Classified advertising is called such because it is generally grouped within the publication under headings classifying the product or service being offered (headings such as Accounting, Automobiles, Clothing, Farm Produce, For Sale, For Rent, etc.) and is grouped entirely in a distinct section of the periodical, which makes it distinct from display advertising, which often contains graphics or other art work and which is more typically distributed throughout a publication adjacent to editorial content.
A hybrid of the two forms — classified display advertising — may often be found, in which categorized advertisements with larger amounts of graphical detail can be found among the text listings of a classified advertising section in a publication. Business opportunities often use classifieds to sell their services, usually employing 1-800 numbers. Classified ads are also among the tools used by many companies in recruitment for available job opportunities.
Printed classified ads are typically just a few column lines in length, and they often filled with abbreviations to save space and money.
Like most forms of printed media, the classified ad has found its way to the Internet.
Internet classified ads do not typically use per-line pricing models, so they tend to be longer. They are also more readily searchable unlike their offline brethren, tend to be local, and may foster a greater sense of urgency as a result of their daily structure and wider scope for audiences. Because of their self-policing nature and low cost structures, some companies offer free classifieds such as Craigslist in the US, as well as Kijiji and Gumtree internationally. Other companies focus mainly on their local hometown region, while others blanket urban areas by using zip codes. Craigslist.org was one of the first online classified sites, and has grown to become the largest classified source, bringing in over 14 million unique visitors a month according to comScore Media Metrix. A number of online services called Aggregators crawl and aggregate classifieds from sources such as blogs and RSS feeds, as opposed to relying on manually submitted listings. Examples include Oodle and Vast.
Additionally, other companies provide online advertising services and tools to assist members in designing online ads using professional ad templates and then automatically distributing the finished ads to the various online ad directories as part of their service. In this sense these companies act as both an Application service provider and a Content Delivery Platform.
Newspapers have continued their downward trend in classifieds revenue as internet classifieds grow. Classified advertising at some of the larger newspaper chains has dropped 14% to 20% in 2007 while traffic to classified sites has grown 23%.
As the online classified advertising sector develops, there is an increasing emphasis toward specialization. Vertical markets for classifieds are developing quickly along with the general marketplace for classifieds websites. Like search engines, classified websites are often vertical in nature with sites providing advertising platforms for niche markets of buyers of sellers.