8 Factors Fueling Uncertainty in Direct Selling.
Confusion? Chaos? Feel at all familiar? I think executives in every industry have experienced a lot of both the past few years. But it certainly is true in direct selling.
What used to work doesn’t always work anymore, and it rarely works to the same degree or in the same way. Even successful companies can’t always put a finger on what’s driving that success.
As we look around at our colleagues and counterparts, we see monthly news of pivots to new models, acquisitions, bankruptcies and everything in between.
And the field…the poor field! Our confusion and chaos at the corporate level doesn’t just trickle down to them; it snowballs into a massive juggernaut that steamrolls right over them.
No one likes chaos and confusion. It’s unsettling, stressful and difficult to navigate. But here’s the good news: the presence of chaos and confusion doesn’t mean things are bad. In fact, they’re often signs of progress.
Don’t believe me? Ever drive in construction? Feel confused? Chaotic? Of course. But the only reason construction is in place is to prepare for growth. Tired, stagnant towns don’t need construction, because what they already have works just fine. But construction is a symbol of growth.
Many executives come to my team asking about how they need to deal with the confusion and chaos. In some cases, the chaos and confusion are around them. In other cases, it’s within them. Regardless, it’s something that must be addressed.
Once you get asked the same basic question repeatedly, it makes you wonder if there’s a bigger thing going on here. I began wondering what’s at the core of some of this confusion, beyond the more tactical answers we naturally gravitate to.
We normally jump straight to some of my other favorite words that start with “C,” like compensation plans and customer acquisition. These are two great examples of foundational pillars of a direct selling company. But lots of companies have taken measures to update their compensation plans and customer acquisition. Some have succeeded, and some haven’t.
So, what could it be? As I chewed on this question for a while, thinking about my own experiences and the experiences of my clients, several concepts began to emerge. And each of these concepts goes deeper than coming up with a new program or promotion. They touch on the heart of the challenge. And the more I dwelled on these concepts, the more I realized how all direct selling companies have room to improve in at least one of these eight areas.
Let’s look at what these areas are and assess just how much each one could be contributing to our confusion and chaos.
1/ Conversations
The fundamental unit of success in direct selling is a conversation. If someone doesn’t first have a conversation about your product or service, then nothing else can happen. “Conversations” can happen many ways these days. A text message, a social media post, an in-person chat, a blog post. But before anyone ever buys a product; hosts a party; signs up as a consultant; attends an event; or anything else we ask our people to do, a conversation in some form or fashion must first take place.
I get to work with the field off and on with some of my clients, which is always fun. And I always talk about conversations. I often pose this: many of you are struggling in your business because you simply aren’t having enough conversations about your business. You keep waiting for something to sprout when you haven’t sown enough seeds. It’s a fun mic drop moment.
You could make a case that a consultant’s primary responsibility is to start conversations about your brand. We want those conversations to turn into something more, of course, but we definitely want every consultant to spark conversations about us.
Many corporate teams lose sight of this in the confusion and chaos of the day. We work so hard on the programs and promos to help drive the business, while failing to spark more conversations.
One of the corporate team’s primary roles and responsibilities is to spark more conversations about the company. Some of that can be done directly, but a lot of it comes down to us making it easier for our consultants to have more conversations—whatever that might look like.
2/ Communication
If your communication falls short, the whole thing falls short. I’ve seen entirely too many projects take months, even years to prepare for, only to see a lack of focus and planning on the communication of the project’s rollout completely sabotage everything else. If you’ve spent any amount of time in direct selling, you’ve no doubt experienced this yourself.
Compensation plan changes. Website updates. Product backorders and discontinuations. Field leaders leaving to join another company. New sales tool launches. I’ve seen really good products and programs get completely destroyed because of a lack of respect and planning for communication.
Here’s the thing: managing communication for a direct selling organization is really, really hard. There are so many different audiences, from customers to passive side-giggers to full-time leaders to everything in between, all caring about something different. So, it’s no surprise that our communication planning of all of our latest endeavors get botched time and time again.
Trust is the corporate team’s most important currency when it comes to working with the field. And trust can only be nurtured by open, honest and frequent communication. And the amount someone trusts you directly impacts the effectiveness of your communication with them. If I don’t trust you, I don’t pay too much attention to what you have to say, and I don’t bother saying much to you, either. If I do trust you, I’m very open to what you have to say and vice versa.
We must improve as communicators to reach the levels we all aspire to reach. I’m convinced that a lack of and/or poor communication is the root cause of 80 percent of the issues that direct selling companies face.
3/ Core Compelling Offer
The easiest thing to sell is something that someone already wants.
Sometimes the biggest obstacle we face is the most obvious one. If what you have to offer doesn’t resonate with the audience you’re trying to reach, nothing else really matters.
The best compensation plan in the world fails without a core compelling offer. Your latest online sales tool fails without a core compelling offer. Your customer rewards program, flash sale, reels and stories, influencer campaigns and everything else—they fall flat if what you offer falls flat.
On top of that, the best sales tool you can give your consultants is an effective core compelling offer. They will have a conversation about it (see point 1) when they’re confident it’s compelling to their customer.
I know your products are amazing. But could the way you position them use a little refresh? Does the market still respond like it used to? Are there opportunities within the marketplace that you’re completely missing, but that your products definitely address? Are your product development efforts producing new core compelling offers, or also-rans?
In direct selling, it’s so easy to get caught up in our own echo chamber. When you only hear from your biggest fans, your offer can sound pretty dang compelling. Step outside of the chamber and see what’s really resonating (or not).
4/ Campaigns
“Real” companies run long-term campaigns that cover months, even years. They understand that building awareness requires time and many different methods. And each of those methods requires its own expertise and nuance. Thinking in terms of campaigns requires drilling down on messaging; mapping out the marketing communications efforts over time; budgeting accordingly and tracking effectively, so you can review and modify as needed. Over and over and over again.
At direct selling companies, we tend to launch something with a Facebook Live and an email, and then let the field take it from there.
Is this harsh? Unfair? Probably. But, simply put, we direct sellers are pretty lazy marketers. We’re spoiled. We’re really good at launching stuff. Not so great at ongoing campaigns. To put it another way, we sow a lot of seeds, but we rarely stick around to water them.
But just think if we didn’t do it that way. Think if we did think in terms of campaigns, supporting our launches over six, 12 or even 24 months. What if we nourished and nurtured those seeds we planted with what those “real” companies do, and then coupled that with the heart and efforts of our sales force? THAT would be exciting to watch.
We can no longer ignore good marketing and a campaign mindset and rely completely on the field. The field needs us to support the irreplaceable work they do with the table-stakes kind of work that any successful company would have in place today.
5/ Conversions
In a world where side hustles and gig opportunities abound, the conversion rate is way more important than the commission rate. Not that commissions aren’t important (they are). But if visits don’t convert to purchases, and prospects don’t convert to customers, then it’s difficult for the modern social seller to tolerate it.
I spoke a lot about this in a recent article I wrote for DSN titled Direct Selling’s Identity Crisis, so I won’t belabor the point here (as long as you promise to go read that article online!). The simple fact that much of the chaos and confusion that ensues in today’s direct selling companies is because we don’t stack up well against our ecommerce competitors. A lot can be implied by the term “conversions” when it comes to ecommerce, but let’s just say that if we aren’t thinking in terms of conversions and how to improve them on a constant basis, then we’re really letting our salesforce down.
Think about what a poorly converting experience does to your consultant. They do everything we ask them to do to drum up interest and awareness. They start the conversation. They share the products, the opportunity, whatever. They get the verbal commitment. They send them a link. And then…nothing.
Eventually, they stop starting the conversation, because they know where it leads. They quickly look for a company to partner with that has a core compelling offer that converts.
Bottom line: your company is an ecommerce company. And you’re an ecommerce executive. Act like it.
6/ Committed
So often, companies go through the exercise of making a bold decision, and then through the grueling process of launching whatever that decision dictates, only to abandon it shortly after launch. We plant the tree, and we water and fertilize the tree for a month or two, and then we rip it out of the ground when the two-month-old tree doesn’t produce years’ worth of fruit.
Are there times to pull the plug early on a bad idea? Of course. But my experience has shown me that our expectations for results, especially in terms of the timing of those results, is often unreasonable. The results may very well be coming, just not in our timing. But we never get to that point, because we can the whole project once it falls short of our lofty expectations.
As you make the bold decisions and bold moves that the times call for, check your commitment to those decisions. Are you truly committed to the path you’re taking? Do you truly believe in them? And not just because you’re hopeful or wishing, but because you’ve put in the research and thought and planning to feel confident in the path?
And is the whole team on board? At least in terms of your executive team, you’re only as strong as your least committed executive.
7/ Competence
This one stings a little. We often make the right decision, but we don’t have the experience or expertise to pull it off. We give our in-house team a chance to grow and learn (which is no doubt admirable), but in doing so, we force our distributors and customers to tolerate our learning curve. And we also hamper the progress of this big, bold move by coupling it with a lack of competence in terms of the people leading the work.
Believe me, I get it. I’m a product of direct selling execs giving me the opportunity to learn something new and grow into a position or a skill. So, I am in no way suggesting that we never do that. But if these decisions we’re making are in response to urgent situations, the urgency may demand a real expert who’s been there and done it, not a fast learner.
For example, we know so many companies are adding elements of affiliate programs to their company, or even pivoting altogether into that area. Then we ask our current field development team, who are experts in direct selling, to manage the affiliate space, which is very different. So, our program flounders because those leading the way are learning on the job, and we lose traction with both the prospective new affiliates because it’s clear we’re not exactly clear on how it works, and we also shortchange our existing distributor base by shifting the focus of their field development team away from them to a certain degree.
The point here is that bold moves deserve bold support. Our corporate teams know a lot, and their experience is priceless. At the same time, we must recognize when our lack of expertise in some new areas could be the very thing that keeps it from working.
8/ Cash
I don’t have to spend much time here: when cash flow is low, everything is harder.
Sure, sometimes you just can’t help it. I’m not really talking about that. What I’m wanting to focus on here is how low cash flow impacts our decisions. The lack of, and need for, cash can taint our decision-making process and force us to follow a path that otherwise we may have passed on.
What decisions are you making today that help put you in a better cash position next year? It may be the less popular choice in the moment, but it could actually be setting you up for a much better decision down the road.
I’ll say it again: chaos and confusion are not signs of failure. In fact, they’re almost always precursors to growth. They don’t guarantee success; they simply shine a light on opportunity.
As you face chaos and confusion, how are you responding? Perhaps reflecting on one of the eight C’s in the article can help you take a step in the right direction.
Brett Duncan specializes in helping direct selling companies evolve into modern social selling models while still maintaining the culture and essence of who they are and what makes them different. He is Co-Founder and Managing Partner of Strategic Choice Partners, a business development firm that helps direct selling companies take their next steps. From marketing services to compensation plan design to operations and distribution support, Strategic Choice Partners is a frequently sought-out partner within direct selling.
From the November 2024 issue of Direct Selling News magazine.
