Have you thought of starting really niche? Like for a specific city?
Also, have you thought of making an iPhone/Android app or something? Make it as frictionless as possible to upload videos and add a posting. Right now, Craigslist has all the users, so your value-add should be more specific. Nothing prevents me from linking to YouTube from my Craigslist postings, but almost nothing is as easy as tapping a couple buttons on my smartphone.
"The Local Marketplace to Buy, Sell, Exchange and Advertise Anything You Desire by Video" is a little too wordy. Make a large bold heading that says something like "Buy and Sell Anything With Video."
Mention the web site at every opportunity. Even to friends. Friends are the best people to tell. Not because they'll give you honest feedback, but because you'll know you've got a good idea if they begin to talk to each other and their friends about it. Similarly, comment on every blog that has a related post. Google Blog Search works wonders for finding recent posts to comment on. I've found that when I mention my startup, a person sometimes just goes and writes a blog post that drives a couple hundred users my way. Include a link in every email you send. Include it in your forum signatures. Tell everyone you get the opportunity to tell. On your blog, talk about something loosely related to the product. Write very thoughtful posts, but write consistently. Once a week is good. Once every day is outstanding. Your posts should produce some value well beyond the scope of your product. Your posts should be helpful on their own.
EDIT: I noticed a comment below about design -- I agree with it. If you look at Craigslist, it's minimal, but it's consistent. I'm no designer, but I use one technique that has allowed me to "fake it till I make it" -- pick a single color that looks nice on a screen. Use 3 different shades of that color (a light, middle, and dark). Use black, white, and 2 shades of gray. Take these 6 colors, and limit yourself to them. The more consistent your colors, the more professional you look.
Don't do a contest unless it's completely necessary. It's only been a month, and not many people actually buy/sell stuff online. See if you can narrow your focus a little more. Craigslist started small, and you can too.
Try branding yourself as a sleeker, easier, more intuitive Craigslist. Right now, your idea is good, just focus on executing small but with high quality.