A report on

Online Classifieds

NIKITA RAHA
nikitaraha6@gmail.com |
A report on online classifieds

A detailed report on online classifieds

We are all certainly aware of the decline of print classifieds, a once significant revenue streams
for newspapers. According to the newspaper association of America, US classified advertising
revenue shrank from $20 billion in 2000 to around $5 billion a decade later.

So in this market, sky is definitely falling if it hasnt collapsed.

The key challenge facing media in the development world, especially print media, is to decide how
to respond to this digital transition. Here arises two key questions:
1. Are classifieds or their close related directories important to your business today?
2. What unique strengths can your organization use to compete online?

If you got the answer it is enough for guiding a media company in market where the transition
from print to digital classified is underway.

What is online classifieds?

Online classifieds is a form of advertising which is particularly common in internet media with
sole aim of promoting a product, an event or any form of service to attract the targeted audience.

Three of the notable service providers in this market in India is OLX.in, Quikr.com and
yellowpages.co.in.

Reasons which prompted the flourish of the classified sites

The conventional method of print media was a very costly affair until the online classifieds entered
into the ground. The wide reach of internet technology and its inevitability in daily life gave the
advertisers an obvious reason to go online as well. The online classified websites not only give the
users flexibility to post their advertisements free of cost but also give them an option to make their
advertisements reach millions of internet users easily.

Before the flourish of online classifieds in India, Classifieds Company like US based Craigslist
was performing tremendously well in US market. It was bringing classifieds to the masses by
allowing everyone to find roommates, baby sitters, couches, etc. for free. This idea attracted
businessmen to bring free classifieds to the rest of the world and thus provide a great public service.
They took the basic concept of Craigslist, i.e. simple, local and free and customized it based on
the needs of the country.

Source of Revenues for the online classified sites:

Premium listings:
Premium ads help you make your ad more visible, reach out to more consumers and sell
your product or service faster. There are 2 types of services for Premium ads: Top of Page
and Urgent. A Top of Page ad costs more than an Urgent ad because of its position on the

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A report on online classifieds

page and ability to get you more visibility. You can even combine the two options and buy
a Top and Urgent Ad.
Paid postings:
The sites also collect fees for posting the ads for more than a specified period most
specifically 30 days or more.
Advertisements and banners/AdSense or google AdSense:
AdSense is a modern way to monetize your web traffic, and very easy to implement. It has
proved to be one of the top earners for the companies. Google.com earns most of its revenue
by allowing other website owners to advertise on their search results pages. All this is
managed through a program they call AdWords (pay per click marketing). We can see
these ads displayed on the pages of the classified websites in a separate column on the
page. These are called Sponsored Results, and the advertisers are paying pay per click basis
for these ads. It's an auction-based system that allows advertisers to compete for those
spots. Whomever has the highest bid and most quality ad, gets the top spot.
Lead generation:
Lead generation is the use of a computer program, a database, the Internet, or a specialized
service to obtain or receive information for the purpose of expanding the scope of a
business, increasing sales revenues, looking for a job or for new clients, or conducting
specialized research. Leads can consist of the names and addresses (or e-mail addresses)
of individuals, corporations, institutions, or agencies. Lists of leads can be gathered or
filtered from targeted databases such as telephone and Internet directories.

In sites like Quikr, OLX and yellowpages.co.in, with every person visiting or registering,
they are actually providing free database to the companies. Location, Income groups, etc
are valuable data for business research processes. So this companies utilizes these to earn
revenues as well.

Illustration 1: Lead Generation

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A report on online classifieds

Source of revenue for the online classified sites

Online Classified Premium Listings and Advertisements Lead

sites Postings Generation
Quikr
OLX
Yellow pages

The table briefly explains various sources of revenue for the online classified sites. Out of
these, Lead generation and Premium postings add to more than 50% of the companys revenue
while the conventional advertisement earns the remaining. Recently, OLX discontinued its
premium listing and posting from its website citing low level of market maturity as the main
reasons. This strategy somehow makes sense when it comes to winning the competitive edge
over other similar online classified websites.

Marketing strategy:

Olx & Quikr are an online classified advertisement medium and has become a meeting point for
consumers to consumers. Both brands have changed entire scenario of classified advertisement
sector within last few months and enhanced brand awareness and consumers experience with
online classified in Indian market.

Founded: - Olx in 2006, Quikr in 2008, YellowPages in 1988

Total Online Classified Market in India: - Approx. INR. 1500 to 1800 Crore

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A report on online classifieds

The OLX and Quikr are two major market giants in online classified market, others
comprising only 33%.

Marketing strategy of the classified websites towards target audience

Applying C2C (Customer to Customer) policy and facilitating transaction at local level.
Providing an opportunity for the advertisers to post their Ad along with the image free
of cost and to remain with the website for longer period of time than the newspapers.
360 degree Brand activation & communication campaigning strategy including TVC,
Print, OOH, and Digital.
An aggressive advertisement campaign of Sell:- Quikr communicating message: -
photo kheech, quikr pe bech i.e. (Take a photo, sell on quikr) Olx communicating
message: - phone ko banao sell phone i.e. (Make your phone sell phone). Subsequently
2nd phase of brand campaign conveying similar message is that earn from home by
selling used goods.
Flipkart has recently integrated with Olx for joint marketing campaign and also has
initiated few campaigns. The endeavor is urging consumer experience by offering sell
used products on Olx and buy new brand from Flipkart. This integrated strategy is like
value-for-money for not only consumers but also brand too which will be also
influencing on cost too.
In the last one month, Quikr has tied up with online comedy channel AIB and also created
branded content for Star Plus, apart from launching three TVCs. Attracting the youths
attention has been the companys primary focus. According Vineet Sehgal, Chief
Marketing Officer, Quikr, said, Being an online classifieds site, our primary target
group is youth. So, we realized that other than being present in the traditional advertising
space, we also got to be where the youth is today.
Active integration with various social networking and media sites to gain popularity

Facebook : The Facebook page, boasts of a huge community of 25 lakhs and sees
some really good engagement. They also add link to their website with every
update. If we click stats on bit.ly, they do get some good clickthroughs.

Illustration 2: OLX activity on Facebook (Source: Simplify360 A Social Media Analytics Tool)

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Twitter: They share the same updates that go out on Facebook. Along with that
they hold contests regularly. The recent one was the
#ReplaceMovieTitlesWithBechDe which trended widely and before that was
#BechDe. The use of hashtags were just appropriate and shows the sense of
branding.

Illustration 3: OLX activity on Twitter (Source: Simplify360 A Social Media Analytics Tool)

YouTube: Their activity with Mrs. Bech De is still on air. The program is nice
and people seem to be liking it as well. It could be a nice content angle for them
apart from being a nice branding activity.

Introducing Mobile apps: With a wide and enhanced reach of smartphones in every
corners of society, mobiles are going to be a very important tool for supplementing to
the growth of the online classified industry. Both companies offer mobile apps on a
number of platforms. OLX has mobile apps for the iOS, Android, Windows Phone,
Symbian and BlackBerry platforms while Quikr apps are available on Android,
Symbian, Windows Phone and Java (for feature phones) platforms, but it does not have
apps for iOS or BlackBerry. The Quikr and OLX app also comes pre-loaded with a
number of handsets of Sony, Nokia, Micromax and Huawei Sonic.
Quikr introducing Quikr NXT: Online classifieds website Quikr recently launched a
new feature, called Quikr Nxt, which allows users to chat using the website or mobile
app. This means users can choose to make a listing private, which hides their email ID
and phone number on the site. So more people will feel free and safe to post their ads.
This will result in more visitors on their website which means more hits on the sites.
This consequently escalates the popularity of these sites and thus more advertising cost.

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Market Growth and Site Performance

Growth of business of OLX.in

One of the biggest reasons of its growth is that Mobile traffic for OLX.in has grown from just
5 per cent of overall traffic in January 2012 to more than 55 per cent of overall traffic in 2014,
and continues to accelerate and grow at a blistering speed.
As per sources OLX mobile apps have exceeded 3.2 million app downloads in India, and is
amongst the top ranked and rated apps across all mobile app stores.
Personal used goods comprising mobiles, computers, electronics, furniture, general household
goods, cars and bikes are the top categories on OLX.in, comprising 70 per cent of the new ads
being listed and 92 per cent of sellers in these categories being individuals.

Growth of business of Quikr.com

The company also visions to grow 5 times the current volume in coming one year, indicating
confident business approach from the company.
The firm has raised around $50 million in five rounds of funding over the past four years which
has proved the investors belief in the company.
The site currently sees 26 million users per month due to its aggressive marketing scheme
indicating an obvious growth in reputation and business share of the company.

Search Traffic for Olx, Quikr and Yellowpages

Illustration 4: Google Trends comparison of OLX, quikr and yellowpages

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Search Traffic for subdomains of OLX, Quikr and Yellowpages

Subdomain Percent Subdomain Percent Subdomain Percent
of of of
Search Search Search
Traffic Traffic Traffic
olx.in 84.94% quikr.com 39.75% yellowpages.com 99.24%

ssl.olx.in 5.49% mumbai.quikr.com 18.07% accounts.yellowpages.com 2.69%

newdelhi.olx.in 4.13% delhi.quikr.com 16.39% sales.yellowpages.com 0.16%

bangalore.olx.in 2.82% bangalore.quikr.com 12.98% interconnections.yellowpages.com 0.07%

mumbai.olx.in 2.56% hyderabad.quikr.com 10.88% lui.yellowpages.com 0.07%

As evident from the Illustration 4, the search traffic of yellowpages has declined a lot and
increase in search traffic for olx is remarkably more than that of quikr.
The table indicates search traffic for various subdomains of the classified sites which
indicate pretty balanced search traffic for quikr indicating wide awareness of the brand.

Regional Search Volume for Olx, Quikr and Yellowpages

yellowpages.co.in
100
90
80
Search Volume

70
60
50
40
30
20
10
0
YELLOW PAGES
Region in india

Tamil Nadu Delhi Karnataka Gujarat AP Kerala Maharashtra WB UP

Illustration 5: Regional search volume (in %) for yellowpages.co.in

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quikr.com
100

80
Search Volume

60

40

20

0
QUIKR
Regions in India

Goa AP Karnataka Pondicherry Jharkhand WB UP Odisha TN Kerala

Illustration 6: Regional search volume (in %) for quikr.com

olx.in
100
80
Search Volume

60
40
20
0
OLX
Regions in India

Goa Andaman & Nicobar Pondicherry

Karnataka AP Manipur
UP Odisha J&K
Punjab

Illustration 7: Regional search volume (in %) for olx.in

The regional search volume analysis for a website help us to analyze region wise reach of
the website in a country. The region having less search traffic needs to be targeted more
for increasing scope of business in that region.

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As evident from Illustrations 5, 6 and 7 the websites of olx, quikr and yellowpages is
accessed all over the country. However, olx has more even search volume throughout the
nation indicating to its more familiarity with the users. Business is more promising in the
indicated areas which emphasizes on customer demand.

Engagement of visitors to the site (Source: alexa.com)

Online Classified Bounce Rate Daily Daily time on site

Sites Pageviews/visitor
olx.in 19.50% 10.01 9:16
quikr.com 25.30% 14.27 16:16
yellowpages.co.in 54.30% 3.46 03:28

Bounce rate of a website indicates the percentage of visitors who enter the site and leave
the site rather than visiting other pages within same site. Least bounce rate in olx.in
indicates attractive and easy to use interface. On the other hand, yellowpages.co.in seem
to receive poor response from the visitors with a bounce rate of 54.30%.
quikr.com tops in terms of daily pageviews per visitor indicating the website is more
navigable and visitor spends more time on quikr than olx and yellowpages.
quikr.com also exceeds other competitive classified sites in terms of daily time on site
indicating wide popularity and acceptability among the users.

Future of online classified websites

Certainly, the future of online classified seem economically strong. Many players have come up
in the arena of online classifieds since the profit of print advertisement started declining. Every
brand is expected to face a tough competition and only the quality will prevail. The mobile phones
will be a major decisive factor for determining the big player of the online classified market. The
mainstay of the business will be the web designers and application developers along with
meaningful advertisement of the brand.

The current business of online classified market is around 2000 crore even when only 20% of
Indian population uses internet. With this we can have a clear projection of the strength of online
classified market if internet usage enhances in near future.