$500,000,000.00 anyone?

20 06 2006

The Wall Street Journal has an excellent article about Craigslist.  For those of you still living in the 19th century, Craigslist.com is an online classifieds that has a page for every major metropolitan area in the US, and some not in the US.  The thing about Craigslist is that it is free.  It's free to post, free to browse, free to contact.  On top of it being free, it doesn't require any kind of registration and supports no ads – pop-up or otherwise.  It's estimated that the web site makes about $25 million per year.  The article says:

One industry analyst has estimated that Craigslist could generate 20 times that $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. What kind of company turns up its nose at $500 million?

 CEO Jim Buckmaster has a great explanation. 

If it's not something that users are asking for," he says, "we don't consider it."

The users haven't asked to be bombarded by advertisements – and in the interest of serving the users – he hasn't given them.  What would happen if more companies followed this idea.  Finding an economically viable way to provide a service without screwing your customers. . .





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