The Economist writes that “small ads are flooding away from newspapers and onto the internet.”
Search advertisingthe small text-ads that appear alongside Google and Yahoo! searchesaccount for 40% of the online ad market. Another 20% goes to display ads and 18% to classified advertising. But search advertising can also work like a small ad and will increasingly challenge print classifieds as websites develop localised and more elaborate services for online users.
Perhaps the most significant development came on November 16th, when Google started up a prototype service called Google Base. It offers a searchable database of free listings, including small ads which can be narrowed down to postal regions. Among its first offerings were used cars. In time, Google could challenge eBay, whose own auction listings now work much like a giant classified websiteespecially with its buy-it-now options. But eBay charges sellers. Even so, it sold more than 450m items in the three months to September 30th, for almost $11 billion.