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Frost & Sullivan: Overall Australian online classifieds market grew 10% to $780 million in 2013


News provided by

Frost & Sullivan

15 May, 2014, 02:24 GMT

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SYDNEY, May 15, 2014 /PRNewswire/ -- The Australian online classifieds market grew 10% in 2013, reaching $780 million. Real estate grew 24%. Automotive classifieds increased 6%, but employment classifieds dropped -4%.

Australian Online Classifieds Market 2014 states online classifieds expenditure will grow at a CAGR of 7.1% between 2013 and 2017. Expenditure is estimated to reach $1,131, with real estate at the highest average annual growth at a CAGR of 12%.

Real estate classifieds grew strongly in 2013, resulting from strong residential housing markets in most states, and major portals successfully converting customers to use premium / depth products. Customers have accepted the benefits of premium products, and this is supported by the vendor, not the agent, bearing advertising costs.  Residential property prices rose driven by low interest rates. Housing construction increased, along with activity in the developer market. A strong residential property sector and growth in listing depth products will drive revenue growth over the next few years, said Phil Harpur, Senior Research Manager, ANZ ICT Practice.

The automotive market had sub-par growth of 6% during 2013, due to slow growth from market leader Carsales and consolidation amongst publishers. Downward pressure on online classifieds ad prices, lower ad volume growth and softer economic conditions contributed to slower growth for all providers.

The weak job market in 2013 impacted the volume of employment classifieds. Fairfax Media's withdrawal from paid job classifieds in 2013 impacted revenue growth. Moving to a free classifieds model could significantly increase the volume of job seekers accessing their site.

To expand job listings, Fairfax Media partnered with global job aggregator Adzuna. Adzuna will promote itself through Fairfax's print and online audience. Adzuna's lower listing cost model gives it competitive advantage for some job classifications.

A weak employment market will result in negative growth in 2014's expenditure on employment classifieds, compounded by use of free classifieds sites, job aggregators with lower cost business models to traditional recruitment sites, and using social media to source candidates.

LinkedIn has become a viable alternative to recruitment websites, although skewed toward white collar jobs.

The online free classifieds model has grown recently across general classified as well as auto, real estate and recruitment, gaining consumer acceptance as a viable alternative to the traditional paid classifieds market, placing downward pressure on online classifieds expenditure.

Contact: djeremiah@frost.com

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