Her thoughts on the US launch of a global powerhouse and new ways of thinking about direct selling
Rachel Kellogg has spent over a decade in the direct selling industry, starting as a consultant in the field and working her way up to leadership. She joined the channel unexpectedly but fell in love with the way it gave an equal opportunity to all. After a successful 10 years in the field with Mary Kay, Kellogg was ready to take what she had learned to join the executive team at Faberlic as an integral part of their recent U.S. launch as national sales director. Her mission is to infuse a culture of love, inclusivity, and growth from the ground up and take Faberlic to No. 1 in direct selling.
Location: Moscow, Russia
SSN: Describe your journey from the field to C-suite
I’ve been in direct selling for a little over 12 years now. I spent almost 11 of that in the field with Mary Kay. Direct selling was never something that I saw in my path. I think most people probably say that. I had a very clear vision of where I was going within the food industry. I had a catering company, and then I had a back injury, and I physically couldn’t do that job anymore. So I was put in this position where it was like, “What’s plan B?” I was 24 years old and very driven in one direction, and I didn’t have a plan B. That’s when Mary Kay fell into my life. I thought that company was for old ladies with big pink Cadillacs. But then it was brought to my attention the future I could have in the direct selling industry.
I didn’t have a college degree because I went all in with my previous career that did not require it. And so at that moment, I asked myself, “Do I go back and try to get a degree in something else or use my life skills and jump into direct sales?” I decided to give it a go and put a time frame on it—I would give it one year. If it did not work out, I would go to college and pursue architecture, because my mother is an interior designer.
Within eight months, I promoted myself to the top 2 percent of the company. So, I decided to stay, and what I really found that kept me there wasn’t selling lipstick. It wasn’t selling cosmetics. It was nothing about sales. It was the platform that I got to be able to bring
others with me.
I say that I’m kind of an old-school feminist. I have a wonderful husband. We’ve been married for 12 years, but I wanted to be self-sufficient. I wanted to know that I was in control and I was building something, and not reliant on somebody else. When I started making that money and seeing that I could take other people to that place, it’s what locked me in. I would use the story, “if I can do it, you can do it and let me tell you why. When I started, I was broke, I didn’t wear makeup, and I didn’t know how to sell anything. But it’s a step-by-step plan, and it’s a duplicatable system.”
So I spent 10 years driving around a big Cadillac at the top of the company. And then it was right about when COVID-19 hit, I took the Gallup StrengthsFinder personality quiz, and it changed my life, because I found out my No. 1 strength was strategy. It showed me something that I had been doing all along, but never really took ownership of and did not know it was something I was good at.
I started looking at everything differently, and I started thinking big picture: “This is what I’m doing for me in this industry. What if I could do it for the whole group? What if I could start something and infuse the culture in and build it from the ground up, to make this massive impact?” And so I ended up walking away from Mary Kay. I had an offer that ended up being too good to be true from another company, but it was a blessing in disguise because it was really hard to walk away from that kind of security. But this offer allowed me to do that, even though it fell through. A couple of months later, a head hunter reached out to me from an executive search agency to let me know that I was recommended for a big position in a company called Faberlic.
I learned that Faberlic was opening in the U.S. and, as an established company, would not have the risks of a new startup, and they were looking for someone to strategically take creative control. I went through the interview process, and I honestly didn’t think I was going to get the job. I know that they started with so many candidates and, being from the field, I didn’t know if they wanted somebody that had more tenure on the corporate side.
But, coming from the field, I know that one of the things that I and so many other leaders always say when companies roll out different ideas or promotions or comp plan changes is: “Well, clearly they’ve never done this, because this makes no sense. Clearly this person making this promotion has never sat in this chair and walked in these shoes.” And so I thought,
“Gosh, how cool would that be? I’ve walked in these shoes, I’ve built this kind of a business. Now let’s marry that with this incredible corporate company and see what we can
SSN: What was Faberlic’s approach to joining the U.S. market?
Faberlic has been on the ground here for a couple of years working on its due diligence and market research to map out the right way to make the jump, and that was something that really impressed me. Clearly, a company must be in the U.S. to move forward. And for Faberlic being the No. 31 global direct selling company in the world, but not in the U.S. and China, the U.S. market was their next move. There’s no other company in the top 30, I don’t think, that is not in the U.S. or China.
While Faberlic knew that the U.S. was the gateway to the rest of the world, they did not enter this market in a “fast and furious” manner —they came in gently, strategically, and smart. They started by asking, “Who do we need to partner with to do this right?”
They partnered with the Sheffield Group, which has an incredible reputation for adjusting the comp plan. They knew they needed to manufacture something here in the U.S., so they found Lief Labs in California where we’re making our supplements. And that is one of the things that makes Faberlic so unique—their global footprint and the way that they partner with the best people around the world. So, Faberlic stepped in gently, did their research, and then let it all come together. Once they found me, it was a go!
SSN: What makes your comp plan unique?
Our comp plan is best described as a stair-step breakaway, but not in the traditional sense. I have never seen a comp plan like ours. Because Faberlic uses a global comp plan, we did not make extensive changes to the plan for the U.S. launch. However, the Sheffield Group did suggest a couple of modifications; one was a really great bonus that they implemented globally, a leadership bonus for balancing your legs. With some companies, you’ll have the top consultants making so much off of one leg, while other consultants are floundering.
So we implemented a bonus that rewards you for being balanced and focusing your energy on the top leaders across the board. Another new feature is the quick start bonus. We find that in the U.S., people want fast results. In other countries, it is more acceptable to be paid big bonuses later. However, here, consultants don’t want to wait, so it’s about what we can do to get money in their hands now. We’ve implemented this fast start bonus for pre-launch that rewards people right away to move up the career path.
If it works, we’ll keep going with it. If not, we’ll modify it. Having worked with different companies, I think this is something that makes Faberlic very special—they are willing to pivot. They’re willing to listen, and they are willing to see a need and fill it.
SSN: What is your philosophy regarding direct selling in the modern, digital age of e-commerce and affiliate marketing?
If we see a need for affiliate marketing, we absolutely can create it. Many direct selling companies need to pivot. The old way of direct selling is dying, and I think we’re going to see a huge change in the next five or six years with many of them going away, for a couple of reasons. First, the FTC is really cracking down and has direct selling under a microscope. Second, if a company is not changing, if it’s not enrolling, if it’s not evolving, it’s dying. The idea of stacking inventory and going door to door, to your friends, your family, and your neighbors is an old-school way of thinking.
When you can go on Instagram and see 10,000 choices, what is setting yours apart? Affiliate marketing is a way of saying, “I want a piece of all of these people, but not actually rewarding them very much to raise their bottom line for what the company’s doing.” And there’s nothing wrong with that. But in my mind, if we would just think about it a little bit differently and move the idea of direct selling and MLM over a little bit and put it under a different lens, we wouldn’t have to continually be trying to grab for things because with social selling, direct sales, e-commerce, or affiliate marketing, they all can fit in the same bubble.
SSN: What do you think about the FTC’s increased scrutiny on the channel, and how did Faberlic prepare for this?
This was our biggest surprise at the beginning. I don’t think a lot of us realized how hot and heavy that was going to come and shift so quickly. We’ve always known the FTC and their rules and what they could crack down on. But we didn’t realize that they’re going to start enforcing these rules this heavily. There was always a gray area that we got to play in, but that is where we are now, and we are doing everything we can to follow FTC guidelines perfectly. We have compliance people, and we have a really great MLM attorney to make sure we stay off the FTC’s radar.
When I was in the field with Mary Kay, I didn’t have my compliance hat on. Now, it is on, and I am seeing the importance of spending time with people and educating them about what they can and can not say. We have to direct everyone to U.S. material only because when you have a global company, what may be acceptable for a recruiter in Spain, may not be legal to say here. So, this is definitely one of our biggest time constraints right now—taking our training material, checking it, re-checking it, and sending it over to compliance. The amount of time, money and energy we are putting into compliance better put us above the bar because we are doing a lot of it.
SSN: What is the key to getting the channel to think differently?
I think the key to that shift is not picking a side, and I could say that about so many things in our world right now. It’s not black or white. It’s not one or the other. The truth is somewhere in the middle. So many times MLMs or direct selling companies want to stay in their box because this is what they’ve always done, and this is what they know: e-commerce is the bad guy, and having a storefront and a salon is the bad guy, because that is retail and we’re direct sales.
So then we have a battle between these two industries, whereas the truth is they could completely complement each other if done right. E-commerce can become a part of direct selling and affiliate marketing. And affiliate marketing and direct selling can aid retail every step of the way.
Some direct selling companies have tried to do that. They just didn’t do a very good job in my opinion. And I think there is another key factor that’s missing in U.S. direct selling: We have celebrities in the MLM world that nobody else knows about. We need to, as MLMs, bring in people who are actually recognized experts in the space to validate whether these products are good or not. We need to take ownership of validating our products using these