There are two main approaches to doing your freelance business. Location-based in the physical environment (offline) or online purely digitally. By online freelancing, I mean the type of work that you can do purely remotely typically from your home office starting from finding clients to executing the work and getting paid. LinkedIn and other professional platforms as well as freelance sites such as Fiverr, Upwork, or PeoplePerHour make online freelancing possible.
Offline freelancing is the type of work that you would typically do in the physical world, i.e. meeting clients for coffee and lunch, going to meetings, perhaps even doing the work in the client’s location too.
In this brief comparison, I list the differences as a guy who has done both kinds of businesses. Several aspects affect how each type of business needs to be run, what potential they offer, and what risks are involved.
What differs?
I figured there are quite a few differences between the two types. I found six things that have a significant impact on how to run the business, yet, I know there would be more differences if we went more into the details.
Here is a short summary. Let’s go through them one by one.
The main differences between online and offline freelancing.
Marketing requirements
Regardless of what kind of business you run, you have to go where the customers go to meet them. Doing business purely online, you must be able to establish a strong online presence in one way or the other. A personal website to showcase your background, skills, and portfolio is almost a must. You can get pretty far with having a good profile page on LinkedIn, too. Setting up a profile on freelance sites is the most obvious requirement. The challenge there is mainly how to differentiate from everybody else online. Your core skills therefore must be:
- Ability to analyze the market for a very specific niche so you don’t compete with everyone in the vast category of your field.
- Written presentation skills. If your profile or webpage doesn’t address your potential clients, your profile will be skipped.
In the physical offline world, a strong online presence is also good to have but not by any means mandatory. You can make a long list of potential clients by just meeting them live in meetups, networking events, co-working spaces, etc. The skills needed here are:
- Small-talk.
- Effective introduction for approaching people.
- Verbal presentation skills to tell people what you do.
Offline you can get projects because you are the ”go-to guy” of the people living near you. They know you, they will ask you to do things even if the task is different from what you did for them earlier. Do good work and the word goes around. You get recommended. You get referrals.
Online, the recommendations and potential referrals work differently. Rankings and reviews on freelance sites, profile views on LinkedIn, visibility on Google search, etc. make the game different from the offline world. It’s the written word, e.g. a recommendation quote, that turns the clients’ heads.
Speed of getting contracts
This is the part that made me make a push toward online freelancing. I realized that it takes a lot of meetings to get a project going because most of the people I met were not currently looking for anything specific, not buying. This is perhaps the biggest difference between offline and online freelancing. People (I mean potential clients) go online when they have some kind of need. Particularly, people go to freelance sites only when they intend to buy some services.
In the physical world, efficiency is much poorer in general. Even for those who are interested in buying something, things get delayed more often than when doing business online. It’s the nature of the internet. Sometimes you could get a contract in place and a project going directly after meeting a new client! This never happens offline.
Competition
This aspect is easy to understand when you just look at the numbers. Let’s say you’re a WordPress developer/designer. If your service can be sold offline to those you meet, the only people you are in direct competition with are the other couple of WordPress developers in your hometown.
Try to do that business online and the competition is entirely different. Any freelance site, LinkedIn, and other places online are full of others with a similar skillset, so the competition is fierce. The only good thing then is that the market is huge too and the overall cake can be sliced among all the players mainly because of availability.
Required expertise
Freelancers need to be very good at the core skill their offering is based on. A programmer who barely gets his software working and needs fixing all the time won’t be in business very long. A writer whose text is full of typos and has problems in addressing the audience will get to find a day job and so on.
By expertise, here, I mean the level of expertise that you would need to be counted as a solid professional in the eyes of the client. The higher it is, the better the pay should be.
Offline, of course, where you only need to be for instance the best logo designer in town, the threshold for being perceived skillful enough to earn top bucks according to the local is much lower than online. Online, you need to be something of a true expert to be in a comfortable position in your market.
Being highly experienced and properly specialized is a big advantage online when your largest addressable market is basically the whole world. Top guys can make top bucks for the top jobs regardless of how the business is done in terms of location. The big difference, however, is in the market itself.
Let’s take one of my coachees in the Philippines. Had he attempted to establish his business purely in Metro Manila, he would have never been able to earn more than the best list rate matching his skill level. In Philippine pesos. By getting his online game going, his earnings are multiplied the moment he nailed the first good project from the U.S. paying just normal rates… but in US dollars. Despite what many say about freelance sites, the reason for clients to buy services online is not only cost-saving. Sometimes, people in the local circles just don’t have enough expertise needed for a complicated job.
Skillset type
The demand for expertise leads to defining the skillset type too. In the physical world, you can succeed by being that above-mentioned ”go-to guy” and taking care of everything in your vast category of offering that your offline clients require. This is because you have warm relations and trust from previous experiences with old clients or solid face-to-face recommendations and introductions to new ones.
Being a generalist online is quite hard. It is not impossible, but it is almost impossible to earn top dollars. This is because true experts take the most demanding jobs by the nature of the jobs themselves. They cannot even be done by generalists.
Getting the question of being a good generalist or a true expert wrong early on in your freelance career can turn out to be fatal. Not because you wouldn’t be able to find any clients, but because getting them would be a constant struggle every time.
Payscale maximum
This is perhaps the best part that makes online freelancing so lucrative. Top talents get top pay. I’ve had clients who hire me on Upwork because I was by far the most expensive option for them. (See more in the article What Happened When I Raised My Hourly Rate on Upwork to $199.)
In offline freelancing, you are most definitely prone to market prices and get what clients are able to pay which won’t be particularly more than what conventional employees get. The trick then is to be faster.
So, what’s the best way?
As of now, almost seven years after I started freelancing, my model is something of a hybrid with 10% offline and perhaps 90% online. As I’m located nowhere near the top markets, in my case, Silicon Valley, the only way to reach the sweet spot is to do almost everything online.
But my offline business part is still there where I started – the startup hubs in Singapore and other Asian countries.
If I make location-based virtual reality (VR) installations for a new game arcade, for instance, the only way to validate my work is done and valid is to go to the site and work with the client’s hardware. I’ve flown to a beach club in Bali just for one good meeting (and drinking). I made a ”house call” to visit my client’s home to make sure he’s fully covered for his big pitch event. I’m regularly present in various startup meetups, conferences, and expos in Jakarta, Kuala Lumpur, Singapore, Tokyo, and other capitals.
I’m a familiar face in many startup incubator offices in several countries. I’ve been giving presentations here and there about VR training simulators and their benefits. I have regular meetups with my subcontractors here in Malaysia. Physical meetings have their advantages, for sure.
Participating in a ”shark tank” startup event in Jakarta is always a nice change… particularly when the client pays.
I’ve also done it the other way round. I’ve been hosting workshops at my home for Singaporean collaborators and turned my guest room into another home office for my Californian client for a month. What great fun offline freelancing has been! Yet, most of the time I spend doing freelance happens online.
Running on two tracks and doing offline business at least every now and then keeps things interesting and variable which helps to avoid getting routinized. For the quality of the encounter, there is still no replacement for physical meetings. Sometimes I think I’m going somewhere just for the fun of having a business lunch with someone new and interesting. Particularly when the client wants to pay for the frog porridge. 🙂
So, perhaps not going 100% online or offline gives you the best of everything. Just keep the proportions right to avoid the pitfalls. What those proportions are is up to you to decide. If you need help in thinking it through, just let me know.
