Master from the Internet: how the service industry is experiencing digitalization

The pandemic has further accelerated the already rapid transition of the service sector to online. Trends figured out how successful this transition was and what the masters and their clients should expect next.

At the end of 2020, the sharing economy in our country grew by 39% and for the first time exceeded ₽1 trillion. The second largest segment of the sharing economy was services for finding a part-time job – their share grew to ₽183 billion against ₽140 billion a year earlier. Trends found out how the process of digitalization of services is going and what awaits the industry in the near future.

New areas of online services

According to a study by Avito Services and Data Insight, in the first quarter of 2021, 9,4 million of our countries worked in small companies and alone in the service sector, the market has recovered from the coronavirus recession and today micro-businesses and private performers form about 6% of the national GDP. And in the future, this market will only grow.

The pandemic has become a powerful incentive not only to transfer services online, but also to diversify them. New directions and specialties began to appear, for example, online nannies, trainers, and the usual services changed the format – hairdressers and manicurists are increasingly invited home, it is safer in terms of reducing contacts, and often cheaper than in a salon. Beauty masters and their clients are looking for each other online – for example, on Avito Services in 2020, the demand for hairdressing services has almost doubled, in just a year, the demand for various services on the platform has grown by 40%.

Master from the Internet: how the service industry is experiencing digitalization
Hairdresser work at home

User habits have also changed: our country is trying to delegate more and more household tasks – from ironing and cleaning to dog walking. At the same time, with the transition to remote work, entrepreneurs began to more actively involve external accountants, lawyers, and HR specialists – after all, if no one goes to the office, then there is no need to pay full-time specialists, it is much more efficient to involve them on a project basis.

In 2020, online platforms allowed companies not only to optimize costs, but in principle continue to work during quarantine – in our country, 72% of service providers use online channels to attract customers, more than half of craftsmen and companies are looking for customers on Avito Services”. Platforms usually take care of content moderation, verify performers’ accounts by passport or company status by TIN. In 2021, Avito Services launched a similar service, which is available both for craftsmen from our country and for specialists without Russian citizenship.

Competition with big companies

Online for the customer of services, the main thing is the speed of execution and the quality of work. So private craftsmen and small businesses can successfully compete with large companies without spending already limited resources on expensive advertising or a large office. According to Avito Services, over the past year, 58% of service customers began to use online platforms more often. Among the reasons for leaving offline, they name the reluctance to call the company, the habit of using Internet services for a variety of tasks, as well as the ability to ask a question to the platform support service.

In turn, the main task of a novice entrepreneur online is to find customers. One of the most popular channels is social networks. However, social media accounts require constant involvement, production and updating of content, promotion costs, and the platform itself cannot guarantee the effectiveness of advertising. In addition, social networks limit the ability to post content for auto mechanics, electricians, plumbers, truck drivers and other professions that find it more difficult to generate beautiful photos and various texts. Here, the entrepreneur will have to fight for the attention of users with photos of cats, recipes, pictures from the beaches and other content that people come to social networks for.

To place an ad and set up its promotion, the master does not need to be a photographer, copywriter and manager all rolled into one. At the same time, users come to classified platforms with a specific request and often solve a variety of tasks: when buying a locker, they find a specialist who will mount it, and when they agree to view the car, they look for mechanics to carry out diagnostics. Here, the masters collect photos of the best works, customer reviews, get ratings – and all this is easier to master than SEO algorithms.

Master from the Internet: how the service industry is experiencing digitalization
Reviews of the master’s clients on “Avito Services”

Low entry threshold

Services remain the area with the lowest barrier to entry. Craftsmen sell existing knowledge and skills, while remaining flexible in terms of employment, combining the main job with the provision of services. It is the provision of services that is the main source of income for 86% of masters, and the remaining 14% use their skills in their free time as part-time jobs.

With the development of remote work formats, specialists have the opportunity to earn money outside of employment, for example, in the status of self-employed, and entrepreneurs can optimize the costs of doing business by attracting accountants, SMM specialists, and lawyers on a project basis. In addition to the tasks of attracting contractors and hiring employees, Avito allows entrepreneurs to find a workshop or office for rent, purchase the necessary materials or equipment, saving time and resources thanks to a “single window”.

Perspectives of online services

The Russian audience of the Internet is increasing, as is its share in the economy. According to a study by the RAEC, in 2020, the contribution of Runet to the country’s economy increased by 22% and amounted to ₽6,7 trillion. Several segments showed strong growth at once – digital content, e-commerce, marketing and advertising. The Runet audience reached 97,44 million people, or 79,5% of the country’s population over 12 years old.

As representatives of Avito Services note, they observe the rapid growth of this market and the active development of platforms for interaction between clients and customers. Already today, craftsmen and companies receive 28% of all orders from new customers with Avito Services, and with the strengthening of the trend for online consumption, this percentage will grow.

Only 16% of our countries surveyed by the Consciousness of Change project said they were disappointed with remote work. According to Raiffeisenbank, 88% of our countries like remote work.

Representatives of the EdTech sphere agree with this. In their opinion, education will no longer return offline in full, and people will engage in hobbies, sports and learning online.

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