Online ad market in Europe set for shake up

New York Times: A motor scooter in Manchester, an apartment in Amsterdam, a poster in Paris. All are available via Craigslist, an online bulletin board that presents a new challenge to the established players in the estimated $100 billion global market for classified advertising.

This story in today’s NY Times highlights changes in a relatively traditional market in Europe, where classified advertising on websites has mostly been an extension of traditional print media.

There have been some great success stories, though. One that comes to my mind is Auto Trader, part of the Trader Media Group (ownership details), founded in the 70s by UK entrepreneur John Madejski. Today they have online ad sites in The Netherlands, Italy, Ireland and South Africa, plus six affiliate sites in the UK, generating annual revenue of over £280 million (€400 million).

Big changes, though, could be coming soon to the whole online classified advertising market through innovation, fast-mover advantage and good old traditional competition:

Though the international Craigslist sites are available only in English for now, the formula seems to be catching on, if more modestly than in the United States. The London site attracts more than 150,000 unique visitors each month. […] The Paris site, begun in November, already draws 50,000 unique visitors monthly. Other recently added sites, including Amsterdam, Dublin, São Paulo, Brazil, and Bangalore, India, have drawn slightly less traffic.

[…] the international sites could eventually pose a significant threat to newspapers and other, more specialized publications – on paper and the web – that traditionally earn significant portions of their revenue from sales of classified ads, specialists in the field say. “It’s got to scare anyone who takes money for advertising,” said Jim Townsend, the editorial director in Houston of Classified Intelligence, a consulting firm. In the San Francisco area, Classified Intelligence estimates, Craigslist is costing newspapers $50 million to $65 million a year in lost revenue from employment ads alone; because other ads on Craigslist are free, it is hard to gauge the overall effect, Mr. Townsend said.

In September last year, eBay bought a 25% stake in Craigslist. And last November, eBay bought Marktplaats, the biggest Dutch online auction site.

Looks like a market about to undergo some big changes.

New York Times | Craigslist Circles the Globe With Online Classifieds, One City at a Time (registration required)

3 thoughts on “Online ad market in Europe set for shake up

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  2. Craigslist is an interesting website, and they clearly have increased their number of locations considerably. But their greatest deficiency is that they don’t provide category specific forms for posting ads. As a result, the ads on Craigslist are often times incomplete. More importantly, they are unsearchable. One company, ZiXXo has solved this deficiency and they are just launching in 100+ US cities (sorry no London yet). There’s a ton of additional information on their Media site:

  3. Thanks for that, Tom.
    Just still on Craigslist, the Financial Time had an interesting feature yesterday about Craig Newmark:
    Paid sub access only, unfortunately, but if you’re a subscriber, it’s worth a read.
    One snippet from the article:
    > In terms of revenue, Craigslist is small. It makes money by charging employers in San Francisco, New York and Los Angeles a small fee to post jobs, usually between $25 and $75. This generates between $7m and $10m in annual revenue for the company. By comparison, the total revenue at, another classified advertising site, was more than $679m in 2003. “We don’t charge for anything unless it improves service for all concerned. We don’t charge individuals,” says [Jim] Buckmaster [CEO]. However, this low-key approach unintentionally siphons off as much as $65m in jobs-listings revenues a year from newspapers in the Bay Area, according to US consultancy Classified Intelligence. <

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