The many users wondered how the Craigslist site generates revenue. On the surface, it seems that Craigslist does not charge any fees for anything and this opinion is almost correct. Site of subscription fees only for a handful of secret sections, while publishing in most sections remain free. Has prompted many financial analysts Craigslist to increase revenue by adding things like a banner ad, but so far resisted any attempt to market itself.
Craigslist makes money only through a handful of sources of income. It charges a $25 fee for publication of the list of jobs in six major U.S. cities. It charges $75 for a list of jobs in the San Francisco area. Post, the company is a $10 fee to the list of renting an apartment in New York. Revenue generated from these fees only cover the operating expenses of Craigslist. The company has not made a profit since its inception. This is meant – and Craigslist CEO Jim Buckmaster to create a superior user experience is more important for the company to obtain money.
Potential Sources of Income
Craigslist is to look at other sources of income, such as including advertising banner or Google text ads. However, the company still hesitate to do so because it fears that the ads take away from the quality of the site. Craigslist president Jim Buckmaster noted that the site years ago deliberated on charging for job listings and, therefore, turned into a banner ad may take time to unfold.
Confusion about the Business Model
Wall Street analysts such as UBS are confused about the Craigslist business model. According to that Buckmaster generate profit is not a central goal of the company. It takes in revenue from job listings to cover operating costs, but the organization has yet to make a profit in its history.
The company does not see a problem with this, but it focuses almost exclusively on the maintenance and improvement of the site. They also do not need more revenue because it has no plans to hire more staff. Craigslist operates with only two of dozens of workers.
Impact on the Newspaper classifieds
Since its inception in the late 1990s Craigslist, and decreased revenue generated from newspaper classifieds significantly. A study conducted by the Newspaper Association of America revenues fell between 2000 and 2010, from $19.6 billion to $6 billion. Which represents a decline of 70 percent, this does not seem to be slowing trend. Although many factors contributed to this decline, the Association believes sites like Craigslist played a major role in the reduction of revenue in the newspapers. This makes sense given that it costs consumers nothing to post on Craigslist while newspaper ads can be quite expensive.