Backpage sees 50 percent annual gain in online escort-ad revenue
13 Oct 2011
Backpage sees 50 percent annual gain in online escort-ad revenue
Backpage.com generated $2.1 million in revenue from online prostitution advertising in August, a 50 percent increase from the $1.4 million it generated in the same month in 2010, according to AIM Group estimates. The August revenue, however, was off about 1 percent from July. It’s just the third time monthly escort-advertising revenue dipped in the 12 months since online classifieds powerhouse Craigslist stopped publishing ads for escorts and body rubs.
Overall, August revenue from online prostitution advertising on five tracked sites declined 4.7 percent to $3 million compared with the previous month. In the last 12 months, ads for escorts and body rubs – both euphemisms for prostitution – have generated $34.7 million. When it stopped publishing them in September 2010, Craigslist was on a pace to generate $44.6 million in annual revenue from escort ads.
Most of the August decline was due to a drop in revenue at AdultSearch.com, a year-old site that has grown the fastest in the last year. However, August revenue for the site was $76,000 down 38 percent from $123,500 in the previous month.
The largest beneficiary of the Craigslist decision to eliminate adult services ads continues to be Backpage.com, which is now the leading U.S. online publisher of prostitution ads. Since September 2010, Backpage – owned by Village Voice Media — has generated more than $23.1 million in online revenue from escort and body-rub advertising. That’s a 33 percent increase over the $17.4 million projected by the AIM Group before Craigslist stopped publishing adult services ads.
Craigslist pulled adult services ads due to pressure from law enforcement officials and anti-sex-trafficking groups who complained the ads promoted both prostitution and sex slavery involving girls under 18.
Village Voice Media, which is also facing pressure from law enforcement officials and anti-trafficking groups, has changed the adult advertising sections of Backpage but continues to carry paid ads for escort services and body rubs. Backpage is the online classified advertising site for VVM’s 13 alternative weekly newspapers, the five weeklies published by Creative Loafing, and a number of other publications, mostly alternative weeklies.
The U.S. Communications Decency Act specifically protects publishers of online advertising posted directly by advertisers if the ads have not been reviewed before they appear online – even if they promote prostitution or include illegal references to discrimination in housing, for example.
Village Voice Media also publishes escort advertising in its 13 print publications, but the AIM Group revenue estimates include only online advertising in 23 of the 394 markets where Backpage.com offers localized sites in the U.S. (The company also offers Backpage sites in Canada, Australia, Ireland, New Zealand, the U.K., the Caribbean and Mexico.)
Here are the trends in revenue, listings and unique visitors at Backpage.com over the last year:
While overall revenue was down in August, the number of escort-service listings published on nine tracked sites was up 0.5 percent to 225,000 compared to July, and the number of unique visitors to 24 tracked sites that publish prostitution advertising declined 5.7 percent to 5.3 million compared to the previous month, according to Compete.com. For comparison, Craigslist had 65.3 million unique visitors in August, according to Compete.
The AIM Group, an interactive-media consultancy based in Altamonte Springs, Fla., has been tracking prostitution advertising since August 2010.
The AIM Group counts the number of Backpage ads for female escorts and body rubs in 23 U.S. cities over a 30-day period. Revenue is estimated by multiplying the number of ads by the advertising rates in each city, plus an assumed additional charge to republish the ads four times. The research does not count ads published outside the primary cities, so it is likely revenue has been substantially underestimated.
The AIM Group has also tracked revenue for four other sites that sell prostitution advertising – Eros.com, CityVibe.com, MyRedbook.com and AdultSearch.com. (Escorts.com was tracked until it closed June 1.)
The consulting group also tracks the number of listings on nine sites and unique visitors to 24 sites that promote prostitution either with listings or by allowing “reviews” of prostitution services.
The AIM Group tracked prostitution ads and, where possible, calculated the revenue they generate in these 23 cities: Atlanta, Boston, Charlotte, N.C., Chicago, Dallas / Fort Worth, Denver, Houston, Las Vegas, Los Angeles, Miami, Minneapolis, New Orleans, New York City, Orlando, Fla., Philadelphia, Phoenix, San Diego, San Francisco, Sarasota, Fla., Seattle, St. Louis, Tampa and Washington, D.C.
Overall, the AIM Group studies 24 websites that either sell listings or promote prostitution in other ways. Of those 24, we are able to compute revenue based on the number of listings and published advertising rates for six – Backpage.com, Eros.com, CityVible.com, MyRedbook.com, Escorts.com (which closed June 1, 2011) and AdultSearch.com. We can also count listings on three additional sites – NaughtyReviews.com, Eccie.com, and A1List.net. For the remaining 15, we track only unique visitors because the other data is not publicly available or because the sites have so little traffic that their revenues or listings would be insignificant. The remaining 15 sites are TheEroticReview.com, Sipsap.com, Preferred411.com, SexyEscortAds.com, BigDoggie.net, LocalEscortPages.com, HotLocalEscorts.com, MyProviderGuide.com, TNABoard.com, FindHotEscorts.com, EscortGuide.com, EroticServicesGuide.com, EpicDreams.com, Escortme.com, and BarebackEscorts.com.
The unique-visitors metric counts a user – a computer or IP address – only once no matter how many times the site is visited from that same location. It does not account for more than one person using the same computer, or one person visiting the same site from two or more different computers (one at work and one at home, for example).
About the AIM Group: The AIM Group, formally known as the Advanced Interactive Media Group LLC, is the world’s leading consultancy in interactive media and classified advertising. It publishes Classified Intelligence Report, a continuous advisory service often called “the bible of the classified advertising industry.” The AIM Group works with leading media companies, broadcasters, dot-coms, yellow-page publishers and technology companies. It provides strategic and tactical consulting; sales training; proprietary and published research about interactive media, and other services. Founded in 1998, it is based in Altamonte Springs, Fla. For more information call (407) 788-2780 or see http://AIMGroup.com.
This monthly update report has been funded by a foundation that has asked not to be identified, in part because it does not want to seem to be taking credit for the Craigslist change in practice, nor promoting other adult-services advertising media.
The original Sept. 15, 2010, report can be purchased at www.aimgroup.com, and proceeds will be given to report’s sponsor. In addition, the AIM Group’s 47-page 2010 report on Craigslist, “Craigslist revenue to top $122 million,” is available through AIMGroup.com.
Note: Mark A. Whittaker, senior consultant for the AIM Group, and Peter M. Zollman, founding principal of the AIM Group, are available for comment on the research. Whittaker is available at 724-553-8428 or email@example.com; Zollman is available at 407-788-2780 or firstname.lastname@example.org.