Online Talent Marketplaces – Landscape Analysis March 2013
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Executive Summary The online talent marketplace is set to grow at an unprecedented pace with increasing computing power Talent Neuron estimates that the total number of freelancers registered in the online talent hub companies is around 5 to 6.5 million till date
Some of the Fortune 500 companies using the online talent services include Google, HP, Microsoft, AOL, P&G, Texas Instruments, Oracle, Dell, Accenture, Travelocity, NBC, Citi Group, American Red Cross etc. The major reasons for the adoption of online talent by the companies are: • To save costs on overheads and other employee benefits • To get access to niche skill set expertise without geographic limitations • For flexible scalability • Freelancers are less likely to miss deadlines than employees • As freelancers are always directly in touch with the clients, the clients can build a better relationship with freelancers than agencies who have multiple contact points Women population constitute less than 50 percent of the traditional workforce, however more than 55 percent of the freelancers are women. Moreover, 2012 witnessed more than 100 percent growth in the women freelancer population indicating that increasingly women are adopting online jobs for a better work-life balance. Talent Neuron estimates that 40-45 percent of the online talent pool is present in the United States, while around 12-15 percent is present in India
Methodology Talent Neuron analyzed over 30 global talent marketplaces to analyze the trends in online job outsourcing
Comprehensive list of 30 global online talent marketplaces
Deep dive
Trends
List of Online Talent Marketplaces 1. eLance
11. PowerLance
21. FreelanceCN
2. Guru
12. Bidfreelancer
22. Freelanza
3. oDesk
13. ScriptLance
23. FreelanceIndia
4. Freelancer
14. vWorker
24. PayPerHour
5. iFreelance
15. Freelance Work
25. Freelancers.net
6. The Freelance Nation
16. Writerlance
26. Freelance UK
7. Virtual Vocations
17. Sunoasis
27. ShortGig
8. Freelancer Jobs Network 18. ProjectSpring
28. Freelance-Seattle
9. FreelanceJobs.org
19. Onlinejobs.ph
29. AgentSolo
10. Design Crowd
20. Freelancerchina
30. Freelance.com
User Base Job Function Maturity Billing Models
Skill Demand Geographic Locations
Zinnov
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Law of the Land Online talent hub companies offer global services in various domains for their clients. However, some companies offer niche skill sets only while some have registered talent from specific countries/regions
Online Talent Hub Companies Tracked
• The online talent market is expected to be around USD 2.5 billion by the end of 2012 with Elance, Guru and oDesk
12
leading the online job market 10 • In the recent years quite a few vertical 7
specific online talent hub companies have been set up such as ScriptLance,
vWorker and Writerlance • Online
talent
hub
companies
in
emerging countries like India and China Global
Vertical Specific
Country Specific
have local freelancers who provide services at a competitive price than freelancers in developed countries
Source: oDesk website and Talent Neuron
Zinnov
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Global Availability of Online Talent US has the largest number of registered freelancers followed by Canada. Emerging countries like India and China are also witnessing a healthy growth in the online talent availability.
Canada has a developed community of online talent in the Editing domain.
Freelancers working in the Technology domain in India are increasingly being preferred by the leading Global 2000 clients United States has a significant number of online talent in Creative and Technology domains. In 2010, temporary jobs (which include freelancers and contractors) constituted over 60 percent of the total increment in private sector jobs in United States
Source: Economagic website and Talent Neuron
In the recent years, average compensation for freelancers in Philippines has dropped significantly, specially for software jobs
Zinnov
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Maturity of Online Talent Marketplace by Job Functions Online talent marketplace jobs are rapidly growing across various domains like Administration, Marketing and Multimedia apart from traditional Editing and Technology domain jobs Online Talent Marketplace - Maturity of Functions
Multimedia and Editing domain jobs include web design, animation, content writing, blogs, business writing and regional language translation
HIGH
Growth Rate
Global 2000 companies are increasingly leveraging the online talent marketplace for Accounting and Legal domain services
Technology
Editing Today most of the online freelance jobs is done in the Technology domain. In the last 6 months PHP skill set in the Technology domain had the maximum number of jobs posted online
Multimedia
Administration Marketing
Accounting & Management Legal Manufacturing
Jobs such as manufacturing design, circuit design, architecture and civil engineering are expected to be in demand in the Manufacturing domain
LOW Laggards
Source: Zinnov – ‘Talent Neuron’ Source: Talent Neuron
Rapidly Growing
Mature
Zinnov
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Skills in Demand Technology domain jobs like Shell Scripting and COBOL witnessed phenomenal growth in demand in 2011 and the demand for similar jobs are expected to grow in 2012 Technology
Multimedia
Editing
Marketing
Shell Scripting
Dreamweaver
Speech Writing
SEM
COBOL
Web Design
Word Processing
Internet marketing
PeopleSoft
Graphic Design
Language Translation
Marketing Strategy
SAS Business Analytics
Photoshop
Content Writing
Google Webmaster Central & AdWords
Wi-Fi
Illustrator
Report Writing
Social Media
Caspio
Microsoft Visio
Word Perfect
Google+
Firewall
Framemaker
Poetry
MailChimp
FTP
Corel Ventura
Spelling
Affiliate Marketing
Codesign
Quark Express
Journalistic Writing
COM
Sony Vegas
Feature Writing
Source: eLance, oDesk websiyes‘Talent websiyes and‘Talent Neuron’ Neuron’
Zinnov
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Engagement Model Types Fixed price engagement model is typically preferred in the global online talent marketplace
Fixed Price
Hourly Rates 45%
55%
25%
60%
• Getting the pricing right for fixed priced projects is a difficult task
50%
35%
• Hourly rates are preferred by freelancers as they can charge for the total number of hours they work for
• It is generally preferred for short projects and freelancers do not prefer to commit for fixed priced projects which may run over 6 months
• Clients generally do not prefer hourly rates as there is higher cost calculation risk
Revenue Share
Retainer 4%
8%
10%
0%
• Retainer options are mostly opted by freelancers working in the Legal and Accounting domains
• Revenue share model is not readily adopted by the Online Talent marketplace due to project failure concerns
• Retainers help in decreasing month to month accountability which is preferably refrained by the freelancers and the clients Minimum Source: Freelance Industry Report 2011 and Talent Neuron
5%
2%
• Clients refrain from revenue sharing as it may hit their profit margins Median
Maximum Zinnov
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Online Talent Marketplace Key future trends
A
Compared to earlier, more complex skills are being outsourced such as Search Engine Optimization, Mobile Application Development, Legal, Accounting , Management, Manufacturing etc.
Today most of the companies hire freelancers for cost savings and flexible scalability. However, niche and specialized skill sets will be driving the market for online talent hub companies
Adoption of online marketplaces among medium/large scale enterprises is starting to happen E.g. Global 2000 companies There will be a clear shift in user base of companies (Currently heavily skewed towards small and medium size companies)
Outsourcing of niche work will increase
B
Summary
Adoption by large/medium size enterprises
C Growth in virtual workforce
D Diversity of supply base
Companies have been increasingly hiring freelancers. Talent Neuron estimates around 10 - 15 percent of the total workforce will be hired from online talent hubs in the coming years
Studies have indicated that there is more participation by the women in the online talent marketplace than the traditional workplace
In 2013, Talent Neuron expects significant growth in women freelancers Companies like Shelancers are being established which are focused on the female online talent
Source: Talent Neuron
Zinnov
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