A deep dive into today’s direct seller and what they are looking for.
When Direct Selling News asked for my thoughts on what motivates today’s direct sellers, I knew this topic was complex. What motivates people is never a simple “black-and-white” answer. The motivations can be as varied as the number of participants.
What is readily apparent is that motivations are evolving. The ultimate objective of all direct selling companies is to grow the business by growing the number of customers. Direct sellers are the intermediaries in this process. Therefore, what motivates a direct seller is important for the company to understand.
Direct Selling Is Poised for Growth
Relevant direct selling models are in position to grow market share in the current favorable environment of consumers actively seeking more efficient ways to purchase products and services. Therefore, direct selling opportunities will become more attractive—even a preferred choice—for those looking for new revenue streams.
“Direct selling is poised for growth and relevance.
The key word in the above hypothesis is “relevant.” In Ultimate Gig, we devoted an entire chapter to motivations for working a gig. In this article, we correlate insights gained from Ultimate Gig findings with experiences, observations and study of additional empirical research. These three insights reveal what we consider to be important to understanding what motivates direct sellers in today’s marketplace.
1/ The origins of direct selling offered an opportunity to represent a brand, enabling consumers to purchase the brand through a very personalized approach. Direct sellers sold to consumers and serviced customers consistently. However, over recent years, we may have lost some of the excitement related to successfully attracting and retaining real customers of the brand. Contemporary direct selling companies are just beginning to recognize the value of analyzing and tracking the behaviors of consumers of their products and services acquired through independent direct sellers. It is as honorable to “sell” as it is to “buy,” and when we can benefit from a sale, we activate new possibilities and opportunities to repeat the process again and again.
2/ As direct selling evolved to include new methods of compensation not explored or used by any other business model, the hypothetical math associated with the opportunity may have become more important than the philosophy behind the brand and the importance of transactions with consumers and customers of the brand. To explain further, David McConnel, Earl Tupper, Stan Beveridge, Mary Kay Ash, Mary Crowley, Rich DeVos and Jay Van Andel appear to have been very focused on the principles and values upon which they founded their companies. I do not recall anything of importance associated with the percentages of commissions paid to those who joined those companies. I do, however, VIVIDLY remember the philosophies these great leaders created and advocated. Each company was built on a foundation of principles and values. Each of the companies mentioned went on to become successful brands associated with direct selling. Direct sellers are motivated to participate when they see more than a transaction and the percentages associated with the transactions.
3/ Simplicity vs. Complexity is the essence of new strategies designed to attract new direct sellers. Affiliate programs will become more and more popular and will be embraced by more direct selling companies. The rationale for the popularity in affiliate programs is based upon proof of concept. Again, the growth of the gig economy is the proof where simplicity, ease of engagement and quick rewards for effort are recognized. The growth of the gig economy does not represent new competition for those companies using the direct selling model, only a reminder that the origins of the model remain fundamental to the appeal of the direct selling model.
Growing market share will be dependent upon attracting more prospects in the effort to attract more shoppers, customers and direct sellers. This is the basic premise upon which the direct selling model was founded. However, the manner in which direct sellers are attracted must now evolve beyond traditional motivations and attract others based upon unique methods of recognition and compensation and excellent support. This will enable the attraction of shoppers and the acquisition of a greater market share of customers and those who seek affiliation with income earning possibilities and opportunities. Direct selling companies must now own the brand.
New Focus. New Opportunity.
As the direct selling channel embraces concepts of simplicity and engages the use of digital platforms and digital tools in customer acquisition/retention efforts, direct selling will become more of a preferred choice by those who explore income possibilities related to the gig economy.
This simply makes sense because the benefits of being rewarded for customer acquisition and retention and the efforts of other direct sellers that are personally influenced are unique to the channel. Unlike other choices now available via the gig economy when seeking new income possibilities, direct selling opportunities continue to remain unique in that a direct seller aggregates the benefits associated with acquisition and retention of both customers and others who affiliate. This attribute should be considered a powerful motivator! Rich DeVos, Co-Founder of Amway, once described direct selling opportunities with three words: “An Uncommon Freedom!”
In the past, direct sellers typically chose one direct selling company to partner with. Today, we find that 69 percent (U.G. Research October 2021) of gig economy participants work multiple gigs. Multiple gigs can be complementary of one another. Direct selling has always been viewed as a viable way to develop an income with freedom and flexibility. Perhaps, direct selling companies will benefit from understanding that the new direct seller may be making other choices for income possibilities and the choice of a direct selling company may not be the only choice. However, direct selling should be perceived as a preferred choice if not the ultimate choice or Ultimate Gig…simply because it is!
Instant Gratification Motivates Direct Sellers
Companies are using technology to reward gig workers by paying quicker for performance. This is a prime motivator for working a gig. Quick pay solves problems faster when financial health and cash flow are primary motivators.
The gig economy has revolutionized the idea of paying quicker for performance. This is the new reality of the gig economy. The phenomenon has ignited the concept of work on demand. When there is a demand for work, a gig company meets the demand in real time through engagement of independent contractors who make themselves available.
Technology is the connector. Almost three of four workers are found to live paycheck to paycheck when paychecks occur on a weekly, biweekly or monthly basis. Accelerated pay is a huge motivator that fuels the appeal and growth of the gig economy, and this feature is now being incorporated into most direct selling models.
The new opportunity for the direct seller is to target more of the general marketplace, appealing to those who wish to easily affiliate with brands, products and services they love.
New Perceptions Will Motivate
Positioning of the opportunity is critical to what motivates, attracts and leads to engagement. What motivated direct sellers in the past does not totally sync with what motivates prospects now or in the future.
Public perception of direct selling models will improve dramatically as it becomes inclusive of newer iterations of the existing models. Perception will improve as labels become less important. It’s imperative to remember:
- The importance of simplicity in recognition, rewards and compensation methods.
- The gig economy is approximately 10 times the size of direct selling and growing in both participation and revenue at a very robust forecasted CAGR through 2027.
- The gig economy focus is more on flexibility, freedom, fair rewards and simplicity. Direct selling is a subset of the gig economy and just one of many choices available.
- The robust growth of ecommerce should become an asset for direct selling companies.
- Digital tools that enable sharing the brand’s messaging can no longer be considered “nice to have.” They are essential.
Direct selling companies have not, historically, considered ecommerce to be competition. However, ignoring ecommerce is no longer an option. Today’s direct selling companies must be competitive and appealing in look, feel and functionality with respect to digital platforms, expanding possibilities and eliminating physical, geographical and time zone constraints. The utilization of direct sellers as intermediaries is a natural way to personalize the experience of engaging an ecommerce platform. As the public perceives us as being more than a direct seller/network marketer/social seller but more of a personalized provider of products, services, possibilities and opportunities, we will motivate more to seek our model as both a consumer and a micro entrepreneur.
As direct selling models of distribution embrace the current inflection point, the opportunities that lie ahead are as strong as ever. Direct selling is an uncommon opportunity…An Uncommon Freedom!
John Fleming is the author of Ultimate Gig: Flexibility, Freedom & Rewards which provides an in-depth glimpse of the future of work and how the gig economy has fueled the growth and appeal of flexible work opportunities. John is principal of Ideas and Design Group, LLC and in both the DSA Hall of Fame and DSEF Circle of Honor. John is also a recipient of the DSN Bravo Lifetime Achievement Award. John has recently released LEVERAGE, a free eBook download.
From the April 2023 issue of Direct Selling News magazine.