ingatlan.com, a leading online real estate advertising company in Hungary, aims to reach revenues of over HUF 1 billion in 2011, CEO Krisztián Korbuly said at the meeting of the MBI & MBO Club on Thursday. The company is a market leader with the most visited online real estate advertising center in Hungary.
The website, which was launched in 1997, has three major revenue sources with the most substantial income coming from real estate agencies, which pay a monthly fee for all their advertisements, according tp Korbuly. Private advertisers, the second source, pay per ads or extra services. The third source is income from developers and investment companies, which advertise through banners and links.
“We made a major redesign to the website last year with launching a Google-like search engine,” Korbuly said. The company has now 278, 000 ads, 53 employees and 1,500 real estate agency partners.
The company has introduced bank card payments, floor planning, a meteorology site, a real estate magazine and a search option to see real estates on the map, Korbuly said. Bank card payments, which were launched in 2004, now account for 64% of all payments. The recently introduced mobile payments, aimed primarily for private advertisers, now account for 16% of total payments.
At the beginning, all the revenues came from banners, as back then advertisers thought than internet was just an electronic form of a newspaper. The website was not yet sophisticated, for instance, it had no search option.
In 2001, there were only some 7,500 ads, which were copied from newspapers to the website. “We are not very proud of that but there were no other ways to fill up the site with ads then,” Korbuly noted. In 2001, the company had a mere HUF 2 million income and only three competitors including the daily classifieds newspaper Expressz.
The long-awaited search option was launched in 2006, Korbuly said. By then, the number of ads grew to 116,000 and the company had 24 employees and nearly 1,000 real estate agencies, as partners. The company’s revenues reached EUR 1 million in 2006.
“Competition was growing, as everybody launched real estate websites, because they thought that it was easy money,” said Korbuly. This, of course, is not true, he added.
“We have found a lot of copies of our website,” Korbuly said. “We first took legal actions against them, but then we found that there is no reason to do that, as even though they looked the same and they stole our database, nobody visited them,” he added.
One of the main competitors was ingatlan.net, which was operated by the two largest real estate franchise companies in Hungary, namely Otthon Centrum and Duna House, Korbuly said. “They tried to drive all our partners to their own websites.” The problem was that they excluded private advertisers and allow only real estate companies to advertise there. In addition, as the two companies dominated the site, smaller firms had enough and returned to ingatlan.com and stayed there. “The funny thing is that ingatlan.net was offered to us two years ago, but we did not buy it,” Korbuly noted.
The company managed to significantly increase its market share by giving a rather unusual reaction to the challenges of the global meltdown in 2008. “In the wake of the crisis, most of the competitors lowered their prices and offered more to their customers,” Korbuly said. “What we did, was to increase prices, which made real estate agencies think long and hard about where to put their money. As 40-50% of their calls came from ingatlan.com, they decided to spend all their money on our website.”
The MBI & MBO Club, an informal network of a selected group of business leaders in the CEE region, is focusing on the issues and challenges facing managers interested in acquiring a business through a Management-Buy-In (MBI) or Buy-Out (MBO). The Club is sponsored jointly by private equity and venture capital fund management company Enterprise Investors and executive search firm Pedersen & Partners. Club meetings, which take place twice a year in each of the affiliated countries, combine opportunities for informal networking with structured presentations that are designed to help members realize their MBI or MBO plans. (GL)