Elance Blog

This sounds alot more doable than the prior model.. I still wish that the individual would have 20 connects rather than 15.

Looks good.
I think the first version, not the revised one was better - less connects on the membership, 6 connects on large projects etc - in his why we'll have a much more professional marketplace with custom bids, higher buyer flow...

...alright, sounds like the plans upgreads now are somewhat better. I still didnt purchaised any membership subscription and was not sure with which to go but i guess now i know...it will be great to try my chance at Elance with one of this new plans.

Thanks for the updates .

I had not written about the bid/connect issue, but it is definitely my time. Below I have copied my old and new membership plan. With the old one, besides the % charged for Elance Project Fee, I would pay $65 monthly to be able to submit proposal to 120 project – which you called bids. The new one will charge $65 – until March and $85 after that to be able to use 120 connect which will render about 90 proposal, this is a 25% increase in fee until March and a 40% after March.

Besides, the other outsourcing web companies that offer similar plans to your new Connect plan DO NOT CHARGE A PROJECT FEE> this is why you pay more for Connects with them as the project has a higher budget. Elance has, up to now, been a great site – although expensive, to get small budget projects. With this change you will turn it into a even smaller budget project site for us providers, which means even smaller revenues for you!!!!!

You do have competition and by far they are already much cheaper than Elance. I think the way to increase your revenues should be to attract larger projects not to make your site unavailable to providers, because if you do not have a fair amount of providers buyers will not be attracted...

-- Cheers,

Ileana Silva
COWgraphic
cow@cowdesign.com
Tel. 507. 6649.2844

These changes sound spectacular and I can't wait for their introduction. Of course, we will have to expect some underlying difficulties at first but sounds like Elance is going in the right direction. Thanks Elance, Judymae

Am I missing something here? Why would anyone have anything but the individual membership? It is more expensive to have the small business package. Doesn't that kind of break the rule of buying in bulk? This sounds like a terrible idea, but I guess I have to try it out a month before I go to another freelancing site.

What happens when I have to ask on a $1200 budget project - "Do your project require blah blah (Which we have expertise with, and will bid/attempt on), or do you require foobar (which we do not have expertise on, and will not bid/attempt on)?

1. I throw away 4 connects with such a question?
2. I ignore the project completly
3. I get bugged ignoring almost all projects and ... imagine the rest yourself!

Prashant

I think the connects are a quite less. But the new model may work well for those who are serious in bidding for projects. Let us hope that this works well for us.

Hi

I am a freelancer ( small company ), using freelance market place sites for many years and having more than 50 reviews on those sites. But I was using to stay away from Elance, because I didn't felt good with Elance on various things. (In fact, I bought a professional membership but never used). Finally it seems Elance got their rhythm back and I see all the good things that I wanted to see years before.

Merging Websites and Software Development Categories:
Often buyers seems to be confused with these two categories and placed projects randomly. Only providers who had two profiles in both these categories can make use of that mis-placed projects with less competition, to others it is an opportunity lost. Moreover, many developers/companies having the skill-set to compete in both categories ( say I have 60% web application skills & 40% desktop application skills ), but they are forced two purchase two profiles.
Even though your nearest competitor also having separate categories, but most of the programming projects (including web programming ) are placed in the software / programming section rather than website design. That is good. Other sites don't place any restriction on categories to bid.

Cost:
It is a known fact that Elance charges providers a very high fee when compared other sites (your annual fee for website design is crazy). I am not blaming this but I do welcome. The biggest problem I have faced with other freelance sites are too much competition, that is too not quality competitors. After placing 40 bids, I am getting response for only 7 bids and I win 5 out of that. Many buyers don't even bother to read our postings, answer questions. What could be the solution to this ?

* Higher membership cost: Sites should have quality providers. There is nothing to boast on having highest number of providers. If a site tells that they having the highest number of providers in the world, that would be hardest site to outsource any work or to get any work. Solution: Have higher membership cost. This will cut out unskilled providers to stay away from keep on testing their luck. Elance already having highest membership cost in the industry so that is fine.
* Cost to bid: All the projects are not same and needs to be treated differently. The burden to bid on high budget project should be high. I am sure providers will not like this immediately, but it is gonna bring very good effects over the period of time. So connections is a welcome move.

Treat quality providers better:
If a provider is able to buy a top membership, it doesn't mean he is a good provider. Allocating same number of bids to everybody is not good. A provider with 120 positive reviews and another one with 4 positive and 2 negative reviews are same just because they provide same membership fee? How about giving 1 extra bid for every 5 positive reviews of a provider ?. One of your competitor is already doing that.
Charge lowest possible commission from providers who have more than 20 positive reviews (or like).

Quality Bidding:
* Allow bidding only after one hour of the project post time.
* Give an option to buyer to mark a bid as spam/generic bid. If a provider gets three continuous spam mark, charge the provider by reducing one bid.
* Moderate the project postings. Force buyers to write the descriptions in length. Making every proposal cost time and money (including connection cost), it is very irritating to see "I need a website developed. Details will be given to winning bid". If a buyer is not ready or don't have enough time to write project requirement in length, they are not going to award the project or it is going to be a bad experience to both of the provider and buyer even if they award.

Quality Buyers:
Having quality buyers are very important to have successful freelancing experience. But Elance seems to be no different from other sites in this regard.
* Suspend a buyer profile if they don't have atleast 25% of projects awarded. Don't need to be too nice with buyers, these kinda buyers will add no value to our site
* Educate the buyers not to select the providers just based on cost.
* Do not allow providers to have buyer profile. You can verify this through their credit card / paypal payments. Nested subcontracting having serious issues and most of the time this end up in failing of the project and bad experience.
* Impose a project post fee and repay this upon project award. This will be helpful in getting only serious buyers. One of your competitor is already doing this with a slight variation.

Operating Cost:
* It seems your operating cost are very high to run this site. Outsource possible work to India, Russia like countries. 6.5% to 8.5% is too much I think. Salaries to employees are more than doubled. Employees are not ready to work with small companies but opting for MNCs even if we ready to pay equal or better salary. It is spreading like a mania in developing countries. And there is 33% tax in earnings + operating expenses. Following is what your competitor's commission:

Site-1: (My favorite site)
No Commission - Use external payment systems. Deal directly with client for payment ie. paypal, wire etc
Commission - 5% upon using their internal payment system. (Not upon winning projects, upon getting paid through their own payment system)

Site-2:
No commission. Pay only membership fee of $12 per month. Escrow management, using their internal payment system are almost free.

Site-3:
Commission: 2.5% for paid membership. Membership fee: $25 per month.
Commission: 5% for free members. No membership fee.

Do I need to say more?
I feel optimistic about your latest re-structuring and planning to start doing business here from 4th Dec. Hope everybody will have nice experience here.

Regards
Vadivelan

This is a question for Fabio: the global services marketplace is exploding, and we are talking about a market size of several billion dollars a month. Why is elance focused on the micro-buyers? Why not Global 5000 customers, Global 10,000, Global 20,000? Why not have a premium services site, or create an altogether new brand, powered by Elance, but different brand. I mean, Elance is a variant of 'Freelance' and that may be self-limiting since potential large customers may stereotype your marketplace as 'for small fish'. On the supply side, I'm sure your key members are business providers and want access to the bigger players, I mean, if you look at the 80/20 rule, it is this 20% that delivers 80% of the business results for elance, surely. In short, what I am dying to know why you are not doing more for the bigger budget projects that the Global 20,000 customers need done. FYI - for most of our large projects, Elance cannot provide us the quality customers, and we rely on other non-web business development channels. Regards, Saadat.

Am worried that the name of architecture is not listed in any category. Number of projects is relatively less.

There are a lot of unanswered questions regarding your new membership model. Would appreciate if you can answer these questions : 1. Do we still have categories. Can a member purchase connects for other categories than the ones he has subscribed to ? 2. What is the premier provider program. No details are available for this. 3. Would the buyer be informed whether the provider is a small, large or a premier provider in our bid response. I agree with an earlier posting on this, regarding the necessity for combining the web sites and the software programming categories. I agree that most programmers are able to do both types of jobs and having them subscribe to two categories instead of one causes additional costs for us providers. Besides it is confusing for the buyer to decide on the category to post. Dave

Well I'm a bit confused. I purchased a quarterly membership last month after doing a one month test, now you are going to tell me I have to pay you even more or take a hike or take a lesser package? I've followed the rules, refused to allow people to pay me on the side for projects I've gotten here even though I could have avoided the fees, committed to following my contractual obligations, now you want to change the contract and charge me more money? I don't consider that a good business model at all. You should either just allow those of us who have paid to get the new "enhancements" for what we paid or find a means to keep both systems in place until our contracted time is up. I don't mind you trying new models, but I certainly don't like having a contractual obligation where I am the only one obligated to it and fees and services can change as you decide to try new things. Sounds to me like you can change your percentage from X% to 50% while I'm in the middle of a number of projects, which is essentially what you are doing. If I want to drop now that you're raising my fees, what happens to the projects I'm in the middle of? I'm not at all happy with this situation.

Hi Thomas,
 
With this change, most memberships will see a price reduction.  For example, a quarterly professional membership in Website Development previously cost $169, or $56.33 per month.  Under the new plan, depending on how you would like to be viewed (Individual or Small Business), if you select Individual for $9.95 per month, you would have an additional $46 to purchase 92 more connects for a total of 107 connects (15 connects come with the Individual plan) if that is what you actually needed.  However, in our experience, a small number of our providers utilize all of their bids, while the majority utilizes less than 50% in a given month.  With the new plan, you can optimize your monthly payment based on your specific bidding activity.  If you use 50 connects in the month, this would be a monthly total of $9.95 + 35 more connects @ $.50 for a total of $27.45 per month.  And your connect volumes that you purchase can be adjusted on a monthly basis.  The calculations above vary only slightly if you select small business.  Additionally, we have merged the Web Dev. and Programming categories so you will have more access to projects to bid on that may match your skill-set with a single category membership.  
 
Regarding the money you have already paid for your quarterly membership, this will be applied as a credit to your new membership.  Of course, if you are unhappy with the changes, we will absolutely refund the remainder of your membership fee (but would hate to see you go).
 
Jon
Elance

This sounds like a better plan, thanks for listening and revising your new membership plan. Now, believe or not, I am a bit concern about the Minimum $500 project - it sounds ideal, I hope it works!!

You can count on my support,

Cheers,

Ileana
COWgraphic
cow@cowdesign.com