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Classified Advertising - Online vs. In Print

The downhill slide of daily journalism began decades ago, when television introduced nightly news programs on both a national and local level. That decline, however, has been radically accelerated by the advent of online classified advertising. Craigslist has probably been the most important development for local classified advertising. This simple, unadorned website provides free listings for most of its classifieds, selling only placements for job opportunities.

Classifieds have always been the bread and butter for newspapers, providing the lion's share of black ink. Yet by three years ago, Craigslist had become a principal local resource for job recruiters. Research organization Classified Intelligence reported two years ago that Craigslist costs the San Francisco Bay Area's traditional newspapers, and their online divisions, between $50 and $65 million annually in revenues from employment ads alone.

According to the study, Craigslist had 12,200 active job listings on its San Francisco site the week of November 21, 2004. In contrast, the San Francisco Chronicle had 1,500; the Oakland Tribune had 734; the San Jose Mercury News had an estimated 1,700; and the Contra Costa Times had around 1,000. The average recruiting ad in a metro Bay Area daily cost $700 in 2004: on Craigslist it cost $75.

That's a local snapshot. The same is occurring at a national level, also in the critical area of job recruiting. http://Careerbuilder.com is the largest job search and recruitment site in the country - it is also owned by a partnership of the Gannett, McClatchy and Tribune newspaper conglomerates. http://Monster.com defined the art of national job recruiting. There are also elaborate online executive recruiting services that mix the traditional personal touch with digital resume files and client searches.

By 2003, online classifieds had nearly matched the newsprint business in classified revenue. In that year, the market for classified ads in the United States was $15.9 billion (newspapers) and $14.1 billion (online), again according to Classified Intelligence.

There is a widespread belief that the online classifieds are more effective with younger people and the more in-depth advertising probably belongs in print. JupiterResearch, another online ad research firm, says that a lot of people research cars online, for example, because it's a great price-check resource. Jupiter goes on to say that only 1 in 10 will shop for cars on the Internet. This analytical point overlooks the fact, however, that many people who do their auto shopping with shoe leather are going to dealers that they may have selected online.

The tools for online classifieds provide easy shopping methods and, generally, more information on the sales item. Photos are easily included as well. The trend is expected to continue in all advertising formats, but especially in the classified arena. In Jupiter Research's "U.S. Local Online Advertising Forecast, 2005 to 2010," the forecast is that spending in the U.S. for online local advertising will grow at an annual compounded rate of 11 percent, or from 2005 to 2010. Seventy percent of that revenue will come from classifieds.

A reflection of the trend at the national level is that one of the primary reasons for Google's $500-per-share stock valuation is the fact that their business model garnered them over $9 billion in revenue in 2006. The preponderance of that money was generated by text based classified advertising, developed through partnerships or through the sale of keyword placements.

Readership for traditional dailies does skew to the older generation, especially now that job recruiting has become such an effective online function. But even with high-end, family oriented purchases such as homes, online advertising often outshines its printed counterpart. The real estate sales bible, the Multiple Listing Service (MLS) is readily available to consumers online - for the first time. The major brokerage chains all have national sites and nearly all local brokers use the web as well.

Madison Lockwood is a customer relations associate for http://www.apollohosting.com. She helps clients understand how a website may benefit them both personally and professionally. Apollo Hosting provides website hosting, ecommerce hosting, & VPS hosting to a wide range of customers.

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