By Tom Winnifrith, The Sheriff of AIM | Tuesday 19 September 2017
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
Earlier I revealed how the UK's largest independent reviewer of Estate Agents had blocked Purplebricks (PURP) after it threatened legal action if Allagents.co.uk continued to carry reviews of its shoddy services which were anything other than flattering - 71 (half) of the reviews were bad and Purplebricks demanded they be removed. Now Allagents has upped the ante with a formal statement which reads:
allAgents is the UK’s largest independent review website for the property industry with over 300,000 customer reviews covering letting agents, estate agents, online agents and suppliers to the property industry.
Founded in 2006 and based in Glasgow, allAgents has the ability to exercise the right of reply to each review. In this way allAgents provides the tools so that a balanced view of the issues is aired.
On September 18th 2017, allAgents took the unprecedented step of suspending Purplebricks’ profile page on the website. This was due to the repeated threats of legal action from Purplebricks Group PLC, demanding the removal of content and negative reviews from the allAgents website.
Martin McKenzie, 60, a Director at allAgents says: “Our business is founded on trust, and we will never let the impartiality of our reviews be compromised in any way. Our customers trust allAgents, because they know the reviews are genuine, and unfiltered.”
“allAgents provided a managed profile page for Purplebricks PLC at no cost to them. We did so in order to provide a truly independent and open platform for their customers to share their experiences, good and bad. We will continue to accept genuine customer reviews for Purplebricks, however at this time we will not be publishing them.”
allAgents' highly experienced moderators carry out stringent checks to ensure that reviews are genuine, including the analysis of the reviewer's email and IP address.
“This is a classic case of David versus Goliath, we’re a small company with an excellent reputation. We will not allow anyone, however big they are, to bully us into compromising our ideals.”
I have spoken to a spokesman for AllAgents and he is clear. These bad reviews of Purplebricks were genuine and so demonstrate that half of those who used Purplebricks and posted reviews thought that the service was shite. Takeaways:
1. This incident poses real questions as to whether Purplebricks business model is sustainable
2. Word will get out and so however much the company spends on TV adverts folks will be ever less keen to use its services. Purplebricks meet the Streisand effect.
3. The use of fascist lawyers letters to stifle criticism is a massive red flag
4. On this basis how on earth will the company ever make a profit.
5. The £1.077 billion market cap, at 399p, is bonkers.
6. This is a 100% slam dunk short
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