Craigslist Business Model | How does Craigslist make money?

Pratyusha Srivastava Pratyusha Srivastava
Sep 20, 2021 5 min read
Craigslist Business Model | How does Craigslist make money?

When you are related to advertising, you must have come across one of the most brilliant and successful advertising websites - Craigslist. Started as a "side-gig" the brand truly made a remarkable presence in the advertising businesses and made its strong position in the billion dollars company's list. Sounds impressive, right? Well, yes! That's some pretty amazing strategies behind it.

Craigslist came out as a non-profit organization but soon the company took its level up and registered itself as a profit organization in the year 1999.

However, in the very same year, Craigslist bought a verified domain for its company in order to protect its brand significance and name in the market. Also, it made the subscribers more dedicated towards the brand.

But it can't be ignored that the tactics and strategies Craigslist applied in its marketing are pretty strong and present an example among the other companies. Talking about strategies, let's get a brief understanding of how Craigslist came out to be such a successful brand. So, Let's look at its business model and how it makes money.

What is Craigslist?
Where does Craigslist operate?
Target audience of Craigslist
Business Model of Craigslist
How does Craigslist operate?
How does Craigslist make money?
FAQ

What is Craigslist?

Craigslist Website
Craigslist Website

Before we get started with the business model of Craigslist, let's understand what really is Craigslist?

Craigslist is an online marketplace that provides services to people and companies for listing on its official website. They can post their listing of jobs, services, offerings, or sale items as per their requirements.

Craigslist was founded by a prominent American internet entrepreneur, Craig Newmark who is also known as a famous philanthropist. The brand was established in 1995 and is headquartered in San Francisco, California.

Today, Craigslist is known as one of the most visited websites across the world with a monthly visit of more than 500 million visitors.

Where does Craigslist operate?

Being one of the most successful advertising websites across the world, Craigslist operates in around 23 largest cities in the United States which are promptly listed on the homepage of the Craigslist website.

Apart from this, the brand serves over 700 cities across 70 countries in the world. The users can easily see the ads available in their nearby locations based on their residence.

Target audience of Craigslist

Craigslist targets every community, age group, and gender. As it provides ads in various categories across the globe, it does not target its audience specifically. So, Anyone with an internet connection can easily benefit from the amazing service of Craigslist.


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Business Model of Craigslist

The most amazing tactic that Craigslist uses in its marketing plans is offering the service of posting any sort of ad from any category by anyone, on its official website. And that's something that attracts more users towards it.

In fact, Craigslist allows users free classified services for posting ads. This makes the brand extremely different from the usual advertising companies.

However, when it comes to specific sections for advertising, Craigslist does charge some money that varies according to advertising plan and the geographical location.

With Craigslist, users get a wide range of commercial categories where they can list out their ads. Then when visitors see their preferential advertisement, they can get directly in touch with the user through the given contact information.

How does Craigslist operate?

Craigslist functions as a host for displaying classified ads from different categories including job postings, sales items, housing, business, service (Beauty, legal or lesson), and personal.

For classified advertising, Craigslist is absolutely free of cost and also for browsing and ad responding. It charges a definite amount of money in only some specific categories.

How does Craigslist make money?

The main source of revenue for Craigslist is charging the users for listing their ads in some selected categories. The rate varies as per the geographical location and the advertising plan the user opts for. Like for the listing, Craigslist charges around $3 to $75 based on the category and preferences.

Apart from these specific charges, Craigslist is absolutely free for the users as well as the users and interested candidates.

Initially, Craigslist came out with the freemium model that only attracts more customers and increases growth. The founders did their best in keeping Craigslist an affordable brand for the convenience of its users. Besides, the highest rate that Craigslist charges is $75 in the job postings section, that too in the United States; the brand did its best to provide the utmost choice and service for the users.


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Conclusion

To conclude, with time, Craigslist came out as one of the biggest and most successful advertising websites across the globe. Although the founders keep the numbers hidden, it's quite sure that they earned great profit through their website.

In the upcoming years, Craigslist will be seen with advanced business developments in order to emerge more promptly in the marketplace. Also, it would be providing new channels to the advertising industries as an alternative opportunity.

Even though the brand charges so little from the users and has such a simplified charging system, Craigslist still made a remarkable market presence.

FAQ

Who is the founder of Craigslist?

Craigslist was founded by Craig Newmark in 1995.

Is Craigslist available in India?

Yes, Craigslist has an India specific section and is currently available in 16 states.

Is Craigslist free?

Craigslist lets users post listings for free but for some specific listings users have to pay a fee.

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