Craigslist can be a great place to advertise listings and generate buyer leads. I have extensive experience posting listings on Craigslist. Here in the Seattle area I have seen some agents and brokerages have great success, but there are some important factors to consider.
1. If your focus is to generate leads (as opposed to trying to sell a particular listing) be aware that you will need a significant number of listings to achieve the critical mass required for consistent lead flow. Seattle has a few brokerages and marketing facilitators who mass-produce CL ads, posting several hundred each day, thousands per month. Offer to post the listings of other agents in your office. They get free advertising, and you get the leads. Try to get at least 25. The more, the merrier...
2. Craigslist caters predominantly to renters, first-time buyers and bargain hunters. If your listings and keywords cater to that crowd you will have better results.
3. Be prepared for spam. Lots and lots of spam.
4. Less is more. It has been my experience that the best results come from the simplest, basic format CL ads. I have tried creating e-fliers on postlets.com in the past, with mixed results. Postlets are great looking, no doubt. The problem is the Craigslist audience. Buyers who WANT an agent usually know wher to find one, and then get their listings from an MLS-fed website, or vice-versa. Those who DON'T will use sites and tactics that help them work around agents, ie. craigslist. So be careful... You might get some calls, but they may very well already have an agent or be trying to avoid one. Also, bargain hunters are looking for a needle in a haystack, not a neon-lit billboard that anyone can see. If your ad is too polished, you will risk turning people off. Keep it simple. Use the basic CL format, with a well written description and good looking pictures.
5. Keep up on your re-posting. This is probably the most important thing to remember. If you aren't re-posting your ads regularly, you might as well not be posting them at all. You should be able to re-post them every 24-48 hours, provided you change the heading enough to sneak past the Craigslist system rules. Make sure you search for your listing after posting to make sure it went through.
Of course, there are numerous other factors that will impact your success with Craigslist, especially in regard to your particular market area. Craigslist is popular for different uses in different places. Do people in your market look for houses on CL? Maybe, maybe not. These tips listed here are, in my experience, universal. It's certainly worth a shot...after all, it's free! (for now...)