Search Siren

The different wages across the world was the driving force behind globalization and the spread of outsourcing that began decades ago. The fact that a company could hire people in China or India at $2 an hour to do the same job that they were paying $10 in the US or Europe, was the start of a major phenomenon that is still only in its early stages.

Online, everything obviously goes a lot faster. While moving a factory may cost millions in logistics, hiring an online firm that’s based in India versus one in San Francisco may not actually cost anything to the client, and with the difference in prices, it results in vast savings.

Of course, all this has a huge impact on online freelancers. Someone living in a rural Indian community may see a $2 an hour salary as a decent wage, and be able to charge rates considerably lower than someone living in downtown San Francisco, where even $20 an hour, ten times more, would not even be enough to survive.

The old argument was the one of quality versus quantity. But as the years go by, we see dirt cheap services offering both, and it seems to be touching every business. The most affected online freelance market seems to be writing. Everywhere on freelance sites, we see rates of around $0.01 per word or lower. For a typical blog article of 500 words, that’s $5. Some people constantly bid lower too, at $2 to $3 for such length. With some research, such an article can take most people around one to two hour, which makes barely a $2 an hour salary.

I’ve even talked with some people who do these jobs who think it’s unreasonable to charge for more. Of course that kind of rate is completely irrealist in most of the western world, and not surprinsingly, many of the visitors on popular online writing forums come from the developing world. Here’s a chart (source: Bytes) of the revenue shares by country from one of the most popular freelance sites, eLance:

Even at these rates, people demand unique, original content, written in perfect english, and there are widely used tools online to check the validity of submissions.

This of course doesn’t only affect writing. Web design, for example, is right there on the list of jobs done at low rates by online freelancers. While well known downtown companies may ask for thousands of dollars to make a website, sites online every day have such bids for $100 or less. With the advances in easy technologies like content management systems, pre-made templates, easy to use hosting panels, and so on, it’s trivial to learn how to make a basic web site. Adding a forum or photo gallery to a site is no more complex than pressing the One-Click install button on your hosting provider’s web interface.

All this paints a grim picture for the online freelancer who aims at, or can’t afford to get less than, a good paying job. It’s not impossible, and people certainly are showing that it’s within reason to make good money from doing freelance work. The first key thing to remember is that no one starts off making millions. You may well have to start at a loss, and do work at a rate that doesn’t allow you to do it full time. Building a portfolio is important.

Then you need to find out where to advertise your services. The various freelance sites each have their own standard rates, and the type of people who hang around them. Some sites are less reputable, are prone to scam posts, and have no moderation or rating system. I’d avoid going there. Other sites are reputable, but they require no or little effort from the freelancers to bid on projects and offer their services. These are the type of sites that young people, new freelancers and those who usually offer very low rates hang out on, because the barrier of entry is so low.

The best places to go for higher paying jobs are also the sites that are the hardest to get into. If a site has a rating system, and requires an actual verification of your account before you can bid on projects, chances are it will weed out the less serious freelancers. Also, if you are a regular contributor and build up your rating, whether they are seen on a particular site as post count, iTrader, rating points, etc, it’s a sign that you are more serious about the work you do and may attract the better paying companies.

Being a good marketer is another key skill for success, in any business. In a world where thousands want the same project, and many can afford to have much lower rates, the way you market yourself often makes the difference. Contacting clients directly (without spamming) or providing higher than average samples may win them over. Also, successful freelancers find a niche to market to. If you try to offer services that can apply to everybody, chances are a lot of people are already taking these seats, but if you find a small market that may require some local knowledge, such as the town you live in or regional interests, you may have more success.

The last tip I would say is to diversify yourself. Offline freelancing is not something to be avoided, and may land much more lucrative jobs, since you’re often only competing locally. Success doesn’t come easy, and trying new, bold ideas is often how one breaks out of the mold.