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Natura Makes Solutions for Eliminating Plastic Waste Available

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In 2019, Natura launched its Natura Innovation Challenge – Zero Waste Packaging.

The initiative was aimed at finding innovative global solutions to combat plastic waste generation and pollution. Now, the company is making some of the projects suggested during the challenge available to the market here.

The solutions shared on the platform include ones from suppliers of biodegradable packaging and new logistics solutions for the disposal of recyclable waste in partnership with a fintech and cooperatives.

Promoted in partnership by the Natura Campus and Natura Startups programs, the Natura Innovation Challenge attracted different kinds of entrepreneurs, including startups, researchers, universities and companies from 35 countries. The challenge analyzed over 570 solutions offering the potential to rethink packaging, logistics and business models with a view to eliminating waste. Its global reach made this Natura’s biggest open innovation call for proposals ever. Three projects were selected and are now at the test phase in the company.

“Natura has worked with open innovation for over 20 years, based on the understanding that it is fundamental for our business. However, we adopt a very careful approach to this work: for us, it is only innovation if it provokes positive impact. By means of Natura Campus and Natura Startups we are going to continue to promote innovation with our network in pursuit of solutions for the major challenges in sustainability and business,” said Roseli Mello, global head of R&D at Natura &Co. “It is essential to share solutions to boost the visibility of the proposals received because they have great potential to impact the chain positively, as well as the businesses of other companies and other industries.”

Le-Vel Donates $100,000 to National Urban League

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Le-Vel announced a $100,000 donation to the National Urban League in support of the organization’s mission to eliminate equality gaps in education, employment, housing, health and justice.

Founded in 1910, the National Urban League promotes economic empowerment through education and job training, housing and community development, workforce development, entrepreneurship, health and quality of life and is dedicated to helping African Americans achieve true social parity, economic self-reliance and civil rights.

“National Urban League is grateful to have the support of committed partners like Le-Vel Brands, who are passionate about expanding economic opportunity and dedicated to good corporate citizenship,” said Marc H. Morial, president and CEO of National Urban League.

“As the recent tragedies and protests around our country illustrate, we have a lot of work to do as Americans to ensure that the principles of equality are upheld and advanced,” said Le-Vel Co-CEOs Jason Camper and Paul Gravette. “The National Urban League has a long history of working at the local level to empower and support African Americans, and our donation in support of their mission is just one step in our ongoing commitment to be part of the solution.”

It’s Time for Your Voice to be Heard

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COVID-19 has changed the game and so will the resurrection of the social justice movement.

The direct selling model has been approaching an inflection point for more than a few years. We have never experienced a threat to the health and welfare of nations as we are experiencing today. Add to that the events of the past few weeks, during which we have seen an unprecedented global outcry for repairing social injustice, and one could easily say that these are indeed the most challenging of times.

What Can We Learn?

Throughout my direct selling career, whether in my days of direct involvement or indirect involvement, I have often said that direct selling is one of the finest, if not the finest, entrepreneurial force for good on the planet. I have also enjoyed hearing the same words from other leaders who hold leadership positions within direct selling companies. I share with you this thought: It is time for your voices to be heard, loud and clear, as to what you and your company truly stand for.

In 1968, when reflecting on the civil rights movement, Dr. Martin Luther King Jr. said: “In the end, we will not remember the words of our enemies but the silence of our friends.”

“It is time for your voices to be heard, loud and clear, as to what you and your company truly stand for.”

We know that it is not the products alone that could ever be the sole fuel to the building of a successful direct selling company or any direct selling business.

Direct selling companies depend on attracting people from all walks of life. Those individuals choose a given company, more often than not, because they see a glimmer of hope for themselves and believe they share that company’s principles and values. They also believe that, regardless of their walk of life, direct selling could be a dream come true. My definition of a dream is simply the opportunity to earn a return on the time and effort invested that is exciting and fulfilling, within a time frame that is realistic and achievable. Some people strive to achieve more, but this simple description is itself a dream. We learned this from Rich DeVos, Jay Van Andel, David McConnel, Mary Kay, Mary Crowley, Doris Christopher, Mark Hughes, and others. What are people learning from you at this most important moment in time?

The additional challenge you are facing, as current leaders and torchbearers, is the challenge associated with how you are perceived by those who have chosen you as the brand with which they align.

What do I really stand for? Who else knows? Do they know now?

From this point of view, the social injustice demonstrations we are experiencing should not be taken as another incident with thoughts such as, “This too shall pass.” It is also important for all of us to understand the difference between authentic protest and unlawful behavior. Here are a few questions I have asked myself, and I hope you may have asked similar questions. What do I really stand for? Who else knows? Do they know now?

This is a time for innovation, creativity, and, possibly, reevaluation of the founding principles and values of your businesses — the key to any authentic strategy to attract diversity. There are people within your company who are stressed, and some are tired. People are concerned and rightfully so. Those who have chosen you — and those who would like to get to know you — often go to bed at night with a hope or a prayer, and it may be about you.

What are people learning from you at this most important moment in time?

No one should be waiting for a time when we will go back to the way things were relative to either of our challenges. To believe such a time will come would be the equivalent of believing in the “good fairy.” We can exist with differences when we are advocates of principles and values that are common to the needs of humans. The direct selling business model can also be a pain reliever, a source of inspiration during the most challenging of times, a beacon of hope! We can never take our focus away from the importance of achieving growth, nor should we ever take our focus off the needs of the people. There are KPIs associated with both.

There are Solutions to the Challenges We Face

I believe this distribution channel will become stronger, better, more appealing, and more relevant than ever! There are solutions to the challenges we face. When leadership carefully guides and navigates, brings forth the best in innovation and creativity, and shares a commitment to values that are common to all the people, we win. What do we stand for?

The great British philosopher and historian Arnold Toynbee said many profound things in his life relative to the strengths and attributes of civilization. He frequently warned us about silence. And, although he was writing in the 1940s, his words remain relevant today. I’ll share this excerpt in closing:

“We are not doomed to make history repeat itself; it is open to us, through our own efforts, to give history, in our case, some new and unprecedented turn. As human beings, we are endowed with this freedom of choice, and we cannot shuffle off our responsibility upon the shoulders of God or nature. We must shoulder it ourselves. It is up to us.”

Just thoughts, my friends…

Please feel free to share these thoughts with others…

John T. Fleming is a member of the DSA Hall of Fame, DSEF Circle of Honor, and recipient of the DSN Lifetime Achievement Award. He is also the author of The Ultimate Gig (ultimategigbook.com).

 

 

DSA Issues Statement on FTC Letters to Multilevel Marketers

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The U.S. Direct Selling Association issued the following statement regarding recent letters from the Federal Trade Commission to direct selling companies.

A handful of direct selling companies, including some members of the Direct Selling Association, have received warning letters from the Federal Trade Commission regarding inappropriate product and earnings claims made in connection with the ongoing virus pandemic.

The FTC has previously issued similar letters to other businesses, including some direct sellers. In response, DSA members have made a renewed commitment to abide by the requirements of the DSA Code of Ethics, and to correct misleading or inaccurate statements made by independent salespeople or the companies themselves about products or earnings — especially as they relate to the coronavirus.

DSA’s efforts to urge members and non-members alike to abide by the highest ethical standards will continue. In that regard, we have reached out to direct selling companies, including non-members, to request they affirm their commitment to those standards as put forth in the DSA Code of Ethics by becoming or remaining DSA members. Those companies which do not make that commitment will not be allowed to become members or remain in the Association. We urge all companies to follow the requirements of the law and go above and beyond those requirements to ensure that customers and prospective salespeople have and share the most accurate information possible. This is more important than ever in the midst of the health and economic challenges we face.

Those with additional questions regarding the FTC letters can contact Adolfo Franco, DSA’s executive vice president.

 

How to Live with the Fear of Failure While Building a Business

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(This article was written by Stephanie Burns and appeared on forbes.com.)

Humans are naturally risk-averse, which makes the pursuit of something as risky as building business quite unsettling. In short, entrepreneurs face fear more than any other type of professional. It’s up to them to make decisions, make payroll, raise money and build a great company, with few people aside from advisors and fellow entrepreneurs to turn to.

But how do we cope with the fear? Fear isn’t talked about nearly often enough, simply because we all want to seem like we know what we’re doing. And while bringing more attention to the fear can actually contribute to more fear, it’s also important to create strategies and coping mechanisms to live with the fear and create anyway.

  1. Know That Fear Can Also Motivate You 

We often hear it said that fear can actually just be misunderstood excitement since the physiological response it invokes in our bodies is identical. Similarly, fear can motivate us. The Journal of Business Venturing shared research on the reconceptualization of fear in entrepreneurship and found that “the experience of fear of failure in entrepreneurship can at times motivate and at other times inhibit an individual.” It went on to report that  the responses to both either engaged an “approach” tendency (in other words, few feel the fear and want to go after it) or an “avoidance” tendency (when we get scared and run the other way).

So, we know that fear is a coin with two heads. It can motivate us or cause us to run, but we can choose the motivation aspect and let fear motivate us to do more and do better. It’s up to us how we want to train ourselves to cope when we feel fear.

  1. Think About the Greater Implications of Your Business 

Fear can also pale in comparison to the good you’re doing in the world. Macdonald Worley, founder of McDonald Worley PC, noted that “taking a moment to look around your business and realize that you are not only helping customers, but you are providing jobs for your employees and a way for them to provide for their families is one of the best ways to orient yourself in a success mindset.” And it’s true: no matter how big or small your business is, you started it to help people. This is the nature of the business. You’re contributing something of a unique value proposition to the world. If the focus is more so on this, you’ll find ways to make it work.

“If you don’t decide to go all in and make it work, you will fail. Burn the ships so you have no way out,” Worley advises. “Giving yourself no choice BUT to succeed is a great way to kick into high gear and take radical action.”

  1. Ditch the Need for Perfectionism

Perfectionism is one of the byproducts of the fear of failure. We somehow internally believe that if we do everything perfectly, we’ve decreased our chance at failure. But, we also know perfectionism is a myth, and it can ultimately sabotage us from doing what we really want to do. If an entrepreneur who is just starting out is holding themselves to an impossible ideal of perfectionism in order to feel comfortable launching their company publicly, they likely will never get to a place where they do feel comfortable.

How perfectionists find a way to prioritize completion over perfection differs, but common ways to move past the need to be perfect include practicing self-observance on the need for perfection, setting mini action steps, and asking for feedback so you can rely on others’ perceptions of your work, too.

Fear is simply an emotion that exists to protect us, but we can consciously decide how much we let it get in the way. Tap into the reason you chose to start a business and move your focus away from the fear and onto the action. This is what entrepreneurs do best.

 

How to Return to the Office

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(This article was written by Maneet Ahuja and appeared on Forbes.com.)

Many employers should adopt a “hybrid” model of office work, with some employees in the office and others working remotely. Clearly communicate phased reopening plans with employees, especially new office protocols, such as testing and wearing masks.

What Public Health Experts Say

  • Consider a staggered return. “Offices may consider starting slow by opening with fewer people at first,” says Dr. Mark Kortepeter, an epidemiology professor at the University of Nebraska Medical Center and author of Inside the Hot Zone. He also suggests shifting work schedules and “having liberal stay at home policies if people are ill.”
  • Antibody testing can be a helpful tool but not a panacea, Kortepeter says. The accuracy of the tests can vary, especially because there is a lag time between being infected with the virus and developing antibodies. We also don’t fully understand whether having antibodies translates to protection from infection and for how long.
  • Build areas of protection. The virus mostly spreads via large respiratory droplets, so using plexiglass or other types of barriers can block some of the direct spread of these droplets.
  • Minimize face-to-face contact by instituting virtual meetings. For in-person meetings, make sure there is enough room to socially distance.
  • Establish employee protocols around personal protective equipment, such as masks and gloves.

What Industry Experts Say

  • Adopt a “hybrid” approach to reopening. “Some jobs are better performed remotely and some are better performed in the office,” says Johnny C. Taylor, Jr., President and CEO of the Society for Human Resource Management. “Employers are going through that process literally by job category.”
  • There are varied ways to reopen, says Taylor. The society’s most recent survey of employers found 39 percent were planning to implement a phased reopening strategy, with critical teams returning first, while 19 percent plan to implement an alternating schedule strategy, with most employees returning on alternating days or weeks.
  • Establish a policy around personal protective equipment, such as masks and gloves, because lax or conflicting guidelines will cause confusion. “We are now watching very closely what happens when you get people back into the workplace, particularly where businesses don’t mandate the wearing of a mask,” says Taylor. “You have a new area of dispute that’s going to need to be resolved by employers.”

Entrepreneurial Hacks

Facebook CEO Mark Zuckerberg recently announced sweeping changes to its remote work policies, such as allowing employees to request the option of permanently working from home and “aggressively” increasing the hiring of remote employees to diversify its workforce. “For the last 10 or 11 weeks, we’ve had 95 percent or more of our population working remotely and what we’ve found is that we’re still able to get a lot of work done,” says Lori Goler, Facebook’s Vice President of People. The new emphasis on remote hiring will allow Facebook to expand its talent pool geographically. “It really creates a lot of opportunity across the United States. So now you don’t have to live in one of the locations [where we have offices] which means that people don’t have to get up and leave their communities,” Goler says.

When the social media giant starts to reopen offices as permitted by state and local officials, they expect to operate at no more than 25 percent capacity in the near-term while proper safety measures are put in place.  “We decided that we would take a more conservative approach, both in terms of leaving the offices and in terms of returning to the offices,” Goler says.

Red Flags

Be alert for working conditions (or fellow employees) that are not complying with safety guidelines. Offices are full of high-touch surfaces—door handles, light switches, appliances—so check what the new cleaning and disinfection protocols are in your office. Stay away from crowded conference rooms or other commons areas where people are unable to socially distance.

The Silver Lining

While working remotely is a big change for many people, it also allows for much greater geographic diversity in hiring and access to a whole new pipeline of talented recruits. Plus, many companies will likely take a hybrid approach of having some people work remotely and others in a physical office. “Every company will have to do what’s right for their company and situation but what we found is that it’s actually worked out really well for us,” says Goler of Facebook. “And we’re pretty excited and optimistic about the future.”

 

Avon Releases Corporate Responsibility Report

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Avon Products Inc. has released its latest Corporate Responsibility Report, which shares progress on all aspects of its sustainability strategy.

Highlights from the report include:

  • $1.1 billion donated to women’s causes
  • 99% brochure paper sourced sustainably
  • 50% of energy use came from renewable sources in 2019
  • 93% recycling in operations
  • Reduced carbon emissions by 53% from 2005 baseline
  • First global beauty brand1 to end animal testing in all markets in which it operates2

This report showcases Avon’s efforts to make a positive impact on women, communities and the world. This includes partnerships and programs to support women’s health and well-being, particularly on raising awareness and funding around breast cancer and violence against women and girls.

According to the company, as part of Natura &Co, a group of purpose-led businesses, the company doesn’t just want to be the best company in the world, but the best company for the world. Avon recognizes the part it plays in addressing rapid climate change and inequality of income and opportunity. To help tackle the challenges facing our world, Avon has expanded its sustainability strategy and will continue to set ambitious targets as it strives to make a positive difference to people and planet.

Young Living Convention Will Be in Virtual Format

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Young Living announced a virtual version of its upcoming International Grand Convention.

The Young Living One2020 convention, scheduled for Wednesday, June 17 through Saturday, June 20, 2020, will keep attendees safe amidst the COVID-19 pandemic and to allow unprecedented access for worldwide attendees.

This virtual format has challenged Young Living to replicate the energy of its in-person convention through digital touch-points. Attendees can expect to experience Young Living products in every virtual format possible and can also contribute to philanthropic causes such as the Run for a Cause 5K and Ride for a Reason campaigns. The One2020 convention will engage audiences through meaningful touch-points and high-energy media, including innovative video and immersive content.

“We’re grateful to have a community that is strong enough to adapt and grow through any circumstances,” said Jared Turner, president and COO of Young Living. “This virtual format of our grand convention will give us an opportunity to reach a wider audience than ever before. We’re excited to share the products we’ve been working on.”

DSA Engage 2020 @Home

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These past weeks, we have seen the nation begin to reopen. Retailers, restauranteurs, and a wide variety of businesses are attempting new approaches to accommodate customers who have entirely new expectations.

Yet, for direct sellers, the wind is at our back: the global health crisis did not close the channel.

Rather, direct selling companies have proven our channel’s versatility and agility as consumers come to accept distributors as local, independent business owners within their communities.

Companies have found new ways to empower their distributors through virtual meetings with company founders and leaders. Party plan companies have developed new merchandising approaches that have taken virtual, in-home parties to a new level. We have all sharpened our focus on the need to provide the insights and tools that help ensure distributors properly characterize product and earnings claims.

Direct selling’s agility has empowered the millions of independent distributors to continue serving their customers and communities from their homes across America and the globe.

And as we approach DSA ENGAGE 2020: Direct Selling’s @Home #GlobalCommunity Experience, we all have so many new insights to share.

DSA ENGAGE 2020 @Home will continue the DSA team’s efforts to ensure that member companies and their independent sales force remain armed with the resources they need to deal with the current crisis. The event aims to help us all envision how we, as a community and as individual brands, will work in the changing environment that lies before us.

The event will kick-off on June 4, with a solution-based expo featuring the industry’s premier supplier partners and 20+ on-demand educational sessions.

Then, on June 9, individuals can tune in as we live-stream three-hours of industry-led content.

Inspiring messages to help us reset and reimagine will be delivered from industry favorites Amanda Gore and DeWitt Jones along with keynote presentations and CEO
discussions offering insights from leaders about the range of approaches their companies have taken.

The event will also offer topical sessions led by company executives and their teams on the areas of digital transformation, social media, legal and compliance strategies, and finding the resonant messages that make sense with these unprecedented times.

DSA ENGAGE Educational Sessions on Demand will include newly produced company case studies presented by DSA member company executives, supplier-led solutions
sessions, Direct Selling 101/Boot Camp sessions, and recordings from the popular VISION 2020: DSA Sales & Marketing Conference 2019.

DSA knows that in the age of social distancing, and as our nation works toward getting back to business, virtual events such as DSA ENGAGE 2020 @Home are a necessity.
We also know that these virtual experiences are only temporary and that they will never replace in-person events. These are indeed  extraordinary times.

We have learned and continue to learn so much. We have adapted and continue to evolve. Now it’s time to ENGAGE, and I hope you join us so that we can envision what’s next and help ensure that our #GlobalCommunity is #StrongerTogether.

Melissa K. Brunton is the Senior Vice President of Education & Marketing Services for the DSA

DSA Reports $35.2 Billion for Direct Selling Channel in 2019

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The Direct Selling Association (DSA) released top line results from its 2020 Growth & Outlook survey during the opening of its June 4–9 virtual education event, Engage 2020.

Growth & Outlook is DSA’s annual survey that reports on the size and scope of direct selling in the U.S. and is audited by Nathan Associates, a third-party international economic consulting firm. The focus of this year’s Growth & Outlook Report has shifted toward analyzing the industry outlook. More specifically, the report will include detailed analysis of Coronavirus and its impact on the industry. It will provide actionable recommendations for navigating the challenges the pandemic poses and provide an industry sales forecast along with scenario planning.

To better understand industry trends within such a rapidly evolving macroeconomic landscape, DSA is conducting extensive research in addition to its standard Growth & Outlook market-sizing survey. For example, DSA’s Coronavirus QuickPulse surveys track the business impact of Coronavirus on a weekly basis, and quarterly DataTracker surveys provide insight into quarterly trends and KPIs. DSA’s Industry Research Committee is analyzing all this survey data, secondary research, and developing key insights and actionable takeaways to include in the 2020 Growth & Outlook Report to be released early this summer.

“We know that maintaining relevance and resiliency are vital for the future growth of the channel. That’s why we have intentionally expanded the focus of the Growth & Outlook survey to include several new inputs including QuickPulse research to help us look forward and envision the future of direct selling,” said Joseph N. Mariano, president of the DSA. “While every form of retail, including direct selling, is being challenged during this time, I am confident the channel will continue to thrive because of the digital innovations coupled with a personal touch that provides unique value to consumers.”

The annual Direct Selling Growth & Outlook Survey provides the following data on the industry:

Retail Sales Remain Steady: The direct selling channel generated $35.2 billion in retail sales in 2019.

Consumers Continue to Enjoy Products and Services Offered by Direct Sellers: Health and wellness products lead the channel in terms of size and growth with person-to-person sales as the most prevalent method of engaging with consumers.

Americans are Still Seeking Entrepreneurial Opportunities: There were 6.8 million direct sellers in 2019, a 9.9 percent increase from the prior year; 87 percent of direct sellers (5.9 million) are part-time.

“The Growth & Outlook study reveals a robust and stable retail channel that is valued by consumers for its products and services, customer service, and overall shopping experience. The resilience of the channel results from its continual evolution and improvement and the dedication and hard work of the distributors, employees, and other stakeholders in the direct selling industry. And it is these demonstrated strengths of the industry that give confidence that it will meet the challenges it faces, now and in the future,” said Paul Bourquin, principal at Nathan Associates.

Mariano added, “There’s something about people’s desire to connect and be a part of a community that is not an inherent part of traditional or online retail sales. A key strength of direct selling, which differentiates it from other retail channels, is the personal relationship and passion for the product direct sellers provide, and that is not altered during a pandemic.”

 

Our 11th Annual Global 100 was One for the Ages!

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Each year, the Direct Selling News team works with companies around the world on this special project, and it has become our signature research endeavor. The goal from the outset of the project 11 years ago was to foster a greater level of transparency within the direct selling community, in turn supporting its growth as a channel for distributing goods and services while simultaneously promoting entrepreneurship.

Since the live event of the 11th annual DSN Global 100 Celebration in Dallas was canceled due to the COVID-19 pandemic, we presented a special video broadcast on our website on the evening of April 1. We appreciate all of you who tuned in from all over the world. We were thrilled to receive notes and texts from many who were happy to see that we continued the event, even if it was done virtually.

We are especially grateful to the many gracious sponsors who stepped up to make our 11th annual Global 100 Celebration a huge success!

The DSN Global 100 had previously listed 100 companies, ranging from $60 million to over $10 billion in revenue each year. This year the 2020 list took on a new look, acknowledging 50 companies achieving more than $100 million in revenue for 2019. This was due to the many factors putting pressure on our channel over the past few years, and we knew a reevaluation of the list was necessary. The purpose of the Global 100 list remains the same: to showcase the true impact of this channel on people’s lives as well as the economic impact direct selling companies make on the communities they serve.

At our Global 100 Celebration, we also had the opportunity to present some special recognition:

  • Best Places to Work in Direct Selling — See the 11 honorees on page 63
  • Bravo Growth Award—OPTAVIA saw sales increase from $301 million in 2017 to $501 million in 2018 to $713 million in 2019—$200 million growth in each of the past two years.
  • Bravo Leadership Award—We presented two awards for leadership. The first went to Orville and Heidi Thompson, Co-Founders and Co-CEOs of Scentsy.
  • Bravo Leadership Award—The second award went to Carl Daikeler, CEO of Beachbody.

Check Out Our Digital Version of DSN

Given so many are now working from home, we have made the magazine available online to complement our printed issue. For a link, go to the home page (halfway down) on DirectSellingNews.com.

All the best,

Smarter Segmentation

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Data leaves clues of how to better inspire your sales force.

After spending the better part of a decade in the direct selling channel industry, I’ve been witness to the onslaught of negative press that has come our way. Some of it we have earned, but it is far from deserved. I’ve seen this channel change lives for the better, it creates life-long friendships, takes ordinary people and turns them into leaders and successful entrepreneurs. So why does direct selling get such a sour response? What can be done to show how much direct selling organizations and our distributors can be a powerful force for good?

It comes down to how we treat people and the communications we promote. Let’s look at the incredibly common industry messages circulating around the internet: be your own boss, freedom from everyday constraints, win trips, cars, riches beyond dreams, joy!  While these messages are achievable, it’s often reached by only a few.

Words, Incentives Can Lose their  Luster

We attempt to motivate, but daily life responsibilities tend to get a higher priority and rightly so. We do our best to inspire with our words and incentives, yet it fades faster than we’d like—incentives are so hard to achieve and complicated to understand. We train to help, but to learn skills it requires repetition, consistency and focus. We also don’t have the time, staff or ability to reach as many as we’d like.

“What limits us from being able to inspire a larger base of superstars, of leaders who can pass their gift to others at rates we wish we could see?”

We also share conversations about our connection to our distributors, but really, for most of us it’s only the top performers whom we can call out by name. How do you think that makes someone who knows they can be a star feel? We all knew Kobe Bryant was going to be a star the moment he set foot on the NBA court for the first time. His performance was a matter of dedication, but it also included coaching to help elevate his abilities beyond what he could do on his own

So how about our field? As an industry, direct sales leads with an annual churn rate reported to be as high as 84 percent while according to the U.S. Bureau of Labor Statistics, all other industries it tracks range between 2.3 – 27 percent annually. Our churn rate has always been an issue. What limits us from being able to inspire a larger base of superstars, of leaders who can pass their gift to others at rates we wish we could see? How can we identify future performers or those who may be in their last days before they realize they are no longer interested and take care of them, so their passion remains?

Smart Segmentation Dives Deeper

The good news is, the answer is right in our face. It’s by using segmentation better, smarter. The channel has been segmentation for years to better differentiate customers from the business builders. This has been helpful to a point but we need to dive deeper. Segmenting by distributor (and their title), customer and sometimes preferred customer leaves a very narrow view of what can be done. It also hurts our ability to reduce the churn rate rarely to where it could be, because we continue to do what our e-commerce and gig economy competitors abandoned years ago: deploy a one size fits all approach for all groups. With distributors, we start everyone in a fast start program. Every leader gets the same incentives. The incentive path is hard to understand and difficult to attain. The reality is, these programs are tailored for us, the business, and don’t tap into the passions and motivation drivers of the distributors. We are training and pushing our people to do what we wish they would do versus what is actually best to maximize their experience. Sure, it works for a few, but it doesn’t address the many who don’t want to follow a path to leadership. This can create a lot of frustration and discontentment with the lower ranks, who feel slighted, not appreciated, and eventually leave the business.

What the industry needs is a better segmentation model. This is done by using AI or machine learning to better place distributors and customers into the defined target groups. We can then target those who are ready to start fast, those who are ready to push on to the next level, as well as those who are ready to emerge as your next top leader.

 Data Reveals Clues

When you’re able to use data to identify consistent behaviors, needs and styles based on how the field interacts with both your brand and teams, it can help drive a connection with your field, and they’ll bond with you because of it. Netflix, Amazon, Uber all use smart segmentation to drive results most businesses dream about. This is how they’ve achieved 500 percent more growth in the last 10 years than the direct sales industry. Using smart segmentation, you can identify groups within your distributor, preferred customer and customer groups who are on the path to becoming your next star within their first 90 days if done well. Have you calculated what a one percent retention rate each month is worth? The value of that small percentage might shock you.

After watching the AI work to cluster more than 20 million distributors in to segments, what I’ve learned is the better you can customize your communication (make it personal)—be it an email, a promotion, training, or a comp plan to what a particular person needs to hear, to feel comfortable to take the next step—the more likely they will open it, click and take action. This creates a feeling of mentorship and that you’re taking a personal interest in helping them reach their goals within your program.

Messaging to the right person with the right message at the right time when they’ll be most responsive to it can change their perception dramatically by giving them simple, actionable steps. At the end of the month, they’ll find they’re at the very top of the mountain you’re trying to get them to climb. They’ll feel accomplished. They’ll be ready to do it again.

So, what’s the bottom line?  Smart segmentation works. Personalization works.

Will Ackerman is the VP of Product at Directech Labs. Most recently he spent 4 1/2 years at JAFRA, part of the Vorwerk family of brands where he built the global digital strategies and programs which led to record growth across all digital KPIs.