Is it really so easy for the Facebooks and Wal-Marts of the world to use a national platform like Oodle or LiveDeal to successfully launch classifieds? Jay Schauer, a friend who runs Ad2Ad.com, doesn’t think so. (Among other services, Ad2Ad automates classifieds for community and college newspapers.)
Schauer complains that “people seem to assume that classified advertising is an easy business to understand and enter. It’s not. It’s a business that demands fierce commitment to localization, understanding the nature of the small local advertiser, and a commitment to small, individual sales.”
Schauer notes that it is “hard ground for start-ups driven by dreams of an IPO. In the past year I’ve seen three competitors drown. Two others are careening toward the treacherous shoals of this turbulent sea. It gives me no pleasure. Good people with good intentions and lots of hard work wasted — it’s a shame and I mean it.
“What those failing groups seem to have lacked is the desire to get down and get real with the individual advertiser who will actually pay for classifieds. That customer is not rich, not sophisticated, not interested in pretty, elegant or cool.”
He goes on to note that “the bulk of classified advertisers live in small towns and tight neighborhoods. They don’t build social networks. They are typically the salt of the earth — and hence of little interest to VCs. This customer wants RESULTS FAST. They want to get information to their neighbors — who are also their customers. Most important, they will pay a reasonable price to do so.”
“Classifieds are not pretty,” says Schauer. “But the economic engine they support is large and remains robust. More important, the neighbor-to-neighbor business interaction is core to the strength of the greater economy and to our political well-being.”