Rumors of Craigslist’s death have been greatly exaggerated, but the dot-com era site may be losing its dominance in the American real estate market. Craigslist’s revenue from real estate listings is down a hefty 23.8 percent from last year, falling from $13 million to $9.9 million in 2012, according to a report today from research firm AIM Group, which tracks the online classifieds industry.
Such a dramatic loss in real estate listings would help explain why Craigslist pulled out all the stops this summer to quash the popular housing search tool Padmapper, which aggregates listings from Craigslist and other sites and displays them on a map with extra search tools. Craigslist sued the one-man operation and its data provider 3Taps, added an "exclusive license" to its terms of service, and ordered search engines to stop caching its listings. Craigslist introduced its own "Map View," similar to Padmapper’s, about a month later.
Still, Craigslist’s overall finances look very healthy
Still, Craigslist’s overall finances look very healthy, according to the report. Revenues are estimated to be growing again after a sluggish 2011, albeit more slowly than in the past. Craigslist is projected to bring in a record $126 million in 2012, AIM Group estimates, an increase from $115 million in 2011 and $121 million in 2010.
The numbers are "conservative" estimates, AIM Group says, based on manually sampling listings and multiplying them by Craigslist’s rates: $10 for brokered apartment listings in New York; $25 to $75 for job postings in certain cities; and $5 to $10 for ads in the "therapeutic services" section.
Revenue from jobs listings was up 13.7 percent to $109.4 million, according to the report, accounting for the bulk of Craigslist's income.
Therapeutic services, which is full of offers for massages from beautiful girls, is also reportedly up 13.3 percent to $6.8 million. Some of that growth is because the section has adopted some of the refugees from the "adult services," which Craigslist shuttered after pressure from human interest groups who said it abetted human trafficking.
Craigslist is an extremely efficient company, with fewer than 40 employees. It also has plenty of easy options to boost revenue if needed: it could incrementally increase rates, or add fees for housing listings in one of its big, wealthy markets like such as San Francisco. Just last week, the company quietly started charging for jobs listings in nine new markets where posting the ads used to be free. AIM Group estimates that will bring in another $27 million a year.
Given its comfortable financial position, Craigslist has been content to offer users a very basic service that hasn’t changed much since its inception. Over the past eight months or so, however, Craigslist has started improving the site in order to head off challenges from startups like Padmapper, international players like OLX and Blocket, and potentially Facebook’s rumored new Marketplace. The classifieds giant may not be happy about getting its first real competition, but users will be.