Kevin links to Internet Outsider which has this great comment:
Despite significant online classified efforts, moreover, the classified opportunity remains massive: The dying newspaper industry still rakes in tens of billions of dollars a year for printed classifieds — a less efficient, less informative, less convenient, more wasteful, and more expensive way to buy or sell products. In another few decades, when the current (and last) generation of hard-copy newspaper readers dies out, printed classifieds will seem as archaic as whale oil. The newspaper companies may be able to retain some classifieds business as it moves online, but given the success of Craigslist, Monster, et al (and the seriously weak newspaper efforts thus far), this percentage will likely be small.
So, there’s a $10 billion plus market for classifieds, and the majority of it is not online.
Here’s where I get excited. Of all the news and community content features that eNeighbors offers to the neighborhood residents, classifieds have been the most popular by far. To date (we launched in April), we have had over 300 classifieds posted from only 2000 users in 18 neighborhoods. Keep in mind that most of the neighborhoods have only been using our service for a few weeks.
Additionally, we have already received numerous comments from users that they would like to be able to publish their classifieds to other neighborhoods in their area. This is a site enhancement that we are currently working.
The great thing is that we built the classifieds engine as a “nice to have” feature for residents to use when garage sales were not appropriate never expecting it to be so popular, but our users have begun to see a huge potential for a truly hyper-local type of market square.
Never underestimate the power of free.