Online Classifieds: NTR Gold
by Lisa M. Osborn
Why let the local newspaper continue to corner the
market on classifieds? With the dot-gones and the economy stalling,
now could be an ideal time for your station to develop a successful
online classifieds program.
Despite decline
"There’s been incredible growth in print
classifieds over the last 20 years," said Mary Clark, director
of strategic local initiatives for Clear Channel, "from $4.2
billion in 1980 to $19.5 billion in 2000, with the employment category
seeing double digit growth more often than not," Clark said.
That’s according to figures from the Newspaper
Association of America, which said employment represents 45 percent
of overall print classifieds revenue and is the strongest print
classifieds category.
Clear Channel is bullish on online classifieds. The
company offers them on most of their station sites through a relationship
with BuySellBid.com, which provides the technology and content behind
the radio giant’s current online classifieds initiative.
Clark believes the revenues will be there for broadcasters
who get involved with online classifieds early on. It’s easy
to figure out how much opportunity is there: Just look through the
classified section of the Sunday paper, count the ads, note the
rates and do the math.
Immunity
Clark is interested in employment classifieds for
a few reasons. They offer multiple revenue streams such as job and
résumé postings and they are immune to what’s
going on in the economy.
Clark realized the revenue-generating opportunity
of online classifieds through personal experience.
"I thought about how much money I’d spent
myself on classifieds when looking for a an account executive for
business or a nanny for my children. Then I wondered how much money
my neighbors were spending," Clark said.
"Global sites such as eBay Inc. are excellent,
but my belief is that we’ll find out mainstream America prefers
local when it comes to expediting the process of selling online."
Broadcasters can deliver a unique opportunity to
real-estate companies using online classifieds.
"For our local realtors, this is another excellent
cross-platform opportunity … it’s a win-win opportunity
for realtors to really reach the home-buying community – reducing
the time between actual listing of the home to sale of the home,"
said Clark.
Go get ’em
"Real estate and automotive are the two biggest
buyers of classified ads in the newspaper," said Dave Casper,
vice president of Internet services for the Radio Advertising Bureau.
He urges stations interested in getting involved with classifieds
to focus on a single class, such as employment/recruitment or real
estate.
"Pick one category, get good at it and move
on to the next. That’s what a station should do with its Internet
strategy in general," said Casper. "Focus on one or two
things that make revenue, master them, then move onto something
else."
Start-up costs are minimal when partnering with an
established online classifieds company, that will be able to deliver
a site populated with ads virtually from day one. In order to be
successful, a station should plan on devoting 20 to 30 60-second
spots per week to drive traffic, according to companies contacted
for this article.
Typically revenues are split, with the station generally
keeping 45 percent to 70 percent of Net revenues.
Help wanted to grow
"The biggest reason why (stations) should do
this is because employment advertising is going to be a $7.1 billion
dollar business by 2005," said Andrew Hammer, manager of business
development for Canton, Ohio-based Top Echelon. Its product, the
"Employment Classifieds" plug-in, can be integrated into
a station’s own Web site.
"It’s a great opportunity for a radio station
to go into a local market, where they’re already focused, generate
a new revenue stream and compete with the local newspaper,"
Hammer said.
This isn’t a "get-rich-quick" scheme.
Hammer provides an example of one Top Echelon TV-station client
that generated $70,000 in its first three months, but on average
most Web sites make much less, in the hundreds or thousands of dollars
per month range.
Revenues are tied directly to how much a site is
promoted. Hammer said most sites aren’t seeing a significant
amount of revenue right now, but as rounds of layoffs continue,
there’s a reason for listeners to be visiting employment sites.
Broadcasters should think of classifieds as a sales
tool, which enable a station to develop attractive advertising programs,
according to Hammer.
Your choice
"A station can sell a package that includes
online, radio and a remote broadcast in front of the store,"
said Hammer. "It’s up to a station’s staff to decide
how creative they want to get."
The people behind RegionalHelpWanted.com have taken
a different approach. The employment site has had success building
classifieds sites in medium-sized markets by directing listeners
not to a station’s Web site, but to the locally branded "YourTownHelpWanted.com"
site.
Dick Orkin, whom the NAB recently announced will
be inducted into the NAB Broadcasting Hall of Fame next April, produces
"YourTownHelpWanted.com"
commercials at his Radio Ranch. Each site is customized for its
market.
To hear example spots, visit www.regionalhelpwanted.com
and click "How it works."
"We have nothing to do with a station’s
Web site," said Eric P. Straus, CEO and president of RegionalHelpWanted.com
in Poughkeepsie, N.Y. "If (broadcasters) want to give us a
link on their site, great, but we don’t require it." Straus
said that a jobseeker wants to visit the strongest brand rather
than the local radio station Web site when looking for a job.
Although he said it’s the hardest part of the
job, Straus encourages competing stations to team up to promote
the site to the community, share revenues and take a bite out of
the newspaper’s bottom line.
"If you care about making money, you should
work with your competitors to help build the preeminent site in
the market," Straus said.
Strike newspapers now
"Newspapers have owned this monopoly for (a
long time). We need to change employers’ habits," said
Straus. "Get them to transition from the newspaper to the Web.
Great radio creative and strong reach and frequency can get that
job done. Just not immediately."
Straus encourages stations to sign on for the long
run.
"Our sites start to make a lot of money after
9 to 15 months, but many broadcasters think if they can’t get
it done in a month or two, it ain’t worth it," Straus
said.
"They’ve had terrific results," said
RAB’s Casper about RegionalHelpWanted.com, "showing lots
of return for their stations."
Interest is growing among station managers, according
to Hammerstrom, who said more consumers are making the Internet
the first place they start to look when shopping for a vehicle.
Automotive classifieds site carsforsale.com
arms account executives with marketing materials and research data
to enable them to compete with newspapers for auto classified ad
dollars.
"When I was a car dealer my newspaper sales
rep was in my office every Monday morning," said Mark Hammerstrom,
chief executive officer of Minneapolis-based carsforsale.com.
Face to face
"Signing on with carsforsale.com
gives radio reps a reason to call on the local dealers, work face
to face and become their marketing partners."
When a radio group partners with carsforsale.com,
"The station in the market becomes carsforsale.com,"
said Hammerstrom. "That’s where you get the local flavor
of the site, which is much more competitive than the national sites."
Hammerstrom attributes his company’s success
to the fact that they aren’t competing with the dealers.
"We are a lead generator for the dealers and
enable them to track the results of their radio advertising."
Carsforsale.com
stays away from providing financing options and aftermarket accessories
on their site because these have long been profit centers for dealers.
Stations that are dipping their toe in the online
classifieds waters are finding, whether it’s employment, real
estate or automotive, now is an ideal time for radio broadcasters
to devote energy to developing and promoting online classifieds
for their stations.
"Revenue growth will be there online, said Clear
Channel’s Clark. Broadcasters putting a concerted effort into
this space will be there to reap the rewards when the market becomes
substantial, as will our advertisers. It’s a joint venture
at this point."
Lisa Osborn is a Los Angeles-based radio broadcaster
and the founder of Traffic411, a service that provides real-time
traffic maps and information to media Web sites. Contact her via
e-mail to InfoRadio@aol.com.
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