on SEO and the rest of the development team also help out.
AR: How about link building?
DR: We use an award winning agency to help us with this and their work is beginning to pay off. There’s also an affiliate scheme in the pipeline where partners will be able to share the revenues we generate on the site. It’s not the primary objective but I’m sure this will encourage more people to link to us.
AR: Which other portals do you think a good job in the market?
DR: I’m a fan of
Kyero for its user experience and I also admire
Rightmove for the way it’s managed to corner the UK residential market.
AR: I’ve been reading about your launch into the UK market. Why do we need another property portal?
DR: I don’t think consumers necessarily do. It’s more of a benefit to agents than consumers. I don’t think agents would have given us a second look 12 months ago. When times were good they were happy to pay a subscription but things are changing. The credit crunch is like a whirlwind. Everything’s up in the air at the moment and when things come down in 12, 18 months, 2 years, I think Rightmove will land in a different position.
AR: You’re offering cost-per-lead business model in the UK?
DR: Yes, we charge £1 a lead and we’ve had a great response so far from agents. We have over 2,000 UK agents signed up and our ambition is to list every agent and every property in the UK.
AR: Why are residential lead prices so much lower than for overseas property? It sounds expensive?!
DR: That’s a good question. The dynamics of the market are certainly different. Overseas property leads are relatively scarce so prices are higher. Also, I believe overseas property buyers tend to have researched more thoroughly so are arguably better qualified.
AR: How do you plan to market to the UK residential market? You must have big budgets?
DR: Obviously search engine marketing but we are also working on a white label proposition and we are currently in negotiations with some high-profile media owners to take our listings. This will form a big part of our marketing strategy.
AR: It must be costing you a fortune. What do the economics of this look like?
DR: The technology is already in place from the overseas side so that helps but you’re right, it’s not cheap. It’s an expensive game if you want to do it properly.
The important thing to remember is that we are not a PLC like Rightmove so we are not under pressure to make short-term profits. We invest our revenues in marketing and technology. My objective is to build long-term value, not squeeze
Short-term profits.
AR: When do you expect the business to show a profit?
DR: As I said, I’m in this for the long haul. The overseas side is doing very well and is close to break even. Overall though it will be another three years before we start turning a decent profit.
AR: You’re a braver man than me. Surely your money would be better off in a bank?
DR: It would be no fun that way and besides, I have no doubts we can create a successful property portal business. It requires patience and deep pockets but we have a great track record and a fantastic team of people to get the job done.
AR: Thanks for your time Darren, much appreciated.
DR: It was a pleasure. Hopefully see you again at OPP Live.
User Comments
I think they have a good chance. Free portals have been around and they are fine to use, but we found that most agents are willing to pay for great service when it works.
The fundamental problem with free sites is that the quality of properties is low, and it’s very difficult to maintain an updated database, these portals end up with old outdated properties, very frustrating for the end user to sift through thousands of useless properties from 2005.
The second is the quality of leads. Most free sites are full of adsense, banners and tend to receive a lot if spam. This can create a credibility issue as well, for most people, real estate is their biggest investment, and credibility when selling and presenting properties is probably more important than most people think.
Most agents also tend to blame the portals when not successful. However, there are definitely different degrees of agents out there as well as web portals. From our own experience, we know that we can have 2 separate agents from the same area, both will receive about the same traffic, but one agent will completely outperform the other when it comes to leads.
Just another opinion ;-)
Tony,
Holprop
To be honest this is a very crowded market with players that have very very deep pockets...i.e. the UK media groups. There are now great free sites like Globrix as well as the big 4 traditional portals. NAEA are also launching a free portal soon. As an ex agent I wish Property Index good luck but I cannot see how they will get any traction. With only 150K properties there is no consumer interest and the agents have no money to spend with an unknown portal. With no USP and too much competition this is perhaps a total waste of time and money !! Sorry!!
Tom Dickson,
Farrells
