This Saturday’s Wall Street Journal featured an intriguing piece about Craigslist CEO Jim Buckmaster as told from the first person perspective of WSJ editorial board member Brian Carney (Zen and the Art of Classified Advertising, June 17). In it, Buckmaster comes off as a bit of an anomaly: a CEO who’s not all that interested in turning a profit. The main objective of the company, says Buckmaster, is to serve its users.
The thing is, according to the article, “One industry analyst has estimated that Craigslist could generate 20 times [its 2005 revenue of $25 million] just by posting a couple of ads on each of its pages. If the estimate is to be believed, that’s half a billion dollars a year being left on the table.”
As folks who follow the online classifieds space are probably aware, and as Carney notes, “The money that does come in comes from businesses posting in just two categories of classifieds in three cities — job listings in San Francisco, New York and Los Angeles and, this week for the first time, brokered apartment rentals in New York.”
Craigslist just added 100 new cities to its roster, too.
The article touches on the effect that free listings sites like Craigslist have had on newspaper publishers’ bottom lines, but doesn’t get in too deep.
Though facetious, Carney’s conclusion is an interesting one:
“If Craigslist does what its users ask of it, and Craigslist doesn’t need or seem to want all the ad revenue it declines to collect, maybe we, as end-users, should ask them to post some banner ads and give us the money instead. There’s something wrong, I suppose, in that reasoning. But I like the idea.”
Gather.com, another site with an altruistic bent, already gives its users a cut of its ad revenue. To be honest, I wouldn’t be surprised if Craigslist were, in the future, to offer up a share of revenue to the very users who enable its existence.