Editor’s Note: The following article is excerpted from the latest 16-page insert produced by Direct Selling News for The Wall Street Journal. The complete insert was distributed to over 1.2 million WSJ subscribers. Reprints can be ordered here.
Americans love to talk about what they buy. And, as a natural extension of that love, millions of U.S. adults are actively engaged in buying products or services from independent sales representatives with whom they have forged a personal connection.
These types of transactions, whether called direct selling, social selling, relationship marketing or social sharing, have become a common channel of distribution. New research from Harris Poll and commissioned by Direct Selling News found that the prevalence of direct selling, buying a consumer product or service person-to-person away from a fixed retail location, is high. More than 156 million people—two in every three U.S. adults—have made a purchase from a direct seller. The online survey of 2,060 U.S. adults 18 and older found that more than 81 million people have done so within the past six months.
And that’s just the activity on the purchasing side of the equation. For millions of people, direct selling has become a viable business opportunity that has given them the ability to make a different choice for themselves and their families.
In a world of economic ups and downs, growing job insecurity and dismal retirement portfolios, building a direct selling business makes perfect sense for many. It offers an opportunity to supplement their household income to meet a specific goal, such as paying for a new appliance, covering a child’s private school tuition or managing a car payment. Some go on to expand their businesses to equal—or even exceed—their previous corporate paychecks.
The giant leaps in technology employed by companies level the playing field even further. With sign-up apps, point-of-sale technology, online sample requests, and social and email follow-up, a business owner’s digital tools can equal those of a much larger corporation. Further, social media has turned traditional marketing on its head, and companies of every design are scrambling to capitalize on digital marketing tools. For direct selling companies, social media just enhances the relationship-driven business model already in place.
In addition to offering a lucrative business model for entrepreneurial-minded individuals, direct selling companies also boost local economies where they operate. Companies on the list of the world’s 100 largest direct selling companies employ more than 175,000 people, spanning the full spectrum of corporate positions.
Amway, No. 1 on the DSN Global 100 list, prides itself on giving its independent business owners the training, education and mentorship they need to become successful. “We believe we are the cure for the common cubicle, offering entrepreneurs the possibility of self-fulfillment through hard work and dedication,” points out Managing Director Jim Ayres. The company also has a powerful, wide-reaching corporate presence; it recently announced a $375 million manufacturing and research and development global expansion that includes four facilities in the United States, a new manufacturing facility in India, and second sites in both China and Vietnam. Operating in more than 100 countries, the Ada, Michigan-based company employs more than 21,000 people worldwide.
With millions of customers, a wide variety of goods and services, and great performance on the stock exchanges, direct selling as a Main Street model of distribution seems to be working very well. “In an uncertain market, people gravitate toward security, and that is what the direct selling industry can offer,” says Dan Macuga, USANA Chief Communications Officer and Executive Vice President of Field Development for the Americas. “In direct sales, the security you have is the security you create… when you create your own business, you shape your own future.”