particleman - 12:31 am on Mar 1, 2010 (gmt 0)
Well, I'll respond directly to the OP. We have in the last 4 months utilized elance for SEO work for two different websites. I intentionally selected two different companies to hopefully find the better of the two.
Without making this post too long here is what we basically got for ~$400/m:
-we established some goals we wanted to achieve, get us on page one for keyword X.
-We got some on site analysis which I expected, some minor on page work, then straight into offsite work in the first month on both companies
-Directory Links 20-30/m
-article submissions 1-2 articles submitted to 20 sites
-One company promised 20 non pr 0 links per month, basically we got link farms, sites setup simply to provide outbound links.
-The other company took a little better approach landing a decent link here and there and many junk links
-neither company got us relevant links to our niche
So, what were the results after 4 months of this?
Site 1 - Already a strong domain, well established, good back links already, but isn't quite on page one for our keyword, page 2 instead. Close analytics monitoring showed no measureable improvement, our main positions have only fluctuated within 2-3 spots up and down. Pretty much all I can read into that one
Site 2 - little more interesting, this site is basically less than one year old. We started on page 2 for our keyword target surprisingly, but also surprisingly with several hundred pages of unique products/content we got very little long tail searches, poor indexing of the site. After the first month of work our indexed pages increased significantly and over a months time analytics reported 4x the visits from google from various new phrases in our historically slowest month of the year. Concerning though is our SERPs moving from page 2 to page 6, all the way back to page 10 at its worst through all the months. Just recently has it moved back to page 3 for our target term. Long tail phrase traffic did not seem to be phased by this though. Mind you this is the only work being performed on this particular site. I believe this drastic movement was a result of the SEO blatantly using the same anchor text in nearly all of the inbound links.
My personal view on all this is NO, don't do it. Basically site 2 appears to be on thin ice with google. My theory is since it had very few links to begin with we saw the full effects of getting junk links (at a rapid rate). Site 1 appeared not to gain anything from it, looks like we're very lucky it didn't hurt the site. This work is IMO very risky and if you're not getting a relevant link from a reputable source don't get it. We had to learn for ourselves, but there you have it. Under careful supervision it would be possible to farm this work out, but personally I am rethinking our stragey at this point.