Cheezhead Recruiting News and Opinion

It doesn’t matter if you’re Chinese, German, American, or French: mention the word “free,” especially when its linked to something online, and the crowds will flock.

This has especially been the case with eBay’s international classifieds group Kijiji, which means “village” in Swahili. Spokesman Hani Durzy said that Kijiji was launched by eBay’s New Ventures Group to bring a sense of community that is lacking in other local classified sites. That “sense of community” has been sweeping the free classifieds market in over 1000 cities and 26 countries since its launch in 2005.

During eBay’s financial report for Q3, the company reported that Kijiji earned a respectable $250 million in revenues, far more impressive than competitor Craigslist, whose projected earnings are around $80 million for the whole year.

While Craigslist’s sole source of revenue is paid job ads in select cities, Kijiji earns its cash through a variety of channels on some of their international sites, including pay-for-premium ads in vertical categories, sponsored and banner ads, and embedded web site links within posts.

Take Kijiji’s British site Gumtree.com, founded in 2000 and purchased by Kijiji in May 2005, for example. Posting a job costs ₤25. The site is reporting around 200,000 live jobs, which adds up to a cool ₤5 million from those job postings alone. And Kijiji’s German site charges €30 to post a job and an extra €4 to add a link to your career site. That kind of cash really starts to add up.

In 2007 Kijiji launched an American version of their site much to the chagrin of others, who speculated that eBay’s gutsy attempt to buy out the rest of Craigslist (they own 25 percent) was rebuffed, and Kijiji U.S. was their vengeful response.

Here’s what Jacob Aqraou, the eBay executive who runs Kijiji, had to say to TechCrunch in an article last February: “We play to win. We will win in the U.S. Six months in, the U.S. is the best launch we have had and we have not put any money into it. We will be No. 1 in the U.S. [Craigslist] went lean and that allowed them to be early when there was no revenue. The site still looks the same as it did 12 years ago. Users expect more. The bar goes up in terms of user interface, trust, and safety. If you stay still, you get run over.”

It’s doubtful eBay views Craigslist as a real threat anymore, considering its expansion beyond their core business of online auctions to become an e-commerce tool kit with a portfolio of sites like Paypal, Bill Me Later, StubHub.com, and Skype.

Although their U.S. site has yet to add fees, optional upgrades, or ads to their listings, changes are most likely imminent as Kijiji takes a more stalwart stance against Craig, the big daddy of the market, on his home turf. Since Craigslist just announced that they are charging $25 to post jobs in more cities, expect Kijiji to follow in their footsteps soon by initiating their own revenue model, most likely at a competitive price.

After all, considering the economic crisis and budget cuts that many companies will be forced to make, $25 is a paltry number in comparison to what the Big 3 charge to post.