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How to Build A Sustainable And Profitable Online Business on Fiverr

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When you’re just starting out as a freelancer, Fiverr can be a quick and easy way to build a sustainable and profitable online business, especially if you have an existing and in-demand skill.

Fiverr was launched in February 2010 with eight categories of services. Since then, the site has experienced exponential growth every year, with no signs of slowing down. In recent years, Fiverr has become a “go-to” online destination for freelance services, processing $699.3 million in transactions per year. The site reportedly generated $189.51 million in 2020, a 3.64x increase since 2017 alone. Fiverr’s net worth in 2021 has been estimated at $5.34B.

Selling services on Fiverr is a viable way to earn a full-time income online. However, if you simply create a seller account and start selling right away, you may end up sacrificing your time for money, which is often not the best way to make a living.

In this post, we’ll cover why Fiverr is a good place to start if you’re new to freelancing, share some tips on how to maximize your earnings and list some of the most common mistakes to avoid.

What is Fiverr?

Fiverr is a global digital market place where anyone can monetize his or her skills, no matter how obscure, and market those services to buyers worldwide as gigs. With a gig, buyers can purchase any professional service offered by a seller. A gig can be something like “I will design a logo for $10.”

Fiverr’s success is largely attributed to its microtasking model. This enables users to get digital services such as logo design, article creation, link building, video editing, and more for $5. In fact, the site’s name derives from this. Fiverr today allows service providers to charge whatever price they feel comfortable with.

The platform still has a lot of $5 deals, but they are primarily used as a marketing strategy to sell more expensive services.

The Fiverr marketplace is not only able to offer a wide range of services from a variety of sellers around the world, but also attracts tons of prospective buyers. It is used by more than 3.42 million buyers annually.

How Fiverr Works

A Fiverr gig allows you to advertise skills that others find useful. Whether it’s article writing, voice-over, logo design, or video editing, you can list your services on the platform by registering as a seller.

A transaction on Fiverr involves two parties:

  • Sellers: Sellers are registered freelancers that offer services on the site.
  • Buyers: Buyers are registered users who buy services from freelancers.

Selling on Fiverr

When you register as a seller on Fiverr, the most important factor to consider is how long it will take you to complete the services you’re offering. There are only 24 hours in a day, and there is only one of you. If it takes you 10 minutes to complete a gig at $4 per gig, your minimum rate will be $24 per hour. In contrast, if it takes you half an hour to complete a gig, your minimum rate would be $8 an hour, meaning you would be earning minimum wage. If that is the case, you would be wasting your time. It would be better if you found a good job with a guaranteed paycheck. Most jobs also offer health and dental insurance, as well as a retirement plan. Freelancing does not provide these benefits.

To maximize your earnings on Fiverr and earn a full-time income, you need to think big. You need to think outside the traditional freelance box. To put it another way, you have to decide to make money without necessarily trading your time for money.

Here are three ways to maximize your earnings on Fiverr:

1. Maintain your competitive edge by offering $5 versions of your gig.

To understand the importance of offering $5 packages, you need to see things from a search engine optimization perspective and a sales perspective.

You aren’t likely to get many views or orders for your gig when you’re new on Fiverr. This is because gigs that perform well in search results and that users buy are largely influenced by client feedback.

Because of this, when you’re new to the site, your primary goal as a new seller is to get as many eyeballs on your gig as possible and to garner 5-star reviews. Fiverr’s search results are more likely to display low-priced gigs since many of their clients are looking specifically for $5 options. If you offer a $5 gig that you can complete in less than 10 minutes, you’re keeping yourself highly competitive without necessarily compromising your value.

Your low-cost option will attract many buyers, and that’s OK; this gives you the opportunity to develop your feedback profile as well as gain experience of working with Fiverr buyers. Nevertheless, you should add gig extras that will raise the value of those projects considerably. Gig extras are additional features your customers can purchase on top of your base price. As an example, if you state that you will deliver the project within three days, you can provide clients the choice of paying extra for one-day delivery.

Gig extras are key to maximizing your earnings on Fiverr.

Let me explain what I mean with an example.

Suppose you are a video editor and you want to offer editing services to the public. You have no experience as a freelancer and you’re new to Fiverr.

A typical gig like this would be something like:

    I will edit your video for $5

What you’ll want to offer is a task that can be completed in less than 10 minutes.

For example, you could offer the following as a basic service:

  • Up to 5 minutes of video footage
  • Add logo
  • Add music
  • Merge clips

This job can be completed in 5 – 10 minutes. However, most competitors charge $15 for the same service. Taking this approach, you’re offering them a much better deal than other freelancers, which will generate lots of traffic for your gig.

However, you shouldn’t stop there. You will want to upsell gig extras in order to make more money from the gig.

Your extras could be:

  • Colour grading and colour correction $25
  • Video effects $35
  • Motion graphics $45
  • Video and audio transitions $35
  • Sound design and mixing $25
  • Subtitles $20

With a $5 gig, you remain highly competitive for the search term “video editing” without compromising your value.

By not including the extras, your gig would either have been significantly less competitive or drastically underpriced.

This package of services would be less likely to show up in Fiverr searches if it were advertised as a single gig for $185. This is because its base price is so much higher than other sellers. In any case, it would be ignored by most users.

Even if you lowered the price to $75, it would still be much higher than the dozens of video editing gigs on the platform, despite the fact that it is well below what the work is worth.

It’s for this reason that you should offer a $5 option, even if it’s not a Fiverr requirement. It’s important to make that move, especially when you’re new to the platform. 

Once your reputation grows, you’ll be able to offer gigs without having to charge $5; Fiverr’s search engine is based on things such as your number of completed orders, your feedback profile, and your seller metrics.

You should bear in mind, however, that many of the biggest sellers still offer a very low-cost option because it generates good leads.

2. Find out the hottest gigs in your niche and make your offer stand out by adding more value.

You must research what the top sellers in your niche are offering to determine what services to provide to your ideal target customers.

There’s a reason for this: the top sellers have done all the research and know what their potential customers are looking for, and they’ve designed it in a way that maximizes their profits. 

So, the key is identifying

  1. What services successful sellers offer at low price points ($5 and $10).
  2. How you can offer similar gigs with better value at those price points.

Keep in mind that these may not be the most profitable services, nor ones you want to continue offering in the future. But targeting them will help you get established and move on to better projects.

Do your homework before creating a new gig by researching the highest paying gigs in your niche.

Focus on things such as:

  • Gig titles of the best-selling offers. Do they contain any keywords or phrases that appear repeatedly? Include these keywords in your offers.
  • In what ways do sellers with high ratings describe their offers? Successful sellers most likely optimize their gig description based on their experiences.
  • How much do other freelancers charge? In order to be competitive, it’s important to determine how much value you need to provide at every price point.

Suppose you are a video editor. You should find out how much video editing other companies are willing to do at various price points, and integrate that information into your gig.

The point is, when you’re getting started, you don’t have any feedback. As yet, you have no proof that you are capable of delivering the services that you’re offering to a satisfactory level. Hence, the only way to get started is with a price that is very competitive and offers a lot of value.

Nevertheless, some new sellers refuse to compromise on price and set prices according to what they believe their services are worth, because they feel they would be undervaluing their perceived value.

Unfortunately, this approach does not work on Fiverr. You’ll need to be more flexible if you haven’t built up a strong reputation on the site. At the same price point, prospective clients have no reason to hire a new freelancer who’s inexperienced. 

Especially when you’re just starting out, you want to find out what services other sellers are offering at low prices. If you have the capability of completing the work very quickly, there is no reason why you can’t offer more value at the same price points. Remember that you are simply trying to build your reputation at this point. You don’t have to keep charging the same price for those services in the future.

Mistakes to avoid when starting a Fiverr business

As a new freelancer, you’re probably excited about the idea of earning money on Fiverr and eager to start offering your services on the platform. Even so, you’ll want to take a step back and make sure you avoid common mistakes that plague many new sellers.

It can save you a lot of headaches later on if you make the right decisions at the beginning.

Not treating your Fiverr business as a business.

It’s important to keep in mind that you’re setting up an online business when setting up a seller account on Fiver.

The first step to success on Fiverr is to develop a strategy to guide your efforts.

The work you do isn’t all that makes up a freelance business. It includes a lot of other things as well, like setting up taxes, invoicing, marketing, prospecting, and so on.

Here’s your chance to establish yourself as a leading expert in your field.

You should treat your Fiverr freelance business like a business, and focus on making it successful.

Not taking deadlines seriously.

Freelancers work according to deadlines. If you commit to a deadline, you must meet it.

Building and maintaining a successful Fiverr business depends heavily on getting gigs delivered on time.

Unsatisfied customers can adversely affect your ratings when you deliver late. Providing work on time is one of the hallmarks of a professional seller.

The following tips will help you avoid late deliveries:

  • Increase the delivery time for your gig. Maybe you need more time to complete the project if you often have difficulty delivering a certain gig on time or if you have delivered the gig late more than once. To ensure you have enough time to complete and deliver the gig, extend your delivery time by one day.
  • Overwhelmed? Put your gig on hold or go on vacation code. When you have a full queue of orders, set your profile to vacation mode or pause the gig. This will give you breathing space to finish up your current orders.
  • Do you need more information to get started? Make sure you respond quickly to buyers when their requirements are missing. This is very important for Extra Fast orders, since the gig creation window is very short.

Despite your best efforts, obstacles can arise that cause delays, even when you allocate enough time for a gig. You may fall ill, or something completely unforeseeable may happen. Should you be unable to meet a deadline due to any reason, inform your buyer of the situation as soon as possible, and politely ask them to extend the deadline.

The bottom line: If you’ve committed to a deadline, stick to it no matter what. Your clients will respect you for that.

Overcommitting yourself

As you accept more work or clients, deadlines will increase. You’ll eventually miss a deadline if you don’t give yourself enough time between deadlines.

You should also keep in mind that high volumes of orders can put a lot of strain on yourself. In the end, the quality of the work you deliver will also be affected, and your clients will be the first to notice this.

You will ultimately receive negative ratings and reviews for your profile as a result. The more negative reviews you receive, the harder it gets to succeed.

You should never be afraid to tell clients that you are too busy to take on their project right now.

Not knowing how to deal with unhappy customers.

When a client is dissatisfied with your work or feels he hasn’t received what he had ordered, you need to work with him to solve the problem.

Review your gig’s sales page again. Does it accurately describe your service? Does it include any misleading information?

You need to be able to handle constructive criticism, especially if it is valid.

You should do whatever it takes to satisfy the client, especially if you know you can do better.

There are times, however, when a client has unrealistic expectations or is simply being difficult. 

Such clients can hurt your reputation and damage your ratings if you don’t know how to deal with them.

Although it may mean losing a pay check or working more hours, the investment is worthwhile if it results in a happy client and an intact reputation.

Not keeping in touch with former clients

Your satisfied customers can be one of your main sources of consistent work.

When a client is satisfied with your work and gives you great reviews, it is a good idea to contact them occasionally to say hello and thank them for buying your gig. Thank them for allowing you to work on their project and let them know you will be available to them should they have any questions. Sometimes a previous customer can buy your gig because you appeared on their radar at the right time.

Not learning from your mistakes

Everybody makes mistakes. But how we handle them makes all the difference.

Whenever you make a mistake, try to fix it and figure out how to prevent it from happening again.

Learn from your initial mistakes and apply this knowledge to your eventual success.

Remember that many sellers initially failed in their first attempts, but came back to succeed after learning from mistakes and improving.

Being a jack-of-all-trades but a master of none.

An idiom that has become ubiquitous among freelancers is ‘jack of all trades, master of none.’ Freelancers who do everything aren’t likely to be amazing at anything.

You run the risk of spreading yourself thin when you try to be good at lots of things so you can book more gigs.

An ability to wear several hats can be an asset. The problem can arise if you are not able to focus on one particular area. Rather than trying to do everything, it can be beneficial to hone your skills and focus on one area you are familiar with.

Unless you have mastered a skill – something you are known for – making a name for yourself may be challenging.

Exaggerating your abilities in your gigs.

Beginning freelancers may be tempted to embellish their gigs by promising the world in order to attract clients. However, if you make those promises just to get a customer, and then fail to deliver, you’ll damage your reputation, which is bad for you and bad for Fiverr business.

When you overpromise and under-deliver, you build up people’s hopes that you can provide a certain service at a certain price, when in fact, you can’t deliver on what you’ve promised. You shouldn’t promise anything if you know you can’t deliver what your clients expect. Not only does it harm your own reputation, but it also hurts Fiverr’s reputation as a whole.

Therefore, it is vital that clear expectations are set from the get-go. To build a successful freelance career, you must underpromise and overdeliver. Be sure to explain to the client exactly what they can expect as well as payment terms and deadlines. Don’t make promises you can’t keep. Don’t use wording that is unclear.

Not asking for reviews. 

Reviews from your customers are the best social currency you can use to convince potential clients you’re the right person for the job.

You’re setting yourself up for needless questions and failure if you’re not collecting them from every happy client you have.

But when should you ask for a testimonial from a client?

If you do a good job, ask for a testimonial immediately. Tell them how important a review is to your business and ask them if there is anything that could deter a 5-star review.

Underestimating the importance of online marketing

If you want to find work and promote your services, you shouldn’t solely rely on Fiverr’s search results. You should also consider how social media can be used to market your business. Advertisements on social media platforms like Facebook or Twitter, for instance, are both affordable and effective forms of targeting specific market segments.

Setting the wrong price

Don’t set your prices based on what you believe you are worth. In the early stages of building your portfolio and reputation on the site, you may have to offer some of your services at a lower rate. Set your prices strategically. In the end, you have to strike a balance between the amount of time and effort you are willing to put in, as well as the lifestyle you want.

Final thoughts

I guess that’s all there is to it. Hopefully, you now have a better understanding of what it takes to run a profitable Fiverr business and how to make good money on the site. Here are a few more tips that will help you succeed on Fiverr:

  • Make sure you use proper grammar and English in your gigs.
  • You should optimize your gigs for price, package, and extras.
  • Let people know exactly what you’re offering.
  • Do your best to avoid missing deadlines and deliver on time.
  • Avoid negative feedback at all costs.

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