Craigslist: the scourge of newspaper classifieds
If you've read articles about a man named Craig and his free online classifieds, you've probably noticed Craig's smiling face in the accompanying photo. Well, Craig has a lot to smile about. He now has classified sites in almost every major US city and in about 100 cities around the world. Newspaper execs hate this guy. And for good reason. According to a London consulting firm, in its relatively short existence, Craigslist has "destroyed" approximately 75% of US newspaper classified pricing, rates on which just last year newspapers depended on for over 35% of their revenue. Danny Meadows-Klue in the UK's The Guardian writes, "The list is not bad news; it's terrible news. The business model cuts at the heart of newspaper profitability and does so with such elegance, and is so intrinsically orientated to the new economy, that you can't help but shrug and say 'this is the future.'" Well, yeah! Every article written about the San Francisco based .org cites the impossibility of newspapers to compete with such a phenomenon.
Example: New York Metro recently wrote an article that proves Craigslist's huge competitive advantage. Not only does the article state that Craigslist receives 50,000 new NYC classifieds a day (25 times as much as in 2001), but also, "In its pre-Craig, May 4 1999, issue, the Village Voice listed 821 rentals and 88 sublets. May 4, 2005 saw 430 rentals and only 8 sublets. On Craigslist, rentals and sales listings are now at about 20,000 and 2,000 per day, respectively. And it allowed more owners to sell or rent sans middleman (no fee!)."
Personal anecdote: I was once looking to sublet my apartment and posted a late night 500 word description for free. I had 10 responses by morning in my email inbox. I am currently looking for an apartment. Last night I found two places that I liked. I know I liked them because there was detailed descriptions and pictures, one even with a link to show me exactly in which part of the city it was. So I emailed them. This morning both landlords responded to me.
Something else I noticed. Say you're moving across the country or overseas and need to find an apartment. Craigslist has you covered since the Internet and email know no physical worldly boundaries.
I'm sorry, but you can't tell me with a straight face that a 150 character classified ad on a jumbled page of black and white that I have to pay for can beat that. I hate to be the bearer of bad news, but it doesn't appear that newspapers are going to be able to trump Craig's model. They could, however, join him, as some papers have started doing (see previous posting). Newspapers could simultaneously place advertisements in their (free) local online classifieds as a means of revenue. Local customers may end up trusting their newspaper more than a broad global phenomenon.
Sources: Media Guardian, New York Metro, The Washington Times
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Interesting read. Newspapers are going through a tough time between classifieds and bloggers. I was just informed of another site http://plugstar.com that seems to be running a new classified community for all states. This could get interesting.
OK, so I did it again: I "used" Craigslist to alleviate my driveway of two cars that had been kicking around a bit too long, and acquire some talent to help support our growing software company.
Now, sure, I could have paid for the same service on Monster.com, Guru.com, OregonLive.com or similar.
But Craig found my weak spot: Free Simplicity.
See, not only are the listings "budget neutral", but at the completion of one, you're prompted to list another.
CL is Classified-Ad Crack for the internet enabled.
3 postings in 30 minutes (WITH images and html accents).
And if you want some fun, go check CL's Alexa ranking (that's the Amazon.com owned company that ranks sites by the shear amount of traffic they receive).
As of this afternoon, they are the 39th most trafficked site on the web.
Thrifty Nickel?
Free Craig!
Best,
ME
http://www.richcontent.com
P.S. Quick update: I had thought Craig sold 25% of the company to eBay. Au contraire: an ex-employee sold their shares for cash to eBay. Craig didn't endorse the move, nor take any of the bounty, according to published reports.