The Freelance Revolution: How the Gig Economy will Transform Marketing Departments and Agencies

What is the gig/freelancer economy?

These two terms refer to a work model that involves completing individual assignments and projects (i.e., "gigs") rather than full-time employment. This phenomenon has permanently settled in finance and IT, and for several years now, it has also impacted marketing and the creative industry.

The development of the gig economy is linked to the entry of Gen Z into the labor market. New generations of employees value freedom, independence, flexible forms of employment, and the ability to work from anywhere on the planet - they don’t imagine their future in offices, performing tasks "from...to..."

The mentality of leaders is also changing. Business owners and managers have realized that their team members no longer need to sit at a desk from 9 to 5 to succeed. They increasingly understand that a freelancer is not just "a person who wasn't good enough to get a job somewhere," but an expert who, thanks to their experience and specialized knowledge, can take their business to new heights.

Add to that the pandemic, the boom in remote work, and we have a recipe for a global transformation of the job market.

Currently, freelancing is not just seen as a way to earn extra income alongside a regular salary but has become a way of life and running one's own business.

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The rise of freelancing and the gig economy: 51% of US residents like it

According to many sources, 1.57 billion people worldwide already identify as freelancers, and the market is still growing. More and more CEOs and CMOs on both sides of the Atlantic want to work with them "on demand" instead of maintaining traditional full-time employees. 73 million American freelancers complete assignments worth $1.3 trillion annually. By 2027, this group is expected to grow to 86.5 million, representing 50.9% of the total US workforce. Wow!

The trend has also reached Europe. According to Eurostat, there are 32.3 million "freelancers" actively operating here, representing 15% of the total workforce. And what do they usually outsource? The most desirable skills among freelancers are social media marketing and web design.

Why is there such a huge interest in freelancers' services? There are two main reasons: a faulty and ruined agency model and the rising costs of full-time employment, as well as the salary and non-salary expectations of candidates.

Combined with technological advancements and an increasing number of tools that allow for finding and efficiently communicating with freelancers, a new model of collaboration naturally emerges.

Scenario number 1: Cooperation with a marketing agency

Let's assume that you are a Marketing Manager in a FinTech startup. You have more on your plate than the average person. You need to act efficiently, make dozens of decisions, analyze data, verify hypotheses, and cope with a limited budget (or lack of budget, if you are in a very early stage of development).

Who can you trust to handle your marketing tasks? Scenario number 1: An agency.

Handing over your marketing tasks to an external agency is still a popular and straightforward operating model. You announce a tender, and meet with representatives of several competing companies. After a few weeks, team leaders and department heads present you with colorful, multi-slide presentations full of insights and arguments about why you should choose them. Unfortunately, very often their involvement in the project ends here, and you end up under the wings of less experienced, unfamiliar marketers.

But that's not all. Rotation, handing over the project from hand to hand, lack of business understanding, and problems with meeting deadlines are key factors that significantly lower customer satisfaction with the agency's work. In addition, agencies, approaching many tenders, win only a small portion of them, and every time they incur costs of preparing an offer. Someone has to pay for it. Someone, meaning you.

Of course, there are exceptions on the market that successfully carry out their missions based on values such as responsibility and transparency, but there is no doubt that we are witnessing the slow decline of the traditional agency model.

Pros:

• At the bidding process, you gather a huge portion of ideas from different agencies (*this is a plus for you, but a minus for agencies, which usually work for free at this stage)
• Easy access to knowledge, tools, and structured processes
• You know who to blame if something goes wrong

Cons:

• You do not have 100% certainty about who is actually carrying out your project - you often end up in the hands of juniors
• You are "one of many" and have to queue up for specific solutions
• You incur additional, often (too) high costs for the implementation and management of campaigns.

Scenario number 2: Hiring a full-time marketer

The second option is to hire a full-time marketer. Collaborating with a long-awaited, ideal candidate sounds like a perfect plan. However, we must not forget the challenges posed by the post-COVID reality.

Today, the battle for talent is exceptionally fierce despite the looming specter of recession or geopolitical turbulence. According to Russell Reynolds data, 72% of business leaders' most significant challenge is the lack of availability of employees with key skills. This is also true in the marketing and creative industry.

Acquiring talented employees is currently one of the key challenges that entrepreneurs face, especially now when the best people increasingly choose the path of freelancing - today they are in Warsaw, and tomorrow in Bangkok or Stockholm.

This affects the costs of hiring a full-time employee and the effectiveness of recruitment processes. An unsuccessful recruitment can cost tens of thousands of dollars, including operational and alternative costs (for example, a poorly matched candidate can generate losses instead of profits for the brand they work for).

Even if you manage to engage a specialist in your marketing department, you usually have to wait for them for a minimum of one month, and sometimes even 3 to 6 months - due to the notice period in the previous company.

Then it's time for onboarding. The average cost of preparing a new employee to enter the organization reaches several thousand dollars, and for specialized positions, it can be much higher.

Apart from all the above points - also consider whether you will fully utilize the specialist's potential and whether you can guarantee them interesting challenges in full-time employment. Are you really sure you need a strategist, marketing automation specialist, or UX designer full-time for 12 months a year? Such experts are usually the most valuable in selected, key moments of activity, for example, during the launch of new products or services.

Pros:

• You have a specialist exclusively for 40 hours a week
• Possibility to fill the position with additional tasks
• Smooth integration into the organizational culture

Cons:

• The standard recruitment process is many times longer than other employment models - and is measured in months, not days
• You have to take care of formalities and incur additional costs (including signing an employment contract, medical examinations, benefits, and paid holiday)
• You pay for every day of the specialist's work - and it is not cheap!
• After a few months, the employee becomes somewhat a slave to procedures, which can significantly reduce their productivity and creativity
• Difficulties associated with terminating contracts.

Scenario no. 3: On-demand Freelancers "By the Hour"

The imperfections of the first two scenarios have led more and more large corporations, startups, and SMBs to choose to work with freelancers. In the USA, 70% of businesses have already used their services, and Europe is not far behind. Why?

Pros:

• Flexibility and lack of long-term commitments, ultimately resulting in a low level of risk - you don't have to worry about long-term contracts, you can change the scope of the project at any time, or even cancel the activities altogether.
• Greater responsiveness - you don't have to contact an account manager, who will then schedule a call with the team leader, and the team leader will pass on your instructions to the specialist; you communicate directly with the service provider, even outside of standard working hours.
• Start working immediately - according to Traffit's analysis, the average time for the hiring process in countries such as Poland is 21.58 days; finding the right freelancer and starting cooperation with them can be done in as little as 48 hours.
• Access to an unlimited number of talents - Your marketing department cannot grow indefinitely, just like the composition of marketing agencies. Meanwhile, in the world of freelancers, the pool of talents with a specific set of skills is practically inexhaustible.
• Simpler and cheaper recruitment and onboarding process + fewer formalities - You don't have to worry about medical examinations, equipment purchases, social security contributions, or sports cards; freelancers settle only for the work they have done, usually based on a single invoice.
• Responsibility in one pair of hands - When working with a team of an agency or marketing department, the responsibility can be diluted. When working with a freelancer, you immediately know "who, what, when and how."
• New perspective on problem-solving, new working methods, new knowledge, and departure from established processes or ways of thinking that are standard in your team. By including an external expert in the project team, you achieve a win-win situation - you deliver new quality, insights, and knowledge to the organization for current employees and the entire company.

Cons:

• You need to have at least a basic knowledge of the projects you are outsourcing (or responsible brand manager) to connect and provide feedback on the work of freelancers.
• Compromising on some aspects - if you want to engage specialists from outside your region or country, they are unlikely to show up for brainstorming sessions in your office.
• Due to the popularity of this model, many beginners appoint themselves as experts - therefore, when searching for freelancers, use only verified platforms.

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How to find freelancers?

The market for platforms connecting freelancers and clients is growing. It is estimated to reach a value of 18.3 billion USD by 2031.

The platforms that bring together freelancers are as diverse as the freelancers themselves. You can use portals that are dedicated exclusively to specific industries, those that promote only students or remote workers, for example:

• Freelancer.com - Do you have a very low budget and simple tasks to be done? Here you can find many specialists from Asia who can complete your assignment "on the spot".
• Mayple.com - a platform mainly operating in the American market, promoting specialists dealing with e-commerce.
• Weworkremotely.com - a platform for posting "gigs" independently, to which specialists from all over the world respond.
• HIondemand.com - a Polish database of senior-level marketers from various specializations (including UX, automation, and web design), where a dedicated Project Manager helps you with the selection.

To sum up, gig economy for your business means:

• a guarantee of working with specific people chosen by you, who will take responsibility and deliver the project in the name of their personal brand
• maximum flexibility and decision-making power in your hands
• a lightweight organizational structure and less sensitivity to random events like COVID-19.

If I had to choose the business word of the year for 2023, I would definitely pick "freelancer". The model of cooperation I've written about above stands out on the monotonous plains of traditional marketing. The benefits of working with independent specialists far surpass the value proposition of most traditional marketing agencies, and selecting specific experts for specific tasks is becoming an increasingly popular alternative to hiring employees on a permanent basis. I am sure that marketing agencies and marketing departments will evolve into organizations that bring together top "on-demand" experts who can be engaged for dedicated projects.

Does this sound like something for you? Contact me, if you want to chat more about it! ✌