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Sunday, May 02, 2010

Rip-Off Report: You Will Donate $5 to Fiverr for $5

It all started with my first article, "Fiverr.com: We Will Rip You Off for $5!".

In it, I explained how "the latest rage", Fiver.com has a payout requirement that is virtually impossible for every merchant to reach. I also wrote 2 more articles after it, and this will be the fourth. In a nutshell, merchants must make a min of 8 sales ($40), in order to be able to withdraw their money. Now, that's bad enough, because that means....

EVERYONE WILL HAVE TO MAKE 8 SALES TO CASH OUT!

Those who don't make ANY sales won't lose any money to Fiverr but they'll still be TRYING to make 8 sales. So, everyone is trying to make 8 sales while all the ads from the newest merchants (read: no sales yet), will be forcing down the ads by the earlier merchants (read: 0-7 sales).

Keep in mind, if you are fortunate enough to make, for example, $55, and cash out, well, currently, it just starts over again. You have to make ANOTHER 8 sales in order to get paid (if that changes, please notify me in the comments). Along with all those NEW merchants, AND along with all those who cashed out and have to make ANOTHER 8 sales.

So, Here Are Some Comments I Received

1. Fiverr is great, IF you know what you're doing.

I never said a person couldn't make money. And, I never said a person couldn't make a LOT of money. But, when you step back and look at Fiverr from a more comprehensive view, you can easily see that a LOT of people are going to be leaving a LOT of money in Fiverr's wallet. And, though they say merchants can't withdraw until $40, they don't specify a deadline... so, does that EVER become Fiverr's money? And, if so, at what point?

2. People should read the TOS. It is their own fault.

Rubbish. That is the mantra of a ponzi scheme. And, while I'm not saying Fiverr is a ponzi scheme, I AM saying that it is virtually IMPOSSIBLE for everyone who makes 1 sale to make 7 more. Theoretically, maybe... in reality, no way. Even if people had the attention, and foresight, to read a boring, lengthy TOS to find the payout requirements, Fiverr's payout requirements would still be virtually impossible for the whole of the merchant community.

3. It's no different than Google's Adsense program that has a $100 payout minimum.

Au contraire mon frere... (on the contrary), Google Adsense is passive income. Granted there's an initial setup of your website and maybe a little promotion but, otherwise, you can be on the beach in Maui while your website is passively earning income from 1000s of people who don't have to spend a dime to click on your ads.

But, with Fiverr, merchants have to PERFORM a SERVICE... and, in order to get paid by Fiverr, they've got to perform a service EIGHT times. And, that's if they are even FOUND 8 times. After all, there are many new merchants every day and their ad is forcing earlier vendors ads down the line as THEY try to make 8 sales.

So, unlike Adsense merchants who can sit on their behind with unlimited websites being found by millions/billions of people who don't have to spend any money to trigger a PPC ad, Fiverr merchants are in a constant struggle with newcomers for 8 BUYERS, while their ads all age and fall to the bottom of the list.

Conclusion about Fiverr

Whether one thinks Fiverr sucks, or Fiverr rocks, is irrelevant. And, I can't say that the owner(s) of Fiverr intended for their payout requirements to be virtually impossible for all merchants and to result in what, in my opinion, could likely result in an "unjust enrichment" violation of law. But, what I CAN say is that it is unethical to have such payment requirements and, in the very least, they should be IMMEDIATELY visible the moment a merchant initiates a public offering.

As for all those who have gushed and praised Fiverr: In your lemming-like zeal, you have, potentially, sent countless others over the cliff. That's right. While it might not be a lot of money, you have potentially wasted a lot of other peoples' time sending them to such a venture. But, I don't stand in judgment of you. I think it's a pitfall that is part of the learning process. But, do understand, it happened because you think like a consumer... a blogger who gives free advertising for businesses in the wish to become popular... as opposed to a marketer who just happens to also blog.
You are the former, I am the latter.

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67 comments:

Anonymous said...

Dude, you are off! Read the terms of use:

"If you do not reach the minimum amount of $40 within 60 days of the last payment and would still wish to withdraw your funds, you can contact our customer support and your funds will be made available for your withdrawal."

You are blowing steam for nothing!

Sam Freedom said...

Not blowing steam, that wasn't there from day 1. I'd bet it that's why you're anonymous. My guess is that you're either with Fiverr and changed the TOS after you saw my articles, or, they saw my articles, changed it, and you're just happening to see the changes now. But, that was not there from the start, and it made no mention it on the "post-sale" page where it clearly, and only, stated a $40 min was required.

In fact, what's there now reeks of being a band-aid. Even if people CAN get their $5-$35, on day 60, the fact still remains that it's ridiculously difficult (as I clearly explained above) for ALL vendors to make 8 sales.

So, the ones who've made $5-$35, and whose ads keep drifting out of site as 1000s of new merchants sign up, STILL can't simply withdraw their funds. Then they have to contact you, and it's STILL going to be the same fee as if they subtracted their $5-$35 earlier.

Instead of changing the TOS mid-stream, why don't you do something constructive and positive, like, in the very least, offering an EARLY withdrawal with an EARLY WITHDRAWAL FEE?

Even that would slightly stink but if it were REALLY about the fees, as Fiverr now states, then charge enough to cover those fees rather than making people wait 60 days.

In internet time, 60 days feels like 3 years and a lot of people signed up thinking the concept was cool and that they could make some quick money if they offered some of their homegrown talent for $5....

...apparently not. Not if 1000s of new merchants will be forcing your ads down, and you're competing with more and more new merchants to make 8 sales, and you end up having to wait 60 days because rich, ol Fiverr is concerned about the fees.

Fiverr's making Gajillions... these vendor are making a fraction of that... give 'em access to their money in a timely manner, not 2 months down the road for those whose ads are aging out of sight each day.

Nice try, buddy.

Steve said...

This is a pretty common issue with online services to make money. Many don't pay out until you reach some threshold that is very hard to get to. Works out well for the company cause some large percentage abandons their account balances. SponsoredTweets is an example of a company with a high threshold and low payouts.

Anonymous said...

Thanks for the heads up. I had just heard of Fiverr and was planning to look into it more deeply next week. Think I'll just write blog posts instead.

Deutschland said...

Nice idea!
But the only one question rises - what the sense in it?

Gaithersburg Homes for Sale said...

I never said a person couldn't make money. And, I never said a person couldn't make a LOT of money. But, when you step back and look at Fiverr from a more comprehensive view, you can easily see that a LOT of people are going to be leaving a LOT of money.....

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Carlos Scarpero said...

It's just as bad for buyers. It's all fine and dandy until you have a problem. If you dispute your charges with pay pal, Fiverr will block you and keep the money.

contractor leads said...

Sam, Fiverr is one of the emerging merchant platforms that aim to aid businesses to market their products. There had been some issues on the TOS (terms of service) during the onset of this system, but that was already clarified after much improvement on the site itself.

Nonetheless, the value there is to be wary of the significant contract details before giving out your money. One must always check the reputation of the site to ensure that he gets his money's worth.

Thanks for sharing!

Anonymous said...

hahaha fucking idiot. Read the terms before wasting your life writing these shit articles. What kind of marketer are you, that you cant even sell 8 gigs worth $5?

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Sam, Fiverr is one of the merchants of emerging platforms that aim to help companies market their products. There have been some problems in the TOS (terms of service) at the start of this system, but has already been clarified after many improvements to the site itself.
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Celebrity Gossip News said...

It is just as bad for buyers. It's fine until you have a problem. If you dispute your charge with Paypal, you Fiverr block and keep the money.

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