Online Classified Ads Build Site RPMs and Revenue

An effective online classified ad strategy will provide a valuable revenue stream that enhances that revenue coming from other sources such as display ads.

Just to be clear, online classifieds are pure text ads presented in a directly-style format. In effect, they are a form of paid content.

A site that focuses mainly on display ads — say three to four ads per page — will have an RPM limited by those ad positions. But imagine what happens to the RPM when those three to four ads positions are on pages with classifieds.

Tactics to Boost Market Share

Several tactics will boost a site’s classified ad volume and market share.

Display classified categories prominently on the home page of your site, especially in the navigation bar. Some newspaper sites even display classified categories above the news categories.

For a local media site, break out employment, automotive and real estate into separate top-level navigation items.

Promote heavily offline and online to increase awareness of the service. For a big site, distribute fliers to staff and provide training. Repeat the training quarterly to make sure that new hires are covered and existing hires are reminded about the offerings.

Place the fliers on the Web site and include links to the classified section of the Web site within the email signatures of classified staff.

In addition to a presence on the navigation bar, put “Place an Ad” in a prominent positions on the home page. Run house ads through the display ad positions of the online advertising software.

Online Order Entry

For any sized newspaper or online-only site, develop order entry pages. The first and most simple approach is a form that can be emailed from the site to whomever on the staff processes the ad.

The second and more effective approach is an online order system that is integrated into the newspaper classified system or the online content management system. A site staff can build a simple interface with some basic knowledge of HTML forms.

Either type of form should require the advertiser to provide name, address, phone number and email address.

The site or classified staff receives the email and either calls the customer or responds by email.

The response will include the final price of the ad. The transaction can take place over the phone via credit card.

A more advanced approach involves the client filling out the form and getting redirected to an on-site (and secure) payment processing page where they finalize the transaction, again with credit card.

An alternative for sites that can’t do on-site transaction processing can be PayPal or a similar service to complete the process.

These services often provide buttons that the site can use. When the client finishes filling out the form and submits it, they either go to a page with the price and a button taking them off site for credit card processing or they are sent directly to such a site.

The credit card processor then sends a notification to the site or classified staff indicating that the client has paid for the ad. The staff then processes the ad for print and online publication.

Classified Pricing

Magazines, newspapers and other periodicals that sell classifieds have a strong need to protect the print revenue while growing the online revenue.

Print ads are more expensive than online ads because of the underlying costs of producing them — especially the print production and circulation costs.

Online classified ads have to be priced high enough so that they don’t undermine the print ads and be priced low enough to be competitive.

Develop integrated rate cards that deliver value. A print and online combination should have discounts for both products when bought together.

Print alone should be more expensive than the print part of the combination, and likewise the same for online. If the prospect isn’t attracted to the combination, then the attraction of online’s low price and reach into new audiences has to be the pitch.

Pursue accounts that have never advertised in the paper or on the site or have been inactive for more than six months. In particular, pursue accounts that already advertise with other pure online competitors.

Volume drives more volume. Once the momentum starts to build and your site has more listings than the competitors, the sales effort becomes easier. Everyone likes to hang around the most popular kids in school.