Embracing a Next-Steps Mentality

I go to a church that is built on a simple but profound principle: help people take their next step in their spiritual journey. When you hear it explained, it’s a pretty powerful concept. The idea is that everyone, no matter where on their journey they are, has a next step to take. Everyone can progress. Everyone can still become more.

In many ways, I feel like this is the underlying promise that every direct sales company offers. As an industry that celebrates personal development, what we really embrace is this idea that anyone, no matter where they’re at or their level of experience, can take a next step toward becoming whatever it is they want to become. The company and its products and its rewards can help with that, but they are really just a vehicle to a greater development in that person’s life.

Direct sales companies help people take a next step in their lives.

But a next-steps mentality isn’t just good for personal development; it’s really smart for business, too. Our channel, probably more than any other, leverages the small steps of many to generate revenue and profit and growth. Sure, every business has its “all-stars,” and its “top dogs,” but companies that are growing are companies that are embracing small progress made by thousands.

In my last article, 3 Stats Direct Selling Companies Must Pay More Attention to in 2022, I shared some very practical reports and data you should have handy to get a handle on where your business is at today. Those reports aren’t the end-all, be-all of KPIs, for sure, but they do a great job at getting down to identifying what I think really matters for us all: creating a next-steps culture.

The underlying question with everyone who interacts with our company and our brand is this: “what do you want out of this?” It can’t be “Here’s what we want out of your involvement with our company.” It must be centered on what they want. Only when we can deliver what they want out of interacting with our company will they ever be open to all the other things they may be interested in down the road.

With the rest of this article, I want to share some thoughts and prompt you to think through where your company could do a better job of embracing a next-steps culture. We too often focus on the big plays, the “giant leaps,” when our model is specifically created with more of a “next steps” mentality in mind.

My question is, are we really embracing that as well as we could?

Here are some thoughts to get your company taking a next step toward a next-step culture.

Next Steps for Your Customers

In the previous article I reference above, I give guidance on a way you can segment your Customers based on their buying habits over a year with your company. Here’s a short excerpt for reference:

“What you need to understand is how often and how much your current Customers and Distributors purchase from you over the span of 12 months. To do this, I like to create about five buckets, or segments, and place all of your current Customers and Distributors into one of these buckets:

• Purchased only 1 time the past 12 months.
• Purchased 2-3 times …
• Purchased 4-6 times …
• Purchased 7-10 times …
• Purchased 11+ times …

Then, for each segment, I want to know the total revenue generated by that segment, the total # of orders and the average order size.”

There are many other ways you could segment your Customer base, so do as it makes sense for your company. Regardless, what you really want to focus on is how to help each segment take a next step with your brand. In some cases, these “next steps” will be central to a sales program or promotion you put in place. In other cases, it could just be timely communication.

Let’s take a look at the Customer who has purchased only one time in the last year. What could be a logical next step for them?

Well, first let’s think about what might not be the most logical next step. They probably aren’t quite ready to sign up for our autoship program (because they haven’t even reordered at all). And it’s probably not likely that they’re ready for our referral program yet (since they jury is still probably out for themselves). And yet, for many direct selling companies, these are prominent next steps offered to a Customer who has ordered only once.

The most logical next step for this Customer is… (wait for it…)… a second order. Is there something we can do to prompt a second order from this Customer. Is there a way that we can clarify how a second order will bring value to their life? Is there an incentive (like a discount code) that could help? Or maybe just timely information about our products?

And what if that next step is still a stretch for them? Do we have clear next steps in place that don’t require a second purchase? Maybe it’s a review, or maybe we can send them testimonials of others who have used the same product.

Just think of the impact on your business if you could optimize the next steps for this segment of your Customers. If you could focus on helping them get just a little bit more out of their journey with your company.

Of course, you can (and should) play this thinking out with all of your Customer segments. What’s a proper next step for those who have ordered from you twice? Maybe their ready to join your Preferred Customer program. Or your autoship program? What about people who have ordered 10 times this year? They may even be ready to become a Distributor, who participate in your referral program. Or try a new product.

For Customer alone, if you could get just 10% more to take a logical next step in their journey with you, it would do wonders for your business (and them).

Next Steps for New Distributors

You can obviously play this thinking out for your Distributors, too. If we look at the other two reports mentioned in my previous article, you’ll see that they focus on your segments of Distributors in terms of annual activity, as well as the engagement of new Distributors with your Fast Start Program.

I think a next steps mentality is even more critical to use with our Distributors, as we too often push giant leaps on them, assuming they are as committed to building their business as we want them to be. But all the signs points to that not being the case, so how can we help them achieve what they want to achieve with us?

If you can segment your training and field development appropriately, it can have a dramatic impact on how to best leverage your training opportunities. Some quick segments, and possible next steps, are as follows:

• Distributors who have still not made their first sale; next steps include a) conversation starters, b) tips on social media posting c) prompts on who to reach out to, d) specific scripts or talking points to bring up.
• Distributors who have not sponsored anyone; next steps include a) clarifying benefits on building a team, b) how to identify someone who may want to be a Distributor, c) how to bring up the opportunity without being pushy
• Distributors who have built wide but not deep; next steps include a) how to be a great sponsor, b) how to leverage our Fast Start program with your new Distributors, c) how to duplicate yourself

The options here are endless. And while every direct sales company has a leadership ranking system in place that inherently helps with this segmentation, so few are really focused on the intentional and specific work of getting someone from one rank to the next, let alone the smaller “next steps” between each rank.

How can you clarify the next steps for your new Distributors better? More importantly, how can you make sure you aren’t wasting their time with talking about next steps that they clearly aren’t ready for?

Next Steps for Leaders

Quite possibly the hardest next steps to line out are those for your top leaders. In many ways, they’ve figured it out. It can feel like they really don’t have a next step to take; they’ve taken them all.

Of course, we know this isn’t true. As soon as your leaders don’t feel like there’s a next step for them to take, crazy stuff will start happening. They’ll come up with a new system or get more involved in something else (or even another company). Who knows what it can be, but just know that we all as humans are seeking out ways to progress, so even your leaders are susceptible to this. If they can’t find their next step at your company, they will start looking for it elsewhere. It’s not a business issue; it’s human nature.

So, make sure you’re nurturing this process as much as possible. Sometimes, you just need to facilitate it and let the leaders run with it. Other times, you need to truly line it out for them. But make sure you’re in tune with what they want out of the business now (as their original “why” may now be a reality, so they need something more).

More importantly, make sure they stay connected to the mission and vision of the company, and understand their role in it. One of the other things I love about my church’s teaching on next steps is this: “When you take your next step, you’re opening up a space for someone else to take their next step.” How powerful is that!

For your leaders, this is the leadership culture you want to cultivate. In some cases, your leaders’ primary role is to build up the next generation of leaders.

What’s Your Next Step?

This next step mentality can really play itself out in every area of your business (and your life). I’m just scratching the surface here. But what I do know is that we all have a clear next step in paying more attention to nurturing and prompting the next steps of our people in a way that makes sense for them.

How do you do this at your company? What are some practical ways you’ve seen this play out?

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3 Stats Direct Selling Companies Must Pay More Attention to in 2022

One of the things I love about my job as a consultant to direct selling companies is that I get to work with a variety of companies at a variety of stages. And while I see little nuances and differences among them all, I can promise you that all direct selling companies have much more in common than they think.

So, when I start to see some work that I’m doing with several clients resonate at a really high level, it makes me think, “That would make for a great article!” And today’s article is most definitely birthed from that very experience.

Even though my roots in direct selling are as a marketing guy, I’m really quite the data hound. In fact, I would say all great marketers in today’s digital age need to be. So I’ve had a lot of fun over the past couple years helping companies uncover the data that matters for the strategies they’re considering. And there have been three reports that, over and over again, seem to get the most attention.

So as we kick off 2022, my resolution for all of us is to pay more attention to the right data. And the right data is data that shows us the real-life behaviors and responses that our Customers and Distributors are having to our company. These three report suggestions are definitely capable of creating your next big “a-ha” moment, so if you’re not tracking these KPIs, I urge you to begin.

Purchasing Segments for Customers and Distributors

Over the last couple years, I’ve worked with lots of companies to put together updated Customer Programs to increase acquisition and retention. These are programs that are typically called things like “Customer Rewards” or “Loyalty Program” or “Preferred Customer Programs,” or a little bit of all of the above. Regardless, there’s no doubt that today’s direct selling company is more focused on acquiring more new Customers and getting current Customers to purchase more.

As I start working through a program that makes sense for the company, I’ve found that there’s one report I request that always clarifies where the focus should be more than others. Some companies track this info regularly; most do not.

What you need to understand is how often and how much your current Customers and Distributors purchase from you over the span of 12 months. To do this, I like to create about five buckets, or segments, and place all of your current Customers and Distributors into one of these buckets:

• Purchased only 1 time the past 12 months.
• Purchased 2-3 times …
• Purchased 4-6 times …
• Purchased 7-10 times …
• Purchased 11+ times …

Then, for each segment, I want to know the total revenue generated by that segment, the total # of orders and the average order size.

Split up your Customers and Distributors so you can look at the data for each separately (which means you end up with a total of 10 buckets). Also, adjust the ranges in a way that fits your company. If it makes more sense for the top tier to be 12+ orders, change it. But I would not change the first two, at the least. You definitely want to know how many Customers only purchased once, and you certainly don’t want to mix up your 4-timers with your 2-timers.

When you put this data together, you will be shocked at what it reveals pretty quickly, and how it will help you a) set reasonable expectations for these segments and b) create program updates that match those new expectations. The other thing it should do it also underscore the importance of segmenting your communication across all of your members (rather than just sending everyone everything).

There are all kinds of insights and industry benchmarks I can share here, but I’ll leave it with just one: the biggest group, at least for Customers, will be the one-timers (which may surprise you). I’ve seen the percentage of the total vary quite a bit across a few different companies, but it’s always the majority. The range I’ve seen has been as low at 55% and as high as 85%. So run the numbers for your company and see where it ends up. Inevitably, you will recognize that the real opportunities for increased productivity and retention are among those who order only 1 to 3 times a year.

Acquisition Segments for Distributors

Most companies have a decent handle on how many of their Distributors are active recruiters. But there’s another level you should take curiosity to that can help reveal opportunities in your business.

First, notice that I call these “Acquisition” Segments, instead of “Recruiting” or “Sponsoring.” I do this because, for many of us, “recruiting” implies signing up other Distributors. Some companies get so focused on Distributors getting Distributors that they lose sight of the Distributor’s primary job, which is to get Customers. “Acquisition,” to me, speaks to both Customers and Distributors.

So, for all of your existing active Distributors, create the following data tables:

Table 1: Customer Acquisition

• Distributors who have acquired zero Customers in the last 12 months.
• Distributors who have acquired one Customer ….
• Distributors who have acquired 2-3 Customers …
• … 4-6 Customers …
• … 7-10 Customers …
• … 11-15 Customers …
• … 15-20 Customers …
• … 20+ Customers …

Like before, once you get past 4-6 Customers, you may want to tweak the ranges in a way that makes more sense for your company. And, if you ever see a segment that looks too big, divide it into two if it helps you gain insights.

For each bucket here, find out the total revenue generated by Customers, the total orders and the avg. order size. This gives you an idea of the annual value of Customer Acquisition of your Distributors who are engaged at different levels.

Then, create similar segments for Distributor Acquisition

Table 2: Distributor Acquisition

• Distributors who have acquired zero Distributors in the last 12 months.
• Distributors who have acquired one Distributors ….
• Distributors who have acquired 2-3 Distributors …
• … 4-6 Distributors …
• … 7-10 Distributors …
• … 11-15 Distributors …
• … 15-20 Distributors …
• … 20+ Distributors …

For this group, you can pull numbers in a way that makes the most sense for you. At a minimum, show the revenue generated by the new Distributors brought in and their organizations (including personal purchases, Customer purchases and Distributor volume). You can add to it if you want, but what you’re really going for here is to understand the annual value of an acquisition. Among other things, once you have this information, you can make some great decisions on what and how you should invest in acquisition campaigns.

Fast Start Production for New Distributors

Most direct sales companies have a fast start program. And… most direct sales companies try to accomplish too much with their Fast Start Program. I’ve worked some companies that I felt really didn’t need a compensation plan because their Fast Start Program pretty much already covered it all!

I’m a firm believer that a Fast Start Program should cater to the “lowest common denominator” Distributor at the beginning and help reveal potential up-and-comers by the time it’s finished. And I’ve found that pulling some pretty simple data can help reveal just exactly where in the process a company should focus its Fast Start efforts.

So, let’s assume you have a 90-Day Fast Start Program, with three tiers, each ending on the 30^th day, 60^th day and 90^th day, respectively. In this case, pull the following data on your Fast Start participants:

Of all of the New Distributors who joined over a given period …

• How many didn’t achieve Fast Start at all?
• How many achieved Tier 1?
• How many achieved Tier 2?
• How many achieved Tier 3?

Now, for each of these segments of Distributors, show the following data two different ways. The first way is to show these numbers over the actual 90-day Fast Start period. In other words, what volume/activity did they drive during their actual Fast Start? Then, show the same data for their first full 12 months as a Distributor (which should include 3 months of Fast Start Period and then 9 months after). This should give you an idea of their first-year results.

• Total # of Distributors in this segment
• % of Total Distributors shown here
• Total Volume (this varies by company, but should account for all of their personal purchases, their Customers’ purchases and any volume driven by Distributors they sponsored.
• Total Customers acquired (or “sponsored”)
• Total Distributors sponsored

You can obviously slice and dice more data into this, but I would encourage you to start with just these basics and make sure you have a handle on the data before you start stretching it out.

If you’ve done this correctly, you should be able to figure out pretty quickly things like …

• What does a Tier 1 New Distributor typically produce in a year?
• Do we have the right balance in terms of how many New Distributors are escalating through the program?
• Is the criteria too difficult? Would we be better off engaging more people with easier criteria?
• What’s the value add when someone moves from Tier 2 to Tier 3 longterm?

Know Your Numbers

There’s no shortage of data in today’s world. The real issue that most direct sales companies deal with has more to do with a) paying attention to the right data and b) taking the time to actually assess the data and let it inform decisions.

We throw around the phrase “Key Performance Indicators” a lot, and they typically refer to ALL of our data. Which is why it seems so overwhelming to us. We forget that the whole idea of the concept of KPIs is “KEY.” We want to really pay attention to those “key” indicators, because they seem to influence a lot of the other stuff.

I certainly wouldn’t suggest that the three reports I’ve mentioned here cover everything a good KPI report would cover. But my experience shows me that most companies aren’t really tracking their data this way, and inevitably I’ve seen when they do, it brings visibility and clarity like never before.

Commit this year to tracking the work that actually matters in your business when it comes to your Customers and Distributors. Serve them best by truly understanding where they’re at and what they’re interested in. So often, we put together programs that never resonate with our people because they miss the mark of the masses.

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Trust and Communication: The Foundation of Success in Direct Sales

I’ve discovered what lies at the foundation of every success, and every failure, in direct sales.

It’s not a sales tool, or a new product. It’s not a promotion, or a tweak to the compensation plan. It’s not a great executive, or even a great field leader. Those things are all important, but you can have them all and still come up short.

What lies at the foundation of every success in direct sales is “Trust & Communication”. And, what lies at the foundation of every failure in direct sales is (a lack of) “Trust & Communication”.

In my own corporate experiences, and in working with many other clients, this simple but profound truth cannot be ignored: Both success and failure are directly linked to the level of trust a company has established and the effectiveness of their communication.

It works in every possible relationship of our business: from corporate office to Distributor; from Distributor to Distributor; from office to customer; from Distributor to customer; and everything in between. For this article, I’m going to use the “office-to-Distributor” scenario for most of my examples.

Note that I have linked “Trust & Communication” together as a single component, not as two separate components. That’s on purpose, and here’s why: One impacts the other (both positively and negatively). They cannot be thought of separately, because they cannot exist separately. They are two sides of the same coin. Phases of a single cycle that continually feed off of each other.

Let’s break that thought down a little bit further, in a positive light. If you trust me, then you are more open to communication from me, right? You don’t spend time questioning my motives or wondering what’s really going on, what I’m really thinking. You just trust me, so you focus on the message being communicated. Likewise, because I communicate with you effectively, you trust me more. Which means you become even more open to communication, and so on and so on.

Now, let’s look at it in a more challenged situation. If you do not trust me, then you’re not very open to my communication efforts, and they are often received hesitantly and with skepticism. If I don’t communicate well, or often, or not at all, then your trust decreases, which then makes you less open to communication, and so on.

“Brett, why are you spending so much time making such a simple and seemingly obvious point?” Because every challenge in direct sales you’re facing now or will face in the future will at the least be indirectly impacted by Trust & Communication, and in many cases is actually caused by a breakdown in Trust & Communication. Put another way, while more specific issues may get the blame for any challenges a direct sales company is facing, more times than not the real guilty party is a lack of adequate Trust & Communication.

In rare occasions, the breakdown in Trust & Communication is deliberate; most of the time, it is accidental, due to a lack of preparation or awareness.

Here are just a few common examples:

Company A is set to launch a new back office system set to be a game changer for the business. They announce one date for launch, only to have to announce another date later, and then another date after that. Pretty soon, Company A stops talking about it so much, which leads the field to wonder what’s happening, which lowers trust moving forward. Because the communication was inaccurate, then less frequent, trust decreased.

You may be tempted to say the back office system is the issue here. But it’s not. Back office systems are always difficult to implement, and they never go as planned. But companies get through that. The real issue here was in Trust & Communication. It’s how the roll out of the new system was being handled that caused the biggest issues. If the Home Office tapped the brakes after the second or third push of the date, then explained that a) things haven’t gone exactly as planned, b) we don’t want to introduce anything to the field that hasn’t been properly tested, c) we will continue to update you on progress, d) we apologize for the confusion from this, and e) we ask that you focus on working your business right now and we will get this to you as soon as possible, then you still would have had some Distributors upset, but the “Trust” would not decrease anywhere near as much, which means they would continue to be open to your “Communication” as you worked through the issue.

If they stop trusting you, they stop listening to you. And if your tribe isn’t listening to you, it gets really hard to lead them anywhere.

Company B just revised their compensation plan, and significant changes were made in how leader’s will earn income that is less than their earning potential before (or at least it’s perceived that way). The Company announces the changes but doesn’t effectively communicate the reasons behind the changes. In addition, the Company has more of a “get on board” attitude about it. Because the communication falls short of helping people understand the reasons behind the change, and because it rushes past any form of empathy, a distrust is created with the field, which then makes any future communication hard to receive, which only further negatively impacts trust. Because the communication was “incomplete,” trust decreased.

In this instance, it’s the tone and style of communication that really makes the difference. The end result may be the same: you have to make the change to the compensation plan, and you have to do it no matter how many people get on board or not. Sometimes, this is just how it is. However, to have a well-planned schedule and approach to sharing this information with the right people at the right times, giving them a chance to understand and comprehend it all, and giving them a chance to share their thoughts (whether they can impact the end decision or not) drastically improves how the communication is received, and therefore drastically improves how these new programs are rolled out.

I bet you have your own stories. And I bet as you take a good look at them, you can see where Trust & Communication were the real key to success or failure in each one.

By the way, the Trust & Communication principle doesn’t just apply to direct sales. It appears to be universal.

The interesting thing here is that there isn’t such a thing as a “Trust Switch” that you can just flip on. It’s something you have to constantly attend to, recognizing the benefits of doing the work to build Trust today likely won’t be seen for months or even years to come. You have to do it anyway.

And while there are no shortcuts to trust, there is a pretty clear path: honest and ongoing communication. Your Distributors must have access to you in some form (be it in person, on Facebook lives or even simple emails) on a regular basis for trust to be built. So if you’re facing a challenge with trust between the Corporate Office and the field, start communicating constantly.

Here are just a few practical thoughts to keep in mind as you get more intentional about building Trust & Communication properly in your business (and life):

1. You can control how you communicate. Start here.
You don’t get to dictate if others trust in you or not; that’s up to them. You can do things to influence their trust journey, and that starts with communication. If you find yourself in a low-trust environment, go beyond what you feel is “normal” for communication, in terms of frequency and transparency. And remember that communication is a two-way street. Make sure you’re available and open to the communication of others. This often impacts their trust in you more than anything.

2. You can choose to trust others.
While you can’t force others to trust in you, you can decide to trust others. People have a way of instinctively sniffing out if you don’t trust them, which only makes them not trust you. Make the choice to trust others as much as possible, and set the example.Side note: “Trusting others” doesn’t mean you do whatever they want. Sometimes that’s just not possible.

3. Communicate more frequently with leaders.
This point is key for direct sales. Your field leaders don’t only have questions themselves, but they’re also getting questions from their team members. Invest time in this group, and over-communicate. “Over-communicate” means you communicate often, and you repeat important messages often. Inform them, equip them, empower them and include them. Not only will this open the opportunity to rebuild trust, but it will also help them share the correct message moving forward.

4. Don’t communicate messages that aren’t ready to be communicated.
We direct sellers are so guilty of this. Stop sharing dates for launches of stuff that’s not ready yet. Stop sharing info that’s not final yet. This is always good guidance, but it’s especially important when trust is low. Expectations for your communication are low when trust is low, so reset those expectations. Create an environment over time where people know that what you communicate can be counted on.

5. Be quick to apologize and correct.
No matter what, you’re going to make a mistake. Sometimes, it’s something you have absolutely zero control over. Other times, you did have control, and you just screwed up. It happens. When it does, apologize quickly, and communicate your plans moving forward.Sometimes, it makes sense (at the time) to break Point #4 above and communicate something a little early, only to see a need to change your plans. When it does, just apologize, and try to let be the exception instead of the rule. Sometimes an authentic apology for a mistake does more to build trust than doing it right in the first place.

6. Schedule time for proper communication.
As you plan for more frequent, more inclusive communication, make sure you allow the proper time for it. If you have something ready to launch on March 1, you may need to spend March 1 – March 31 communicating it properly with your different audiences, and launch it on April 1. Don’t skip the appropriate timelines for communication. It will make or break the success of whatever it is that you’re doing.

7. Trust comes from understanding your heart more than your head.
I’m guilty of diagramming and “Powerpointing” my audience to death at times. The details are important, and they need to be shared. But they don’t even compare to your heart.When it comes to building trust, people will connect with your heart, your emotions, your soul much more than anything else. For some of you, this comes naturally. For others, not so much. Regardless, people need to see it. Do what you need to do to share it. Direct sales is a very emotional business, so don’t ignore your own emotions when communicating.

As you navigate our way through so many new things in direct sales, it’s more important than ever to tend to Trust & Communication in a heightened way. Go the extra mile to intentionally do this well. You’ll not only love the results, but even the process.

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The Truth About Your Top Leaders

There’s a good chance I end up regretting that I wrote this article.

I can feel the hostility and defensiveness forming now. The “virtual vegetables” being thrown my direction. The accusations of blasphemy, even.

I’ve talked myself out of writing this article several times this year. While the topic continually pops to the front of the line in my brain when I’m up for a new post, I’ve desperately searched for other subjects to write about to avoid it altogether. I figured I didn’t need the hassle the will inevitably come with it, and maybe it wasn’t the right audience for it.

But, alas, it’s a topic that won’t leave me alone. I guess its time has finally come. So here we go.

A few disclaimers before we dive in:

1. I work with corporate executives of direct sales companies. I have served as one myself in the past. So, while this article will be talking a lot about top field leaders, its target is actually the corporate executive.
2. I’ve shared these thoughts we a few companies over the last year or so, and I’ve always been surprised at just how well it has been received. Which only underscores the fact that it’s as much of a challenge and issue for direct selling companies as I observe that it is.
3. I love direct sales, and I love direct selling leaders. You will likely question my sincerity on this one several times over throughout this article, so I will likely repeat this fact throughout.
4. More importantly, I respect what top leaders have accomplished, immensely. I haven’t done it myself, and I probably couldn’t do it. On top of that, the character and work ethic that is required to make it happen is something I find beyond honorable.

OK, now that we have that out of the way, shall we get started?

The Game Has Changed

But first, an allegorical reference that I think could help.

I played baseball growing up, all the way into college. In many ways, it consumed my life until I was 20. I was pretty good at it, and played for a great program. Specifically, I was a pitcher. I was quite successful, and the last game I pitched in was in the College World Series. It was a good run.

Now, I have a 12-year old who is involved in Select Baseball, and I get to help coach the team. I love it. It takes a lot of our time, but it is so worth it. My son is also becoming quite a pitcher, so I’m trying to steward that talent in him the right way.

Here’s what I’ve realized, and I’ll keep referencing throughout this article: Baseball has changed since I played it last in 1997. I didn’t want it to, but it did. And my coaching for my son and his team in 2021 will only go so far until I accept, and adapt, to this fact. It’s as simple as that.

And while baseball has changed a lot over the last 25 years, I think direct selling has changed even more. And yet, I watch so many companies revert back to tactics and strategies that worked so well 10,15, 20 years ago. And I see so many companies hide behind the bravado and type-A personalities of their field leaders, while they hesitate to make the bold decisions that are necessary to adapt to the way the game is played today.

As I’ve shared with them what I’m about to share with you, I’ve seen heavy burdens lifted from their shoulders, and sparks of enlightenment twinkle in their eyes.

I know The World of Direct Selling has its fair share of both corporate executives and field leaders, so let me just say this again: This article’s primary audience is the corporate executive, but I’m also hoping it provides some enlightenment and guidance for field leaders to consider, too.

Two Undeniable Truths About Your Top Leaders

Corporate execs have such an interesting relationship with the top leaders in the field. They are the Distributors you will hear the most from, interact with the most and include the most in your planning and strategizing. On the one hand, you covet their buy-in and praise for everything you do. On the other hand, their constant requests, frequent complaints and occasional drama can push you to the edge at times.

It’s an interesting relationship, but it’s a necessary one. So learning how to best navigate it is of utmost important, for both parties.

Here’s truth #1 about your leaders: We love them, and we wouldn’t be where we are today without them. And, we want nothing but the best for them.

I’m going to assume we can all agree with this.

Here’s truth #2: In a direct sales company that’s 15 years old (maybe even 10?) or older, your current top leaders cannot be the source of your future growth.

I’ll wait just a second to let the sting wear off of that one for a bit.

I’m not speaking to the skills or capabilities or heart of your leaders. I’m simply speaking to the extremely logical facts surrounding their situation and yours. Let me break it down for you in three core points.

Direct Sales Has Dramatically and Fundamentally Changed

Many articles have been written here about the changes we’re facing in direct selling. I even wrote about 2019 as The Year Direct Selling As We Know It Changed Forever. So I don’t think we need to spend time making this point.

What we do need to spend time on is taking the next step in our thinking: If things have changed so much, then we must recognize that what worked well before might not (probably doesn’t) work so well now.

Your top leaders obviously did something right. There’s no disputing this. The real question is… “What is right for right now?” At least some of what your top leaders relied on before as a key part of their success doesn’t work the same and/or as well as it did when they were climbing the ranks. And yet, that’s the system they know the best and believe in the most. Because it’s the system that worked for them!

We all like to lean on “tried and true” methods. But too many of them aren’t “tried” as much anymore, and many aren’t quite as “true” as they used to be.

Let me dip back into my baseball allegory. There are mechanics and principles of pitching that I swore by, and my coaches swore by, as I was developing in the 1990s. They worked for me then. But as a coach, I’m realizing there are some key elements that I would swear by that professionals are telling me is not longer seen as a best practice.

For example, above all else, I was taught to keep the ball low. If I could keep most of my pitches down in the zone, then everything would be alright. Now, hitters have actually been trained to change the path of their swings, so that keeping the ball low on every pitch no longer makes sense. And it’s batting, not pitching, that has required pitchers to rethink this principle. Put another way, if I was pitching now, and I lived by the creed to keep all of my pitches down in the zone, I wouldn’t experience anywhere near the success I did in the ‘90s. Because the game has changed.

Don’t get me wrong; there are plenty of principles from the ‘90s that do still apply to today’s game. But sometimes even those need to be applied a little differently to adapt. Now that I’m a coach, I owe it to the kids I coach to learn the new principles as best I can, and teach them that. It won’t help them for me to show them the now outdated approach that I swore by in the ‘90s, no matter how much I loved it or how well it worked for me.

Harsh statement alert: Your top leaders aren’t the experts they think they are. It doesn’t mean they aren’t experts, and it certainly doesn’t mean they don’t know what they’re talking about at times. But my experience is they often lose sight of the fact that the game has changed, and those principles that worked so well for them, like 3-way calls or leading with opportunity or even in how they position their income claims, just don’t work the same way today (thanks to technology, the regulatory environment and the marketplace).

And even when what used to work still does work, it often doesn’t work as well, and requires a lot more work to get the same results.

They Don’t Have the Growth Mindset Like They Used To

Now I’m really stepping on toes.

It is very rare for your top leaders to truly have the growth mindset needed to grow your business. It’s not their fault; it’s human nature. If I was in their shoes, I would be the exact same way.

Your top leader has likely earned a great income with your business, and established a strong recurring paycheck. And this is awesome, because it is one of the great benefits of our model. So, your leader’s primary driver right now, especially if your company has experienced a recent decline in sales, is to keep what they have. Like I said, this is human nature. Your leaders will innately prioritize anything that keeps them from losing what they have over anything that will increase what they have.

This is an extremely understandable mindset. But it is not a growth mindset.

When your leaders started, they most definitely had a growth mindset. All they could do is grow. They had nothing to lose. Now, they have so much to lose. To expect them to not protect what they have for the good of the company overall is ridiculous. They have a maintenance mindset.

Hear me out: I’m not saying that your top leaders don’t want to grow. As a matter of fact, I can promise you that most of them do want to grow. But they want to grow without risking what they’ve already built. And that is where the friction lies.

They Don’t Have the Energy or Time They Once Had

Your top leaders have worked really hard for a really long time. And yet, it seems most companies continue to ask for even more from them because of their status. Which only exhausts and burdens them more, which ends up being unproductive.

Sure, these are the people that were your road warriors before, who would stand in front of the state until 1 a.m. talking with anyone and everyone who wanted to chat. They had a drive and energy that was unmatched, and, especially in those early years, the business essentially rose and fell with them.

Now, they are in a different place in life. They’ve been successful. They’ve reaped rewards for their work and commitment. To expect them to have the same drive and tenacity now that they had 15 years ago to get their (and your) business off the ground is unrealistic.

And yet we keep asking our top leaders to do the bulk of the work. Not only is it unfair to them, but it’s actually not the way our model works.

Direct selling is not made to succeed from the work of just a few top leaders. By its very nature, it rewards everyone the most when more people are doing a little bit of work and buying a little bit of product.

On top of that, especially if your company is experiencing a decline (which is inevitable if your 10 years old or older), that means your top leaders’ income has also dipped. And I’m sure, for many of them, that they are frustrated by the fact that, in some ways, they have to start all over again. At least it can feel that way sometimes. I’m sure many of them didn’t think they would still have to work this hard or this much to keep the business going.

So as the corporate leader, how much are you burdening amazing leaders to accomplish a mission they’ve already accomplished? Could it be that the corporate team is relying on those top leaders even more than the top leaders want to be relied upon?

There’s a Necessary Cycle to Direct Sales

The very design of this model creates the very issue we’ve been talking about. It’s an issue that rises up every 10-15 years. It has to do with generations of leaders. And I would daresay it is the fundamental component of longterm success for a direct sales company.

If your company is not seeing a new generation of top-performing leaders rise up every 10 years, you can almost guarantee a decline until you do. If your company continues to burden your top leaders with the responsibilities that should be given to that next generation of leadership, then you will stumble and shrink. Because this model celebrates the development of the next generation of leaders.

There are so many components to the “growth formula” for a direct sales company. To be honest, it’s no formula at all; every company is different. But I do think you’ll find these three elements at the core of any growing company in our channel:

• New People (Customers and Distributors): If new people aren’t coming in at a regular pace, then growth will not occur.
• Young Leaders (not in age, but in tenure and ranks): If new leaders aren’t rising up, then growth will eventually stall out.
• Market-friendly Offer: If you don’t have a great product and/or a great program to introduce those products that’s easy to share, then eventually people stop talking about you.

As a corporate executive, you are the steward of your business. And while it’s unfair to expect everyone to have a growth mindset in the field, it’s not unfair to expect you to always have it. In fact, that’s your job. The best way you can support everyone involved in your company is to nurture growth at every turn. I believe that starts with making sure the three components above are addressed and re-addressed on an ongoing basis.

And, it also means that you have to know how to receive the feedback from all of your constituents, and filter them accordingly. It’s not easy, but it’s necessary.

I hope it’s obvious that I value top leaders, and their opinions, and all they do and have done. I wouldn’t exchange it for anything. I’m in no way saying you should ignore them or overlook them. But my challenge to the corporate executive is that you can’t stop there. You have a lot more people you’re responsible for beyond your top leaders. And to rely solely on their input, or to not use discernment or understand the context, is lazy leading.

It’s a paradox, really. Ultimately, the thing that will help your top leaders the most is growth below them in the organization. So focus on a growth mindset at all times, even when all the input you may be receiving is rooted in a maintenance mindset.

My high school baseball coach had an interesting saying. He would always tell us, “There’s no such thing as staying the same. You’re either getting better, or you’re getting worse.” He typically would tell us this right before we were going through a hard round of conditioning. While I would finish those burpees or run those foul poles, I would ponder that statement a lot. I would think, “Wait a second, I think it is possible to stay the same.”

And yet, the more I played baseball, and, more importantly, the more I’ve lived life, the more I’ve realized how true his statement is. There ain’t no staying the same. You’re either growing, or you’re shrinking.

Commit to growing. It’s the best thing you can do for everyone (whether they know it or not).

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The Makings of a Modern Compensation Plan for a Direct Sales Company

In April, I shared with you my thoughts on The Makings of a Modern Marketing Team for a Direct Sales Company. As so many areas of direct sales has shifted over the last 10 years, in light of both changes in direct sales as well as around direct sales, it is imperative that members of the corporate team, those who are stewards of the brand and the model, proactively shift components of the business to keep up, if not stay ahead.

But marketing is not the only area that deserves our attention here. In fact, while my firm, Strategic Choice Partners, has always worked with direct sales companies to create or adjust their compensation plans, we’ve seen a massive increase in both the number of companies and the breadth of changes requested over the last 18 months.

This makes sense, of course. The regulatory environment alone is requiring every company to take a hard look at the structure of how it pays compensation. There’s no need for me to go into those details here; plenty has been written about it already. I will say that I have been a tad surprised at the lack of urgency that most companies have had in making what appear to be obvious updates in their plans in light of these new regulatory insights.

Beyond these regulatory changes, however, is an even bigger question that seems to be at the top of every executive’s mind, either consciously or subconsciously, when it comes to thinking about compensation plans. That question is this: “What exactly am I paying for?”

It’s a simple but extremely profound question. And it is of utmost importance when working through any updates to your compensation plan. If you aren’t clear on what you’re paying for (and what you’re not), then you’ll never really be clear on what your compensation plan needs to accomplish.

As I mentioned in my Annual Checkup for 2021: “As direct sales companies continue to dish out 40%+ in commissions, they find themselves asking a very important question: “What am I getting in return for that 40%?” The expenses and responsibilities of the home office in today’s direct sales landscape is much more involved than in decades past, and yet the payout of the compensation plan in most cases has not been adjusted to account for those additional expenses. It makes for quite a tight margin!”

So, what are you paying all of your commissions for? Are you leaning on Distributors to acquire new Customers, and let the corporate office do the rest? Are you leaning on Distributors to do much more? Are Distributors your primary marketing channel, or are you having to invest more in things like online advertising, influencer outreach and video production?

Here’s the fundamental thought: If you’re still paying a 1990s compensation plan for a 2021 deliverable, you’re probably finding it very hard to finance “all the other stuff” that the corporate office has to do now.

With the rest of this article, I want to merely skim the surface of a few areas that are becoming bigger and bigger parts of compensation plan design today. It’s not intended to be comprehensive. But as I’ve had conversations with so many executives over the last few months, I’ve noticed these areas and ideas always seem to resonate with them most.

1. Your Preferred Customer Program

A Preferred Customer program is nothing new in direct sales. That said, many companies (especially 10+ year-old network marketing companies) are still struggling to find the right fit in this area. This struggle is due mostly to the hope that a simple Preferred Customer program can be incorporated without impacting much of the rest of your compensation plan.

This, of course, is futile. On the one hand, to create a Preferred Customer program that doesn’t require some other shifts in your compensation plan creates a Preferred Customer program that no customer actually prefers. If we prioritize keeping our comp structure in place, paying out the way it does, hoping we can just add this new component, then it’s extremely difficult to a) create a program that’s attractive to a Customer while b) incorporating compensation components that are attractive to the Distributor for obtaining Preferred Customers.

If the last two years have taught us anything, it is that we must prioritize the Customer. The modern comp plan needs to start with putting together the best offer for your Customers, and appropriately attractive compensation for those who find and serve those Customers. Figure that out, and try to work your way out from there.

2. Your “Hourly Rate”

Compensation plans don’t pay by the hour, but the normal Distributor is certainly going to think in those terms. In a world where gigs are abundant and easy for anyone to tap into, and where time and attention are more precious than they’ve ever been, a direct selling opportunity must prove (quickly) that it’s worth someone’s time to become a Distributor.

On average, what does someone make per hour spent sharing your products with new and prospective Customers? In our experience, reaching a rate of $30/hr. is a great target.

This doesn’t need to be an exact algorithm, but rather just simple, back-of-the-napkin math. If you’re a party plan company that offers 25% retail commissions, and the time spent to prep for, present and close out a party is 4 hours, and the typical sales of that party is $400, then your Distributor essentially earns $25/hr ($100 earned for 4 hours of work). Not bad, but you may want to consider a) raising your commissions to 30%, b) finding ways to increase the average party size or c) decreasing the time needed to conduct a party.

For a more one-to-one approach, if your company offers 25% retail commissions, and the time it takes for someone to post a live-streamed video to show your products takes about one hour total, and they sell $150 worth of product during that time, then that’s $37.50/hr.

As you can see, so much impacts the earnings per hour beyond just your retail commission rate. As my partner Alan Luce explained in his most recent article, “Added to what the companies are doing, existing sellers and potential direct selling candidates have discovered that selling online, rather than using the traditional face to face techniques, is actually more profitable than the old system.”

Dig into what this hourly rate could be for your company, and across the different selling scenarios.

3. Compensation Isn’t Just Commissions

One of more refreshing components of modern compensation plan design is recognizing that not all people are actually motivated by money alone. In fact, given that the vast majority of Distributors don’t expect their direct selling opportunity to provide anything close to a full-time income, we can sometimes find ourselves increasing compensation in ways that actually doesn’t resonate best with our constituents.

Many companies are starting to incorporate very creative loyalty and/or rewards programs that operate outside of/alongside the compensation plan. In some cases, these programs are only for Customers. In other cases, they include Distributors, too. Regardless, these programs offer all kinds of fun ways to earn discounts and credits toward product purchases, among other things. I’ve been involved in a few of these programs, and I can tell you, if done correctly, they can provide a very powerful motivation for otherwise overlooked Customers and Distributors, and a powerful lever for the corporate team to access as needed.

And a quick side note here: for party plan companies, the most common concern I hear is with Hostess programs. Namely, more and more, hostess programs are being used by Distributors to collect orders. While this isn’t “wrong,” it’s certainly not why the Hostess program was created. In its purest form, a Hostess program is a very rewarding referral program. Your Distributors have likely found very creative ways to take advantage of this program. This is all fine, but when you realize how much you’re paying out in Hostess Rewards, you want to make sure this is actually getting you maximum referrals. This has led many companies to consider incorporating a broader Rewards program instead. It’s worth looking into.

4. Learn from Affiliate Marketing

I think direct sales offers a much better overall platform than traditional affiliate marketing. That said, I believe we can learn so much from affiliate marketing programs. And the modern compensation plan design will look more and more like a multi-tiered affiliate marketing program than a traditional direct sales program.

I won’t go into all the details and differences of affiliate marketing, but I believe there’s a space between traditional direct selling and “traditional” affiliate marketing that represents the future of our industry. On the one hand, direct selling provides a community and culture that brands crave to have and customers love to be a part of. Ultimately, this is what everyone loves when they look at the companies within the direct sales channel. Relatively speaking, our compensation plans are massively more lucrative than affiliate marketing programs.

That said, affiliate marketing is simple, and proves that commissions probably don’t need to be so lucrative. Affiliate marketing is asking for help with brand awareness and customer acquisition, and that’s about it. The company will take it from there. So their commissions and rewards align with that.

Several direct sales companies have added and Affiliate level to their programs over the past few years. While I think this is a step in the right direction, we must get away from simply adding on components while ignoring the rest of the program. The modern direct sales compensation plan (and overall program) needs to be attractive to an affiliate marketer, and also to existing Distributors to acquire new affiliates. This requires a holistic look at your plan.

5. Plans Are Getting Flatter (Not Fatter)

The real hallmark of the modern direct sales compensation plan is that most plans are getting flatter. “Flatter” can mean a lot of different things, but it generally refers to plans not paying out on as many downline levels, and/or plans not paying quite so much to the very top leaders over time.

This trend is typically what stops 10-year-old+ companies in their tracks. And that’s mostly because the field leaders that have their ears the most are the leaders at the highest levels of the plan. I have a completely separate article on that I’ll share at a later time ;-).

Simply put, with a compensation plan, you get what you pay for. As any of us with any corporate experience can attest to, the field has uncanny ways of showing us what we’re really paying for, and you can’t blame them for that. But as stewards of the company, our responsibility is to help stabilize the company, and grow the company. This normally occurs at the lower to middle parts of our “plan”. Which is why the modern plan will be a little flatter than what we’ve been used to.

Especially when a company is experiencing a decline in sales, it is very common to introduce new bonuses, new levels or new compensation plan elements to motivate your top leaders, thinking these All-Stars, if they could just give a little more, will help make things right. This very rarely works. The reason it rarely works is because there’s only so much more your All-Stars can give you, incrementally speaking. They already give so much. And while it may be natural for them to want a bigger slice of a shrinking pie, your job is to increase the size of the pie.

Don’t look for ways to make the top levels of your plan fatter. Look for ways to motivate the new Distributor, the new Customer and the young leader. Not only will it help the company overall, but the fact that the pie is getting bigger will actually reward your top leaders more than anything else you could come up with.

6. Simplicity

The modern direct sales compensation plan will be more committed to simplicity that ever before. We’ve touted the importance of simplicity in our industry for a long time, but few companies have really made it happen. Sadly, is a running and well-known joke that compensation plans are too confusing. We laugh about it, and then we do nothing about it.

But the modern company won’t just talk about it. They will build plans that are simple and straightforward. New companies have the advantage of starting from scratch to make this happen. Existing companies have a tougher job, having to morph their existing plans into a more streamlined model. But the innovative ones will do it, no matter how hard it is.

For a plan to be truly simple, a company cannot start their plan design with figuring out how someone can make $500k per year, and then work your way down. The modern plan also won’t be as concerned with creating massive income for its top producers. Don’t get me wrong: There will still be plenty of high incomes with the modern plan design, but that will be because the sales volume warrants it, not because of “17 ways to earn income” and infinity bonuses and the like.

There are so many other intricacies and ideas that constitute a modern direct sales compensation plan. I’m sure many of you have incorporated some great improvements into your own plan over the last few years. I’d love for you to share them in the comments.

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The Makings of a Modern Marketing Team for a Direct Sales Company

“Marketing”

It’s one of the most inconsistently defined words in the English language. But “marketing” for a direct sales company takes that inconsistency and dumps it on its head even more.

What should marketing look like for direct selling today? Is it a sales support role? Is it the driving force? Is it online? Is it just pretty pictures and catchy words? Is it packaging and products?

It’s an interesting question, and it’s an area of direct sales that has seen seismic shifts in recent years. It’s also forced many companies to completely rethink how they set up their marketing teams. It’s also continued to frustrate many other companies who stick to the organizational structures they always known to try to navigate these new waters.

It would be impossible for me to capture everything a marketing team needs for a direct sales company in a single article. Mostly, because the marketing needs of every company are different. I don’t believe that every direct sales company needs the exact same structure because every company defines the responsibilities and role of marketing differently.

What I will attempt to do in this article is offer the foundational pieces of a modern marketing team for today’s direct sales company. I will no doubt miss something that you think is essential. But as I’ve personally worked with well over 30 companies over the last five years, I’ve seen very common trends and gaps within the marketing departments. Companies often reach out to us at SCP asking for guidance in this area. Others reach out asking our Marketing Services team to step in and help with the load. Regardless of the circumstance, I’ve clearly seen very similar needs and oversights among all companies.

So, based on that, let’s take a look at what the modern marketing team should look like at a direct sales company:

Graphics Designer(s):

In a world where the first step toward success has much to do with “stopping the scroll” as anything else, your design team is a critical component of your company’s success. It’s critical to have designers who not only crank out great work, but can also do it for multiple platforms. Gone are the days where one designer can specialize in print, another in web graphics and even another in packaging. Today’s direct sales company needs designers who can hold their own in every area of design. From flyers to specific sizing for social media networks to web banners, and everything in between, your design team needs to be fluent in them all.

Even more importantly is the volume of design needs that today’s company must crank out. I can remember not so long ago when a flyer and a couple banners could get you through several weeks. Today, the constant need for content across so many channels make fresh graphics output an almost daily need.

Today’s graphic designer must be great, fast and versatile.

Front-End Web Development/User Experience:

A close cousin of your design team is your front-end web developer. I’m not talking about your IT team and the back-end work that they do. Today, with so many companies leveraging platforms like WordPress and Shopify to handle their “front-facing” sites, it’s imperative to have someone on site who knows how to make those platforms work. We’re talking about experience in plugin selection and installation, minor coding needs, browser testing, responsive design experience and much more.

This person often has come out of the design side, not IT (although not always the case). They are a web designer who has had to figure out how to make these things work on their own, and over time have taken a liking to it. They are developers, and they can work in code (to a certain extent), but they have much more of a design and user experience focus, making them much more of a marketing resource instead of an IT resource. Many times this person can also help with web design work.

Many companies I work with, especially smaller ones, have not found this person, or they are at the mercy of “some guy” who helps them on the side. The work of this person impacts almost every area of your marketing efforts. It’s critical to find the right resource and one who can respond quickly.

Content Development and Copywriting:

Copywriting has been a pillar of any marketing team for decades, and that will continue. However, the new twist on “writing” today is that it expands much broader into what I would loosely term “content development.” Your writers cannot just focus on the message; they now must also account for the medium where that message will appear. Subject lines in an email have a dramatic impact on the consumption of that email. Headers and sub-heads (H1, H2, H3, etc.) are critically important on a landing page.

In addition, we all work in a heavily regulated environment, and your content development team must also internalize those boundaries to streamline the review process and obviously reduce risk. This is a steep learning curve for any team. Be it product claims or income claims, it’s quite the learned skill.

Your content development team will also influence, at a minimum, your social media strategy, and may even oversee it in some instances.

Simply put, because the internet runs on content, you now must find content creators who understand what and how the internet wants to receive that content. The beautiful thing about the web is that it gives us instant feedback on what we’re producing (in the form of analytics and open feedback). Your content team has an opportunity to learn with every single item they push out. Are they taking advantage of this?

Video Production and Video Marketing:

Video is certainly a part of content development, but the skills and thinking it requires is at a whole other level. The good news is that video has become so accessible and commoditized for any company, no matter your size. The bad news is that finding high quality video production and know-how on how to leverage those videos gets lost in the clutter a bit too easily.

The biggest change over the last five years in video production is that the volume of videos need has increased dramatically. If the Internet runs on content, then video is its super-fuel. Think about it: as you scroll through Facebook and Instagram, how many videos do you see? It’s a lot.

Yes, we can all capture and create videos from our phones, and there is definitely a place for that in your video strategy. But we must make sure we are also cranking out well-produced, professionally created video work, as well. These videos are often your sales force’s most used sales tool, so we can’t get too lazy on the video front.

Let me first make this point: If you have only one person producing videos, then you’re not producing enough video. Video production and editing takes time, and to meet the needs of today’s marketplace, one single video editor won’t cut it. So start looking for ways to complement your current team to economically crank out more.

On top of it all, you also have to account for video marketing. Put another way, once you’ve made that great video, what do you do to get people to watch. Yes, your Distributors can certainly help with this, but it takes a lot more than that in today’s world.

I won’t go into all the details here, but video marketing needs to account for things like incorporating video into your organic social strategy,  your paid social strategy, YouTube optimization, search engine optimization, email marketing, sales funnels and much more. My experience is that the person who produces the video is rarely the person who knows best how to market the video. So how does this work at your company?

Social Media Management:

These days, “social media” has become synonymous with “marketing,” for better or for worse. And yet there are so many aspects to social media that the direct sales company must account for. Depending on the size of your company, it can seem very difficult to find the right people to manage it all.

Step one is finding that person who oversees what is actually posted on your social media channels. They are creating the content calendar and driving whatever necessary work needs to be done to make it happen. You can find all kinds of opinions and case studies on how often you should be posting as a company. For me, if you’re not posting at least once a day on at least Facebook and Instagram, you’re falling short as a direct sales company.

Then there’s community management. Who is engaging with the audience that’s engaging with you? Who is replying to comments? Who is answering questions? Who is escalating customer service issues? Who is monitoring what’s going on? It’s great if the person producing the social media content is also this same person, but as you can see, it’s an entirely different skill set. It’s hard to find someone who handles both of these areas well. Especially for a direct sales company, the person (or people) responsible for community management need to be very well informed about what’s going on with the company (or they at least need to be really good at getting answers quickly). This is because they’ll see questions about products, incentives, contests, the comp plan… and so much more. So they at least need to have some decent familiarity with how everything works in the company, so they at least have the proper context for whatever questions they may receive. On top of it all, they need to do all of this with a tone and approach that represents the company, because so much of what they’ll do will be public.

And even still… we aren’t include paid social strategies here, which I include later in the article.

Oh, and who is training and equipping your field with social media training and resources? Because that’s a very different skill set, too.

Suffice it to say, most companies are transitioning to social media teams, vs. just a social media person.

Communications Planning:

My opinion is that successful marketing at a direct sales company hinges on communication planning. I also believe that consistently creating impactful communications plans for a direct sales company is one of the hardest things you can do. This is because we must account for so many audiences and messages at once. Is this an email for customers, or Distributors? U.S. or Canada? English or Spanish? And how many emails have they already received this week?

And that’s just email ;-).

Some companies can afford to have a dedicated Communications Director, where their primary purpose is to handle this planning. This is obviously great, and yet I have met many a Communication Director who struggles with figuring out how to properly plan and account for everything happening at the company.

In smaller companies, the communication planning function falls on someone with a different title. It may be a Marketing Manager, or even Marketing VP. It may even be your main writer, or possibly someone on the field development side of the aisle. Regardless this function is absolutely critical to your entire team’s success. Time and time again, I have found that, once a company can get a grip on its communication planning, it starts to see progress in all of its marketing efforts.

Digital Marketing Specialists:

“Digital marketing” covers a lot of ground, so it’s almost unfair to lump this into one category. But for the sake of brevity, I’m going to do just that here.

There are many rabbits you can chase when it comes to digital marketing. On top of that, many of these digital tactics appear to be within reach of anyone on your team, who may have other responsibilities within your department other than digital marketing. These two facts is what can make digital marketing dangerous. If you don’t have a) someone leading the way in terms of what your company will and will not focus on, from a strategic standpoint, and b) true expertise in each specific channel, you can end up wasting a lot of time and money suffering through your learning curve.

So, what’s a direct selling company to do? Here’s a baseline recommendation, that by no means includes everything you could be doing on the digital front, but rather covers the areas that I believe is both within reach of and would have a significant impact on every direct sales company, regardless of size or shape:

Hire a Digital Marketing Leader.
You need someone to provide the digital roadmap that makes sense for your company. I’m not necessarily talking about IT strategy (though it’s closely related), but rather a marketing strategist that knows the digital space well and knows what is realistic for your specific company to pull off, given whatever circumstances and constraints you find yourself in. That last part is really important. I’ve seen many company that hire a digital marketing expert who comes in recommending that the company does “everything” right away, only to find out the infrastructure, platforms, backend software, budgets… whatever can’t pull it off (at least in the recommended timeframe). So all the work that gets done often creates confusion and even more problems that it can solve.

If you can hire a full-time person for this position, I definitely recommend doing that. They can then either hire more team members who specialize in certain areas, if there’s budget for it, or contract work out. If you can’t hire this person full-time, I would consider finding a digital marketing consultant who can become rather involved in your business and play this role.

Optimize and Leverage Your Analytics.
There are all kinds of analytics packages, but most companies use Google Analytics, so I’m going to speak in those terms. Here’s a fact: Most companies do not have their Google Analytics set up correctly. When they do, they typically aren’t leveraging all that Google Analytics can provide. And from that group, rarely does that data make its way to the executives and help inform decisions. We have so many capabilities to track and analyze the work we’re doing, but most of us are completely missing the boat here. Have someone take a look under the hood and get your web presence humming on all cylinders. This begins with optimizing your analytics.

Incorporate a Paid Social Strategy.
Social media is now largely a pay-to-play. You probably already know that. The real question is: How are you using this capability? Most direct sales companies go straight to acquisition: how can we crank out some Facebook ads to get new customers or distributors? While this is possible, I don’t think it’s where I would start with paid social campaigns.

If you’re not incorporating retargeting, custom audiences and a true funnel strategy (top of funnel, middle of funnel, bottom of funnel) into your paid campaigns, you are, again, wasting a lot of money and time, and missing out on what could be some very promising results over time.

You need a resource that knows this space for at least Facebook and Instagram and can commit a decent amount of time to it each week to optimize your results. And … you need to make sure all the necessary tracking components (pixels, etc.) are in place so you can actually tie sales and ad spend (see Analytics above).

Pay More Attention to Your Email Strategy.
One thing all direct sales companies seem to have in common is how much we continue to rely on email. We send out a ton of emails. Half the time, that’s because we don’t adequately plan our communications (see above). But I digress… I’m a big fan of email, so don’t take my criticism as a reason to forget it altogether. However, as long as we’re going to rely so much on it as a marketing and communication channel, let’s invest some time and even money in making it work better.

Do you know your company’s open rate on all emails? For Distributors? Customers? How about clicks? How often are you testing components of your emails, like subject lines, graphics and offers? Do you segment your email campaigns? Every email campaign is an opportunity to learn something and to improve. Are you doing this? And who is leading it?

Automate as Much as You Can.
Marketing automation is here, and it’s a beautiful thing. I think it’s especially important for direct sales companies. As so many distributors introduce new people to your brand via website visits, social media, and so much more, how are you taking the ball and running with it from there Marketing automation can cover so much, so rather than get into those weeds, let me simplify it to this: what is your automation roadmap for 2021? If you don’t know, you’re not doing this at the level you should.

Now, as I mentioned, digital marketing can include so much more. Ecommerce analysis, user experience improvements, apps and third-party tools, Google Adwords… there’s a lot I could make a really strong case for. But at a minimum, make sure you are addressing the areas of digital marketing I’ve mentioned above.

Product Marketing & Management:

With so many different platforms and channels to use for our marketing, it’s easy to lose sight of the most important component of your marketing, and that’s the product you offer. Nothing accelerates a marketing strategy like a great product that meets the needs and desires of a clear and targeted audience. And yet, so many companies tend to look to R&D to just crank out something to go sell, or the founder’s whims drive whatever we’re launching at conference next. Who is laser-focused on your team on the success of any given product that is made available? Who is thinking about that product day and night? Who is dreaming of campaigns?

Don’t let all the fancy bells and whistles of marketing overshadow the most important part of it: your product. Invest in expertise in this area.

SEO and Online Reputation Management:

You may be thinking that SEO and online reputation management isn’t a “must-have” component of today’s marketing world. I couldn’t disagree more. Let’s consider online reputation alone: you can hit the ball out of the park in every other part of your marketing, but if the Google results associated with your company are negative, you’ll find it very difficult for a prospect to get past it. This is tough on any business, but especially a direct sales business. Think about it: Your Distributor is working their tail off, sharing the message of your company with a prospect, only to watch it crash and burn when they inevitably Google your company name. Not only do you lose the prospect, but you will eventually lose the Distributor, too. Why would they work so hard time and time again only to see the same results over and over?

Many factors influence your online reputation, but only the corporate office can really do anything about it. The best time to handle issues like this are before the negative results even appear. It must be a constant focus of any direct selling company.

Whew… there’s a lot to marketing in the direct selling world these days, and that only covered what I see as the “must-have” areas. I know it can be overwhelming. That’s why it makes sense so often to reach out to third-party teams (like the SCP Marketing Services team that I lead) to jump in and fill whatever gaps you may see in your current marketing strategy.

I’d love to hear where you feel like you struggle the most, or maybe areas you think I overlooked. Please drop a comment below.

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Your 5-Step Annual Checkup for 2021

Happy New Year, everyone!

In years past, I’ve shared my resolutions for direct selling around this time of year. That’s always been fun; you can read my resolutions for 2017 and 2019 here. I didn’t make any resolutions for 2020 (Thank goodness, who would’ve seen that coming!), but I did summarize the top marketing challenges based on some time spent with colleagues in the industry, which you can read here.

I think it’s fun to look back on these looks ahead, if for no other reason than to see what still hasn’t changed, or, hopefully what seems like “old news” because we actually did do something about it.

This year, I think 2021 deserves a different approach. So, rather than taking the resolutions route, I wanted to take more of an “annual checkup” approach. Let’s face it, after 2020, we could all use an annual checkup!

And while any checkup could consist of all kinds of tests and components, I feel like there are five areas in 2021 that especially require our attention.

1. Your New Distributor Onboarding Journey

This is one of those things that needs to be a part of every annual checkup. But I think it’s especially needed in 2021. You may have put off some necessary updates in 2020 as you waited for things to shake out. Now, even though the shaking isn’t over yet, I think we have a much better idea of what may phase out in time and what changes in how we do business are here to stay.

So, when a new distributor joins your company, how do those first 30 days look for them? For most companies, this starts with a) a Welcome kit, b) an automated email sequence of 7-15 messages, c) a specific section in your back office for new distributor training and d) possibly an app or third-party tool used for training and communication.

I’ve harped on this area for years, and so have others. This previous WDS article from Daryl Wurzbacher offers some great thought-starters when it comes to your onboarding process.

The first question to ask yourself is this one: Do we have a “New Distributor Onboarding Journey” in place already? My hope is you do, but if not, congratulations: you just identified 2021’s top priority for your company ;-).

Assuming you do have some form of New Distributor Onboarding Journey in place, pull it altogether so you can review the entire process holistically. Here are some questions to ask yourself to help frame the proper review of everything you have:

• What portions of the current content is incorrect/no longer valid?
• What’s wrong about the tone/voice?
• What’s missing? Are you not talking about a certain product enough? Maybe a sales tool, or a web page? Maybe a new technique or training?
• Who’s missing? Are there corporate staff members that should be featured more? New field leaders? Maybe you highlighted a third party before that you don’t need to feature anymore.
• Is the pace right? Are they receiving the right messages at the right time and in the right order?
• What do the analytics say? What are the open and click-through rates on your emails? What % of all new distributors opened all emails? Half of the emails? None of the emails? On web pages, how many visits did they get? Are there certain videos or elements that seem to get more attention than others?
• Are you looking at the analytics regularly? Are they set up correctly?
• What new techniques or channels should you consider? Maybe a customized audience in Facebook? Or a Facebook Group for new consultants? Texting? Weekly webinars?
• How can you better equip your leaders who sponsor these new distributors to get more involved in the onboarding process?
• How quickly can you address all of this? This new and improved onboarding approach you’re planning does no one any good until it’s launched. So, if this isn’t something you can crank out ASAP, who can you hand it over to for help?

You can never give your onboarding journey too much attention. We work so hard to get new distributors to join our business. Put the same effort (or more) into crafting an experience that makes them glad they made the decision, and helps them succeed in finding new customers and sharing more products.

2. Your Shipping & Distribution

Above all else, I believe 2021 is going to be the year where your efficiencies and performance in distribution could make or break you.

Possibly more than anything else, 2020 accelerated the adoption of online shopping and exponentially increased the number of packages we all receive at our doorstep each week. It almost “broke the entire system! (Anyone still waiting on a Christmas item to deliver?)

And yet, while shipping volume increases, we’re also seeing costs increase, and by quite a bit. My colleague Rich Harkey recently shared some areas to keep an eye on in his November 2020 article “3 Ways to Best Prepare for Increased Distribution Costs in 2021.” Most of us just accept our shipping costs as an expense we cannot control. The details behind what we’re charged can be confusing. But if you don’t dig into those details, you could find yourself falling behind with a customer base that demands fast and cheap shipping.

Here are just a few questions to ask yourself as you take a good look at your distribution operation:

• What was your average cost per shipment in 2020? Was it more or less than previous years?
• What was your average fee to customers for shipments in 2020? Was that more or less than previous years?
• Do you understand the details behind every fee in your bill?
• How well would you rate your distribution operation? In receiving orders? In packing? In timely shipping?
• Do you use a third-party distribution warehouse? Should you consider it? Should you consider a new one?
• Are there new ways to shave a few pennies on shipments in certain areas?
• When is the last time you negotiated your shipping costs with your carriers? Are you due for another discussion?

My expertise is not distribution and logistics, and it may not be yours, either. So it’s easy to just let someone else deal with it. But your shipping costs impact every single order that leaves the building. So it’s important. Find someone who knows how to get to the bottom line on your shipping expenses, and who can guide you through the process of getting more efficient in this area.

3. Your Online Analytics

I’ve personally worked with almost 100 different direct selling companies over the last seven years, and I can think of only one that has set up their website analytics properly, and actually uses that data to impact their business. Only one!!

“Online analytics” can mean a lot of different things, so I’ll narrow it down a bit. We’re talking about properly installing, setting up and reviewing your Google Analytics, as well as installing social tracking elements like the Facebook pixel to your website. You could probably include email analytics in this, too. There is not only a world of data waiting for you to uncover, but also a world of targeting opportunities waiting for you, that could make the difference in having an up year or a down year.

My experience has shown me that everyone wants to do this better, but they never get around to doing it. The problem with that is this data you gain grows exponentially more powerful the longer you’re gathering it. So it’s imperative that you get it set up the right way right away. You can see in this November 2020 article on Amway’s new CTO  that it’s a challenge that escapes no one, no matter how big or small you may be.

Simply having Google Analytics installed on your site isn’t enough. Most people don’t have it installed correctly or optimally, which means they are either getting faulty data or they are missing out on data. In addition, adding the Facebook pixel and other tracking elements to your site is something you should do even if you have no plans to use it currently. One day you will, and you’ll be glad you’ve already been tracking the data, rather than having to start from scratch.

Here are some questions to walk you through your annual analytics checkup:

• Do you have Google Analytics installed on your site? How confident are you that it’s installed correctly?
• How often do you or someone on your team review your website analytics? Should this be given more regular attention?
• Is the Facebook pixel installed on your site? Should you consider other tracking pixels?
• How often do you review your email analytics?
• How are you intentionally using these analytics to improve your marketing efforts? Your sales efforts?
• Is your tracking set up correctly to account for your replicated sites? (This is a big one; sometimes replicated sites can make it very difficult to accurately measure data if they aren’t tested and set up correctly).
• Are you using tools like Google Tag Manager and Google Search Console?
• Are you keeping up with the ongoing updates and capabilities of these platforms?

The beauty of the digital world is that you can track just about anything, and a lot of it is free. Most of us simply aren’t taking advantage of it all.

2020 accelerated adoption of ecommerce, so we must rush to catch up in running a top-notch ecommerce operation.

4. Your Events

If there’s anything we direct sellers know how to do, it’s how to throw a great event. And yet 2020 certainly challenged us in this most comfortable of all comfort zones. Some companies embraced the challenge, and others fell a bit short.

The good news, if you want to look at it that way, is the opportunity to embrace the challenge is sticking around through 2021!

As we all came to grips with “virtual events” in 2020, we also learned that “virtual events” can mean a lot of different things. Hopefully your trial and error in 2020 gave you some experience in what works best for your company. Is it a truly live event? Or do you produce the event prior and stream it live? Do you use Zoom or Facebook Live, or something else?

We probably all have our preferences based on our experiences this past year. And let’s not forget that in-person events will hopefully back on the table to some degree for most of us later this year. But… I think we all can agree that the future will be much more of a hybrid approach of virtual and in-person events, well beyond 2021.

So, here are some thought-provoking questions to get you going on your annual checkup for your events:

• What went really well in 2020 with our events?
• What did not go well in 2020 with our events?
• What is our preferred virtual event approach?
• What approach have we seen other companies use that we should check out?
• Should we increase the number of events this year, or decrease?
• Are we going to have an in-person event this year?
• What investments in equipment or software do we need to make? Or sales tools?
• What is our event calendar for this year?
• Who can we reach out to for some help or insights?
• How can we equip our sales force to conduct better online events?

5. Your Compensation Plan

More than any other year that I can remember, companies are taking a hard look at updating their compensation plan in fairly significant ways. Some of these updates continue to be driven by changes prompted by the quickly evolving regulatory environment. Most are wanting to look at an update to simply get more bang for their buck.

As direct sales companies continue to dish out 40%+ in commissions, they find themselves asking a very important question: “What am I getting in return for that 40%?” The expenses and responsibilities of the home office in today’s direct sales landscape is much more involved than in decades past, and yet the payout of the compensation plan in most cases has not been adjusted to account for those additional expenses. It makes for quite a tight margin!

More than anything, companies are interested in two things right now: 1) How do we increase customer acquisition, which then leads to… 2) How can I continue to pay so much to my top leaders when customer acquisition typically occurs at a much lower level in my distributor hierarchy?

It’s a tough nut to crack, and the answer is always “It depends.” But the questions are the right ones to be asking. Here are a few more worth your time:

• What percent was our commissions payout in 2020? Was it more or less than years’ past?
• What percent were other elements of our payout (like promotions and incentives)? More or less than years’ past?
• What’s the breakdown of payout to top tier, middle tier and lower tier of my Distributors? Does the activity as it relates to the payout for each tier align with our strategy for growth?
• What is the home office spending on lead generation (for customers or distributors)? What percent of total revenue does this account for?
• How well does your plan allow a new distributor to earn $500 a month on sales to new customers?
• Do you have customer programs in place, like a preferred customer discount, or a loyalty program? Should you? Are the ones you have working?
• Do you have a “Hostess Program”? Is it working the way it’s intended?
• Overall, as you look at the different components of your plan, do they incentivize and instigate the behavior that is actually going to make a difference for your company? Could there be better ways to invest that payout than how you are now?

My partner Alan Luce recently share some thoughts on creating a more retail-centric plan toward the end of his article Lessons from the Lockdown, Part 3. This is definitely worth five minutes of your time.

Overall, it’s a fundamental question you’ll ask over and over again when it comes to your compensation plan: Is this juice worth the squeeze? And … does it allow for us to keep going and growing for years to come?

There are so many other things worthy of your attention as you kick off this new year, but I heartily believe that these five areas mentioned above deserve everyone’s attention in 2021. The times they are a-changin‘, and the winners will be those who are the most agile in their adjustments.

What areas do you feel should be included in your 2021 Annual Checkup?

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What to Do When Your Direct Sales Company Closes Its Doors

I was recently involved with a company that decided to close its doors after experiencing a long and successful life as a direct sales company. This is certainly never any business’ intent, but you are reminded that some (all?) businesses have a lifespan, and that’s OK. Direct selling has had so many great companies come and go over the years, and their legacy, influence and impact can be seen in so many ways still today.

With that, I was involved in communicating this decision with the field. As you can imagine, this news was difficult to give and receive, and it stirred up all kinds of emotions. But more than anything, it stirred up a sense of gratitude and appreciation, even in the midst of the sadness and stress of a door closing.

I had the opportunity to share some thoughts with the field leaders how they can think through the ominous question of “what now?” And I know it’s a very common question that is top of mind for so many direct sellers, whether their company also chooses to close its doors, or they personally have decided they want to move on. I’ve summarized some of my advice in this article, hoping it can provide some guidance and provoke thought for anyone looking at what’s next. And, if you work on the corporate side, perhaps this article will prove to be resourceful for you at some point.


If you find yourself in this situation, here are 12 thoughts on how to figure out the next best move for you.

1. Do Nothing.
If your direct sales company is closing its doors, there’s actually nothing that you have to do. Sure, there are many things you may choose to do, but it’s so important to have a mindset of empowerment in this situation in the midst of what can feel sad, disappointing and even frightening.

If you can rise above all of those normal feelings, you can actually take advantage of a moment in time that so rarely presents itself to you: you don’t have do anything unless you want to.

So take advantage of this moment. Spend some time thinking and strategizing without letting all the other emotions dictate your actions. No one can force you to do anything right now. It’s your choice.

2. Get Rest.
This is a practical but vitally important tip. If you’re like most, once you heard that your company would be closing its doors, assuming you got at least a little bit of a notice (side note: companies, please, if at all possible, give some kind of notice before just shutting things down), you’re scrambling like never before to get those last sales in and communicate with your team and reach to your customers and plan for the future… on top of everything else your busy schedule required of you. You’re tapped out, and that’s no position to be in to make a big future decision.

Find time to refuel and refresh. For most of us, that actually means get some sleep. On top of that, find ways to rest your weary mind. You’re going to need it as you think about your next steps. Make sure your tank is full before you make the call. I know every situation is different, but if you can set things aside for a few weeks, it can only help you develop the clarity and decisiveness you’ll need moving forward.

3. Reinvent Yourself…
We all know the phrase “when one door closes, another one opens.” Similarly, when one phase ends, another can begin. In many ways, you’re looking at a blank slate of sorts. This is an opportunity to take stock in yourself, and figure out what you want your life to look like moving forward. And … if there are parts of it you want to leave behind, what a great opportunity you have for that!

You could apply this to anything, but in a direct selling context, it could look like this:
– “I don’t want to be known as ‘the lash lady’ anymore.”
– “I wanna be known as a team leader, not just a great retailer.”
– “I’m done with network marketing; I wanna look at party plan.”
– “I’m done with party plan; I wanna look at network marketing.”
– “I’ve been known as the ‘sidekick’ forever to my upline leader; I’m ready to branch out.”

Of course, your reinvention may have nothing to do with your direct selling business. Whatever it could be, leverage this moment.

On the other hand, you could…

4. … Double Down.
At the same time, you may have a moment of recommitment to what you’ve done or what you’re known for. You may not know exactly what the future holds for you, but as you think about it, you may see very clearly that you want to not only keep doing some of the things you’ve always done, and even at a higher level.

That could look something like this:
– “I don’t know what’s next, but I know I love sharing jewelry with others and how it makes women feel. So I’m definitely gonna keep doing that.”
– “I’m known for mentoring young leaders, and want to find a way to do it more.”
– “I just love hosting home shows, even during COVID! I’m gonna find a way to make that work in a modern way.”

You get the picture. One of my mentors, Tony Jeary, has an exercise he calls MOLO: “more of, less of.” Take the time to write down what you want to do more of in your life, and what you want to do less of. It seems simple on the surface, but it’s extremely powerful in helping you find the guardrails needed for your next step.

5. You Are Paid in Full.
In order to move on in the healthiest way possible, you need to accept that you are “paid in full” as far as your experience with your old company goes.

I’m not necessarily talking about commissions and profits. I’m talking about having a feeling of someone owing you something, or you owing someone else something. To be the best you can be for whatever you’re gonna do next, you must release any expectations left with your former company.

For example, you may be a top leader in your old company, with a large team that you’ve led for a long time. It’s very easy to continue to feel responsible for that team, but let me alleviate you of that burden. You’ve likely given them so much over the years. Your company’s decision to close its doors isn’t your decision. Don’t feel like you’re responsible for your team’s next steps. They will no doubt come to you, wanting to know what to do. But, given all the blood, sweat and tears you’ve put into building that team to begin with, you may not be up for having to do it again.

On the flip side, it’s important for you to not think anyone (like your upline) owes you anything moving forward. They’ve given you all they have to give you. Don’t feel like they owe you a certain spot in their organization at a new company, or a head’s up on what they’re doing, or anything. They don’t; you’re paid in full.

Similarly, you don’t owe them anything, either. For some of you, you may not be that crazy about your upline, or maybe others on your team. This is an opportunity to start fresh, with different people. That’s OK.

If you’re of the mindset of being paid in full for work done, then you’re in the best position to receive whatever is to come next.

6. Write Down What You Would Do Differently.
If you could do it all again, what would you do differently? Not what the company should have done, or your upline, or your customers. YOU. If we can truly learn from our mistakes and misfortunes, what a learning experience you’ve been given! Don’t let it slip away.

Think back to when you started. Or maybe how you coached your team. Maybe it has to do more with how you balance the rest of your life. Whatever it is, think about it. So often, we cherish the experience we’ve had so much that we say we wouldn’t change anything. But I don’t think that’s actually true. I think there are little things in our lives we would definitely change. Hopefully we’ve grown wiser.

Document your thinking and here, and have it handy to apply as you move ahead.


7. You Don’t Have to Join Another Direct Sales Company.
Let me make this clear: I love direct sales, and I think it’s a wonderful opportunity. That said, there are lots of different ways to start businesses and earn income and do whatever it is that you love most about direct sales. So before you dive head first into thinking you must join another company, think about what you truly enjoy the most.

For example, if team building really isn’t your thing, and you just like retailing, then there are all kinds of options outside of direct selling for you to consider.

You still may prefer direct selling because of the product or the profit margin, or something else, but you could also be an affiliate with another company, or leverage some influencer options, or something else.

Also, if you love building up people and coaching them, but don’t care for selling or retailing, you also have other avenues to look into.

Again, I’m all for you joining another direct sales company, but I’d be misleading you if I made you think it was your only option.

8. Make Sure You Can Do It with Passion.
If you’ve been with a direct sales company for any period of time, you’ve probably grown quite passionate about it. As you connect with the essence of the company, beyond the products and the comp plan and all that, it creates a connection that drives you.

Whatever you do next, make sure you can see yourself pouring yourself into it like this.

I’ve seen many direct sellers hop from one company to another because they feel like they just “need to find a home,” only to realize they aren’t that passionate about the company or how it does things.

9. You’re Joining an Existing Culture.
If you’re thinking about joining another direct sales company, this is the most important advice I can give you: every company has its own culture, and culture is very powerful. Above all else, you must make sure you connect with the culture of the company you are going to join. Otherwise, you are destined to fail, in one way or another.

Think about it: the company you are leaving surely had a culture, a way of doing things. You can probably remember when someone from another company would join, and you’d point out to them, “Oh, that’s not how we do things here.” Or, “at this company, we do it this way.” That’s normal.

Now, you will be the person tapping into that existing culture. And while there will be many similarities, it will still be different. Between how you are used to doing things and the new company, which culture do you think is going to prevail?

So, more than anything, as you join a new direct sales company, make sure you resonate with the culture. Everything else is secondary.

10. Be a Student.
Likewise, don’t be that new Distributor who joins a new company and knows everything. Just calling it like it is, everyone is already going to be keeping their eye on you. Don’t come in trying to change everything and trying to show “a better way” right away.

Not only does that new company have an existing culture, but they also have an existing system, and training, and ideas on what works and what doesn’t. You may be able to influence and improve all of that eventually, but first seek to understand what’s already in place.

11. Know What You Don’t Want to Do.
You may not know exactly what you want to do, but you may know what you do NOT want to do. And this knowledge can be very helpful.

I spoke with someone who told me, “I’m not sure what I’m going to do, but I know I’m tired of selling!” This is a great revelation that can guide this leader in her decisions. You may also know you’re tired of selling make-up, and want to try nutrition. Or maybe you don’t want to deal with hostess programs anymore. You may know you want to focus on a consumable product instead of a one-time sale.

Whatever it may be, knowing what you don’t want to do can you help find what you do want to do.

12. Don’t Feel Rushed to Make the Decision.
Obviously, I shared a lot of thoughts on how to think through this process the right way. Which takes some time. So make sure you actually take it!

It can be so tempting to jump quickly to another company, hoping everyone else follows you and you can take advantage of what that means long term. I’m in no way against this sort of thing. It’s one thing to do something quickly; it’s something else to rush into something.

This decision is too big; don’t rush it.

What did I miss? What do you not agree with? Have you gone through this process yourself? What tips would you have for someone facing this situation?

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Brett Duncan
What Norms Aren’t Worth Rushing Back To?

As we all do everything we can to rush back to normal, stop and consider what “normals” actually aren’t worth rushing back to.

I heard this statement on a podcast recently. It’s not a podcast specific to direct sales, but it’s a statement that has haunted me over the last 10 days or so. As we navigate our way past the initial shock and awe of the pandemic, and now settle into figuring out what to do now, I think every strategic discussion should incorporate this question as its starting point.

I think there are plenty of “normals” that direct selling needs to leave behind in 2020. To be honest, most of them should have probably been left behind in 2015 or so. I’ve shared my thoughts on a lot of that over the past few years here in The World of Direct Selling, namely in these articles:

• 2019: the Year Direct Selling as We Know It Changed Forever
• Our Story is Better Than Their Story; Are You Telling It?
• 9 Resolutions for Direct Selling Companies in 2019
• The 7 Most Common Recommendations for Direct Selling Companies

In this article, my aim is to share some unique thoughts on transitions that now face us as a channel that maybe weren’t quite as clear prior to the pandemic. Yes, we still need to take a fresh look at compensation plan design. Yes, we must increase our commitment to compliance enforcement (of ourselves and our sales force). Yes, we must respond to the market forces around us in new ways. None of that has changed. In fact, if anything, the pandemic should only be increasing your belief in those needed shifts and accelerating your activities to make it happen.



Below, I’m listing some areas I believe we now unequivocally must rethink. It’s not that they weren’t questions on minds before, but when I ask myself the question, “What norms in direct selling aren’t worth rushing back to?,” these strike me first. I won’t pretend to have captured them all, so I’d love for you to add your own thoughts in the comments below.

1. Strict Work-in-the-Office Policies

Working from home was already steadily trending upward, and now it’s skyrocketing. What have you learned about how to operate your business as you’ve had more people working from home over the last couple months? Most execs I talk to are pleasantly surprised at how productive their teams can be and how relatively easy it was to keep the operation chugging along. It’s also shined a light on areas of inefficiency within organizations, as companies are seeing firsthand in some instances that only a fraction of the work they thought was necessary for certain tasks and systems is actually needed. More importantly, when you begin hiring in the months and years to come, work-from-home will no longer be a preference for many; it will be a requirement. To attract the best talent, you’re going to have to revisit your thinking on this one. Trust me, I still think people will want to come together in an office environment, but probably not every day. Most experts believe a hybrid approach (two days a week in the office, for example) will become the new norm, allowing for the best of both worlds.

So, if you’ve always had the mindset of “if you’re not in the office, you’re not working,” it’s time to leave that thinking behind. And you can’t just allow for work-from-home; you’ll need to take steps to accommodate it.

2. Low Cash Flow

One of direct selling’s “elephants in the room” is how so many companies operate under such a low cash flow situation. Direct selling is always a volatile business, surging and crashing as momentum flows in the field. So many companies, especially within their first ten years, focus on volume above all else, cheating themselves of margin and cash for the future. Strong cash positions allow you to make wise decisions in the midst of challenges. Without it, you are at the mercy of so many outside factors. It’s unsettling, and unhealthy. Trading volume for margin has its place, but not nearly as often as we direct sellers think it does. If that’s been your modus operandi, leave that behind in 2020. Figure out how to push yourself to a healthier cash flow over the next two years (and beyond).

3. Loose Compliance

OK, I know I said I wouldn’t revisit some of the topics I’ve covered elsewhere, but I do feel the pandemic has intensified the spotlight on compliance in the midst of the pandemic. I know many assumed regulators would back off in the midst of COVID-19. In fact, they did the exact opposite. I’m sure you’re familiar with the FTC calling out ten of our companies in April. They’re pressing in during the pandemic. What does that tell you? There are lots of things we cannot control about the regulatory environment right now. Let’s set that aside. What I find disappointing is how sluggishly most companies are incorporating and enforcing new compliance standards. This is not a phase. It is not going away. Compliance oversight and enforcement is now one of, if not the, primary responsibilities for the home office. If you’ve been slow to act on the shifts we watched occur in 2019, and continue to do so now, please change your thinking. If you assume you are immune to these regulations because “you’re not one of those companies,” think again. The examples being given are examples common to many direct sales company, to some degree. Get serious about it, and start doing something.

4. Hanging On to Under-Performing Markets

Direct sales companies are also notorious for charging into new countries when they aren’t quite ready to do it, or when they don’t have the infrastructure or financial foundation to pull it off well. As hope sprints eternal, these half-baked launches continue to drain resources and attention. Over time, while all signs point to shutting the market down, it feels wasteful to give up after years have already been invested.The pandemic is certainly pointing out what markets are worth keeping and which ones are not. If you thought it was tough keeping that market afloat before, just wait… As you labor over P&Ls and sales reports, don’t be afraid to make the tough decision here. Our current economic situation actually provides the perfect situation for making these decisions. It’s understood that tough calls have to be made.

Stop ignoring your gut. If you know it’s time to pull the plug on certain markets, do it. It could be the healthiest thing you do for your business moving forward.

5. Poor Video Marketing and Production

Video was already important. Now, it’s vital. In the “virtual world,” great video is the lifeblood.“Video” can mean lots of different things. Live streaming, social videos, product videos, opportunity videos, selfie video… there’s a lot to look into. Now, both quantity and quality are of utmost importance. As more and more companies commit to more mature video strategies, those videos that are strategic in both their timing and their production will stand out. It doesn’t mean that everything requires a studio and full lighting set up. But it also doesn’t mean you can just get by on your iPhone alone anymore.

Stop going cheap on video. Invest a little in improving the videos you make on your own (lighting, sound, low-cost equipment) and pair that with well-produced, more professional videos with an in-house team or agency.

6. Opportunity-Centric Businesses

This, also, isn’t a new suggestion. But there is a new twist. Many are leaning on the age-old assumption that direct sales always does well when the economy is down. I believe studies have shown that the more accurate thing to say is that direct sales companies don’t do as poorly as other companies do, but there are still struggles in a down economy, especially depending on your product mix. Regardless, we know more people will be looking for new ways to earn income. And that’s typically a good thing for us. What we can’t assume is that people will accept the same ol’ “opportunity.” The choices are vast, and the need is immediate.If the presentation of your plan still focuses on team building as the primary point of the story, that needs to be left behind moving forward. Yes, people are looking for ways to earn income, but they are looking for ways to earn income RIGHT NOW. If we can’t scratch that itch sufficiently by letting them earn adequate pay for simply sharing a product with a few customers, then we will lose. Today’s prospect won’t be interested in team building because they don’t have time for that right now. It doesn’t mean they won’t be interested in the future, but it can’t be viewed as a requirement to them upfront.

We’re no longer the only gig in town. We still offer many advantages over other alternatives, but if we don’t put our best foot forward in alignment with what our prospects want, then what may be “best” for them will be overshadowed by what’s “easiest” every time.

7. Uncompetitive Shipping & Delivery

Here’s the thing: Shipping is never free. In many ways, it’s costlier than ever. But the market is dictating that a) we must incorporate reasonable fee structures for shipping and b) it needs to get to me fast.I won’t pretend that we can all compete with Amazon in this arena. But we can’t ignore it, either. If you’ve been ignoring alternatives to your current shipping fee approach, or tolerating sub-par service in this area, it’s only going to get harder. I find myself struggling through this with clients myself. There’s nothing easy about figuring out the best way to meet market expectations while protecting margin. But it’s what is necessary from here on out.

8. Ignoring the Affiliate World

There is a whole world of affiliate marketing that most direct sellers completely ignore, and sometimes go out of their way to dismiss. Thousands upon thousands of people already eagerly share products for retail and ecommerce companies for commissions ranging from 1% to 12%. They work hard for what many of us would consider a small amount. If a company can find ways to accommodate the affiliate world without forcing them to stray too far into the “network marketing waters,” there is a huge opportunity for growth. This means fresh looks at enrollment fees (most affiliates don’t have to do that at all currently), online sharing, openness to sharing other products from other companies and much more. There’s a market that wants what we have, but they just don’t know about us (or they have the wrong idea about us). What can you do to help them?

There are so many more norms that aren’t worth rushing back to. Obviously, events are shifting completely, and that probably deserves a whole article on its own. What other norms do you believe we don’t need return to moving forward?

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Brett Duncan
The 10 Marketing Challenges Direct Sales Companies are Taking On in 2020

Marketing has always been important in direct sales. But it’s never been as important as it is now. Today’s direct sales environment finds the sales force expecting the best in packaging, lead generation, awareness campaigns, online marketing and much more. On top of that, they also want constant training on how to become great marketers themselves. It’s a load that most direct sales companies didn’t have to account for (at least to this degree) until recently.

I was privileged this past week to facilitate a session at the DSA Marketing & Communications Seminar that included about 20 different marketing professionals from different companies in direct selling. The companies represented included Young Living, Nu Skin, AdvoCare, Oriflame, Scentsy, Senegence, Saladmaster, Amway, Tastefully Simple, Zurvita and Isagenix, to name a few. It was a wonderful mix of great companies, and an excellent forum to share ideas and best practices.



Over the course of the three-hour session, we spent a lot of time discussing what areas these companies will be most focused on in 2020. Listed below are the top ten takeaways that I personally noted from the discussions. These are my own paraphrased takeaways and should not be taken as absolute or exhaustive plans by all the companies I mentioned above. Rather, my hope here is to provide an informal “state of marketing” in direct selling, to serve as a reference point for your own plans this coming year.

1. Online Advertising is Our New Norm.
   As a general rule, direct selling companies will be spending more on online advertising in 2020 than they did in 2019. Most of this spend will be on Facebook, Instagram and Google Adwords, with some adding YouTube advertising or additional display networks, too. The campaigns will be focused primarily on brand awareness and end-consumer lead generation, with very few focusing on Distributor recruitment. That said, while all will be advertising more, not everyone has yet taken advantage of some of the more fruitful components of “funnel marketing,” like retargeting and abandoned cart campaigns.
2. Multichannel Approaches are Getting More Attention.
   Several direct selling companies are committed to finding a way to leverage Amazon in 2020, with a handful already listing their products there. It’s important to distinguish that no company is looking to Amazon to replace their salesforce efforts; rather, companies simply know they must account for the Amazon effect while also still serving their salesforce in the process. One company shared that Amazon has actually become a great marketing channel for them, introducing new customers to the brand who may have never purchased otherwise, then leading them to the corporate website and/or a Distributor’s website to continue their purchases and enjoy better deals.Admittedly, this approach can cause some concern and confusion with the field, but the pros seem to outweigh the cons for those with experience in this area. Specifically, many companies are creating commission pools that pay eligible Distributors profits from these Amazon purchases, adding for some a healthy income addition.
3. Influencer Marketing is a Priority, but Still Challenging.
   Most companies are planning to leverage influencer marketing more in 2020. However, almost all who have experience in this area to date express challenges when it comes to helping their existing salesforce not feel as though they are in competition with these influencers. At the same time, many influencers sometimes struggle with the requirement to purchase through an Independent Distributor as part of their promotional efforts.Regardless, all companies recognize the potential of incorporating more influencer marketing into their plans. Some pay with product, others with experiences and others with actual money. Many experienced companies suggest focusing more on micro-influencers, and not getting too caught up in network size. They often see better results with influencers who have from 5,000 – 15,000 followers, instead of those with 100,000 or more. In addition, many companies are trading sponsorship and celebrity endorsement budget for increased influencer marketing work, seeing a better direct return for their influencer marketing efforts.
4. Website Design is Never Done.
   It’s safe to assume that every company is redesigning their website in 2020. By “redesign,” I’m talking about significant design and/or architectural updates, not just simple banner tweaks here and there. In some cases, this even means a new platform or ecommerce engine.Many companies that plan to redesign their website in 2020 also redesigned it in 2019. The point is simple and clear: a website is never complete. A redesign could be prompted by technological updates that need to be taken advantage of. In other cases, new business programs and positioning prompt a whole new approach to the company’s online presence. Regardless, the simple truth is that changes in positioning, platforms, programs and capabilities requires us all to be ready to update our core website design regularly. And, in most cases, companies are working with third-party agencies to help them make this happen.
5. Corporate Messaging Needs Some Attention.
   Given the current regulatory environment, my assumption is that all companies would be taking a hard and thorough look at the corporate messaging represented on their websites, print materials, etc. However, there is a wide-range of work in this area, in terms of both urgency and degree of change. Some companies are aggressively reviewing their own messaging and changing years-old positioning to match what they deem to be aligned with the current guidance provided by the FTC. Others don’t feel like their messaging was far off to begin with. And others are simply waiting to see what happens.Let me add a personal opinion here: I believe the degree of change in corporate messaging that is required is much more than many companies believe it should be. I would stress that all companies a) gain more clarity ASAP on what is and is not acceptable in terms of income claims and implied claims, and b) prioritize a thorough review of all marketing materials to identify areas in need of an update. This is something a third party (like my company, Strategic Choice Partners) can help with if you don’t have the bandwidth or understanding to do it yourself.
6. Print Work Continues to Diminish.
   While it is no surprise that companies print less than they used to, it is somewhat surprising that companies plan to print less than they did in 2019. In my discussions, no company plans to print as much as they did in 2019.
7. Low-Cost and No-Cost Enrollment is the New Trend.
   To compete in the Gig Economy, where an enrollment fee is rarely required, many direct selling companies are lowering their enrollment fees to well below $50, and many are foregoing enrollment fees altogether. In addition to competing with the no-cost norm of the Gig Economy, companies also like the low barrier to entry and low-risk positioning that comes with these lower fees.
8. Who Matters More: Millennials or Gen Z?
   As the topic of marketing to millennials arose, many expressed that a focus on millennials is “so five years ago.” If you haven’t addressed millennials already, you may have missed that boat. The focus now needs to be on Gen Z.However, many in the group agreed with a sentiment expressed that psychographics, not demographics, is what really matters. In other words, what’s the brand story or worldview that your company resonates with, and who holds to the same worldview? There are people in every generation that can find something about your brand that resonates with them. Focus on attracting them at a psychographic level, and then focus on how you reach them (channels, messaging, etc.) based on their demographic.
9. Search Marketing and Online Reputation Management are Getting More Attention.
   Most companies plan to increase their search marketing efforts in 2020. This work may include organic search engine optimization, paid search or online reputation management. More companies are recognizing that the Home Office must be better stewards of the company’s online presence, understanding that only the Home Office can improve online reputation.
10. Roughly Half of Us are Rebranding or Repackaging in 2020.
    Based on the group I chatted with, half of them plan to launch a new packaging design or even a new brand approach/logo design for the company overall in 2020. If you’ve ever been a part of rebranding or repackaging, you know how much work goes into that. For many companies, this means many resources will be consumed with all the work that goes into new packaging, leaving them with little bandwidth to handle additional projects.

Overall, it’s clear that direct selling is a digital marketing industry. Just the simple shift in looking to digital marketing as a component of what we do to an identity can shape many decisions from the executive level on down. I found myself frequently impressed with and encouraged by some of the efforts direct selling companies are making in their marketing. That said, many participants expressed the need for marketing budgets to increase many times over, leaving the company with some very important decisions to make in terms of where those funds can be found in their current model.

Let me thank the DSA again for hosting such a helpful and practical summit, and I hope they continue to create these experiences more in the future.

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Guest Post by Brett Duncan
Our Story Is Better Than Their Story. Are You Telling It?

A lot of people have a lot to say about direct selling these days. Have you noticed?

From company announcements to proclamations from the investing world to regulatory agency decisions to even a TV series, there is no shortage of hot opinions and big news in the world of direct selling.

As the old saying goes, “any news is good news.” But is that really true here? It seems the only news we’re getting falls in the “bad news” category. Further, the only opinions those of us in the industry are giving are just opinions and pontifications on that bad news.

Maybe the reason it seems the bad news is standing out so much is mostly because we’re doing a bad job spreading the good news. Put another way, when there’s an absence of a good story, the bad stories inevitably fill the void.



Are there major shifts occurring in direct selling? Of course there are. Are there changes being forced upon some of the fundamentals of how we’ve done business? Most definitely. Are there bad actors and people and companies who spend a little too much time trying to stretch the boundaries instead of just playing well within them? Unfortunately, yes. And are there tried and true methods that have worked for years that are proving to be a tad over-tried and not so true anymore? Indeed.

Guess what? That makes us like every other channel in the world. Everyone has to deal with swift changes in the marketplace, and updated regulatory pressures and new approaches to business, and, well, people being people. We aren’t as unique as we like to think we are here.

But we are unique in so many other ways. Really good ways. Ways that can warm your heart and fire up your soul. If you’ve been in direct selling for any period of time, you know exactly what I’m talking about. Sure, you also see those areas that need to change, but you don’t lose sight of all the good that comes out of our channel. It’s something worth cherishing, and it’s something worth fighting for.

Our biggest issue may actually be that we’ve been horrible at telling our story. At showcasing the good stories that come from direct selling (and there are lots of them).

Notice I use the phrase “our story.” Not “your” story, or “my” story. I’m not necessarily talking about your company’s story; many of us are very good at that. I’m talking about the bigger story, the collective story. I’m talking about the story of this channel, regardless of the company. It’s obviously important for you to keep telling your company’s story, but that story will get associated first and foremost with your company, not the direct selling channel. What we need are more stories that celebrate the good of our channel and the role it has played in so many lives through the years, regardless of the company.

I’m wondering how we could start telling that story even better.

To get us started, here are just a few thought-starters in terms of all the great stories we can tell about direct selling. I’m sure I’m missing a lot. More than anything, I challenge you to take a look at the list and look for one or two items that stands out to you. Ask yourself why, and then ask yourself how you could tell that story a little better and a little louder.

Here are just a few of the great stories we can tell, and be proud of, about direct selling:

1. A great first step into entrepreneurship.
   I listen to a lot of podcasts. I’m pleasantly surprised how often I hear from extremely successful entrepreneurs who tell of how they first got started into entrepreneurship by joining a direct selling company. Whether they were selling knives and books during college, or sharing nutritional supplements, or holding home shows sharing jewelry to friends and family, it sparked their entrepreneurial itch and gave them a safe (and low-cost) environment to learn how to develop that interest. And now, they’ve gone on to launch huge companies, crediting much of their journey on direct selling. What a legacy! What a story! Let’s not overlook the impact our channel has on raising up new business leaders in the world.
2. The original “Gig.”
   The Gig Economy is all around us. That comes with both its share of opportunities and challenges for direct selling. But in many ways, direct selling was the original gig in the modern world. While we should all be thankful for how accessible business opportunities are now for people, it wasn’t that long ago that direct selling was just about the only choice when it came to side hustles. So let’s celebrate the booming Gig Economy by celebrating our rightful place in it, and celebrate our “giggers.”
3. An opportunity for anyone.
   Direct selling is available to anyone. There are no prerequisites, no resumes required, no degrees insisted upon. Sure, you learn how certain skills can help you be more successful, but you don’t even need to know those skills to get started. You simply need to decide you want to get started. How can we celebrate those stories more, of how untrained, unexperienced people can enjoy great success within our channel?
4. A channel for women.
   Roughly 75% of direct selling is made up of women. It’s pretty much always been this way. It’s a channel that has seen countless women rise up in ways they didn’t know was possible. It’s helped thousands of single moms provide for their families, and thousands more women contribute in substantial and meaningful ways. And for those women who choose to do so, it’s allowed them to stay home and raise their family they way they want to, when that may not have been possible otherwise. In a society that is increasingly recognizing the importance of women in all parts of life, direct selling is way ahead of the curve.
5. A channel of innovative products.
   Think of all the types of products that wouldn’t have become major categories without the help of direct selling. And think of all the major brands and companies that have come from it, too. Where would wickless candles be without Scentsy? Where would food storage be without Tupperware? Where would the nutritional and skin care industries be? Where would the beauty market be without Avon and Mary Kay? And where would CBD be? Direct selling is a channel tailor-made to bring bold innovations to the world. Don’t let the lazy criticism of “snake oil” hold you back. We have so many examples of how direct selling is responsible for introducing the world to innovations that really matter.
6. Reducing debt and financial burdens.
   Money and income are only a means to an end. They are really only valuable once they are applied to something else. For many of our Distributors, the income they have earned while part of our companies has allowed them to crawl out from under huge financial burdens and experience true freedom in their lives. Yes, we have to be careful how we make these “income claims,” but the stories are real, and they deserve us coming up with a way to tell them. In a world where student debt, consumer debt, healthcare debt and just about every other form of debt continues to charge ahead, stories of overcoming the norm are both inspiring and important.
7. People become a better version of themselves.
   What we hear most in direct selling is the personal journeys that our Distributors find themselves on, and what they discover about themselves in the process of building their business. They stretch beyond their pre-conceived limitations for themselves. They do things they never dreamed they would do. They spark an energy and an excitement and a hope that simply wasn’t there before. And it shows up in every area of their lives. Outside of the income, or the income potential, is the greater reward: we help so many people become better versions of themselves, and tap into potential that they never even considered before.
8. People impact the world in amazing ways.
   As people become more personally, it also leads to them giving back and impacting the world in a greater capacity. Beyond the confines of our companies, we see Distributors who are making a difference in their community, at schools, at non-profit organizations, and far beyond. We all know Distributors who start churches, who coach teams, who support charities, who invest in community centers, who volunteer, etc. And most of the time, they will tell you that wouldn’t be possible without their involvement in direct selling.

We have so many great stories. I’ve only scratched the surface here. I’d love to know what other stories you can think of.

Here’s the thing: a story is only good if you’re telling it. Let’s not let outsiders be the only ones telling our story. Yes, let’s address what needs to be addressed, but don’t lose sight of all the good we’ve done and continue to do as a channel. Our story is better than theirs; let’s tell it!

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Guest Post by Brett Duncan
2019: The Year Direct Selling As We Know It Changed Forever

I know. It has quite an ominous sound.

And then, it also seems a tad presumptuous and oddly grandiose.

Of course, it could also just be another click-baity, news-jacky headline whipped up by a consultant trying to drum up business ;-).

I guess all of the above is possible. But none of it can dismiss the point that 2019 may indeed be the year we look back and realize it all changed. Direct selling as we’ve known it will never be the same. And I think I’m OK with that.

There’s a quote I’ve been thinking about a lot lately: “the revolution you’ve always wanted never looks like what you thought it would.” Isn’t that the truth?!? We’ve been talking about the eminent changes coming to direct selling for several years now. And we’ve certainly seen the shifts roll out steadily during that same time frame. To pin a date on when “it all changed” is silly.

But I must say, after leaving this year’s US DSA Annual Meeting in Austin, I felt the difference like I never have before. It was something in the air. You could see it in people’s eyes. It became quite clear in the conversations. It wasn’t fear, but it want’s certainty, either. Companies and executives seem to be more open to anything and everything than ever before. Even if it denies what we’ve regarded as sacred in direct selling crowds for some time.

No one was talking about the changes that were coming; we were all talking about the changes that are happening right now.

Crazy Times in Direct Selling

The last eight weeks have been relatively crazy ones for our industry, even for direct selling. AdvoCare is moving into a single-level compensation structure after ongoing conversations with the FTC. Stream is selling its energy business to NRG. Avon, both old and new, is forming new alliances with companies all over the world. It’s a lot to digest.

On top of it all, companies are pioneering new ways to combat today’s most popular challenges. Some have found the best way to fight Amazon as a direct seller is to join them. Others have embraced an omni-channel existence, where direct selling is one way their product is taken to the market. Complicated compensation plans are being traded in for something that looks more like affiliate marketing and rewards programs. Even Amway has a CEO with a last name other than DeVos or Van Andel.

The times, they are a changin.’

As tempted as I am to ramble on in a puddle of speculation, I will resist. Instead, I’d like to look at the three forces that are causing the shift, and that have, in my mind, made 2019 the milestone year we will remember in the future. While none of us will agree as to the year the changes began (did they ever stop?), I do believe we can all agree that the change is unmistakably upon us in 2019. Here are the market forces that have made it so.

My goal in pointing out these rather obvious forces is not to exhaustively describe them as though they are new. Rather, I want to remind us all of what they are, so that we can take a fresh look at our new world through the lens of these three viewpoints. Sometimes taking a new look at what you’ve always known is the ultimate form of innovation.

Market Force #1 = New Regulations

No reader of this newsletter is a stranger to all of the updates in our regulatory world. There’s no need to rehash that here. The government forces at play have certainly changed how they think of direct selling. And it’s forcing the way we have to think about it, too.

When I think of regulations, I think of rules. And when I think of rules, I think of a game, or a sport. Every game has rules. It’s what makes the game fair, clear and competitive. The rules are actually what makes a game fun.

I’m a big football fan. In the NFL, a committee meets every year to suggest, discuss and vote on new rules and updates. Over the past few years, some significant decisions have been made, all in a spirit to make the game better. There have been pretty significant changes to how kickoffs will work in an effort to improve the safety of the game. They moved the PAT (point after touchdown) back several yards a couple years ago to make that part of the game more engaging (and boy, has that worked!). They’ve gotten more sensitive on pass interference to … well, I’m still not sure what they’re doing with that one!

As you can imagine, coaches and players alike have all kinds of opinions about every rule change. And there’s no shortage of their expression of these opinions, either. But I can promise you this: they adjust their style of play pretty quickly to adhere to the new rules. It would be foolish not to. Their success is dictated by how well they play the game within the confines of the current rules.

The rules of direct selling are changing. And it’s not those of us in the industry that are making the changes, for the most part. I personally don’t agree with all of the rule changes, and I bet you struggle with them, too. I find myself trying to figure how and when to fight back and appeal, and when to take note and adjust accordingly.

But here’s what I do know: the rules have most definitely changed. The term “game changer” is almost cliché and certainly misused, but that’s exactly what we are experiencing in direct selling due to these new regulations. The game has changed.  For me to play my best game, I better figure out how to play within the confines of those rules. Otherwise, I’m not even playing the right game!

It doesn’t help that the interpretation of the rules is murky right now. Where we want clear boundaries, we get “guidance” instead. Maybe that’s just the process. In the meantime, I know there are plenty of no-brainer areas where embracing the shift whole-heartedly would not only be prudent, but even opportunistic.

It really comes down to where we want to invest our best efforts. Do you want to spend your resources getting better at playing yesterday’s game, or preparing to play the new game?

Market Force #2 = The Consumer Marketplace

I think I’ve used the word “marketplace” more in the last year than I have in all the other years of my life combined. That’s because the marketplace is a powerful force. And it’s one that is begging direct selling to change so it can continue to be relevant for decades to come.

Even if the regulatory environment was not forcing certain changes, the consumer marketplace most certainly still would. And in many cases, the changes would be the same.

I’ve distinguished this as the “consumer” marketplace for reasons you’ll see shortly down below. I think of the consumer marketplace in these main areas:

1. The way people want to shop and buy.
2. The access consumers have to brands and options.
3. The way people want to interact with brands.
4. The shorter lifespan of success for any brand.

Firstly, the marketplace is telling us it wants to shop for and buy stuff in a new way. And it goes way beyond ecommerce. From curated subscriptions to marketplace apps to influencer marketing to so much more, the actual experience and psychology of shopping is changing. It’s not just about simple checkout processes and payment options. In a world with so many choices, what the consumer experiences during the buying process on an emotional level is just as important as the functional level.

Access to more brands, more products and more options has compounded with the onset of the Internet. And since access to brands has gotten easier, the quantity of brands has increased. It’s easier than ever to create new products and offer them to a market. And because there are so many options for so many specific products, building actual brands that connect has become more important than ever. When 30 different companies are trying to build a better mousetrap, it’s the mousetrap that finds a way to connect with me emotionally and align with my worldview that gets my vote, and my money.

Because the experience of shopping has fundamentally changed, and because access to the products I want is overflowing, the expectations I have as a consumer in terms of how I interact with a brand has also fundamentally changed.  Sure, social media has a lot to do with this, but it transcends social media. Simply “meeting expectations” no longer meets expectations. Consumers expect to be rewarded for their loyalty and patronage. We expect to be treated as a precious gift. In addition, consumers are just as interested in what their association with a brand says about them as what the product does for them.

Finally, with the added importance of the shopping experience, increased access and higher consumer expectations, you see a shorter lifespan for most brands. Of course, it’s not impossible to build long term brands right now; it’s just less likely. And that’s because consumers are constantly looking for new experiences, access to new brands and interactions that exceed their perpetually growing expectations. In a world where overnight sensations sometimes don’t even take a night to go viral, we also see brand lifespans shortening at an alarming rate.

There are other components of the consumer marketplace, of course. But to think about these four areas are enough to prompt some deep thought. Direct selling could claim both advantages and disadvantages in every area. Here are some quick advantages:

• Shopping Experience: the in-person, community-centric shopping experience could actually become more attractive to some shoppers.
• Access: we provide curated access to unique products, typically not available anywhere else, with a personal touch.
• Interaction: what’s more interactive than an Independent Distributor with a customer?!?
• Lifespan: direct selling is a great go-to market strategy. In a world where everyone is trying to figure out how to go to the market, could we have a secret weapon?

Now, let’s look at some disadvantages:

• Shopping: direct selling companies are notorious for creating complicated shopping processes, mostly due to components of their compensation plan, hostess perks, etc.
• Access: Distributors may not be willing to compete with a seemingly endless list of options and marketplaces (e.g. Amazon, eBay, etc.)
• Interaction: Direct selling companies have long relied on their Distributors to interact with consumers. Now, consumers expect more, and that’s new ground for many of us.
• Lifespan: To be honest, direct selling companies have always struggled a bit with this one. But in a world where the competition compounds every day, could that lifespan shorten even more?

How is your company addressing these four areas?

Market Force #3 = The Entrepreneur Marketplace

I actually believe this market force could be the most powerful of them all, and have the greatest direct impact on our industry.

It wasn’t long ago that direct selling wasn’t only the best gig in town, but it was just about the only gig in town. It seemed ridiculous that anyone could start their own business for only hundreds of dollars. When compared to options like franchises, direct selling was the hands-down winner.

In addition, there weren’t so many direct selling companies. Once I was convinced that direct selling was a great option for me to earn some more income, I had a relatively limited menu to choose from.

Not so anymore. First, the number of active direct selling companies continues to grow. Even if direct selling was the only option, there are now hundreds of options within that one option. I don’t think that’s a bad thing, but it has impacted how we position our opportunity.

Most importantly, direct selling is definitely NOT the only gig in town anymore. As you well know, the “gig” has evolved into its own economy now. The “free agent nation” has emerged. The side hustle has taken center stage. There are endless opportunities for today’s entrepreneur.

There are better resources to explain what the Gig Economy actually is and what it looks like today (take a look at ultimategigbook.com – it’s fantastic) than I can offer here. Suffice it to say that direct selling isn’t exactly the belle of the ball in this space right now. That sounds bad, but I think many of us are beginning to see that we could truly position ourselves as the Ultimate Gig. It will require some fundamental changes in how we approach this entrepreneurial segment, but we definitely have some unfair, and under-leveraged, advantages in our corner.

Let’s briefly take a look at a few of the factors we must consider when thinking about the Entrepreneurial Marketplace:

1. The entrepreneurial options are endless.
2. Most people aren’t looking to “start a business” anymore.
3. The ease of earning trumps the volume of earning.
4. Customer acquisition is now on the home office.

Amazon. Uber. Etsy. Freelancing. Virtual employees. Affiliate marketing. The list is endless in terms of how easy and accessible it is for anyone to find a way to be entrepreneurial. Whether you’re looking to strike it  rich starting a business, or just make $50 today to pay for dinner tonight, it’s pretty easy to do it. So where does direct selling stand out in a sea of entrepreneurial opportunities?

While direct selling companies keep promoting “business opportunities,” the Gig Economy keeps showing us just how many people aren’t interested in that. In fact, it may actually turn them off. Making an extra $300 a month isn’t typically considered “a business” by a normal person. Sure, it technically is a business, but that’s not how most people think about it. So why do we keep pushing it?

And since most people aren’t interested in starting a business, they definitely aren’t interested in investing in a business. As you compare yourself to the other options in the Gig Economy, ask yourself this: how many of them require an upfront purchase to take part in it? In other words, what is their “Starter Kit?” When choosing between a side hustle that’s free for me to start and one that costs $50, most people go with the free option without even considering the benefits of the $50 investment. What should direct selling companies be doing about this?

So, in a world where the entrepreneurial options are endless, and where “starting a business” isn’t that attractive, then it only makes sense that what most people are looking for is the easiest way to make that side income in a way that fits their schedule the best. The majority of your Distributors, and definitely those who choose an option outside of direct selling, are looking for the easiest, quickest, most streamlined and hassle-free way to earn a modest amount ($100?). And they also want to get paid for it immediately. Sure, there are still some who will realize that, “If working 3 hours got me $100, then I wonder what 10 hours could get me?” But that’s not most people.

And, by the way, direct selling has always been its best and most fruitful when you get a lot of people sharing a little bit of product. If you have lots of Distributors meeting a need by earning an extra $250 a month, you’ll have no problem developing a subset of leaders who can earn substantial incomes that would compete with a full-time job. But we can’t expect everyone to become a leader. I would go so far as to say we should shift our focus to generating the $250 monthly earners.

Finally, the role of customer acquisition is increasingly falling on the home office instead of the Distributors. This is completely new terrain for direct selling. You could easily argue it’s a foundational shift. The whole idea (simplified) around direct selling originally was that the home office would create the products, ship the products and mail the checks, and the Distributors would find the customers and make the sales. Not anymore. As we continue to compete with more and more entrepreneurial opportunities that actually don’t expect the entrepreneur to handle customer acquisition, we must realize how the expectations of the entrepreneurial mindset has shifted away from the traditional form of direct selling I described above. On top of that, the home office now has to find the budget to generate customer acquisition while still funding the rich compensation plans we’re known for.

How is your company attracting today’s entrepreneur? Do you spend your time trying to convince this growing audience of why your way is better? Or are you finding ways to align your business model with what this marketplace is telling you it wants?

Moving Forward With Confidence

So, it’s all here upon us, right now in 2019. The change we’ve been discussing for years is here. Does it look like you thought it would? More importantly, what will your company look like in response to it?

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