Defying the Odds
Herbalife Nutrition shatters net sales records in 2020 on the way to DSN Global Celebration Award for International Growth
Global direct seller Herbalife Nutrition, recipient of Direct Selling News’ first-ever Bravo International Growth Award in a tie with PM-International, is celebrating its best year ever, hitting a milestone after ten straight quarters of growth. Net sales last year increased 13.6 percent over 2019, resulting in $5.5 billion, the largest annual net sales in this 41-year-old company’s history. 2020 reported net income was $372.6 million compared to $311 million for the full year 2019.
Three of Herbalife Nutrition’s six regions—Asia Pacific, Europe/Middle East/Africa (EMEA) and North America—set annual net sales records of their own. Finally, the company’s fourth-quarter net sales increased 15.6 percent compared to the fourth quarter of 2019, resulting in $1.4 billion and the largest fourth-quarter net sales in Herbalife Nutrition history. Net sales performance for Q4 2020 demonstrated the strength of the company’s geographic diversity, said Herbalife Nutrition CFO Alex Amezquita during the Q4 2020 Herbalife Nutrition Ltd. Earnings Call; in the company’s five largest markets, the U.S., India and Vietnam saw double-digit growth in net sales.
In 2020, Los Angeles-based Herbalife Nutrition also celebrated the grand opening of its 95th market, Uzbekistan, and continued to deepen growth in its existing markets and expanded product choices for consumers. In the fourth-quarter alone, Herbalife Nutrition launched 95 products globally and began 2021 with the launch of its new baked goods line, Protein Baked Goods Mix. The company also recently welcomed its first Chief Digital Officer, Joe Miranda, to build and drive Herbalife Nutrition’s digital strategy for the future.
Herbalife Nutrition’s record-breaking 2020 may be attributed to several factors: First, a flexible business model that enabled distributors to pivot to a predominantly online business; the relevancy of its products at a time when more consumers are reprioritizing their health; and the entrepreneurial nature of distributors and their ability to adapt their sales approach with customers.
“From a demand perspective, our business is backed by favorable consumer trends in an environment that has never been more responsive to what we bring to the table. We believe that individuals around the world have a heightened focus on consuming healthy, nutrient-dense foods and supplements. Additionally, individuals who are seeking an economic opportunity are finding our business model to be attractive,” said Herbalife Nutrition CEO John Agwunobi during the company’s Q2 earnings call.
Spirit and Growth
That entrepreneurial spirit may be most consequential in the story of Herbalife’s historic success. The broader health and wellness industry already was a $4.5 trillion business before the pandemic. When lockdowns and social distancing began, consumers had to find ways to stay well from home—without the benefit of gyms, easy access to healthy takeout or even doctors’ offices. In an article for the U.S. Chamber of Commerce, Jemma Shin, consumer insight strategist, states that the rise of preventative care has the effect of making “well-care” more accessible for all, “putting people in increased control of their own well-being. Home has turned into a wellness hub, where people build their self-care routines and find simple joy in their daily lives.”
That’s led to a surge in popularity of preventative health products and solutions that allow us to take care of ourselves, connect with others for support or even start a business in this growing sector. With the support, education and training already in place for its global independent sales force of entrepreneurs, Herbalife Nutrition was at the right place at the right time to serve customers during and long after the pandemic.
When stay-at-home orders began last year, the company immediately moved its events, training, recognition and field support to a virtual model to help distributors fund their businesses more efficiently. Distributors moved their meetings and supportive communities to virtual platforms, and some of the distributors began providing Herbalife shakes for their customers via takeout and home delivery. In March, the company held its first completely virtual and interactive international leadership education and training conference. The content was built from 15,000 video loops. Attendees had access to an interactive all-in-one-event platform from which they could access live broadcasts, exclusive on-demand content, recognition information and videos designed to increase social engagement around Herbalife Nutrition’s history, growth, global corporate social responsibility efforts, new products and sponsored sports teams. Forty speakers and more than 40 hosts from around the world conducted business trainings and regional panels. The conference wrapped up with four regional awards ceremonies leading up to a global celebration. Events were broadcast regionally and around the clock to accommodate international time zones and were interpreted in 24 languages. All participants also received access to more than 50 segments of exclusive on-demand training and recognition content.
Collectively, all of these modifications made it easier for distributors to continue to support, train and mentor existing team members, attract prospects, and grow their respective customer bases by showing others how to take control of their health from home. Consumers over the last 15-plus months have had the opportunity to consider what good health means to them. “In 2020, many consumers realized the importance of health and the role nutrition plays in good health, a fact that has been part of Herbalife Nutrition’s mission since its founding more than 40 years ago,” says Jennifer Butler, Vice President of Media Relations for Herbalife Nutrition. As its growth suggests, the company has seen increased demand for its full line of nutrition products as well as the business opportunity its sales model offers. It’s clear that Herbalife Nutrition’s message of empowered, self-directed health has resonated with consumers throughout the world.
A Serving Spirit
Herbalife Nutrition also maintains a deep commitment to serving communities in need, particularly those whose access to good health is limited by poverty and malnutrition. Last year the Herbalife Nutrition Foundation donated $4.47 million globally to help improve local communities. Also, last year, through Herbalife’s Nutrition for Zero Hunger Initiative, the company provided nearly 700,000 meals to children and families, donated more than 800,000 servings of Herbalife Nutrition products to communities in need, and provided more than 87,000 beneficiaries with essential dietary supplements and nutrition education to reduce nutrient deficiency and support healthy child development.
Herbalife Nutrition and The Herbalife Nutrition Foundation formed a new partnership in March with the Asociacion Mexicana de Bancos de Alimentos (BAMX), a nonprofit dedicated to meet the needs of people experiencing food insecurity in Mexico through community-based food distribution, in which $50,000 was donated to provide nutritious food to individuals and families in need. In partnership with nonprofit hunger relief organization Feed the Children and in support of the Nutrition for Zero Hunger Initiative, Herbalife Nutrition announced in April the results of a global food insecurity survey which found that 73 percent of Americans had experienced food insecurity, or lack of available financial resources to feed a household, for the first time since the start of the coronavirus pandemic. Subsequently, Herbalife Nutrition announced that it would supply 48,000 sets of healthy snack and recipe cards as part of Feed the Children’s food boxes distributed to low-income families throughout the United States. Much like meal-kit services, the meal and snack recipes, designed by Herbalife Nutrition’s team of nutritionists and registered dieticians include affordable ingredients often included in food donation boxes. “One of the things we’re most proud of is that employees and distributors never lost sight of giving back and helping communities all over the world,” Butler says.
Herbalife Nutrition’s success story is a testament to the power of direct selling to offer the products customers want in the way they want them—through a business model that meets independent distributors where they are, backed by a community of support that educates, motivates and celebrates its members in person, virtually and everywhere in between. Having adapted its processes and procedures to help the company and its distributors become more efficient and create an even better customer experience, Herbalife Nutrition has demonstrated its ability to navigate formidable challenges and emerge stronger than ever.
From the June 2021 issue of Direct Selling News magazine.