I would be very skeptical of any startup trying to compete against Craigslist because, in addition to strong network effects, the latter has two difficult-to-replicate competitive advantages:<p>* Craigslist’s operating expenses are <i>ridiculously low</i> in relation to its <i>huge size</i>, allowing it to offer most services for free and still earn a profit. According to its public fact sheet, every month the site receives more than 50 million classified ads and serves more than 30 billion web pages.[1] Alexa ranks it as the ninth most-trafficked site in the US.[2] Yet somehow, the company manages to do this with just over 30 employees![1] On a per-year basis, that’s around 20 million classifieds per employee! Infrastructure costs are also <i>very, very low</i> in relation to traffic, as the site’s design, functionality, and interface are all ridiculously light and bare-bones.[3] No startup can match such ultra-low per-classified costs.<p>* While Craigstlist is technically a for-profit corporation, it operates as a <i>non-profit</i> organization,[1] so it is not seeking to maximize profits; instead, it is seeking only to be financially sustainable. Wealth-seeking entrepreneurs are at a huge disadvantage if they try to compete against a well-established entity that has <i>both</i> an ultra-low-cost advantage and no desire to acquire wealth over time.<p>In short, Craigslist possesses what Warren Buffett calls the “low-cost producer” advantage: it can offer a commodity service for less than anyone else.[4]<p>[1] <a href="http://www.craigslist.org/about/factsheet" rel="nofollow">http://www.craigslist.org/about/factsheet</a><p>[2] <a href="http://www.alexa.com/topsites/countries/US" rel="nofollow">http://www.alexa.com/topsites/countries/US</a><p>[3] According to this 2011 presentation, Craiglist, the 9th most-traffic site in the US, is powered by only ~500 servers located in two data centers: <a href="http://www.slideshare.net/jzawodn/lessons-learned-migrating-2-billion-documents-at-craigslist" rel="nofollow">http://www.slideshare.net/jzawodn/lessons-learned-migrating-...</a><p>[4] For example, read Buffett's description of GEICO’s competitive advantage in his 2000 letter to shareholders: <a href="http://www.berkshirehathaway.com/2000ar/2000letter.html" rel="nofollow">http://www.berkshirehathaway.com/2000ar/2000letter.html</a>
Up here, "north of the border" in Canada, Kijiji has cut a swath through Craigslist use. I rarely hear Craigslist anymore but Kijiji is almost ubiquitous for online classifieds, especially in my non-tech friends. "Throw it on Kijiji"<p>I don't know why it took off so strongly here in Canada but the speed at which it did surprised even me. I have also been surprised it hasn't done the same in the US since it's not <i>that</i> culturally different when it comes to online classifieds.<p>Edit: <a href="http://ontario.kijiji.ca/" rel="nofollow">http://ontario.kijiji.ca/</a>
I will have to agree with point #1. I don't care about the UI, period, the end.<p>I'm so used to typing sfbay.craigslist.org, and just search that I don't even think about it.
Textual list works great for me for most part. If I'm interested, I send an email, get a response. Done!!<p>Why do people think that putting a lipstick on a pig will make it more appealing when all I want is some pork.<p>Regarding scammers: there will be scammers in every alternate, at least thats what I think. It is my job to do the due diligence and take care.
I'd also say that a lot of startups don't do a very good job of competing. YardSale launched a big press push last week saying that they'd post your listing to Craigslist for you. The contact link in the Craigslist post goes to a sign-up form for the Yardsale app. Pretty much useless for selling anything and mainly just a user acquisition ploy.<p>I was actually pretty disappointed because I really care about how hard it is to post to Craigslist. I think that's a huge issue right now and will be for them going forward. As more people rely on smartphones as their primary computing device (and selling device for that matter---phone, sms, camera, email, etc.), there will be more opportunity to create something that takes casual sellers away (who are also buyers, wink). Obviously at niches at first, but it's going to be a serious weakness (if an 800lb gorilla can have a serious weakness). Call me crazy, but their complete disinterest in mobile (not Mobile, AL - <a href="http://mobile.craigslist.org" rel="nofollow">http://mobile.craigslist.org</a>) is IMO their Achilles heel.<p>Payments, reputation, spammers--I agree that none of that matters because it introduces way too much transaction friction (and annoying things like taxable income!)<p>What I do care about is that fact that in 2012, people try to sell their couch without a photo, when nearly everyone on an Internet-enabled smartphone has posted a picture to Facebook/Twitter/Instagram without even thinking twice about it. That's just weird.
Okay, so Craigslist's big advantage over everybody else is its user base, right?<p>But at least in my experience, most people who use Craigslist wish that there were something better that had a large user base. They don't like the UI, they don't like how many scammers there are, etc. They <i>tolerate</i> Craigslist because that's where the results are, but they would be happy to jump ship if they could get those results elsewhere, but with more pros and fewer cons.<p>It seems like this would be a good case for "conditional commmitment."<p>Kickstarter is a great example of a service that allows conditional commitment. Here's the problem it solves: People are reluctant to donate to a cause unless they know there is enough other support to make the goal viable. Kickstarter lets them conditionally donate, and their donation is only collected once some threshold of total pledges have been reached. (Side note: A Kickstarter for politics would be a great way for a third-party candidate to make inroads, don't you think?)<p>In the case of a Craigslist alternative, perhaps one strategy would be to have people commit to a proposed new service -- on the condition that some threshold of other people also commit. Once the threshold is reached, boom, it's like Black Friday, with a line of people at the door waiting to rush in en masse.
This article didn't bother to list the contents of the graveyard, so I tried. But all I can find are success stories:<p>* Kajiji - popular in Canada (according to another poster)<p>* OLX - popular in Spain and Latin America [crunchbase]<p>* okcupid<p>* AirBnB (mentioned in post)<p>* StubHub<p>* Etsy<p>* Legal Zoom<p>* Elance
"Everyone has their own theory on 2-sided marketplaces and mine is as follows: if you provide a seller with a pool of qualified buyers, and a transaction happens, they will continue to sell through you. Otherwise, they will go elsewhere."<p>See "positive network externalities", as mentioned here: <a href="http://news.ycombinator.com/item?id=4152078" rel="nofollow">http://news.ycombinator.com/item?id=4152078</a>
It seems like a mistake to compete with Craigslist in its entirety. They had years to grow their community and brand while maintaining a relatively low cost structure.<p>Startups that are concentrating on different pieces of the pie and providing a better experience seem to be on the right track. AirBnb, OkCupid, and the other companies listed in the comments here. Even in the jobs space I find LinkedIn jobs having more and better listings than Craigslist.<p>It's easy to hate Craigslist because of stories about it "crushing" other companies. But much of Craigslist's value is in its data and that data being solely available on its website. If that data was available on competitors, then it would lose leverage. This is true for many websites out there and they go to lengths to protect that data (eg. LinkedIn shutting off its API to third-parties).
I guess I'm not sure <i>why</i> you'd want to try to compete with Craigslist directly. Besides the network effect, there is also the fact that Craigslist isn't really making that much money (at least compared to how much they could be).<p>This means that anything competing with it with a goal of making money is going to have an even harder time competing with CL, which is mostly free and completely free of advertising. Look at eBay, which arguably could have been improved on quite a bit <i>and</i> charged users fairly high fees - nobody (that I know of) ever managed to compete with them on a large scale in the auction space.<p>Like others have said, I think the value is in competing on very specific areas. A few that would be possible and profitable:<p>- Jobs/contract work. Given the technology we have, I think the internet has done a poor job of changing the way we find and apply for employment and short-term work. I've been working on some prototypes for tech-oriented job sites, and I think there are a lot of other industries that could benefit from smarter job sites. Plus, there is a considerable amount of money in this area.<p>- Housing, especially in places like SF and NYC.<p>- Local services.<p>Lower-end stuff like people selling used couches and Xbox 360 games is probably not an area worth getting into.
<a href="http://www.quora.com/Craigslist/Why-hasnt-another-product-disrupted-and-replaced-Craigslist" rel="nofollow">http://www.quora.com/Craigslist/Why-hasnt-another-product-di...</a><p>but the more important graphic is this one - <a href="http://s3.amazonaws.com/data.tumblr.com/tumblr_kwkfi5tqEi1qzqh0wo1_1280.png" rel="nofollow">http://s3.amazonaws.com/data.tumblr.com/tumblr_kwkfi5tqEi1qz...</a><p>ill leave this here.
This post misses exactly half of the problem.<p>Amanda talks about Craigslist from the perspective of the seller (new sites have nobody to sell to).<p>What about the other half, the buyers? Same problem -- users on new sites have nobody to buy from.<p>The whole problem is the network effect. And the reason there aren't Craigslist killers is because it's insanely hard to overcome this. Your product may be 100x better, but sellers won't use it until tons of buyers do, and buyers won't use it until tons of sellers do. Craigslist didn't have this problem because it was basically the first decent online classifieds site. So now Craigslist can just sit there and not innovate.<p><i>This</i> is why people are so upset with Craigslist, and why supposed Craisglist-killers are failing. (It makes normal product competition, like getting an app to be #1 in the iTunes store, look easy by comparison.)
And this, everyone, is why Craig's most brilliant move is to not allow integration. The only way anyone beats them is to "also have that too." In this case, "that" being the craigslist user base.
For anyone curious about craigslist marketshare and competitors, this is the best resource I've seen on the topic: <a href="http://www.quora.com/Craigslist/Why-hasnt-another-product-disrupted-and-replaced-Craigslist" rel="nofollow">http://www.quora.com/Craigslist/Why-hasnt-another-product-di...</a><p>In that discussion is reference to this graphic, which does a good job illustrating many of the would-be craigslist-crushers (although most go after niches rather than the whole pie): <a href="http://s3.amazonaws.com/data.tumblr.com/tumblr_kwkfi5tqEi1qzqh0wo1_1280.png?AWSAccessKeyId=AKIAI6WLSGT7Y3ET7ADQ&Expires=1340750527&Signature=OiMRxp%2FZU1YLGfYJB2JSuv%2Fgd4A%3D" rel="nofollow">http://s3.amazonaws.com/data.tumblr.com/tumblr_kwkfi5tqEi1qz...</a>
That's sort of an interesting thought. Being the buyer for early sellers as a "user acquisition cost." Clearly this can't be done on a large scale, but I don't think anyone would plan on doing a national craigslist rollout. I wonder what kind of budget you'd have to have to do this for 1 small city for a few months.<p>Keep in mind you don't have to keep people's stuff, you can always re-sell it on ebay or craigslist :-) (and re-list it on your mythical new site. now you have inventory for the buyers and you are the buyer for the sellers)
I think that most startups that try to compete with Craigslist fail in their strategy.<p>I was lucky to have professor Jakki Mohr as a teacher, and she advocated the "bowling alley" strategy:<p><a href="http://wisepreneur.com/innovation-marketing-2/innovation-marketing-strategy-first-get-a-beachhead" rel="nofollow">http://wisepreneur.com/innovation-marketing-2/innovation-mar...</a><p>As the article states, and lesterman shows below, there are several startups that succeeded in beating Cragislist.. but they all did so by focusing on a specific niche.
<a href="http://carsabi.com/" rel="nofollow">http://carsabi.com/</a> also recently pulled craigslist results:<p>"June 12th: We no longer include vehicles from Craigslist, as they have requested that we not index their listings"<p>Too bad, it is a killer car shopping site, but without the massive craigslist db of results, they won't have nearly as much to offer.<p>Craigslist should really introduce a paid API or something, since they seem to hate being scraped. I think they fear becoming irrelevant.
My friends and I had a startup idea in 2007 that competed with Craigslist. (I didn't follow through, but one of them is still in that space) I can't believe that five years later, no one has managed to push CL off the top. It was a bad user in 2007 and still bad now. Everyone I know <i>tolerates</i> CL. No one likes it. CL refuses to add new features that would improve the user experience and benefit customers.
The challenges to compete against Craigslist aren't unique to Craigslist. Startups that want to compete with any dominate product in the market pretty much have to face the same challenges. Ebay, Facebook, Google Search, etc. all share similar challenges, specifically solving the chicken-and-egg problem.<p>However, I do believe that competing with Craigslist might be a bit easier given that there is almost no innovation happening in the product. Craigslist hasn't changed much since I first used it 7 years ago. There is definitely an opportunity to disrupt Craigslist position and it's a matter of time.<p>Craigslist is in an amazing position right now and they have a lot of potential to really continue to dominate. Ultimately, Craigslist's demise will be through its own undoing of not actually trying to compete and innovate.
"Why do so many startups focused in the above four areas generally flounder?"<p>A "flounder" is a fish! She means "founder", which is a verb which roughly means "sink".
You can have a much nicer UX, better code and extra features<p>But CL has both traffic and a well-known brand, investor money can't buy that.<p>Any feature you add is useless when there's no content, and there's no content because nobody goes to your site, and nobody goes because there's no content, see how it goes?<p>And of course CL knows better than letting you "borrow" their ads...
In Ireland, DoneDeal.ie and Adverts.ie have pretty much killed any Craigslist usage (although it was never that popular here even though I think most people would recognise the name)