How to make money from online classifieds


It’s bad enough that Craigslist pulled the revenue rug out from under newspaper publishers. Now, anyone with a website and a community base has tools at their disposal to launch custom online classifieds for their niche audiences.

Is there anything left for the newspapers?

The answer is yes. But publishers can’t keep trying to replicate their print model online – that ship has sailed. So where are the opportunities? Here are five steps newspapers - or any content publisher, for that matter - can take to recapture lost business in the classifieds marketplace. 

1. Break down the silos. Many newspapers launched online classified sections on their websites as separate entities, segmented from the rest of the site (and the print classifieds) in both content and design. In some cases, readers have to fill out separate forms for an ad they want to run in print and on the web. This “silo” approach increases inefficiencies and inhibits the ability to expand the online marketplace’s audience.

The Houston Chronicle took a different path. It replaced its moribund daily print classifieds with a weekly, full-color tabloid section, created from content and listings pulled from its online shopping site, which runs on a classifieds platform from Kaango.

“Instead of having a free-standing section with no connectivity to the web, the intent is to break down the barriers between print and online and merchandise the online shopping network,” said Todd Neal, vice president of real estate for Hearst Newspapers, which owns 15 dailies including the Chronicle. The strategy not only drives more readers to the web, Neal said, but eliminating the daily print general merchandise classifieds saved the paper “a boatload of money.”

2. Add context. Integrating online classifieds with the rest of the website also opens up opportunities for contextual placement. The concept works in two ways.

First, a paper can target classified listings to relevant editorial content in different sections of the site (think Google AdSense). The Houston Chronicle, for one, is experimenting with this approach.

“We want to take that [classifieds] data and surface it in other places on the site in places where people may not expect to see it,” said Jerome Dorsey, Hearst’s director of market development. For example, real estate listings could run on the home page or in the business section; auto listings might run on the sports page; merchandise listings could go into the lifestyle section. “We’re experimenting with how and where you put it so the audience interacts with it,” said Dorsey.  

Second, a publisher can bring original and repurposed content into the marketplace itself, to improve the user experience. The Chronicle includes community blogs, for example, on its marketplace home page.

This type of content is a key differentiator from Craigslist and other purely transactional sites, said Michael Kranitz, president and CEO of Kaango, whose network is used by close to 300 newspapers. “By structuring your marketplace to address different areas of interest, you can sprinkle contextual content throughout the listings,” said Kranitz. “That content can be used to sell collateral display ads or to link to other relevant content.”

3. Aggregate. An online marketplace needs to have enough listings to satisfy even a niche audience. That’s why classified platforms such as Kaango or Oodle are gaining momentum: these companies offer a network of marketplaces that can be aggregated into any one site. So a shopper in Boston, for example, will have access not only to local ads, but also those from across an entire network of sites.

“You have to a critical mass of buyers and sellers,” said Craig Donato, CEO of Oodle, which averages 100,000 new personal and commercial listings a day. “They need to come to your site and find unique content. And when they sell, they need lots of buyers.”

Aggregator networks that pull listings from multiple sources offer a potentially key differentiator for newspaper sites: convenience. “There’s value in not having to go to multiple sites,” said Steve Outing, editor of

The downside of widespread aggregation is a more complex transaction for buyers who are located in different states or regions than sellers. That’s why some papers, such as the Chronicle, are focusing instead on building up their local base. “We believe we can generate more sellers from within the marketplace,” said Neal. “We’re more interested in those local sellers.”

4. Up-sell, cross-sell, even down-sell. Publishers are taking several different approaches to monetizing their classifieds sections. While many offer free postings to individuals, the ad-buying process is often a progression of upgrade opportunities – premium placement, additional photos, longer run times. For commercial advertisers, display ad wells on classifieds pages offer additional opportunities to capture eyeballs and clicks.

Some papers are also integrating print placement into the online ad posting process. The key, says Kranitz, is adapting the print model to suit the online model, not the other way around. “You shouldn’t have to dumb down the ad for print,” he said. “But you can reverse-publish content harvested from the web, and sell positions around it.” This approach can help papers preserve what’s left of the print revenue stream while positioning the online streams for growth, Kranitz said.

Outing believes papers have a much broader opportunity to sell services beyond the classified post itself, in effect becoming a digital agency for local businesses. In their “Classifieds Manifesto,” Outing and co-author Christopher Ryan offer a scenario in which newspapers would provide small businesses with everything from website design to direct mail to search engine marketing.

5. Get social. Publishers may not see the inherent connection between a transaction-oriented classifieds business and the social web. But others see a very strong link. “Classifieds are a form of conversation,” said Donato. “Do any of my friends want this? Do I know anyone who owns a car like this? Publishers need to apply that framework.”

Such an approach can manifest itself in many ways. AJCexchange, the Atlanta Journal-Constitution’s online marketplace, lets users share their listings on Facebook, Twitter, MySpace or Delicious. Sellers on the Oodle network can link to their Facebook profiles or other online identities.  Other publishers have implemented functionality that allows users to comment on listings.  

The goal, according to Donato, is to enable a new form of word-of-mouth marketing by figuring out “how to help consumers create conversation around listings, and how to help local advertisers participate.”

The key for publishers such as Hearst is leveraging the classifieds channel to engage friends and family. “Whether it’s a coupon for a local retailer, or a happy hour at a local pub, we can turn this into a lifestyle play beyond where you go if you want to buy something,” said Neal. “It really expands your universe.”

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