Classified ads are still alive and kickin'...for now.
It's the year 2010 and you need a job. You pick up your local paper and flip to the classifieds. Your eyes skim past the Web listings that invite you to visit the company online. Remember when each classified was an inch or two long? Now they're reduced to two-line Web addresses. The ad that finally catches your attention: a color photograph of a woman in a business suit, talking to clients on the beach. The headline reads: "Mixing business and pleasure has its privileges." The ad doesn't specify the type of business nor does it describe positions available. The last line reads: "Visit us at www.BestCo.com."
That - arguably - is one of many shapes print classified ads could take in the near future. By some accounts, classifieds will become a laundry list of Web addresses, a starting point for those selling or buying products and services. And some, like Edward McKersie, have an even more grandiose view: "The print classifieds of the future will look more like fashion ads - less text and more jumping out," predicts the president of Pro Search, Inc., a recruitment firm in Portland, Maine.
Over the past few years, as the New Economy continues to rewrite the laws of business, online pundits have predicted the demise of print classifieds. "The Internet will eliminate classifieds as we know them," wrote Chris Charron, a Forrester Research analyst, in his 1998 report entitled Goodbye to Classifieds. "Online spending will cut into newspaper revenues to the tune of $4.7 billion by the year 2003, a 23 percent reduction from the projected $20 billion in auto, job, and home classifieds newspapers would get in the absence of the Net." Even the Newspaper Association of America (NAA) initially feared the worst, predicting in a 1996 report, Classified in Crisis, that newspapers would lose up to 50 percent of all classified revenue by 2001.
Indeed, more companies are recognizing the benefits of migrating classifieds online - cost, speed, and wider reach, to name a few. Online classified ad revenues rose to $185 million in 1998, a 54.2 percent jump from the previous year, according to Veronis, Suhler and Associates. Within the category, the recruitment arena has seen the biggest gains - no surprise, since the cost of a three-line ad in a newspaper averages $1,383 for a two-month run. The same ad on an Internet job board costs $152. Says Forrester senior analyst Charlene Li: "Online recruiting is more efficient than newspapers or hiring agencies. Recruiters plan to increase online spending 52 percent by 2004, primarily at the expense of print advertising and search agency fees."
Yet even the loudest doomsayers will concede this point: Print classifieds aren't about to disappear completely. And the print world isn't about to let go of valuable revenue streams without a good fight. Revenue from print classifieds totaled $18.6 billion in 1999, a 4.3 percent increase over 1998, according to the NAA. While this growth is less than stellar in today's booming economy, the NAA maintains that print classifieds are here to stay. And yet, about two-thirds of the country's 1,500 daily newspapers now have electronic versions, and more than 500 of them post their classifieds online. In another decade, even small-town papers will migrate to online classifieds, predicts Leland Westerfield, a senior media analyst at PaineWebber. By then, classifieds will make up 10 percent of a newspaper's revenues, rather than the 40 percent chunk it garners now, says Westerfield.
Even so, there will still be a segment of the population that either isn't wired or chooses to receive information in ink. Says Kevin McCourt, director of online classified advertising for the NAA: "One hundred years ago we had about 90 percent market share, because we were the only medium out there except for notices in the town square. As each new media came on board - radio, TV, direct, cable, and now the Internet - our market share has decreased, because it obviously has to come from somewhere. But look, we're still here."
Today's online readers still don't mind smudging their fingers with old-fashioned newspaper ink. In a 1999 study, the NAA found that Internet users are more likely to read daily and Sunday print newspapers than the general population: 74 percent of Internet users read the paper on Sunday and 61 percent read a daily paper, compared to all U.S. adults, of whom 67 percent read the Sunday paper, and 57 percent read a daily. And of the Internet users who read online newspapers, 74 percent say they continue to read the print versions as often as they did before getting wired.
The NAA study also asked people to list all the sources they turn to for automotive, home, and job information. It found that 42 percent of online users in the market for a car consulted newspaper print classifieds, while 38 percent went to the Web. For real estate, 28 percent checked newspapers and 21 percent surfed the Web. And for employment, 36 percent read the papers and 31 percent visited the Web. Says McCourt: "People add each medium to the number of resources they can turn to. They don't give up the old entirely. The closer people get to making their final decisions, the more information they seek from as many different venues as are available."
Print will continue to play a role in that mix, even if that role morphs into something new. Print classifieds may take on more of an image-building flavor, telling people why they should work for or buy from a certain company, rather than list every detail. "Print classifieds will become yet another front door for linking into deeper databases of information online," says David Israel, CEO of Classified Ventures, an auto and real estate classified site founded by eight major newspaper companies, including the New York Times and the Chicago Tribune. "They will be smaller display ads, teasers, with just enough information to get you interested. And then they'll direct you back to a Web site where the company can provide richer information - photos, videos, links to reviews, etc. - and a facility for contacting them."
Classifieds may change physical format, as well. Newspapers may begin to sponsor niche publications devoted to local jobs in specific industries to supplement the classified sections of their newspapers and to accommodate job seekers with hectic schedules. For instance, healthcare professionals may not have time to access the Internet at work. Placing a printed guide in hospitals, for example, may become a better way to reach this market. In fact, healthcare is one of the few industries in which Kathe Bass, management supervisor at communications agency Bernard Hodes Group, still recommends using printed classifieds, at least in the short term. "This group is not going to the Web yet. They're still looking to newspapers and industry journals to check up on the marketplace," says Bass.
So far, a majority of Americans remain intensely loyal to their local papers. A whopping 71 percent of residents in non-metro areas read their community newspapers regularly and 86 percent of those say they use ads in their community newspaper to find bargains locally, according to the National Newspaper Association. Says Pro Search's McKersie: "Ninety percent of people looking for a job, even in today's global marketplace, are not looking to relocate. The transaction is a local one. So in that sense, newspapers have a strong advantage over the Monster.coms of the world."
For now, advertisers, too, are just as loyal to the ink medium. About 85 percent of companies still post job openings in newspapers and 56 percent of adults refer to them in their job searches, according to analyst Perry Boyle at Thomas Weisel Partners. Moving forward, print classifieds will continue to have life among higher- and lower-end jobs, forecasters say. But for recruiters of middle job categories - those with salaries between $30,000 and $150,000 - print classifieds are "going the way of the buggy whip," says Boyle.
That's because the Internet is increasingly cutting out the middleman. Company recruiters and job candidates who once turned to outside recruitment firms are now turning to the Web to find each other. Executive search firms, analysts say, will be used to find higher-level jobs because those positions require a greater level of discretion and recruiters need to cast a wider net for prospective candidates.
"But print classifieds will never disappear entirely," says PaineWebber's Westerfield. "You can still go to New England and find a horse and buggy maker. The introduction of the car didn't get rid of them completely." Who knows? Classifieds of the future may make Americans long for the simple days of today.