The Myth Behind Craigslist: It's Not Maximizing Revenue Potential
from the bull dept
"Companies looking to maximize revenue need to throw as many revenue-generating opportunities at users as they will tolerate."But Buckmaster's very next claim belies the fact that he knows the first half isn't really true:
"We have absolutely no interest in doing that, which I think has been instrumental to the success of craigslist."And, that, really is the point. While it may seem paradoxical, Craigslist actually is being much smarter (on purpose or not) in how it "maximizes profits." It's doing it by not pissing off users and not trying to squeeze them for every possible penny today, knowing correctly that doing so is a horrible long-term strategy. But it's difficult to think of many companies that throw off the sort of profits that Craigslist does on a regular basis. It employs 30 people and most estimates suggest in brings in $100 million in revenue per year. What other companies of that size bring in that much in revenue?
Then look at all the companies that claim they are trying to maximize profits. And compare. I can't see how anyone can take the claim that Craigslist isn't doing that with a straight face. The company knows more about maximizing revenue than probably every celebrity CEO or management consultant out there.