The Real Estate Council of Ontario says it is looking into allegations that real estate brokerage Purplebricks Canada used staff to write online reviews about the company.
In a statement to REM, Joseph Richer, RECO’s registrar, says: “We are aware of the allegations regarding the soliciting of online reviews at Purplebricks, and we have received numerous inquiries about it as well. We are currently looking into the matter to gather more information, in order to determine whether this would constitute a violation of the legislation.”
A recent article at Forbes.com said Purplebricks Canada offered employees paid days off in exchange for made-up positive reviews on Facebook and Google.
The article said it had obtained an email sent by Purplebricks Canada’s marketing department to the company’s staff. The article reported that the email said: “No need to fabricate stories, just an ‘I think Purplebricks is great’ or ‘Purplebricks is the future of real estate’ would be fantastic,” read the email, which was sent by one of the company’s marketing directors in March 2019.
An email to REM from the public relations firm Casacom, which manages Purplebricks Canada’s media relations, says, “This is the only statement Purplebricks is issuing. No interviews will be granted.”
The statement says, “The email did not ask for fake reviews. It was sent in good faith and was a complete one-off and an error of judgment. We only offered this incentive once, in March 2019, and it generated only a handful of reviews. It followed the name change from ComFree to Purplebricks and the refusal of Google and Facebook to transfer the reviews that were already on their sites; it will never happen again. Purplebricks Canada recognizes that it’s vital for all reviews to be genuine and authentic – and we work hard to earn positive feedback from our customers through our expertise and great service.”
Purplebricks is an online real estate brokerage. It officially launched its operations in Canada in January 2019, but the company acquired the DuProprio/ComFree Network from Yellow Pages Digital & Media Solutions Limited in June 2018.
In a story in REM last June, Purplebricks Canada CEO and general manager Lukas Lhotsky said the company is a registered real estate brokerage that helps people buy and sell their home for a single fixed fee, offering the same expertise consumers would expect from a traditional real estate brokerage.
The company’s website currently advertises an up-front listing fee of $499 and a $2,499 fee payable when the home successfully sells, plus taxes. Buyer agent commission is not included.
The site says the brokerage currently has more than 80 Realtors.
Purplebricks’ parent company is based in London, England. It first expanded to North America in September 2017, operating in Los Angeles. But in July 2019 it announced it was shuttering its business in the U.S.
Romana King, director of content at Zolo Realty, said the online review issue is in a grey zone for real estate boards and for ethics committees.
“It’s unfortunate,” says King, adding issues of this nature hurt anyone who is involved in the real estate business.
“It’s not like real estate agents and brokerages have a stellar reputation in the marketplace right now as it is. Really, it’s terrible timing. You’ve got an industry that’s really desperately trying to clean itself up and the bad press it’s received in the last four or five years with all the less than reputable practices . . . This is not isolated to the real estate business but it hurts the real estate business in Canada because people aren’t just going to see Purplebricks, they’re going to see any company that’s not on the up and up.”
She said some of the long-established real estate firms in the country might get away from the public scrutiny a little easier, but the newer brokerages that are pushing the industry into the technological age might hurt a little bit more.
“We have to do it right,” says King. “We have to do it right from the start and that means being honest members of the business industry. And you can’t do that if you’re trying to game your reviews.”
Online reviews can be powerful, she says. Studies have shown that 90 per cent of consumers will look at those online reviews before they make a purchasing decision.
“That’s a huge chunk of people . . . I think consumers need to be better educated on how to actually review online reviews and see whether or not they’re legitimate,” says King.
One way to do that is to look and see if there are many similar reviews and if they are skewed in either a good or bad direction. Check out when the reviews are posted and the names used for the reviews.