Online Talent Marketplaces Landscape Analysis

Online Talent Marketplaces – Landscape Analysis March 2013 This report is solely for the use of Talent Neuron clients and Talent Neuron Subscribers. ...
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Online Talent Marketplaces – Landscape Analysis March 2013

This report is solely for the use of Talent Neuron clients and Talent Neuron Subscribers. No part of it may be circulated, quoted, or reproduced for distribution outside the client organization without prior written approval from Talent Neuron.

Talent Neuron Copyright and Disclaimer Copyright The material in this report is copyrighted. No part of this report prepared by Talent Neuron can be reproduced either on paper or electronic media without permission in writing from Talent Neuron. Request for permission to reproduce any part of the report may be sent to [email protected]. Customers are welcome to use an unlimited number of copies of the materials contained within this report. Furthermore, customers may copy any graphic herein for their own internal purpose. Talent Neuron requests only that members retain the source name/logo mark on all pages produced. Please contact our Talent Neuron account manager at +1-408-716-8432 for any help we may provide. The report herein is the property of Talent Neuron (A Zinnov LLC Company). Beyond the membership, no copyrighted materials of Talent Neuron may be reproduced without prior approval.

Disclaimer All the information contained in this report is obtained through proprietary technology aggregation algorithms, human experts, network of domain experts, discussions with industry leaders, public and confidential information sources believed to be reliable. Talent Neuron makes no representations or warranties regarding the errors, omissions or completeness of any information contained herein and shall have no liability for the same. The report is provided solely for informational and marketing purposes and opinions must not be construed as advice, recommendations or endorsements. The reader of the report is advised to conduct an independent evaluation and form conclusions with respect to the information provided.

Talent Neuron can help in selecting the right location by providing data, analytics and insights on Locations, Talent, Cost, Peer Group Footprint & Trends

Source: Talent Neuron Website

Location Analysis

Understand the capability of each potential location and make data driven decisions on setup and expansion

Peer and Talent Insights

Understand the capability of each potential location and make data driven decisions on setup and expansion

Ecosystem Analysis

Understand the capability of each potential location and make data driven decisions on setup and expansion 2

CAPABILITIES Talent Neuron has assisted over 100 companies in their global location analysis and site selection process Ecosystem Insights

Forecasts

Industry/Domain

Wage Inflation Trends

Skill Wizard

Market Insights

Market Tracker

Company Tracker

Proprietary Data Sources Web Crawling

Surveys

Expert Insights

Reports

Consulting

Network

Analytics

Source: Talent Neuron

Talent Neuron KEY FOCUS IS ON THE TECHNOLOGY INDUSTRY. OVER 80% CLIENTS ARE IN THE PRODUCT ENGINEERING DOMAIN. 500+ GLOBAL CITIES COVERED

6 DOMAINS 35 FUNCTIONs 150+ SKILL SETS

PROPOSED APPROACH – Data Gathering and Analysis through BIG Data Talent Neuron will use data driven Big data principles (for large data analysis) which will provide comprehensive insights and transparency on the trends, current realities and opportunities in any locations

Connectors (API / Screen Scraping)

100+ Job sites

Patent Databases

3,000+ Company Career Sites

Publication/ Journal Databases

Universities

Technology Contributor lists

Social Media/ Public Profiles

Community Sites

Skill Availability

Hadoop Engine (Big Data Approach)

Location Insights

Compensation and Cost Trends

* Details not disclosed by the company Talent Neuron Website Source:Source: Talent Neuron Research and Analysis

=

Over 12,000 Unique Data elements for each city

Peer Company Footprint

Talent Neuron has two module Talent Intelligence and Talent Analytics. Our data spectrum covers 500 cities, 9 Domains and 400+ skill sets

520+ Cities

~12,000 Unique Data Points Per City

9 Domains & 400+ Skills

Module 1: Talent Intelligence

• • • • • • • • • •

Location Profiles Talent Pool (Installed and Fresh) Salary and Cost University Peer Companies Monitor Role Views Job Engine Top Brains Public People Profiles

~7,500 Companies & 22 Million Profiles

Module 2: Talent Analytics

• • • • • •

HR Data Consolidation Peer Benchmarking Decision Support Analytics Workforce Planning Skill Circles Hypotheses Validation

5

Talent Neuron, gathers data from multiple sources

Data Mining from Connectors

Job Sites

Universities

Company Career Sites

Publication/ Journal Databases

Patent Databases Community Sites Technology Contributor List

Social Media/ Public Profiles

News Articles & Public Data – Crawling Engine

Correlated data on Talent, Cost, Peer companies

Zinnov Primary Research & Interviews

Data on City level suitability & Ecosystem

Survey Data from Companies

Data from Govt./ Industry Bodies

Data from Local Recruitment Companies

6

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

8

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

9

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

10

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

11

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

12

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

13

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

14

Talent Neuron Platform Talent Neuron Platform provides granular data for over 500 cities in 83 countries. It tracks over 12,000 unique data parameters for a city that spans across location attributes, talent pool size (Domain, Function and Skills), Universities, Salary and Cost etc. Global Location Profiles Global Talent Insights

Job Engineer

Talent Neuron

Role View

Global Cost & Salary Insights

University Outlook

Monitor

Peer Companies

For Detailed information on Location, Talent, Cost, Risks, University Information contact [email protected] Source: Talent Neuron Website

4701 Patrick Henry Dr. Building 7 Santa Clara CA – 95054 Phone: +1-408-716-8432 21, Waterway Ave, Suite 300 The Woodlands TX – 77380 Phone: +1-281-362-2773

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[email protected] www.talentneuron.com

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