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DSA Committed to Helping Members Support “America’s Original Entrepreneurs”

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According to the recently released “Growth and Outlook Report: U.S. Direct Selling in 2017” by the Direct Selling Association (DSA), 2017 saw slight decreases in sales and involvement in direct selling in the United States, the largest direct selling market in the world.

The DSA, the national trade association for companies that offer entrepreneurial opportunities to independent sellers to market and sell products and services, reported that retail sales in the U.S. in 2017 were $34.9 billion, down 1.8 percent from 2016, and that 18.6 million people were involved in direct selling, which represents a 9.3 percent decrease year over year. Participation in the channel varied from those who joined direct selling companies as discount customers to those who are pursuing a business on a part-time or full-time basis.

Retail Sales

Estimated retail sales for 2017 were $34.9 billion, down slightly from 2016’s $35.54 billion. This marks the second year in a row that sales have declined. Sales had climbed each year from 2009 to 2015, which had an all-time high of $36.12 billion in sales.

The top states with direct selling activity continued to be Texas, California, New York, Florida and Illinois, which, collectively, accounted for nearly 45 percent of all U.S. sales in 2017.

Wellness products remained the most popular product category in the U.S. in 2017, accounting for 33.8 percent of sales, followed by Services (22.1%), Home & Family Care/Durables (16.8%), Beauty & Personal Care (16.5%), Clothing & Accessories (8.2%) and Leisure/Educational (2.6%).

Direct Selling Population

After a record 20.5 million Americans involved in direct selling in 2016, the DSA reported 18.6 million for 2017. Of those, 13.0 million were discount customers, 4.7 million part-time business builders and .9 million full-time business builders. These statistics do show growth in the number of Americans starting home-based businesses: In 2017, .9 million Americans had full-time businesses compared to 0.8 million in 2016, and 4.7 million Americans were involved in part-time businesses in 2017 compared to 4.5 million in 2016.

The direct selling channel, known for its flexible entrepreneurial opportunities for all ages, reflected that in the statistics that showed 36.9 percent of direct sellers in 2017 were Millennials; 34.0 percent, Gen Xers; and 26.4 percent, Baby Boomers.

By gender, 73.5 percent of direct sellers in the United States in 2017 were women and 26.5 percent men. After an almost 3 percentage point drop from 2014 to 2015, the percentage of men joining the channel has increased each of the last two years, with a 15 percent increase from 2015 to 2016 and another 1.9 percent increase from 2016 to 2017.

Ethnic and racial demographics for 2017 show that Americans involved in direct selling were 80 percent non-Hispanic and 20 percent Hispanic. 85 percent of those involved were White/Caucasian, 8 percent African American, 1 percent American Indian or Native Alaskan and 1 percent Native Hawaiian or Pacific Islander. These numbers closely reflect the fabric of America: the U.S. population is 82 percent non-Hispanic and 18 percent Hispanic. With regard to race, 77 percent of the U.S. population is White/Caucasian, 13 percent African American, 6 percent Asian, 1 percent American Indian or Native Alaskan and 1 percent Native Hawaiian or Pacific Islander.

For more insights and statistics on the U.S. direct selling channel, visit www.dsa.org.

PayPal to Buy Hyperwallet for $400 Million

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Earlier this week, PayPal Holdings Inc. agreed to acquire financial–technology company Hyperwallet Systems Inc. for about $400 million, a deal that augments its offerings to businesses for managing and processing their online and mobile payments.

Founded in 2000, Hyperwallet helps individuals and small firms receive payments for goods and services that they sell on online marketplaces. The company, which counts private-equity firm Primus Capital Partners as a major shareholder, can disburse payments in more than 200 countries through a variety of forms, including debit cards and transfers into bank or PayPal accounts.

PayPal executives have previously identified both deal-making and supporting commerce that happens over online marketplaces as two of the company’s biggest drivers of growth in coming years. Although its shares are up 60 percent over the past year and its market capitalization recently topped $100 billion, PayPal is facing increased competition from banks, startups and established tech companies like Amazon and Apple Inc.

In May, the San Jose, Calif.-based company agreed to buy European payment-terminal maker iZettle AB for roughly $2.2 billion, the largest acquisition in PayPal’s nearly 20-year history. At an investor day shortly after the deal was announced, John Rainey, PayPal’s chief financial officer, laid out plans to spend between $1 billion and $3 billion annually on acquisitions.

PayPal already manages payments for some of the largest online marketplaces, including Uber Technologies Inc. and Airbnb Inc., through its Braintree unit, and executives hope that acquiring Hyperwallet will make it more attractive to prospective customers. Around half of global online retail sales occurred on marketplaces in 2017, according to Internet Retailer, a trade magazine.

“We see an explosion of marketplaces,” said Bill Ready, PayPal’s chief operating officer, in an interview. “We want to serve them with a full operating system for commerce.”

Hyperwallet Chief Executive Brent Warrington and around 300 employees will join PayPal’s ranks after the deal closes. Warrington said in a news release that selling to PayPal was an “outstanding opportunity to supercharge Hyperwallet’s growth.”

Many of PayPal’s competitors are also angling to do more business for marketplaces. Adyen NV, which listed its shares in Amsterdam last week, handles payments for online crafts marketplace Etsy Inc. and online travel company Booking Holdings Inc. Earlier this year, Adyen won a bid to become the primary payments processor for eBay Inc., PayPal’s former parent company and one of its biggest sources of customers.

Ready said that what distinguishes PayPal from other payments companies that cater to marketplaces is that it can connect those businesses to the more than 200 million consumers globally who have PayPal accounts.

“The thing we uniquely do that no one else is doing is bringing both buyers and sellers to the equation,” Ready said.

Cosmeceuticals on the Rise in China

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A new report from Mintel, one of the world’s largest market intelligence firms, provides insight into skin care shopping trends in China.

According to the report, while China’s cosmeceuticals market is currently quite diversified and fragmented, it appears cosmeceutical products are resonating more and more with Chinese consumers.

Mintel’s research reveals that as many as seven in 10 (69%) consumers agree that using cosmeceuticals daily can prevent skin sensitivity. In comparison, 44 percent say that they only look to cosmeceuticals when they are suffering from certain skin conditions.

Reflecting increasing attention to the ingredients found in cosmeceuticals, up to three in four (74%) urban Chinese consumers agree that it is essential for cosmeceuticals to contain effective ingredients. Further, three in five (60%) believe cosmeceuticals formulated with fewer ingredients are safer.

Speaking at in-cosmetics Korea, an exhibition for personal care ingredients, Associate Beauty Director Jessica Jin of Mintel said, “The term ‘cosmeceuticals’ really only started to gain momentum in China over the past few years, yet more and more beauty retailers are expanding their offerings to include cosmeceutical products in store. Busier and more stressful lifestyles, as well as worsening environmental conditions, today, have created more concern around skin conditions among consumers who are looking for relative treatments as a result—and this is where cosmeceuticals come into the picture.”

“Our research shows that Chinese consumers believe that daily use of these products can prevent skin sensitivity,” continued Jin. “On the other hand, fewer consumers think cosmeceuticals are only needed when they experience certain skin conditions. This spells good news for the Chinese cosmeceuticals market given the favorable potential for such products to be included in consumers’ daily skincare routines. With more knowledge about and attention paid to ingredients and product safety, it is important for cosmeceuticals to highlight the efficacy of star ingredients.”

Consumer understanding of ingredients is currently at an all-time high. What’s more, it seems that men, like women, are also eager for ingredient information with little gap in ingredient awareness between genders. According to Mintel research, 56 percent of men have purchased facial masks that include collagen as an ingredient in the last six months; this compares to 58 percent of women who did the same. Other ingredients with significant penetration rates among men include essential oils (40% male vs. 33% female), vitamin (34% male vs. 32% female) and amino acid (32% male vs. 35% female).

In order to validate a product’s quality, Mintel research reveals that cosmeceuticals can do that via data and institutional endorsement. Indeed, over half of urban Chinese consumers say they believe that a product is high quality if it has precise data to support it (55%) or if it is authorized by a professional institute (52%).

“A product’s effectiveness and safety are both equally important to Chinese consumers,” said Jin. “When setting product claims against cosmeceuticals, it is essential that manufacturers are aware that consumers highly value scientific data and endorsement from professional institutes to substantiate a product’s quality and effectiveness. To further penetrate the Chinese market, cosmeceuticals can also consider providing in-store services such as skin type tests through the use of devices, as well as engaging pharmacists to increase credibility.”

Global Good: Why Direct Selling Succeeds Beyond Our Borders

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In this issue:

The global economy is in an interesting state right now.

On one hand, U.S.-based businesses are more optimistic than ever about their overseas prospects, according to Wells Fargo’s 2017 International Business Indicator survey. A strong U.S. dollar, changing regulations and untapped consumers in emerging markets are giving domestic companies incentives to explore and expand beyond America’s borders.

On the other hand, the impending Brexit (the United Kingdom’s plan to leave the European Union in 2019), threats of trade wars, uncertainty over trade pacts and stark divides over multiculturalism are dampening corporate enthusiasm for thinking and acting globally, according to the Wells Fargo survey.

“Larger societal and geopolitical shifts are causing American CEOs more concern than any “dynamics in their own markets.”

The survey revealed that more than 85 percent of respondents said they are concerned that potential failure of trade pacts such as the North American Free Trade Agreement could adversely affect their international business. According to a recent survey by PwC, larger societal and geopolitical shifts are causing American CEOs more concern than any “dynamics in their own markets.” In his new book Us vs. Them: The Failure of Globalism, author and Eurasia Group Founder Ian Bremmer says there is a retreat from globalism not only in established regions such as the Americas and Europe but in developing markets such as Indonesia and Turkey.

At the very least, the world is engaged in economic, cultural and political tug-of-war, and everyone’s heels seem deeply dug in. So, where does direct selling fit into this scene? With global and multicultural mindsets hardwired into many direct selling companies’ DNA, the channel seems to be in the picture without being part of the picture.

Global direct selling revenue hit $182 billion and more than 107 million people worldwide were involved in international direct sales in 2016, according to the World Federation of Direct Selling Associations (WFDSA). (WFDSA will release 2017 global direct selling statistics later this summer.)The three-year compound annual sales growth rate was 5.2 percent. The U.S. Direct Selling Association conservatively estimates that 58 percent of its members have an international business presence.

The channel’s natural ability to succeed consistently in international markets stems from four basic characteristics:

  1. The direct selling channel easily taps into a universal desire for health, wellness and beauty.
  2. Direct selling companies are highly adept at understanding and adapting to cross-cultural norms.
  3. The direct selling model appeals to the basic human drive for financial security.
  4. Network marketing at its core is about improving lives, which appeals to human beings’ innate need to connect to something outside of themselves.
Wellness & Personal Care Products On the Rise

On a pure retail level, direct selling is heavily weighted toward products that appeal to consumers in all cultures, at all socioeconomic levels.

More than 60 percent of the 44 U.S.-based companies on the 2017 Direct Selling News Global 100 list provide products for health and wellness or skincare or both. “People around the world want beauty and wellness products,” says Kay Zanotti, CEO of Arbonne, an Irvine, California-based company that sells self-care products in such countries as Australia, Poland and Taiwan and had global sales of $553 million in 2017, one-third of which came from non-U.S. markets. “Everyone wants to look and feel their best.”

According to WFDSA, wellness products account for 35 percent of direct selling categories around the world, followed by cosmetics, which account for 30 percent. The percentage of sales from nutrition products last year at Amway, the world’s largest direct selling company according to the Global 100 list, is even higher, at 50 percent. Amway’s personal-care and beauty products accounted for 26 percent of the company’s sales last year.

The trend toward taking care of the body, inside and out, is only growing, says DSA Executive Vice President Adolfo Franco. “That’s why you see a lot of direct selling companies diversifying into those categories.”

Adapting to Market Needs

The best products in the world may not sustain a company that can’t bridge cultural differences, though. The ability to integrate other customs and business processes is perhaps the biggest differentiator between U.S. companies that make it beyond U.S. borders and those that don’t. A number of traditional American brands have fallen flat in international markets when they’ve tried to do business there the way they do business in the U.S.

Earlier in the 2000s, eBay lost its bid in Japan in part because it required credit card payments at a time when Japanese shoppers preferred to pay cash on delivery. Best Buy scrapped its European and Chinese operations when it realized shoppers there didn’t like big box stores. U.S. companies also tend to announce global launches before they happen—giving local competitors a chance to get to consumers first. And they often assume shoppers in non-U.S. markets will respond to advertising strategies that work in the States.

The bottom line in these commerce and cultural missteps is that these companies didn’t take time to understand, adapt to and earn trust in these new markets. This is where direct selling companies have a natural advantage, say executives like Steve Wallach, CEO of Chula Vista, California-based Youngevity, which sells nutrition and beauty products in markets such as Southeast Asia, Eastern Europe, Latin America, Japan and Canada. Youngevity is relatively, well, young in the international market, generating just 9 percent of its revenue overseas last year. This is the reverse of such companies as USANA and Herbalife, both of which generated, at most, one-fourth of their revenue domestically in 2017. But Youngevity is closely watching those that have gone before it, and Wallach says he is learning how to navigate these new waters.

“Direct selling is a people business,” Wallach says. “That’s what transcends international markets. If you don’t like people, you’re in the wrong business.” WFDSA Executive Director Tamuna Gabilaia says that people are so central to the model that the channel doesn’t need to invest the same kind of money promoting it as conventional business does, “We do not spend millions of dollars on advertising. We are a word-of-mouth industry.”

Relationships First, Products Second

The business model of focusing on relationships first and products second aligns well with how business works in countries like China, which many consider the holy grail of international markets, with $33 billion in direct selling revenue in 2016, second only to the United States. Even if upcoming 2017 stats change that number, China’s increasing relevance is not going away. Case in point: eBay’s initial efforts in China failed because it didn’t understand a cultural concept called guanxi, the country’s unwritten rules for developing the social networks and influential relationships that are critical for success in that market. And while China has some incredibly stringent network marketing regulations, direct selling companies are more likely to inherently understand and be successful with a concept like guanxi because they are seasoned relationship builders.

Sandy, Utah-based 4Life Research generated at least half of its $316 million 2017 revenue from outside the United States—in countries such as Korea, Mexico and Germany—and is developing inroads to China. “There’s a proper way to create relationships there,” says Co-Founder David Lisonbee, echoing the theme of how important it is to understand a country’s culture and regulatory processes. “We cannot do it alone—we have to hire local people, engage attorneys and work with consultants who understand the intricacies of the terrain.”

“Trying to get a population of people to change to the way you do business as opposed to you changing to the way they do business is an important distinction.”
—Steve Wallach, CEO, Youngevity

Bianca Lisonbee, also co-founder of 4Life and wife to David, agrees that, in general, direct selling companies succeed internationally where others might not because of the channel’s “built-in communal experience.” Many traditional business models are built around competition but in networking marketing, “I can’t succeed if I can’t help you to succeed,” she says.

Aside from knowing how to navigate and integrate cultural norms, U.S. direct selling companies that succeed globally have the capacity to adjust their products to fit various regulatory requirements. “It would be wonderful if everybody’s rules were standardized, but they’re not,” Wallach says, explaining that Youngevity often changes the formulas in its supplements and juices to meet the criteria of different health ministries. The key to maintaining the integrity of a brand in these situations is to make sure the products deliver the same results regardless of the ingredients, Wallach says.

Arbonne also customizes the contents of its nutrition and beauty products depending on the market, Zanotti says. “With global preference with formulas, we did extensive testing to ensure that expectations would be met in the new market and made any formula adjustments before launch,” she says.

Entrepreneurial Spirits

A desire to be in control of one’s time and earning potential may be as potent as the desire for health and wellness, direct selling executives say—marking another motivator that makes network marketing a natural fit in many corners of the world.

“People overwhelmingly want to better themselves and have a positive impact on their families,” says Amway Chief Sales Officer John Parker. Half of the nearly 49,000 respondents to the latest Amway Global Entrepreneurship Report (AGER) in 2018, which covered 44 countries, said they have a strong desire to start their own business. Some individual regions had even higher response rates—including Latin America, where 73 percent of respondents expressed a strong entrepreneurial desire, followed by Asia, with 69 percent.

“We think human behavior is the same everywhere,” says Jere Thompson, co-founder and CEO of Dallas, Texas-based Ambit Energy, which launched in Japan in May 2017. “People like to save money and people like to make money.”

“This industry is way ahead in helping to create independent contractors, more flexible work. Only now are other businesses starting to catch on to that. “
—David Lisonbee, Co-Founder, 4Life Research

Beyond the chance to control one’s income, direct selling also typically offers low barriers to entry, says DSA’s Franco. Startup costs are minimal and there’s often little or no training required to become a consultant. “The opportunity for easy entrée into a market with low cost, especially in the more challenged markets in the world, and to be able to work from home, to work at one’s own pace and skill set—that’s a huge consideration,” Franco says.

The emergence of the gig economy (the Ubers, the Airbnbs, the Door Dashes) has made direct selling even more attractive as it recruits independent business owners around the world. But direct selling was gig before there was gig, executives say. “This industry is way ahead in helping to create independent contractors more flexible work,” says David Lisonbee. “Only now are other businesses starting to catch on to that.” Adds Bianca, “Network marketing has been teaching people to fish for a long time.”

While the channel has benefited from a cross-cultural interest in financial independence, it’s important not to assume that all entrepreneurial mindsets are alike, Thompson adds. While many people in Japan, for example, are beginning to see self-employment as a viable alternative to working 12-hour days, the protocol for establishing these kinds of opportunities is different than it is in the United States. American entrepreneurs “want things to happen quickly,” Thompson says. But the Japanese take as much time as necessary to make sure every box is checked before giving an outside company their stamp of approval.

“Trying to get a population of people to change to the way you do business as opposed to you changing to the way they do business is an important distinction,” Wallach adds.

Franco expands on the unique economics of the direct selling model by pointing out that it is somewhat immune to changing market conditions because of the nature of the business model. “It’s a resilient business channel,” he says. When traditional jobs are scarce, people often turn to direct selling to maintain their income. But even when job growth is on the rise, direct selling recruitment tends to be flat at its worst, he says. Gabilaia agrees. “When economic conditions are good, our industry’s growing. When economic conditions are not so good, our industry is still growing—or stable,” she says.

Social Good

If a company sells a solid product that delivers what it promises, that’s a good thing. An even better thing, according to Gabilaia, is when a company also does good things for the communities where its distributors and customers live. “What we have seen is that people pay more attention to how the products they’re buying help social causes,” she says, and direct selling takes corporate responsibility very seriously.

“Our industry has a heart and it always has,” Gabilaia says. Charitable contributions from the directs selling companies that WFDSA surveyed last year were up 23 percent to more than $204 million, an average contribution of $4.3 million. And that doesn’t include contributions from independent business owners or in-kind contributions, she added.

—5 Best Practices for Making It Work in the Global Market—

Forty-four companies in the survey reported giving a total of $76 million to charitable causes outside the United States in 2016. Among 41 companies that reported donations for both 2015 and 2016, reported giving increased 54 percent in 2016, according to WFDSA.

“There’s a universality of filling basic human needs that crosses all cultures,” Bianca Lisonbee says. “Not just with products but in the need to feel part of the community, part of something bigger than ourselves.”

According to Amway’s research, doing business for a higher purpose is a common desire among would-be entrepreneurs, too. Forty percent of AGER survey respondents said they would be motivated by social reasons more than profit reasons to start their own business.

Time and Patience

Just because direct selling has advantages that prime it for being successful internationally doesn’t mean there aren’t frustrations, executives say. From complicated, bureaucratic regulations to language barriers to basic time zone differences, the realities of working across borders can test even the most seasoned company’s resolve. But Jere Thompson learned from Ambit’s experience in Japan that the only way a company can close the gap between the U.S. experience and the global experience is by being deliberate and persistent. “One foot goes in front of the other,” he says. “And only after a certain distance will the next gate come open.”

Purchase the June 2018 Issue in which this article appeared.

Purchase the June 2018 Issue in which this article appeared.

MONAT: Opportunities Lead to Growth and Limitless Possibilities

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In this issue:

MONAT by name represents the fusion of two words: MODERN and NATURE; however the name is just the beginning of the fusion MONAT represents. The intersection of a consumer need and the science to meet it. The blending of cultures.

The dovetail of lessons learned and forward thinking. In its short history, MONAT has taken these “fusion opportunities” and created a company that has experienced explosive growth. This growth recently earned the company not only its first spot on Direct Selling News’ Global 100 list, but the esteemed Bravo Growth Award as well, for achieving the largest percentage of growth in sales of any company on the list this year.

Marking its first appearance on the Global 100 list, MONAT ranked No. 52 globally. For fiscal year 2017, MONAT recorded $314 million in sales, an increase of 667 percent from $41 million in 2016. The company’s growth is just one part of MONAT’s evolution from one family’s dream to a thriving beauty business.

An International ‘American Dream’

Long before MONAT was imagined, Co-Founder Luis Urdaneta discovered the potential of the direct sales channel. As a distributor for a legacy direct sales company in Venezuela, Luis grew and maintained a successful organization, learning the lessons and best practices that only “on the ground” experience can teach, he says. “In this industry where people come with very limited possibilities, to change the quality of someone’s life is very special,” Luis shares as his rationale for remaining in the channel throughout his career. “Why not stay in an industry that helps you help people and makes them successful, which in turn makes you successful. This still inspires me every day.”

This passion for direct selling and its potential inspired Luis to partner with his oldest son, Rayner or “Ray,” to apply their intimate knowledge of direct sales to a new market sector within the channel—premium beauty and wellness. In 2001, the Urdaneta family launched L’eudine Global in Latin America; today, the company is a multimillion-dollar, multinational presence in the channel.

“In this industry where people come with very limited possibilities, to change the quality of someone’s life is very special.”
—Luis Urdaneta, Co-Founder, MONAT

Following the success of L’eudine, Ray felt confident he could create something new in the world’s largest direct selling arena—the United States. He was armed with experience in the channel, proprietary beauty technology from his development team and an unmet customer need he’d uncovered after years of researching the beauty space. “I noticed that the premium hair care segment was growing—you didn’t see that five years ago,” Ray recounts. “People were willing to pay a premium for a good hair care product. You can have a lot of fun with hair, right? The interest in anti-aging and anti-pollution around hair care was rising as well. We had this great technology. We knew direct sales. That’s what made us pull the trigger.” So in 2014, with Ray as CEO and his father, Luis, as co-founder, the Urdanetas announced their family’s newest venture.

Breaking New Ground

MONAT officially launched in October 2014, the first company in the direct selling channel dedicated to anti-aging hair care. While skincare companies were addressing consumer needs for anti-aging products to combat the harmful effects of UV rays and other environmental factors, no one was meeting those same needs in the hair space. Thus far, MONAT stands alone in the direct sales channel as the only company to focus exclusively on anti-aging hair products.

President Stuart MacMillan believes MONAT seized the right opportunity at just the right time. “The premium hair care market is just growing exponentially,” he says. “I knew from a product standpoint that we had something really cool, being the only people in that space with a consumable product, one that people use on a regular basis and one that’s easier to sell because people buy it anyway. We launched and haven’t looked back; it’s been phenomenal. Better than we even expected.”

MONAT’s product line revolves around the company’s unique, naturally based formulations and ingredients—Rejuveniqe™ Oil Intensive, a proprietary blend of antioxidant-rich oils; Capixyl™ (an emollient); Procataline™ (Pea Extract); and Crodasorb™ (a UV absorber). Products are sold individually and in systems that address specific hair care needs, such as volume, growth and color. Customers have the option of making a one-time purchase or enrolling in MONAT’s VIP Flexship program, which provides a product discount, free shipping and a free bonus product with each shipment.

MONAT’s field representatives, or Market Partners, take advantage of the company’s focus on social marketing and quick-paying onboarding period. “While we have a pretty standard compensation plan, we’ve enhanced it in two ways,” MacMillan explains. “One, we have a smart start program that gets a fair amount of money into people’s hands quickly, and it keeps them motivated and excited. The other is the opportunity to build a long-term sustainable business.” MONAT’s social selling strategy is youthful and on trend, with an emphasis on social media, including directly appealing to the company’s target demographic of women ages 25-45. The strategy is clearly successful—MONAT closed 2016 with 12,000 Market Partners and ended 2017 with over 150,000.

“People were willing to pay a premium for a good hair care product. …We had this great technology. We knew direct sales. That’s what made us pull the trigger.”
—Rayner Urdaneta, CEO and Co-Founder, MONAT
Values That Cross Cultures

While many businesses work hard to create that sense of family and camaraderie within their organization, the Urdanetas’ family culture fosters it naturally. Ray explains that the initial challenges of blending two cultures are now what make MONAT so strong. “In the beginning, I would get comments from people across the hall: ‘You speak too loud,’ ‘you laugh too hard’ because we are always talking and laughing,” Ray shares. “What I’ve noticed is the people who didn’t embrace our passion are now loving it. They love the passion, they love the laughs, they love the high spirit of our culture.”

But their family’s roots aren’t all the Urdaneta family brings to the fabric of MONAT. The values, life lessons and business practices that Luis Urdaneta learned and then modeled for his children have inspired so much of how the company operates today.

“We have always been very community, philanthropy oriented since the very beginning—even in our previous companies in South America,” shares Luisa, Ray’s sister who manages MONAT’s recognition and philanthropy efforts.

This legacy of helping others is the foundation of what is today known as MONAT Gratitude, a movement Luisa leads within the organization, which empowers both corporate team members and Market Partners in the field to impact their local communities. Following MONAT’s launch in 2014, Luisa began organizing volunteer opportunities for home office team members to participate in, partnering with local branches of the Salvation Army and Habitat for Humanity. Gratitude picked up steam in 2015 when Luis asked that his birthday in December be marked not with gifts or a celebration, but with a “Gratitude Week” across the company, in which everyone across MONAT would choose an organization to support in their local communities during those seven days.

With the success of Gratitude Week, Luisa and her team made a plan to empower everyone in the company to exercise gratitude all year long. “Instead of creating a foundation, we put together a structure that helped our field find out how to make a difference in their own communities,” she explains. MONAT Gratitude has its own website, www.monatgratitude.com, where Market Partners and corporate staff can see the company’s current philanthropic efforts, find service ideas and share their local efforts with the team. “We wanted to take a fresh look at success,” says Luisa. “We understand that making money is amazing and being your own boss and managing your time, that’s amazing, but to be really balanced in your life and feel absolutely fulfilled, you need to make other people happy and you need to help other people. That’s kind of the equation.”

The Family, Expanded

Ray, and Luisa, as well as brother Javier, who serves as chief of staff, had front-row seats for their parents’ direct sales journey and believe the lessons they learned have made all the difference in their own lives and taught them to push for greater things. “I always tell people that to be a really good entrepreneur, you need a big vision, you need to think big,” says Ray.

Thinking big has meant looking beyond the Urdaneta family for talented senior leaders who bring a deep experience to MONAT’s executive team. What began as a family enterprise, quickly expanded. “As the company grew, we started bringing more experienced people to each area of the business,” says Javier. “We acknowledged that even though we had experience in direct sales, we didn’t have experience in this market. We were willing to say, “ ‘we know what we don’t know at all’ and we need people to bring guidance and support.” Today, the senior leadership that manages every area of the business brings depth of experience, intimate knowledge of the channel and a keen understanding of both the U.S. and global markets. They’ve all been grafted into the “family.” MacMillan explains,” We talk about family, it’s part of our language here. We have family huddles and do things around the concept of functioning as a large family.”

“We talk about family, it’s part of our language here. we have family huddles and do things around the concept of functioning as a large family.”
—Stuart MacMillan, President, MONAT

Ray and this diverse, expanded family fuse big-picture thinking with fast-paced, adaptable decision making. “I believe there’s a saying that, ‘you cannot have it all’—I always say, ‘why not?’ We can be dynamic, we can leverage technology. This is the best time in history to be in business; there is no reason why your decision-making or execution has to be slow.”

MONAT is anything but slow. The company has experienced year-over-year growth, though the team feels there’s no one contributing factor behind MONAT’s success. It’s yet another fusion of multiple things making magic together—deep direct sales experience, a strong social media presence, a culture of family that extends far beyond the Urdanetas and the flexibility to adjust and course-correct on the go.

Luis Urdaneta and three of his children who work for MONAT, Luisa, Ray and Javier.

In the same week the company was presented with the Bravo Growth Award, MONAT launched operations in the United Kingdom with more than 1,500 Market Partners already on the ground. “After launching the U.K. with so many Market Partners already signed up, I felt confident that not only will MONAT continue to succeed in North America, but this is going to be big around the world,” Javier shares. Following 2017’s record sales, the team is projecting to double sales in 2018. New products are on the horizon as well, MacMillan says. “There’s still a lot to do in our market—it’s growing exponentially.”

Dreaming big and accelerating towards goals are two of MONAT’s hallmarks, but Ray says the short term is all about building strength. “We are not the kind of company that’s going to expand full-speed ahead into the world, even though we want to,” he says. “We want to make sure that we have strong, deep roots in the market before moving forward. For the next two years, it’s continuing to build a strong foundation so we can give the field 100 percent of what they need before moving forward.”

With sales continuing to expand and a growing team in the field around the world, MONAT’s fast pace has become its standard, with Ray and his siblings continuing to draw on the lessons they learned from Luis. “I’ve taught my children many lessons—honesty, fairness, passion, perseverance, and to always fight for people,” says Luis. “I’ve never wanted to have passive children. I applaud them for having initiative and vision for the business, for the way they respect each other, our team in the field and the company.”

Joni Rogers-Kante: Her Vision and Focus Keep Moving SeneGence Forward

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In this issue:

Her voice is an instant clue to the essence of Joni Rogers-Kante. Soft, with a rich timbre that hints at her Midwestern upbringing, it offers a measured confidence and calmness that reveals her well-earned grit.

As founder, CEO and chairwoman of SeneGence® International based in Foothill Ranch, California, in less than 20 years Rogers-Kante has led SeneGence to strong growth in both product sales and the number of Independent Distributors. The private company does not release annual revenue figures, but it does report strong 100 percent year-over-year growth—what chief strategy officer Ben Kante calls an “understatement,” and it now has just under half a million Distributors.

Hard work and patience, two distinct characteristics of Rogers-Kante, have stood well for her and her company over the years. And her determination to reach her goals remains unwavering. “Joni is not a person that gives up easily, or, for that matter, at all,” says Michael Moad, who joined the company in its infancy in 2001 and now serves as its chief legal officer. “As such, she inspires those around her to address challenges with a ‘never say die’ attitude. Thus, it is not so much that SeneGence prospered without a struggle. We had struggles. We just never quit.”

Her prowess as she steers SeneGence into the future has not gone unnoticed. Rogers-Kante was chosen to be the keynote speaker at Direct Selling News’ Global 100 Celebration held May 2 in Dallas, where she was also honored with DSN’s Bravo Leadership Award.

“I really need to put in the time to do the work, to do the years to finally have something that’s big and beautiful and truthful.”
—Joni Rogers-Kante, Founder, CEO and Chairwoman, SeneGence International

While Rogers-Kante is quick to give her team the credit for the company’s success, many reiterate it is Rogers-Kante herself who continues to be its guiding force. An early positive experience in the direct sales channel laid the groundwork for her vision that would become SeneGence. She joined Mary Kay years ago, and although she says she did “OK” as a consultant and earned the famous pink Cadillac, it was the business model itself and company founder Mary Kay Ash that impressed her.

Joni Rogers-Kante served as keynote speaker at the DSN Global 100 Celebration.

Falling in Love with Direct Sales

“I literally fell in love with the business of direct sales when I joined Mary Kay because of what Mary Kay Ash was doing for women, and I found that to be just fascinating at a time when there weren’t a lot of options for women,” says Rogers-Kante. Eventually she became a single mother to young son Alan and started formulating a plan for creating her own direct sales business.

“Joni’s work ethic is like one i’ve never seen before. nothing stops her from keeping an appointment or delivering on a promise.”
—Ben Kante, chief strategy officer, SeneGence International

Focusing on her desire to create cosmetic and skincare products that worked and “stayed put,” she began piecing together her plan in late 1994. “I was always driven in that direction, and, of course, what woman doesn’t want cosmetics and skin care that really work and make your skin look beautiful?” she says. By 1999 she had launched her business with a product that would eventually morph into SeneGence’s most famous product, LipSense®, a long-lasting lip color. “It took about five years for me to write the business plan,” she adds. “I needed to bring the pieces together to actually launch the company.” This entailed traveling throughout Europe and the United States looking for people who could help launch her venture. When she found a chemist who had formulated a product similar to her idea, everything began to align so she could bring her vision into reality.

Now boasting over 300 products—LipSense® Liquid Lip Color, Sense Cosmetics®, SeneDerm® Anti-Aging SkinCare, SeneDerm Solutions and Abundance Parfums— the company markets its products in 12 markets: the United States, Canada, Australia, Poland, Switzerland, Guam, Indonesia, Puerto Rico and the four countries of the U.K. Later this year SeneGence will open in Mexico, and in New Zealand the first of 2019.

Patience and Hard Work Are Key

Knowing how she took her time to create her company, it’s easy to understand one of Rogers-Kante’s core beliefs: Success takes hard work and realizing gratification is not instant. This principle can be traced back to Rogers-Kante’s upbringing in the small rural community of Sapulpa, Oklahoma.

Growing up she had all the joys of being on a farm, raising cattle, amazing days of going out and jumping on the horse bareback and being gone all day riding around the countryside. “I did have that good old-fashioned Midwest kind of thinking where you’ve got to plant your seeds, you’ve got to get up in the morning at 4 a.m. to feed the cows in the middle of winter in the field, so I think I got a really great understanding of hard work and that there’s no instant payoff,” says Rogers-Kante.

This commitment to hard work and patience continues to be a part of her business philosophy. “I really need to put in the time to do the work, to do the years to finally have something that’s big and beautiful and truthful,” she adds.

Distributors take a SeneGence incentive trip to Cabo San Lucas, Mexico.

Distributors take a SeneGence incentive trip to Cabo San Lucas, Mexico.

One person who knows the depth of her focus is her husband, Ben Kante, SeneGence’s chief strategy officer. The two met in 2000 when he was hired to document the company’s grand opening. The couple married in 2004 and Kante has had a firsthand opportunity to witness his wife’s drive and steady demeanor. “Joni’s work ethic is like one I’ve never seen before,” he says. “Nothing stops her from keeping an appointment or delivering on a promise… she always takes the higher road and she always puts herself in other people’s shoes.”

“Without a doubt, Joni’s vision was a key factor in our success,” says Moad. “However, her perseverance was just as important.”

The Focus Is Always on the Mission

Apple Co-Founder Steve Jobs reportedly said, “If you are working on something exciting that you really care about you don’t have to be pushed. The vision pulls you.” That appears to be the case for Rogers-Kante, and, perhaps most important, her vision is pulling thousands of Distributors to success along with her.

Kirsten Aguilar, SeneGence’s senior vice president of marketing, has watched how Rogers-Kante energizes Distributors. Aguilar says she feels the company’s founder has an uncanny ability to make everyone in an audience feel like she is talking directly to them. “I see women cry, laugh and, most importantly, 100 percent engage when she is speaking, and it’s a joy to witness,” says Aguilar.

Kante notes that even though his wife is a shy person who really doesn’t like to speak before an audience, she always seems to say the right thing about the right subject, and she knows how to relate to people. “She’s passionate and she’s certain about the direction of the company and it seems to really just flow through her once she gets up on stage,” he says.

This passion may be the heartbeat that keeps SeneGence pumping, but Rogers-Kante has an interesting take on managing her personal feelings when it comes to running the business. “It never mattered how I felt about something personally, because my personal feelings were not what was to be taken into consideration,” she explains. “What was to be considered was the end result. ‘Are you getting to the goal? Are you moving forward?’ What matters is that you put your feet back on the ground and use today to make progress.” So, Rogers-Kante explains, it just doesn’t matter if she’s tired or upset or has had her feelings hurt—she simply focuses on “completing the mission.”

“While direct sales affords people from all walks of life an opportunity to earn extra income, the opportunity cannot stand alone without an excellent product and good people.”
—Michael moad, chief legal officer, SeneGence International

On the other hand, she does allow her personal feelings to come into play when celebrating the accomplishments of others. “I do embrace the joyful parts of watching people achieve their goals and I enjoy watching how it brings them joy and affects their lives,” she says.

Supporting Distributors’ Efforts Is a Priority

Million Dollar Lips: A Journey into the Hearts of Women in Business

Aguilar says she believes Rogers-Kante’s commitment to empowering women is instrumental in building the SeneGence brand and in helping Distributors reach their goals. The founder wants women to live a life in love and abundance by sharing products that really work. And Aguilar feels Distributors learn from Rogers-Kante by her willingness to talk about her own vulnerability and journey. Adds Moad: “From the outset, Joni conceived of a direct selling company that was focused from the perspective of the Distributor, having come from that point of view herself.”

Along with her executive team and employees, Rogers-Kante constantly seeks ways to enhance the Distributors’ efforts. Her 2011 book, Million Dollar Lips: A Journey into the Hearts of Women in Business, details her life journey and offers inspiration to others. Distributors are also featured on the Times Square jumbotron in New York City—an advertising promotion that will continue through 2018. All Distributors are invited to submit videos for the weekly feature. “People are stopping in their tracks to see what SeneGence and LipSense are all about as they bustle through Times Square,” says Aguilar. Such exposure is a nice boost to Distributors, along with the fact the products have a longtime fan in singer Christina Aguilera and are used by makeup artists on Broadway performers.

Long-term plans include opening new markets in Asia, South America and Europe, and a production facility will soon open in Corona, California. Although the company will maintain a presence in California, construction is now underway in Sapulpa for a new 225-acre campus, which will house a distribution center, warehouse, corporate offices, manufacturing and research development, and convention facilities.

Given these plans, growth is a given, says Moad. “I do expect our growth to continue, although maybe not at the pace it did during parts of our recent expansion.“

SeneGence has always had an anchor product (and now a whole product line) that is desirable in the consumer marketplace—regardless of the sales channel,” he adds. “While direct sales affords people from all walks of life an opportunity to earn extra income, the opportunity cannot stand alone without an excellent product and good people.”

With the success SeneGence has experienced thus far, it would be easy to assume the visionary behind this success story is finally taking it easy. Not so, according to Kante. “She just never stops; if she isn’t working she isn’t happy,” he says. “There’s no job too low for her to get involved in.” Hand in hand with this work ethic is her strong determination to see all her goals reach the finish line. “She’s like a dog with a bone,” adds Kante. “Once Joni’s made up her mind, it will get done.”

Purchase the June 2018 issue in which this article appeared.

Purchase the June 2018 issue in which this article appeared.

D. Gary Young: A Lasting Legacy For Future Generations

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In this issue:

D. Gary Young was the amalgam of a life spent overcoming tremendous adversity—poverty, disabling injury, ridicule and a harsh upbringing fostered in him an unstoppable desire to help others in need.

Through Young Living Essential Oils, the company that he and wife, Mary, founded in 1994, Gary Young built a direct selling legacy, earning him the prestigious inaugural Bravo Legacy Award at the Direct Selling News Global 100.

However, during the writing of this feature to honor Gary, we received the sad news that he had passed away May 12, 2018, after a series of health problems. We pay tribute to him by honoring his memory through his own words and those closest to him. In addition to how he personally touched so many lives, his extraordinary professional contributions to the direct selling community will be felt for generations to come.

Mary Young accepts the Bravo Legacy Award on behalf of her husband and Young Living Founder D. Gary Young.

 

Early Life and Abject Poverty

As a boy, Gary called a 20-foot-by- 30-foot mountain cabin in Challis, Idaho, home. With no running water or electricity, the family—Gary, his parents and five siblings—eked out an existence determined by what they could grow and hunt. Life was harsh.

“As I looked at the poverty in which I lived, I knew in my heart that I never wanted to live like my parents and was determined to have something better,” Gary said. He dreamed about creating and forging a future out of the wilderness and the mountains that he loved.

“My father taught me the value of hard work and how to be creative in solving problems and achieving what had to be done. This gave me the physical and mental strength that equaled whatever challenge came my way,” Gary said.

And his challenges were great. In his early 20s, a logging accident left Gary near death with 19 broken bones, three skull fractures and multiple herniations of the spinal cord. He languished in a coma for three months. Upon waking, doctors said he would not walk again.

Distraught, Gary attempted suicide twice. “He didn’t want to live without his horses. He didn’t want to live without his mountains,” Mary Young said. An attempt to starve himself ironically prevented scar tissue from forming and nerves rerouted. Sensation returned to Gary’s toes and he defied the medical prognosis. Gary rose to walk again.

“Whatever path I walked, God was my partner and foundation for the decisions I made. After my terrible accident at age 24, I promised God that if he gave me back my legs, I would spend the rest of my life serving his children,” Gary said.

Unfortunately, challenges followed Gary throughout his life, in the form of injury and illness. On Jan. 25, he faced yet another when he suffered a stroke that rendered his left side useless.

“Gary was a man who loved God and believed the mountains were God’s living room, where Gary went to communicate and find peace,” Mary said. “He loved his home and his family, and his greatest joy was in being of service to his fellow man, helping people reach their highest potential, have a greater understanding and compassion for one another, and achieve mutual respect and honor, even with our many cultural and ethnic differences.”

D. Gary Young during his participation in the Iditarod Trail Sled Dog Race in Alaska.

Laying the Young Living Foundation

A self-described “gunfighter” who lived by instinct, fast decisions and emotion, Gary Young never hesitated in life or business. The three 33s guided him: 33 percent intuition, 33 percent calculation and experience, and 33 percent gut feeling.

Mary and D. Gary Young

In the 1980s, Gary was immersed in alternative medicine, and then became fascinated with essential oils. He studied essential oil distillation methods in the early 1990s and became enamored with the potential power of natural ingredients. When a distillation teacher in France advised him to grow the necessary plants himself, Gary jumped at the idea of getting his hands dirty and planted his new 60 acres in Idaho with lavender, peppermint and tansy.

By 1994, newly married Gary and Mary Young, who sang with the Utah Opera, wanted to share essential oils with the wider world and for the first time used network marketing to do it. They renovated a run-down Riverton, Utah, building as their headquarters and called the fledgling company, Young Living.

Driving Energy

Gary’s all-encompassing, driving energy infused Young Living. He plowed fields with his tractor, designed and built farm and distillery equipment, formulated in the laboratory, and taught seminars. His dedication, energy, enthusiasm and capacity for hard work, Young Living President and COO Jared Turner said, “put people half his age to shame.”

“The only way Gary knew how to lead was from the front and the rest of us did our best to keep up! When you have a vision as singular as his was, paired with the determination and drive to accomplish it, you see unbelievable things happen. You see Young Living happen,” Turner said.

For 25 years, Mary watched this man take on every day as if it were his last. “He was passionate, quick-witted, emotional and brought excitement and creativity with his empathetic, loving and kind nature that was very contagious,” she said.

Gary put his unique zest for life on full display for Young Living’s Members by riding a zip line into an annual convention, mushing a dog sled team across the Alaskan wilderness, and taking up medieval jousting for sport. “If you’re not living on the edge, you’re taking up too much space,” Gary said. “Think of your goal, feel the passion come up inside you and forget about all the stuff on the side trying to convince you that you can’t do it. Yes, you can do it.”

Growing the World Over

“You’re only as good as that which you can give to someone else,” Gary said. Young Living and the network marketing channel allowed Gary to fulfill his own dreams in grand, visionary ways and make good on his promise to God to help others.

Keeping that promise started at the source of essential oils themselves. Gary traveled the world to learn all he could about growing and distillation, journeys that became far-reaching opportunities for good.

When Young Living established farms in places like Chongon, Ecuador, where Gary lived for a time tending lavender, he cultivated crops and formed strong, equally beneficial bonds with local farmers and villagers. He looked deep into the holistic needs of the community and set about meeting them.

“I was able to provide jobs for people who had never had a job, provide education for children who would never have an opportunity, and see poverty turn into real success with longevity for countless people,” Gary said. “It was very exciting for me to see ways that I could teach people how to help themselves through honest, productive work that produced oils for my company. It was a win-win for everyone.”

Turner said, “I think one of the biggest differentiators is that he led with his heart. That’s not to say that Gary wasn’t brilliant, insightful, and incredibly well informed. I can testify that he was! What I mean is that he prioritized the human benefits of his products and the company above any financial considerations.”

“I believe that when God blesses you financially, it is your responsibility to help God’s children who are less fortunate, not only with money but with giving of your time to help in other physical ways when possible,” Gary said. He formalized this belief with The Young Living Foundation in 2008.

Chongon’s children were first on Gary’s list. He acquired land for a new school, The Young Living Academy, and built it in 2009. Partially funded through $75 a month student sponsorships, the academy serves the educational needs of 300, K-12 students and has changed the trajectory of these students’ futures.

The Young family celebrates breaking ground for Young Living’s new headquarters.

The Foundation supports the communities where Young Living sources essential oils. Projects have taken them to Uganda with Sole Hope to scrub and remove small parasites causing dangerous and even deadly foot infections. They’ve also made shoes for villagers as a proactive measure. They partnered with Healing Faith Uganda to purchase mosquito nets, organize service trips and help test for malaria. Elsewhere in Africa, they doubled the efforts of African Hearts, a transitional home for abandoned children offering shelter, food, social services and quality education, purchased land and built an additional school for 200 children, ages 3-5.

Perhaps most memorable was Gary’s 2016 trip to Nepal, nine months after devastating earthquakes and aftershocks left 1.2 million homeless. Standing among ruins in Yarsa distributing blankets, Gary looked upon the flimsy tents, lean-tos and tin sheds and knew they were no match for the coming winter. People—little children—were dying of exposure. Why had help not arrived?

Working with permission of Nepal’s vice president, Gary sliced bureaucratic red tape and set about saving lives. His problem-solving mind saw a simple, South African brick-making machine used on Young Living’s Ecuadorian farm as a solution. Dirt mixed with small amounts of cement made bricks. Bricks could save lives in Nepal.

The Young Living Foundation ordered a complete, automated block factory, hired an engineer, architect and project manager and sent them for training. They taught the Nepalese to rebuild devastated villages, and then to manufacture and sell construction blocks, which created long-term economic value.

Gary mobilized Young Living’s Members for muscle and funding and counted rebuilding Yarsa’s homes and school a favorite memory. “Hundreds of our Members gave freely of their time and money to travel such long distances, to sleep in tents, and to work along with these people who lost everything and desperately needed help,” he said.

“We consider ourselves the Young Living family and when members from around the world work together on a specific service project, at winter harvest, or spring planting, there is a bond created that uplifts and warms the heart and brings a joy that fills the soul,” Gary said.

Instinctive Success

Sales under $800 a day didn’t meet the bills, but vision and an “inner knowing” drove Gary in Young Living’s early days. He made grand predictions and Mary would chuckle. “But as the years went on, I came to understand that no matter what he said he was going to accomplish, he always accomplished it,” she said.

D. Gary Young worked closely with the people of Nepal to help communities in need in 2016 after the country’s devastating earthquake months before.

Before the paint was even dry on their first headquarters, Gary drew up plans for their next. He was confident Young Living would someday live up to his dreams, confident it would outpace a laundry list of direct selling giants. Mary laughed again and asked how he could be so sure. “I just know,” Gary responded.

Perhaps only Gary could see the company’s future success because only he knew for certain how to harness his maverick style, his ability to outwork everyone from dawn until long after the sun went down, and his drive to help others. Gary saw it clearly. Gary made it happen.

In 2014, Young Living’s explosive growth outpaced its infrastructure. They invested heavily across the board and slowed opening new markets. By 2015, Young Living achieved $1 billion in annual sales and repeated it the next three years, placing it among the world’s largest direct selling companies. Revenue growth of 800 percent the past five years culminated in 2017 sales of $1.5 billion.
Today, the company reports 3,000 global employees working in 13 offices, representing 22 markets. It ship products to 133 countries. Young Living operates one of the most technologically advanced essential oil distilleries in North America, as well as 16 corporate and partner farms in the U.S., Ecuador, Canada, France, Oman and others. Since inception, they’ve welcomed some 4 million Members.

“Gary’s entire MO was to help people improve lives in every possible way. Every decision he made was for the benefit of his employees and Members around the world. Gary’s philosophy was infused into the daily operations of our company at every level, which I believe is a key part of the ‘YL Magic’ that sets us apart in this industry,” Turner said. “Each of us, from the executive level on down, has taken Gary’s beliefs to heart, which ensures that his legacy is secure and Young Living will never deviate from its core principles.”

Purchase the June 2018 issue in which this article appeared.

Purchase the June 2018 issue in which this article appeared.

DSN Welcomes Executives and Guests to its Global 100 Evening of Celebration

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In this issue:

The DSN Global 100 Celebration recognizes the direct selling channel’s proud history of providing individuals from all walks of life unparalleled opportunities for entrepreneurship and personal development.

This annual event also showcases the impact and growth potential of the $182.6 billion global direct sales channel. Worldwide, more than 107 million people are involved with direct selling, according to the World Federation of Direct Selling Associations.

During this year’s ninth annual celebration, held May 2 at the Renaissance Dallas at Plano Legacy West Hotel, Direct Selling News unveiled its exclusive ranking of the top revenue-generating companies in direct selling based on prior year revenue. Hosts Lauren Lawley Head, Senior Vice President and General Manager for SUCCESS; and John Fleming, former publisher of DSN, hosted more than 200 executives from throughout the United States as well as Canada, India, China, Malaysia, Germany and New Zealand, among others.

“The identification of companies to include on the list is the culmination of months of research and the cooperation of many individuals across the world,” said Lawley Head. “The Global 100 ranking has become a benchmark for the channel and a valuable resource for the academic community.”

John Fleming

Former DSN publisher John Fleming addresses the crowd.

“We’re building businesses at a great moment in time,” said Fleming. “Never has the support and technology and the focus on real customer acquisition been greater. Never have the masses in mature economies throughout the world been more interested in some form of entrepreneurship—a method of business that allows for flexibility and freedom to work when one would like to without time constraints. Research has long stated that we are headed toward an economic landscape where the independent contractor will make up more than 50 percent of the labor force that supplies products and services. SUCCESS Partners has long identified this new economy as the YouEconomy. Others refer to it as the sharing economy or the gig economy; however, the point is that this research and its forecast favors direct selling companies.”

Dallas violinist Dean Raskin

Dallas violinist Dean Raskin.

For the sixth consecutive year, Ada, Michigan-based Amway claimed the top spot as the No. 1 direct seller in the world, with $8.60 billon in revenue in 2017. This global giant maintains a large portfolio of top-selling brands including Nutrilite vitamin, mineral and dietary supplements, as well as Artistry skin care and color cosmetics and XL Energy Drink. Amway does business in over 100 markets through more than 3 million independent Amway business owners.

“We’re so proud to be part of an industry that supports and empowers an invigorating lifestyle for people who want to work to live, not live to work. This industry is so special, and we look forward to continue supporting and inspiring the next generation of entrepreneurs,” said Kim Drabik, manager of industry and shareholder relations, who accepted the award on behalf of Amway.

London, U.K.-based Avon Products once again took the No. 2 spot on this year’s DSN Global 100 list, with $5.70 billion in revenue in 2017. “Direct selling can’t be more important than it is today,” said Jan Zijderveld, Avon’s new CEO, who was traveling and shared his thoughts in a video message. “We now have about 6 million microentrepreneurs around the world. When you empower women, the whole society becomes better, more prosperous and more balanced. That’s something the direct selling industry and especially Avon does really well. It’s really something to be proud of.”

Special Guests

DSN welcomed very special guests to the dinner, including our own John Fleming and attendees from all over the United States along with representatives from Immunotec in Canada, PM-International from Germany, DXN Holdings from Malaysia, Vestige Marketing from India and New Image Group from New Zealand. Also in attendance were members of China-based Global Direct Selling Research Institute, Brian Cai and Dale Sun. This organization has provided tremendous assistance to DSN’s Global 100 research efforts in recent years.

DSN Global 100

The Global 100 have plenty to celebrate this year:

  • Amway’s Kim Drabik accepts the company’s award for its No. 1 ranking on the Global 100.

    Collectively, the Global 100 achieved more than $85.2 billion in net sales in 2017, up from $82 billion in 2016. And among those companies are 14 that grew by $100 million or more in the past year.

  • In 2017, a record 24 Global 100 companies achieved more than $1 billion in net sales. Those 24 companies generated $59.6 billion for the year—approximately one-third of all global sales from the channel.
  • The Top 10 companies achieved $40.6 billion in revenue last year.
  • Mid-market companies—those between $300 million and $1 billion—are represented by 28 companies in this year’s ranking. Three companies are within striking distance to $1 billion; nine are in the $600-million-to-$700-million range; and another six already are at the half-billion-dollar mark.
  • By region, there were 43 companies from North America in the Global 100; five from South America; six from Europe/Africa; and 46 from Asia/Asia-Pacific. A total of 18 countries were represented on the list—Brazil, Canada, China, Colombia, Germany, India, Japan, Luxembourg, Malaysia, New Zealand, Peru, Russia, Singapore, South Korea, Switzerland, Thailand, the United Kingdom and the United States.
  • Companies appearing in the ranking for the first time included Coway from South Korea (No. 11); Hualin from China (No. 37); Golden Days from China (No. 42); MONAT Global from the United States (No. 52); Best World International Limited from Singapore (No. 61); Alpha from China (No. 62); Prüvit from the United States (No. 67); Norland from China (No. 68); Green Leaf from China (No. 70); Kangli from China (No. 80); Vida Divina from the United States (No. 85); Usborne Books & More from the United States (No. 96); and Xyngular from the United States (No. 99).
  • Companies returning to the ranking are Rodan + Fields (No. 16) and Juice Plus (No. 32) from the United States; Amore Pacific (No. 35) and LG Household & Healthcare (No. 54) from South Korea; Apollo from China (No. 53); and Cosway from Malaysia (No. 79).

The Bravo Awards

The Bravo Awards recognize excellence in business.

The Bravo Awards recognize excellence in business.

Each year, the DSN Global 100 celebration recognizes a direct selling executive whose exceptional leadership qualities have propelled his or her company to extraordinary new heights with the Bravo Leadership Award. This year’s recipient was also DSN’s Global 100 keynote speaker for 2018, SeneGence Founder and CEO Joni Rogers-Kante, whose incredible story has inspired entrepreneurs throughout the world.

Rogers-Kante began her career in direct sales with Mary Kay, where she developed a love for the channel and its ability to provide tools for women to support themselves while raising their self-esteem. A newly single mother, with little income and an uncertain future, she spent the next four years working on her dream of owning her own business. With hard work, persistence and faith, she eventually opened SeneGence. Her company has become an international leader in the cosmetics industry, best known for its long-lasting lip color products. The continued growth of SeneGence is fueled in large part by Rogers-Kante’s vision to help empower women worldwide.

She spoke of the “Amazon effect” that has forced a lot of brick and mortar retail outlets to reduce staff and/or close up shop altogether in recent years. But “the online buying experience is not the ultimate answer,” she added. “People still want to see and feel before they purchase. It’s our industry, our products, our opportunities, and our ability to provide people with an infrastructure they need to write their own destinies without fear or risk—that’s what sets us apart. Amazing, energetic, creative people who so badly want to provide a prosperous future for their families will come to our companies not only for our products, but because other options are limited to them. Now their future is in their control—not the control of companies who can lay them off at any minute.

 

“Independent distributors can now bring back the concept of small town family-owned businesses to any town, any city or any country they choose to through the direct selling channel,” she said. “We have at this time in history an extraordinary opportunity to create a major shift in the way products and services are purchased through a voluntary salesforce that is coming available. My story started with one, but it’s about everyone who provides support and services to this industry as our efforts reverberate throughout the world and touch others’ lives. Our industry is the industry of the future.”

This year, Direct Selling News introduced a new Bravo award: the Bravo Legacy Award, honoring an individual who has made extraordinary professional contributions to the direct selling community that will be felt for generations to come. It’s extremely fitting that D. Gary Young, founder of Young Living, was the first recipient of the Bravo Legacy Award. His dedication to quality and commitment to excellence built Young Living exponentially and helped the company surpass $1.5 billion in sales last year and $1 billion the previous two years, with revenue growing 800 percent over the past five years. Young Living is now one of the largest direct sales companies operating in the United States.

Gary Young, who passed away on May 12 soon after the Global 100 Celebration, wasn’t able to attend the event, but his wife and business partner, Mary, traveled to Dallas to accept the award on Gary’s behalf.

 

“It’s a bittersweet moment,” Mary said. “In my life, I know of no one who deserves more of this kind of recognition for what he has given to the world—he literally gave his life for what millions of people now have in Young Living. His goal was to help people in whatever capacity they needed and to see people become better than what they thought they could be—and to see happiness and joy come into their lives.”

Todd Eliason, DSN’s new publisher and editor in chief, reveals insights from the Global 100 ranking.

Miami-based company MONAT received the third award, Bravo Growth Award, for increasing its annual sales an astounding 667 percent from 2016 to 2017. MONAT took a decidedly different approach in 2014 when it launched as the first company focused on developing anti-aging products specifically for hair care. The company now has more than 150,000 Market Partners in the United States, Canada, and most recently, the United Kingdom. President Stuart MacMillan and Co-Founder and CEO Rayner Urdaneta were in the United Kingdom to celebrate the company’s official launch and were unable to attend the DSN Global 100 Ceremony. However, Chief Marketing Officer Linda Padilla, Director Market Partner Experience Jason Russell, and three of MONAT’s original employees were in attendance to accept the prestigious award on behalf of the MONAT leadership team, the entire Urdaneta family and its Market Partners.

Sponsorships

SUCCESS Partners was again the lead sponsor of the DSN Global 100 Celebration. The following companies also sponsored the event:

Platinum Supplier Sponsors: Avalara, Exigo, Hyperwallet, IMPACT This Day, InfoTrax and Landmark Global.
Platinum Table Sponsors: Prüvit, SeneGence, Total Life Changes and Young Living.
Gold Table Sponsors: AdvoCare, Ambit Energy, b:hip Global, Isagenix, Jeunesse, Mannatech, MONAT, Plexus, PM-International, Stream, USANA and Zurvita. DSN

Purchase the June 2018 issue in which this article appeared.

Purchase the June 2018 issue in which this article appeared.

Frequently Asked Questions about the Global 100 Ranking – 2018

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In this issue:

Why did DSN start the Global 100 list?

DSN created the Global 100 list to acknowledge the achievements of direct selling companies and to provide a clear picture of the magnitude of the industry. Just as every credible industry ranks its players—through Inc. 500, Fortune 500, and Forbes’ lists—DSN wanted to show the public what a viable and credible industry direct selling is.

Who uses the Global 100 list?

The DSN Global 100 list offers a unique perspective on the global impact the industry has on economic and social levels. It provides a scope of learning not only for industry members, but also for researchers, investors and those seeking opportunities within the industry. When DSN began the ranking in 2010, it was committed to creating a fair ranking that would showcase a transparent industry, thus providing credibility and consumer confidence as well as research support for those desiring information on direct selling companies.

What research process is utilized to produce the Global 100 ranking?

The identification of the companies to include in the DSN Global 100 list is the culmination of months of research and the cooperation of many individuals throughout the world. Wherever possible, the DSN team seeks out public records and documents for publicly traded companies. Additionally, the team reaches out to the private companies that may qualify for the ranking. Research begins in December and continues through to the publication of the Global 100 list. To fully reflect the global reach of direct selling, each year, DSN has been able to extend the boundaries of research by working with research partners, including China-based DIR Group, to obtain information on international companies.

How is privately held company data compiled?

Nearly four-fifths of the DSN Global 100 data is derived from privately held companies. Most of this data comes from the companies themselves, which submit a revenue number validated by the CEO and certified by a qualified agent, and when they submit they enhance the value of the industry’s strategic objective to showcase a much more transparent business model. These companies could have chosen not to participate; however, their cooperative spirit, which so exemplifies this unique industry, makes the Global 100 ranking possible.

What revenue number does DSN ask for in the research process?

To participate in the DSN Global 100, a company need only submit a net revenue number validated by the CEO and certified by a qualified agent. DSN does not request confidential financial documents. DSN respects the financial privacy of all direct selling companies, asking that a company only reveal the annual revenue number that will allow it to be placed in the ranking.
What is the purpose of the Revenue Certification Form (RCF)?

In an effort to further ensure the integrity of the Global 100 list, DSN instituted the Revenue Certification Form, or RCF. The RCF requires all private companies to have their revenue number validated by the CEO and certified by a qualified agent (either at the applicant company or an outside independent source). DSN believes any company performing in a manner warranting identification and recognition as one of the Global 100 companies would proudly share its revenue number in a manner deemed fair to all.

Why isn’t Value-Added Tax included in the revenue number?

The ranking criteria is net sales revenue from direct selling operations before commissions and without value-added tax. The VAT, from DSN’s perspective, is certainly an integral part of the salesperson’s life; however, it is not a part of the corporate revenue as we track it.

Why aren’t some companies I know of on the list?

There are both nationally and internationally based companies worthy of recognition in the DSN Global 100 ranking that do not appear on the list. If you do not see a specific company it could be that (1) the company was contacted but declined to participate, (2) the company did not respond to requests, or (3) the company did not submit information in time. Each year, new companies come onto the radar screen and every attempt is made to connect with them.

Click here to view this year’s list

Purchase the June 2018 issue in which this article appeared.

Purchase the June 2018 issue in which this article appeared.

Partners in Self-Regulation for all of Direct Selling

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In this issue:

Since 1971, the Council for Better Business Bureaus Inc. (CBBB) has administered the self-regulatory programs that operate under the umbrella of the Advertising Self-Regulatory Council (ASRC), including the National Advertising Division (NAD), Children’s Advertising Review Unit (CARU), the Council for Responsible Nutrition’s dietary supplement review program, the Interest-Based Advertising Accountability Program and the Electronic Retailing Self-Regulation Program (ERSP).

The U.S. Direct Selling Association (DSA) has a long and proud history of encouraging self-regulation of industry practices. Its comprehensive Code of Ethics was adopted in 1970, and the DSA Code Administrator administers it.

In December 2017 the FTC’s Acting Chairwoman Maureen Ohlhausen appeared before the DSA and challenged it to adopt a bolder self-regulatory posture. It was shortly after that when DSA began working with the CBBB to launch a new initiative to strengthen the direct selling industry’s self-regulatory programs.

The Acting FTC Chairwoman said that this new and more aggressive approach to self-regulation would benefit both DSA’s consumers and member companies by providing a more accountable and fair marketplace with lower compliance and regulatory costs than would be true under government regulation. There are also benefits to the government by allowing it to focus its limited resources on the most egregious practices and industry members.

We know these benefits because they have been the result of the programs we have developed for so many other industry groups. Each of these programs was adopted by leading industry groups faced with increased scrutiny by media, advocates, and the government. The advertising industry, the infomercial industry, the dietary supplement industry and the online behavioral advertising industry decided to step forward and take control of their own practices by adopting self-regulatory programs built around a robust set of proven standards:

Purchase the June 2018 issue in which this article appeared.

Purchase the June 2018 issue in which this article appeared.

  • First, it is imperative that self-regulatory programs provide a fair and meaningful standard of review. The work at NAD, CARU, and ERSP centers on delivering industry members guidance on whether their practices meet legal and industry standards.
  • The second critical component is independence. Program decisions are reached by expert attorney staff who evaluates advertising claims independent of any outside influence or consideration other than the party or parties’ evidence.
  • Transparency is a critical element of these successful self-regulatory endeavors. All case decisions are announced and made available for the guidance of the industry. This transparency allows the public, advocates and the government to see the work, read the analyses and judge the program for themselves.
  • CBBB self-regulatory programs are based on accountability. At the close of a NAD, CARU or ERSP inquiry, for example, advertisers are asked to provide a statement that they will comply with the recommendations, if any, included in the decision. If the advertiser declines to commit to the recommendations or is later found to be non-compliant, the matter will be referred publicly to the appropriate governmental agency.
  • Finally, the decisions published by these programs apply to all industry members, not just members of supporting trade associations or businesses that agree to follow them. The reputation of an industry for truth and fairness is established by the industry as a whole, not just individual members.

Effective self-regulation demonstrates an industry’s commitment to marketplace behavior that benefits consumers and businesses. As Chairwoman Ohlhausen emphasized in her remarks, effective self-regulation helps everybody. The CBBB is delighted to be working with DSA to develop the framework for this exciting program.

C. Lee Peeler, Esq., a 33-year veteran of the Federal Trade Commission, is the President and CEO of the Advertising Self-Regulatory Council and EVP of the Council of Better Business Bureaus.

 

5 Best Practices for Making It Work in the Global Market

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  1. Find the local direct selling association. “The national DSA will have detailed knowledge of how the market works and can inform companies which legal regulations apply,” says Katarina Molin, executive director at Seldia, the European Direct Selling Association.
  2. Hire native speakers. Someone who knows the language from the inside will help you avoid faux pas, says 4Life Co-Founder Bianca Lisonbee, recalling that a pronunciation of an abbreviation the company once put on an international label was unintentionally off color. Molin agrees: “It’s a worthwhile investment to have a local manager who speaks the local language and who understands the key do’s and don’ts about the specific business culture,” she says. And even if you’re expanding to a market where consumers and potential distributors speak your language, “the tone and style of messaging can be very different in different countries,” Molin adds. So don’t just copy and paste website content.
  3. Do your homework. Study other companies’ successes and failures and learn from experts on the ground in the country you’re targeting—before you start doing any business there. “The temptation is to go ahead without checking boxes of the regulatory agencies,” for example, says 4Life Co-Founder David Lisonbee. “Many companies have jumped the gun… and then that creates negativity about the industry.”
  4. Expect complications—sometimes serious ones—and roll with them. “It doesn’t seem to matter what market we’re adding,” says Youngevity CEO Steve Wallach. “There’s always something going on—whether it’s a natural disaster or geopolitical turmoil. That goes with the territory of international expansion.”Your company may even be able to become part of the solution. When Hurricane Maria devastated Puerto Rico in 2017, for example, 4Life leased a fleet of private planes and helicopters to transport relief supplies and more than 70,000 pounds of food to the country, where it had been in business since the early 2000s and already had distribution warehouses.
  5. Don’t mess it up. eBay is probably an exception to this rule, as it managed to find its footing in China after initially failing. Usually, you get one shot, direct selling executives say. “If you don’t do it right the first time, you probably won’t have another opportunity,” says Arbonne CEO Kay Zanotti, adding that it’s critical that top management is part of any global expansion. “I’ve learned the value of being personally involved and committed to our new market launches,” she says, “A firm commitment at the highest level not only sets an example, it’s essential to international success.”Also, be measured in your ambitions, adds Ambit Energy Co-Founder and CEO Jere Thompson. “So often, the inclination is to land grab,” he says. “But you go into too many markets at once and you don’t have the oversight that’s necessary, you suddenly no longer have dry powder to address challenges or your people get burnt out from doing too many things at once.” ‘recruit, recruit, recruit.’ ” However, those companies that place high priority on leading with product (retailing) and retention strategies are much better positioned to experience long-term sustainable growth.
Purchase the June 2018 Issue in which this article appeared.

Purchase the June 2018 issue in which this article appeared.

U.S. Direct Selling Experiences Slight Decline in Sales, Representatives in 2017

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According to the recently released “Growth and Outlook Report: U.S. Direct Selling in 2017” by the Direct Selling Association (DSA), 2017 saw slight decreases in sales and involvement in direct selling in the United States, the largest direct selling market in the world.

The DSA, the national trade association for companies that offer entrepreneurial opportunities to independent sellers to market and sell products and services, reported that retail sales in the U.S. in 2017 were $34.9 billion, down 1.8 percent from 2016, and that 18.6 million people were involved in direct selling, which represents a 9 percent decrease year over year. Participation in the channel varied from those who joined direct selling companies as discount customers to those who are pursuing a business on a part-time or full-time basis.

Retail Sales

Estimated retail sales for 2017 were $34.9 billion, down slightly from 2016’s $35.54 billion. This marks the second year in a row that sales have declined. Sales had climbed each year from 2011 to 2015, which had an all-time high of $36.12 billion in sales.

The top states with direct selling activity continued to be Texas, California, New York, Florida and Illinois, which, collectively, accounted for nearly 45 percent of all U.S. sales in 2016 with $16.1 billion.

Wellness products remained the most popular product category in the U.S. in 2017, accounting for 33.8 percent of sales, followed by Services (22.1%), Home & Family Care/Durables (16.8%), Beauty & Personal Care (16.5%), Clothing & Accessories (8.2%) and Leisure/Educational (2.6%).

Direct Selling Population

After a record 20.5 million Americans involved in direct selling in 2016, the DSA reported 18.6 million for 2017. Of those, 9.6 million were discount customers, 7.6 million part-time business builders and 1.4 million full-time business builders. These statistics do show growth in the number of Americans starting home-based businesses: In 2017, 1.4 million Americans had full-time businesses compared to 0.8 million in 2016, and 7.6 million Americans were involved in part-time businesses in 2017 compared to 4.5 million in 2016.

The direct selling channel, known for its flexible entrepreneurial opportunities for all ages, reflected that in the statistics that showed 36.9 percent of direct sellers in 2017 were Millennials; 34 percent, Gen Xers; and 26.4 percent, Baby Boomers.

By gender, 73.5 percent of direct sellers in the United States in 2017 were women and 26.5 percent men. After a 3 percent drop from 2014 to 2015, the percentage of men joining the channel has increased each of the last two years, with a 15 percent increase from 2015 to 2016 and another .5 percent increase from 2016 to 2017.

Ethnic and racial demographics for 2017 show that Americans involved in direct selling were 80 percent non-Hispanic and 20 percent Hispanic. Of the non-Hispanic direct sellers, 85 percent were White/Caucasian, 8 percent African American, 1 percent American Indian or Native Alaskan and 1 percent Native Hawaiian or Pacific Islander. These numbers closely reflect the fabric of America: the U.S. population is 82 percent non-Hispanic and 18 percent Hispanic. Of the non-Hispanic population, 77 percent is White/Caucasian, 13 percent African American, 6 percent Asian, 1 percent American Indian or Native Alaskan and 1 percent Native Hawaiian or Pacific Islander.

For more insights and statistic on the U.S. direct selling channel, visit www.dsa.org.