Kijiji raises price for Top Ad promotion

What I'm about to write may make me sound like an ass-kissing Kijiji shill, but regular readers know that not to be true. I'll gladly call shenanigans if Kijiji does something stupid, but I really don't believe raising the price of the Top Ad option is such a case.

As explained in the Kijiji Canada knowledgebase, "Kijiji Ads that have been upgraded to also appear in the "Top Ads" section at the top of a category listing page for several days. More people read and reply to these Ads because of their prominent position on the first page of a category over a long time period. Simply put, buying a Top Ad is the best way to help sell your item."

I disagree that buying a Top Ad is the best option. Honestly, I go right past the top ads as though they're not there. If I'm looking for something specific, I'll do a search. I just don't buy into the value of the Top Ad. But, I'll give Kijiji the benefit of the doubt -- if they're going to say it's the best, I'm sure they have stats to back it up.

Now, I'm told the price of the Top Ad option has gone up. Kijiji forum user mppboxman sounded the alarm this morning:

I just noticed that Kijiji has upped their fees for promoting ads to top ads by as much as 75%!!! I put a couple furniture ads as top ads on Friday, January 27th for 3 days at a cost of $5.99 per ad. I went to do the same today (January 29th) and the new cost is $10.99 for 3 days and the 7 day top ad amount jumped from $10.99 to $18.99!!!

Calm down, boxman.

Here's the part that will make me sound like an evil capitalist, a Kijiji suck-up, or both.

It makes sense for Kijiji to hike the Top Ad price if it's popular. Consider the parallel situation of a landlord with a high-rise apartment building to rent. If all the units are rented, the rent is too low. Obviously people like the building enough to rent there, because the place is full. So, raise the rent. Keep raising the rent until you have some empty units. Maybe a few people will move out because the rent is too damned high, but most will keep paying, and you'll see profitability rise across the board. You'll be eating the value of the empty apartment, but you'll make more overall from the higher rent in every other suite.

Volunteer Moderator Angus Black actually did some math that would've broken my brain if I'd tried to provide facts to back up my analogy:

Kijiji raises the rate by 83% and looses maybe 30% of it's Top Ad subscribers in your city.
Overall Kijiji has increased revenue by 28% and made the Top Ad category more appealing to the remaining 70% of it's subscribers because they now have 30% less competition in the Top Ad section.
With an 83% increase Kijiji can loose up to 54.5% of it's current Top Ad subscribers and still break even. That is very unlikely. Even if it did happen it would only be a matter of days before people noticed that a Top Ad would be a good purchase because there would be so fw competitors.

Shawn from Kijiji Corporate once explained it in a fashion that sounds far less mercenary:

Over time as certain cities and categories have grown at different rates we are now at a time where we need to re-balance pricing. For example, if the price for Top Ads were to be set too low then there would be too many Top Ads and those that purchase the option will not get as much visibility. Hopefully in cases where we’ve increased prices, you will see improved results for your top ads and in those categories where we’ve lowered prices listers can enjoy the savings!

I think that's a correct assessment, too. If you're buying a Top Ad, you want your ad to stand out. And if it's cheap enough that too many people are doing it, you won't stand out. If everyone's special, nobody's special. Raise the bar for who gets to be special, and the Top Ads get to stand out.

If you've been priced out of buying top ads, what can you do? Well, for starters, make a better ad. Write an ad that will capture your buyer's attention in less than a second. Pair it with a great picture. And to keep it near the top of the listings, if that's important to you, delete and repost your ad every few days. Just don't be a dick about it. Nobody likes that guy who sells DVD box sets who reposts all of his ads every day and litters the place with his DVD box set ads. I'M TALKING TO YOU, DICK! Anyway, there are ways to have your ad placed well without having to shell out the dough.

This is simply my opinion, but I think you'll continue to see the paid features on Kijiji subjected to increased prices as long as people use them. As per my landlord example, there will be a point at which people just won't pay, and Kijiji will probably choose that as the Goldilocks price point -- not too high, not too low ... just right.