LiveDeal.com, a free local online classifieds site in the U.S., recently launched its Canadian counterpart, LiveDeal.ca (LiveDeal Canada), through a joint venture with Torstar Corp., and its online unit, Torstar Digital. According to the firm, LiveDeal.ca breaks down online shopping barriers by enabling buyers and sellers to meet in person and “try before they buy,” which eliminates prohibitive shipping costs and reduces fraud. Simon Jennings, a long-time veteran of the e-commerce arena in Canada, has been appointed general manager. He spoke to Pipeline about his view of the future of online classifeds.
Pipeline:You have a long history in the e-commerce business – were you involved in the development of this project at all?
SJ: No, I came in after the i’s were dotted. It was a good time to come in.
Pipeline:It seems that online classifieds have really kind of struggled for a long time. Where do you see it right now in terms of its development?
SJ: I would suggest online classified hasn’t struggled, it just really hasn’t matured. I would go so far as to say eBay has been a great indicator of the potential and growth of online classified and the desire to use it. When you look at some of the big brand names that have popped up out of nowhere in the U. S. or just on the Net in general that are geography-agnostic like a craigslist, which is really a version that doesn’t really work on a revenue model, it’s more of a free community. But with the popularity of those things springing up, the demand is huge. When you then combine that with the traditional providers of classifieds they have all realized the business is incredibly healthy but the medium itself in print isn’t the only game in town anymore, and as all of their users are now also using the Internet as well, it’s a natural migration to be able to duplicate the product on both sides. Unless consumers stop buying couches from one another, which is never going to happen classifieds is a huge and thriving business, the net is just a natural place for it to go. It’s incredibly healthy when you consider the penetration of broadband in Canada and the general acceptance of being able to buy stuff online, although it should be noted in classifieds you’re not actually buying it online, you’re meeting someone online in your local community and going to pick it up yourself.
Pipeline:Maybe it hasn’t struggled but they did suck from a user standpoint. Did you ever try to use the Toronto Star’s online classifieds?
SJ: I’m not sure I’d say it sucks. It’s a natural stage of evolution. Like everything else we’re now looking at second and third-generation versions of these models, and classified’s time is now. It wasn’t a few years ago, not because of anything other than consumers were still trying to navigate the Web. Five years ago, eBay sucked, auctions in general sucked. Bid.com and auctions.com had horrible platforms, so it takes a while for someone to focus on a product before it becomes user friendly. The papers to their credit did allow the content to be online, but essentially what they did while they tested the waters was they used the data feeds they were getting and just posted them on the Internet. It took them a while to figure out if it’s going to catch on at all — then you start looking at usability, and I think that’s where they are now. In fact, LiveDeal is the quintessential recognition that consumer usability is important. The difference between LiveDeal and something like craigslist is LiveDeal is the first online classified that is actually easy to use. You can search by things like how far you have to drive to get it and all that other stuff that is intuitive to a classifieds conversation but hadn’t been there in the past.
Pipeline: Tell me a bit more about the evolution of LiveDeal. One of the unique features is that local aspect.
SJ: One of the things that makes LiveDeal a unique offering for consumers …is that it has a local aspect but it has a national reach. By comparison we’re talking about something like an eBay. It (LiveDeal.ca) enables individual communities to shop for a couch across the street using the Internet. It has a lot of the simple marketplace opportunities like better signage; you can add more pictures, and you don’t have the traditional print classified restriction on the number of words you can use. It has brought it to a consumer lever where I can write a paragraph about how wonderful my television is; I can show you three pictures and I can tell you where to pick it up. Unique to classifieds online and to LiveDeal is this is a perfect tool for people who want to know what they’re going to get for the product. The difference between this and an auction model is the couch may be near and dear to me, but if I’m only going to get $50 for it I’d rather not put it up there. So that’s a big position for online classifieds and one of the biggest points of difference between this and an auction model.
Pipeline: What is the business model for the site?
SJ: We offer users the opportunity to increase the visibility or the features on their sale item. The listing itself is free, so one picture and a listing is free. But if you’re an automotive dealer and you want to list five cars with 15 pictures of each car and you want to bring the product to the consumer the way online can, those little features come at a minimal cost so that’s where a big part of our revenue is from.
Pipeline: What would be the percentage of users who pay for features versus those who pay for them?
SJ: It’s too early to tell.
Pipeline: Any predictions?
SJ: My prediction would be many, for the simple reason the cost is nominal and the results are great.
Pipeline: Do people who advertise in the Star’s print classifieds automatically have their stuff listed online?
SJ: People who register via the phone or Web would have their listings pushed over to the LiveDeal interface. They can go in and see their listing at any point and change it and decide what they want to do with it.
Pipeline: The press release says local e-commerce is the next big thing. Can you expand on that a bit?
SJ: It is. The reason is companies like LiveDeal are finally bringing a marketplace where people can actually buy locally. The biggest challenge has been that there has been nothing that has fallen into the category of a local e-commerce play, unless you’re talking about someone from Canadiantire.ca who happens to live around the corner from a Canadian tire store. I think what is really interesting here and why it is really taking off is it is the consumer-to-consumer marketplace that is being introduced en masse. The early numbers suggest consumers are ready for this and frankly, they have been doing it forever. The only thing that has changed here is the medium is now the Internet, which just makes it faster and easier.
Pipeline: The LiveDeal.ca site has very much of an eBay look to it was that intentional?
SJ: I think probably both companies have spent some time looking at usability and what is a clean, simple look to use. It’s paramount to saying that the classified sections in most print properties look somewhat similar. There’s probably a reason for that. What we’re trying to do is take a lot of the excess information off the page and just list the stuff in an order that makes sense.
Pipeline:How do you see the scope of this site developing over the next year or so?
SJ: As the listings increase and we start to get more user feedback, the levels of granularity and service will probably grow. We have an automotive section, which is broken down by car, model, make and year, and that will probably expand into a lot of mufflers, cogs, wheels and rims, and stuff like that. But the consumers and how they migrate will dictate a lot of that. Another thing we anticipate seeing is … applications like wireless. Video is right around the corner, so when will I be able to see and hear the car? We’ve already seen that with companies like viewit.ca for the real estate arena. A lot of that is driven by users. Right now we’re speculating it’s there and we’re preparing from an engineering standpoint to be able to respond to it and have an offering for it.
Comment: pipeline@itbusiness.ca