Hemnet: ARPU Expansion

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As someone who was head of sales at Hemnet, it would be great to understand how you approached pricing. Did you look at the total transaction value and consider it as a percentage, or did you target certain ARPU growth? Could you walk us through the internal view and strategy around pricing?

When I started at Hemnet, it was just after General Atlantic and Sprints had acquired Hemnet. I was previously at Schibsted, and we were about to buy Hemnet, but the Swedish government didn't allow it because we were too large. At that time, a property ad was around $150. During my tenure, we launched two new packages, Plus and Premium. The idea was that with three options, customers would likely choose at least the middle one. Recently, they launched Max as a new product. If an ad was $150 when I started, Max is now about $3,000 for the package. The strategy was that $150 was too cheap for an ad, and we worked on finding the right value for what an ad should cost, looking at other markets as well. Initially, revenue from advertising was about 50%, and ads were also 50%. Now, it's around 80% for property ads.

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It seems like Booli has a very strong position in the pre-market, but still, nine out of 10 homes are sold on Hemnet. How do you think that evolves? Do you think over time more homes will be sold on the pre-market to avoid high prices on Hemnet?

I think that's the point I mentioned. Real estate agents are now trying to sell properties without using Hemnet due to the market for Hemnet. I should say Booli is not a big competitor in a way because it's state-owned, focusing on creating competition among banks mostly and acquiring new customers through their site for loans. I have friends working at Booli now, and they don't have a strategy to increase revenue from ads or anything like that. It's just a good service they want to provide. I know Schibsted, for instance, has been looking to buy Booli, but it's not for sale.

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