Recycler site sets sights on Craigslist
Recycler.com’s Pamela Johnston with staff outside their Miracle Mile office. Photo by Ringo Chiu.
If you wanted to sell your used car in Los Angeles, the Recycler was once your publication of choice. You could get a free, basic classified ad touting its low mileage and low price.
Then came Craig and his list. The Recycler responded with an L.A.-oriented online listing of classified ads. The Recycler’s print edition held on, but its website couldn’t compete once San Francisco’s Craigslist became the leading force in Internet want ads.
Now Target Media Partners, the L.A.-based owner of the Recycler and 59 other classified print publications across the United States, is trying a different strategy. It stopped its individual city-based websites and last month it rolled out a single national classified website, Recycler.com.
Target Media still has 60 city-based classified newspapers. And it thinks they’re a strength because an advertiser can get a basic listing in both the local newspaper and on the national website for free.
The goal is to challenge Craigslist, and Target Media believes Recycler.com can tap into customer dissatisfaction with the online classified market leader.
“When we talked to users and were surveying them, we found that there was increasing frustration with Craigslist,” said Pamela Johnston, chief operating officer of Recycler.com. “Buyers complained that you get so much spam and sellers complained that after a few days their listing sunk deeper and deeper. We’ve tried to make it better for the advertisers and the buyers.”
A spokeswoman for Craigslist declined to comment.
Recycler.com works much like Craigslist: People can post a classified ad or look at them for free.
But an L.A. resident selling a sofa or a saxophone on Recycler.com would also be given the option of placing a free ad in the print edition for Los Angeles and the San Fernando Valley. Recycler also offers print customers a free web ad. That way, Johnston said, advertisers can reach potential buyers in both mediums.
“If you want to reach everybody, you should be in print and online,” she said.
The print version of Recycler is free to consumers and can be found in coffee shops, gas stations and grocery stores. Some Target Media publications cost $1. Many of them have a name different from Recycler.
Although Recycler’s basic web and print classified ads are free to advertisers, it charges for “enhanced” web classifieds. Those give users the option of adding more than one photo, or having their listing appear higher in searches or for a longer time. The enhanced ads cost between $7 and $29.
Target Media charges its small business and commercial advertisers, such as used-car dealerships or furniture stores, for print and online classified ads in bulk packages.
Kirsten Mangers, chief executive of Irvine online advertising broker WebVisible, believes the combination of Recycler.com and Target Media’s print publications could be especially valuable to small businesses.
“It gives them extended reach and distribution,” she said. “It gets the message out there and helps move their inventory.”
Johnston estimates that Recycler.com started with a base of 750,000 visitors and many paying advertisers. She predicts that the website will generate enough revenue to make a profit by the end of the year.
Recycler.com is planning to use its combination of print and Internet to draw advertisers who currently use Craigslist and automotive sites such as Cars.com or AutoTrader.
Recycler.com is also promoting a number of features not found on Craigslist. They include a photo slideshow option and targeted-search functions that allow users to narrow results so they don’t have to scroll through pages of irrelevant ads.
Recycler.com won’t offer any “adult services” categories that have made Craigslist controversial.
The website, which employs 40 people locally between its headquarters in Sherman Oaks and an office space at the Target Media offices in the Variety building on Miracle Mile, also reviews every classified before it is posted online to make sure it belongs there.
Recycler.com said it’s approaching 1 million monthly visitors to its website, compared with Craigslist’s 50 million. Craigslist’s local pages made up 97 of the top 100 classified websites last year, according to a report from Altamonte Springs, Fla., consulting company AIM Group.
Given the situation, experts believe Recycler and similar services may be able to survive comfortably in their niche. But seriously challenging Craigslist is a different notion.
“Craigslist has become somewhat pervasive and part of our culture,” Mangers said. “But Recycler has that brand equity. People know that it’s a reliable source.”
Mark Whittaker, consultant for AIM Group, agrees.
“It might be difficult for anyone to overtake Craigslist at present, but it’s still possible to create and run a successful classified advertising business,” he said. “Craigslist provides one option, but it isn’t the only option and it never will be.”
Recycler was founded in Los Angeles in 1973. The print classified paper grew to 18 regional editions and photo magazines by 1998, when it was purchased by Times Mirror, then the parent company of the Los Angeles Times. It also launched Recycler.com in 1997 as a local companion website to the publications.
In 2007, Target Media Partners, which already owned some classified publications, acquired the website and the network of regional classified publications, then bought others across the United States.
The launch of the national Recycler.com comes during a period of transition for the classified market. Annual revenue from print classifieds is expected to drop to $5.6 billion this year, down from $6.2 billion last year, according to a report from Charlottesville, Va., media research company SNL Kagan. That number is predicted to sink to $4.9 billion by 2014.
Revenue from Internet classifieds also took a hit, a decline that’s seen as linked to the recession. It’s expected to drop from $2.2 billion last year to $2.18 billion this year. But in contrast to print, it’s expected to increase to $2.6 billion by 2014.
Deana Myers, a senior analyst for SNL Kagan, said Internet classified revenue has yet to come close to print revenue because local newspapers and classified papers continue to capture a large portion of a community’s ad dollars.
“They have lower price points and are more targeted,” she said. “They’ve taken a hit but we assume that smaller papers will keep that trend going.”
Johnston said that industry numbers don’t necessarily indicate a decline in revenue for Target Media’s classifieds because their business model differs from newspapers with a classified section.
“I wouldn’t say we’re experiencing a downturn in revenue growth in print, but over time people believe there will be more of a preference for online,” she said. “It’s smart for Target Media to participate in both channels because we believe that, for a long time, people will use both.”
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Rival Reborn Recycler site sets sights on Craigslist Recycler.com’s Pamela Johnston with staff outside their Miracle Mile office. Photo by Ringo Chiu. If you wanted to sell your used car