This new breed of brands leverages digital technology to invent faster, more automated, more personalized purchasing experiences.
“I had this craving to have a field of people who are passionate about my products. You don’t get that with direct-to-consumer.”
— Kevin Hafen, co-founder and CEO, Univia
“Cutting out the middleman” is a phrase well-known to those who utilize the direct selling model to distribute their goods and services, as they focus efforts and marketing dollars on the consultant’s ability to connect with consumers.
By Sarah Ravits
Companies capitalize on direct selling fundamentals in an effort to increase brand loyalty and customer experience.
Recognizing the power of generating a good experience for the customer, brands are once again delving into areas once dominated by direct sellers.
The pop-up experience draws its structure directly from the same principles as the Tupperware party: touch, feel, experience and fall in love, all within an impermanent setting.
When Tupperware engineered the in-home party in the 1950s, it created the experience of demonstrating products in such a manner that customers couldn’t help but fall in love with them. This “personal” approach set direct sellers apart from other retail efforts for more than half a century.
But so far in the 21st century, there have been few such clear-cut selling approaches belonging to only one channel; mainly, the lines within the world of retail continue to blur as various entities borrow best practices from each other and try out different approaches.
Companies that utilize artificial intelligence and machine learning will gain a competitive advantage over those that don’t.
The applications to business are as varied and vast as the business landscape, but one thing both AI and machine learning can provide is more confidence in decision-making by producing data-driven findings.
Machine learning has the capability to understand patterns in data at a level of complexity and nuance many orders of magnitude deeper than a human being could ever recognize.
"Amazon and other gig opportunities have been using these technologies for years. Companies must move from acting on lagging indicators to acting in anticipation of the most probable future."
—Michel Bayan, CEO, DirecTech Labs
An algorithm is a set of steps intended to accomplish a task. Your favorite chocolate cake recipe is an algorithm. The more frequently you make it, the better you get at judging how external factors such as the temperature of the butter and the moisture content in the air affect the finished cake. Repeatedly making the cake and learning from it each time will contribute to making you a better cake-baker.
By Corinne Lincoln-Pinheiro
Properly crafted, gamification can improve retention, recruitment and sales.
“It not only provides ‘visualization’ of distributors’ performance, but it also creates a social community and friendly competition, by bringing distributors together in a game-like environment.”
— George Elfond, CEO, Rallyware
“Direct sales and its entire methodology and processes are a gamified type of application, with compensation metrics, mechanisms, and multi-level tiers of recognition.”
— Sebastian Leonardi, President, DSXGroup
“We like earning things like badges and prizes and advancing levels. It’s this basic concept that we all intrinsically knew as children playing games.”
— Brian Palmer, CEO, Krato
“Gamification is important because the independent salesforce needs a path to success and many coming into direct selling companies haven’t been trained,” says Brian Palmer, CEO of software firm Krato. “It creates a fun learning environment and promotes greater engagement, longer retention, and higher revenue per order.”
Gamification is the application of game mechanics into non-gaming activities, and for direct sellers, can influence sales strategy, onboarding of new consultants, marketing campaigns and promote higher levels of performance.
How smart logistics can help win the delivery game.
Getting orders out quickly with an incredible delivery speed is now standard. It’s important for operations to be set up to move quickly but also to provide great service.
—Bryce McCuin, director of marketing, A2B Fulfillment
“There is no competing with Amazon,” states Bryce McCuin, director of marketing at A2B Fulfillment. That sobering thought nonetheless finds supply chain management (SCM) professionals in the direct selling channel sprinting to keep up with customer demands that seem to grow more demanding every day.
Fulfilling the perfect order with the most efficient use of resources and low-cost strategies is a balancing act for many organizations. Advancements in technology, e-commerce, globalization, and higher customer expectations are changing the rules all across the logistics and supply chain ecosystem.
What to know before you take your direct sales company abroad.
By Sarah Ravits
As store and online retailers continue to push the envelope in terms of functionality and speed, a service standard experienced anywhere is very soon expected everywhere.
Expanding overseas presents unique challenges, but also great potential for growth. “Once you reach a certain stage and want to expand the company, it’s the logical next step,” says Janet Weil, general counsel and senior vice president of compliance and legal affairs at Texas-based WorldVentures.
Moving north from the United States into Canada is often considered the first, and most practical, step. Lewis Retik, a partner in Ottawa-based law firm Gowling WLG, says this is because the two are physically close and share similar cultures. “If you look at the two countries, there’s a very significant economic integration, perhaps more than in any other two countries,” he says. If products sell well in the United States, “there’s a reasonable chance they will sell well in Canada.”
Direct selling companies must innovate to stay competitive.
Note: The following is part of a series “New Pressures on the Direct Selling Channel.” This segment deals with the pressure resulting from innovative tech developments in other retail segments that increase consumer expectations.
As store and online retailers continue to push the envelope in terms of functionality and speed, a service standard experienced anywhere is very soon expected everywhere
In the very human business of social selling, exotic digital technology have taken a back seat to one-on-one interactions and tried-and-true business processes that emphasize personal relationships. But all consumers, including independent distributors, are becoming accustomed to more innovative technologies as part of their usual shopping experiences in other channels.
A team of Nu Skin’s field leaders celebrate together.
Direct selling’s culture-building differentiators remain intact.
“Earning a prize is something that you give yourself. Recognition is what the company gives you and that’s what makes it so special. You can’t give it to yourself; it comes from your community.”
— Steve Jamieson, Exigo
“Part of the process is really an art that comes from having a strong relationship with your field that helps us understand the data.”
—Jesse Stamm, Pampered Chef
“For those who achieved and attended an incentive trip with the company, their new enrollments were up 6,300 percent above those who did not attend a trip. Additionally, their earnings went up 200 percent.”
-Darren Jensen, CEO LifeVantage
For the millions of “volunteers” that go to work every day for their chosen direct sales company, a strategic rewards and recognition strategy can keep them motivated to share the products and opportunity they represent. As a result, the company culture and environment can become “stickier” and can lead to an increase in activity.
Henri Bonan, owner of Utah-based awards and incentives company The HB Group, cautions, however, that no reward or recognition, whether it’s a small bag or a lavish trip, is a stand-alone motivator for any independent salesforce. He says, “A company’s compensation plan has to be good enough that people are working their business and making money. The recognition supports what the company is already doing, not the other way around.”
By Nat Reade
Direct selling is even more effective with millennials because it provides a sense of belonging and a deeper level of support on how to use a product, and that’s something that they really appreciate.
–Bart Dangerfield, Vice President of Business Development, Univera
Traditional direct selling companies have leaned toward corporate-led communications. Gen Z's want the message to be their own particular story.
–Brian Palmer, CEO, Krato
The 34 years between 1980 and 2014 bracket two very different generations: millennials and those who come after them, often referred to as Gen Z. Time magazine once called millennials the "Me Me Me Generation." If you type "Millennials are" into Google, you get such answers as "lazy," "entitled" and "killing," apparently referencing the many societal norms they've done in.