Five Business Lessons From Fiverr
If you still haven’t heard of it, Fiverr (on Fiverr.com) is actually a virtual marketplace of services and goods where anyone can make or take jobs for the price of just $5. The idea (the business more of) became an instant hit the moment it launched. Hoards of people wanting to get things done for a measly price of just 5 bucks flooded the site. And because there’s too many people willing to pour out cash, so did those who are actually willing to do those jobs for a quick cash.
My first reaction when I heard the transaction cost of just $5 was….. [expletive here]… you gotta be kidding me. Isn’t that exploitation? Isn’t that unfair? This is very, very bad for industry competition. But the more I looked into it (and tried the system myself) the more I thought highly of Fiverr and started to see the light in their innovative idea.
Actually, I joined Fiverr because I needed a place to get started with collecting testimonials for a freelance business that I just launched (see my bio). I figured that while I was doing it, might as well earn a few. The low fixed price didn’t matter because I wasn’t really after the earnings. I was just after the testimonials. So the first thing I did was to post a job that I was willing to do (which was logo design) for $5. Then I’ll just wait IF there will be orders, do them and collect the testimonials (and the money which was just icing on the cake).
What I wasn’t expecting was that A LOT of orders literally poured in. I was thinking the job posting I opened would just be a chill kind of work thing. I didn’t realize that it’s really serious business in there and quite a number of people actually want to get things done fast. In a day I’d receive 2-5 new orders and it wouldn’t stop. Fiverr have a merit system that makes your job posting more visible and popular if you get good ratings for your work. And maybe I was good (haha) so eventually I got swamped with orders it came to a point I had to close my logo service because I don’t have enough time to handle the orders.
Which brings me back to the fact that I was truly amazed with Fiverr, and therefore studied the site for business lessons that might come in handy for me (and for everyone). This is just my observation so take my advice with a grain of salt.
And the Business Five Lessons Are…
1. Timing is important! Fiverr launched right after the much sensationalized global recession started to recede. Well if things are started to get a little okay for everyone that doesn’t mean everything is entirely okay. A lot of people are still jobless and looking for work. And let’s face it, desperation pretty much pushes you to do anything just to earn a living. This is where Fiverr banked on. That even at such a low price people would still go for the job. Better to get a few bucks than nothing right? Plus on the other side of the equation there’s also the businesses that wants to lower costs…. really lower costs. Fiverr became their post-recession gift.
2. One Great Idea. Okay, maybe this isn’t much of a lesson. But you got to admit, great businesses could sometimes boil down to that one eureka moment where you leap from your chair (or wake up from bed) and suddenly figure out one idea that will click with the world. When it comes to Fiverr, it’s their ingenious system of how one low fixed price can increase jobs, increase spending, open opportunities and get things done. Like we all know, it doesn’t really have to be that complicated. The simpler, the better.
3. Stop Analysis Paralysis. Question: what’s worse than a person not wanting to buy from you? Answer: A person who wants to buy from you but didn’t because he/she can’t make a decision. This is actually about your potential buyers or would-be clients and the phenomena called analysis paralysis. If you haven’t heard of it yet, it’s relatively simple. It means that an array of choices can sometimes stop a person’s action or makes him/or her unable to come up with a selection because making the final decision is too hard. For example, sometimes for a service you offer lots of packages with different rates. You might think this is to better suit various types of clients. But in the end, it only makes it harder for them to think which one to have. And so they back out.
In Fiverr, analysis paralysis is simple eliminated. The job costs $5. Either take it or leave it. Done deal. By limiting (or like Fiverr, by only providing one option), you reduce the decision-making process into a simple yes and no. Easy enough for everyone to decide making the transactions fast and efficient.
4. Get a lot of media attention. Fiverr has been featured almost everywhere. From The Wall Street Journal, to TechCrunch, to CNN Money, name a big time news outlet and it’s probably been there. Of course you’d say “yes this is a requisite but it can be too ambitious”. Well, even if you don’t have big time funds, how about reconsider lesson #2? Sometimes to get spotted by these publishing companies you need to be as unique and as ground-breaking as possible. One great idea can start the role of the next-big-thing.
5. Simplicity and Functionality. Probably my favorite part about Fiverr is how simple and functional every aspect of the website is. For example, if you go to the homepage, you’ll automatically see the gigs and learn by just looking how everything operates. The site literally speaks for itself. Plus I kinda like the aesthetic appeal of it but then again that’s just me.
The point of this post isn’t actually just about the lessons from Fiverr. It’s about being observant and being quick to pick up lessons from those who have succeeded in their own venture. The idea may not be replicated (that’s copying) but the technique can always be replicated and applied to your own. Now that’s some skills you should learn