In this post, we’ll discuss working from home business basics and in particular, Fiverr.com. As our more than 10,000 online learners know, when a great opportunity has run its course and seems to be ‘racing towards the bottom’, we take the following steps;
- State the problem
- Discuss our MEASURED experience(s)
- Give warning to all considering use of that particular online tool
- Pull the course from our online curriculum
It gives us no pleasure to add Fiverr.com to our growing list of once great work at home businesses. Several years past, we agonized in much the same way concerning Hubpages. For those who are unfamiliar with ‘the hub’, this, at one time anyway, was one of our favorite content marketing websites. They launched in 2006 and although we didn’t become active users until a few years afterward, the hub quickly gained momentum as the premier content submission platform. Hubpages understood that core to any successful social media website was building an inter-dependent ‘community’. The principle on which ‘social sharing’ is built is to foster a ‘give and take’ relationship. By 2011, Hubpages had forgotten this having become drunk with their own success and under a misguided belief of improving the platform for everyone. The relationship between content creators, a function we’d performed with the hub, allowed creating great articles (original content) and in exchange, content writers were allowed insert a few back-links to their personal sites which produced traffic for the company.
Ah – if that were only true today! Slowly and for no discernable reason other than pure greed, Hubpages began to dis-allow any back-links within content. Their selfishness has cost what is most important to any company’s growth; credibility. At that time, we’d produced a two hour online course which not only taught entrepreneurs how to use Hubpages but encouraged its use above their nearest competitor(s). This brings us to Fiverr and an email we received several days ago. This communication stated our account was suspended yet the reasons were questionable. They gave some silly excuse for doing so but here, before proceeding with the topic at hand, is what the reader should know;
- We haven’t violated any rules stated in their policies and procedures
- We hadn’t been active, except producing a video tutorial course, since early 2013 so how could we violate policy?
- Fiverr.com is failing to scale in a way they’d envisioned and made many empty promises to investors which remain unfulfilled as of this writing.
- Core to Fiverr’s growth struggle(s); their website is over-populated with sellers and not enough buyers. More simply put – supply far outweighs demand.
- This, until recently, was a wonderful work from home business opportunity.
Let us be clear; we are not ‘railing’ against them because of some perceived injustice. Had we been dependent on Fiverr as a profit center (sales) when the suspension occurred, perhaps our motives would be less than honorable for such a harsh assessment. However; Fiverr is now suffering from the same failure as happened to Netflix several years ago. Netflix provides online streaming content in form of movies and other media for $9 per month before premium upgrades. Realizing they had to grow revenue because of promises made to investors, Netflix attempted to raise their rates to $14 per month (if memory serves) and suffered a huge backlash from subscribers! This situation rocked their business model and as ‘type cast actors’ discover when trying to escape their image (hello Gilligan), Netflix had locked themselves into being the Wal-Mart of streaming content (Everyday Low Prices).
Fiverr has done likewise and unfortunately, there is no immediate remedy. Sure they may have strategic plans and many great ideas but it boils down to this; how will they scale upwards without violating cost structure? Many sellers, at Fiverr, are doing quite well but these are few and far between and surely represent only a fraction of the total 1.3 MILLION reportedly onsite. According to Semrush.com, website tracking software, Fiverr receives about 90K visit monthly. Although this sounds like a lot, please consider the following;
- With 1.3 million sellers, it is safe to assume about 42% of the 90K visits represent this group logging in, servicing buyers and other housekeeping items unrelated to ‘unique’ visits which are key to growing an online business. While active and top rated sellers, we logged in (no buying intentions) at least 20 times weekly.
- At minimum, 10% are ‘curiosity’ clicks from advertising campaigns.
These numbers are, of course, conservative and other analytic assumptions can be accurately made to further reduce the number of revenue generating visits. Understanding these reasonable assumptions; on the high side, only 43,200 of monthly website visits actual produce sales for both Fiverr and sellers. Knowing each purchase, called gigs, are $5 each – the company is generating approximately $216,000 in sales each month. That number is probably $50K higher with ‘gig upgrades’. As do most organizations which enjoy little competition because of niche service offers, Fiverr, understanding they could no longer scale through sales growth without radically shifting pricing structure and like Netflix, alienating huge swathes of current customers, had to find a way to generate ‘promised earnings’. An answer to their lack of growth seemed apparent; ‘put the squeeze’ on sellers who once received $4 per assignment (Fiverr received $1 to make up the $5 gig fee) and now, sellers receive a paltry $3 per gig!
Trust us; that number will further decrease. If we could paint a picture in a way most understand; it isn’t unlike the U.S. government increasing income taxes on current taxpayers because they’ve failed to live up to job creation promises which would’ve added new tax payers and lightened the burden on current payers. We’d venture a guess tens of thousands of sellers are receiving these vague emails and being suspended as have we. The reason Fiverr is doing this is simple – they have too many sellers and not enough buyers. ‘Thinning the ranks’ allows them to bring ‘the force’ back into balance but this isn’t the chief reason for such treachery. They, like any schmuck silly enough to accept capital investment with no real growth prospects long-term, must explain to investors WHY they aren’t meeting sales forecasts and what they intend to do rectify such incompetence. Imagine investor excitement when Fiverr’s leadership announced; “Hey – we aren’t growing buyers but increased revenue by charging 20% more to our sellers”! Fiverr wins and sellers lose.
For Fiverr sellers who’ve suffered this indignity; contact us and we’ll send you a simple process you can use to receive a ‘fresh start’. Remember; it was us who cracked the ‘Google Adwords Ban’ code back in 2007 which, to date, has allowed tens of thousands of Google advertisers to get their accounts back! Compared to Google, getting a new account with Fiverr is a ‘walk in the park’.
It’s painful to no end for us to end this blog post by offering; as one-time top ranked sellers; Fiverr.com is no longer a valid and profit earning at home work option for the masses as it once was and to this end; we’ll be removing the online course. Someone once cried out; “Oh; how the mighty have fallen”. Not all is lost, however. As with any life experience, never waste time sulking over a loss rather; learn from Fiverr, Netflix, Border’s Books, Blockbuster Video and other such unnecessary failure(s). Be warned; whether currently managing an at home business or traditional establishment – your company, at this very moment, is either racing towards the top of your industry or racing towards the bottom. In which category do you belong?
by 