Direct selling’s visionary leaders discuss how their companies’ 2020 pivots have shaped their 2021 outlook.
To view the complete videos from The Change Makers event, go to dsa.org/cm-recordings.
Last November, C-suite leaders and senior executives engaged in a DSA livestream event that focused on shaping the direct selling channel post-COVID-19. Hosted by Thirty-One Gifts Founder Cindy Monroe, the four-hour event shared how these leaders met the challenges of 2020, what they did to change their business approaches, and how they will continue to be agents of change for their companies, teams, distributors, and consumers moving forward.
CINDY MONROE, Founder, Thirty-One Gifts
There is something wonderful about human nature and an individual’s desire to connect as part of a community. Those of us in direct selling know this desire for connection is the driving force that makes this channel so exciting and dynamic. Each one of us is part of strength by leaning on each other in good times and in times of uncertainty, to build each other up, to give each other permission to dream, and to recognize the best in each other.
As direct sellers, beyond our desire to seek strength from our community is our passion for innovation. We know that our community is stronger together and that our shared passion has the power to transform individuals, families, and communities. When direct sellers come together, ideas are sparked, and strategic insights take shape.
It is hard to comprehend all that happened in 2020—the change that took us all by storm. Yet, we can clearly see that direct selling continued to adapt to an evolving market. And we fully understand that the personal relationships we make and the passion for our products are so important to our business model. Whether through traditional one-to-one selling, home parties, or online, those relationships and that passion allow our brands to find success in new ways that others admire.
The visionary leaders featured on the following pages faced their share of change in the past year. They discuss how their companies’ 2020 pivots ultimately have shaped their 2021 outlooks, and how they will continue to be change makers for the foreseeable future.
Heather Chastain: Certainly 2020 has challenged executives everywhere. We’ve all been challenged to rethink our own ways of approaching business, the opportunities we provide, and our ways of viewing technology, customers, our place in the world—and what’s even possible for us to achieve as an organization. How are we going to take all of that and shift it into 2021 strategic planning?
Let’s start with some of our learnings from 2020. We’re in the relationship business. That is what we do. But the very nature of relationships has shifted because of 2020 and the use of technology. Creating that sense of community that is so vital to what we do and how we do it is a new challenge. How is that factoring into what you have done in 2020, and how is that view of creating community and relationships in this new world shaping 2021?
Joni Rogers-Kante: We are in seventeen countries, and all our offices were already virtually connected for the corporate team. So it was just a matter of making sure that everyone was connected individually as they worked from their homes instead of the office. And that, frankly, was a pretty easy transition. Of course, our amazing IT department made sure that was all in order maybe within a week. We didn’t miss a single beat. We have meetings set up every hour on the hour, different departments, different countries.
My amazing President, Philippe Guerreau, and I had a discussion and decided that I would certainly keep hands-on communication with our salesforce, and he would run all the countries’ corporate office teams. So I had the great pleasure of beginning to reach out and touch and talk to our leaders, every day, from nine to five, on the hour, every hour. And of course, I would address the entire company once a week. Through this communication, it’s been fun to exchange ideas. It’s also been important to listen to the challenges—leadership challenges, sales challenges, sponsoring challenges—and help to come up with solutions at a much faster speed than we normally would.
Nancy Bogart: As a company our size, it is a little bit different. We were not set up to communicate in an online-only world. I was just traveling a lot and making phone calls. When this all hit, our IT department, which is extremely small, pivoted really well. It was the opportunity to grow past where we were. We were very traditional. Our consultants were still placing orders and delivering those orders and doing home parties. It was almost like this little cord was cut, and once it was, we felt like we were able to elevate so quickly.
I have never spoken to so many of our field in a week. I bet I could not have done in three months what we were able to do in a week. That has enhanced our relationships with our remote employees. We are still tucked in little Nixa, Missouri. We are still open, and I still can go into the office. But it allowed us to come to the consultants and show them how we are going to help them have their meetings and how they are going to communicate with people. For our business, this is going to be such a huge opportunity to take into 2021. We have seen our largest sales volume in twenty years just since May. July was the biggest month we have ever had.
Jane Creed: We just came off one of the greatest Septembers we ever had. I would attribute it to that real ability to be very authentic and to really reach out to our people, and to thinking of things to do that we never even thought about. Obviously, we are a wine culture, so very much an entertainment and joyful kind of community. We do not only have to do business things—let’s do a cocktail hour. Let’s share about our corporate giving programs. Let’s do all kinds of things in the evening. And it is so wonderful, and it is so connected.
That’s the key for 2021—how you embrace technology with that in-person recognition that really touches your heart."
—Deborah Gibbins, Chief Operating Officer, Mary Kay Inc.
To put it on a family level, I have not seen my daughter since the shutdown happened in March. Right now she’s in England. But even her relationship with me, I think, has gotten so close because we are able to look at each other’s eyes. We can see each other and really talk. And so I feel like it has been so great to be able to meet with our leaders one-on-one and to be able to break the rules. And I think we really learned that at convention. We had the highest attendance ever and an unbelievably successful sense of togetherness. I think we will never go back to many things, and things will never be the same. And I think that is okay because the things we have learned are unreal.
Heather Chastain: There has been a “we’re all in this together” kind of spirit. It’s been much easier to do that because there is this sense of camaraderie and shared purpose and shared desire to come together. Can you tell us a little bit about that and then how you’re planning on catapulting that into next year?
Deborah Gibbins: Our big seminar, our big convention that happens in the summer—every market has set a record around the world for attendance.
What creates community in direct selling is recognition, so how do we marry this, all these people being a part of this in a way that they haven’t been before? We cannot go back, cannot expect people to take time off their day jobs and invest money to attend these events. What were we thinking? We want to use this technology and invite more people in. That’s the key for 2021—how you embrace technology with that in-person recognition that really touches your heart. That is a little harder. We are ideating right now on how we can blend the best of both.
I don’t know what 2021 will look like. I know it won’t look like 2019. Hopefully, it won’t look like 2020. But we’ve got to start envisioning what that married virtual and in-person looks like so we can get back to the best of recognition. We’re starting to talk about Zoom fatigue, and it is a real thing.
I think what people are hungry for is some consistency. We have used these leveraged plans and accelerated that, and we do not want to go backwards. We have talked a lot about the difference between traditions and values. Our traditions are going to change. They are going to keep changing. We will keep pivoting on traditions, but we are going to be consistent on our values.
Heather Chastain: 2020 was a time of radical change. Everything hit us from every direction. But it’s an incredible opportunity for us to streamline and simplify our businesses and make some of those changes we probably wanted to do for a while. So what are some of those things in your business that you have taken advantage of with this opportunity, and as you look at your strategic planning for 2021? Are you thinking about ways to further simplify, further streamline, further refine, to make your business more agile?
Joni Rogers-Kante: We are a little behind the curve in that our company did not have a customer program for twenty-two years. We just launched it in October. So it is perfect timing that our distributors are at home online, talking to their customers, and embracing a customer program where they are trusting us to handle their customers in a way we never have before.
It is exciting for all of us on the company level, and, of course, for our distributors as well. It is helping to give them a tool that, I believe, would not have been accepted in the same way—we are now helping them with their customer load. This is not only important for our company; it is also important for the industry. And our distributors have completely embraced it. So for 2021, we are really focusing on our end-consumer customer programs through our distributors.
Heather Chastain: As we look at 2021, do you feel like there are areas where we may have to increase our agility? Whether it is supply chain or technology or recognition, what areas do we need to be preparing our teams to react to more quickly?
Jane Creed: Strategically, one of the things we see is a real need to be able to fulfill the customer’s desire for customization. You have a much more intimate connection by being able to see somebody in their home and by seeing what their needs are, what their emotional makeup is. Customization is something that the consumer really wants, to meet them wherever they are.
So as we plan, it is not what we want to give them but what they want to have, which requires, of course, a whole different kind of setup with your warehouse, your distribution, your inventory management, all kinds of things. We are really focused on seeing the individual and fulfilling personal needs first.
Joni Rogers-Kante: I agree with Jane 100 percent. We have been working on some objectives for at least a year and a half around a tagline we use often, which is “beauty is in the blend both inside and out.” And that has everything to do with the individual needs of the user. So customization is it for us through high tech.
You know how to process the order, but that is not what the magic is. That is not where the relationships come from. That is not where the change is made in the world, which is what we are all here to do—change the world one person at a time."
—Heather Chastain, President, Shaklee US and Canada
Deborah Gibbins: Having a more robust supply chain, thinking about backup suppliers for key components, really bolstering segmentation to a segment of one. That customization of identifying each person’s own unique need and then enhancing that with technology. We had started a digital journey and we are just accelerating it. And we are doubling down on that even more in 2021 because this is not going away.
Nancy Bogart: I have had a saying for the last six months: we want computers to do what computers do so people can do what people do. People’s time is very finite. Even though we are at home, we are busier. We have so many moms who are schooling their children. The family is working from home. We want those nuggets of time for our consultants to matter, where they are not doing paperwork. Our focus is not as much the customer experience as the consultant experience. How is she spending her time? In 2021, we’re going to have a big shift from the very hands-on, very boutique feel of our program to have it where my time with you is my time with you. It is part of my very, very intentional strategy that our consultants put their faith and their family first, and that they focus on people and not on process.
Deborah Gibbins: Time is the ultimate resource more than anything else. The best return on investment we can give people, even more than money, is time back.
Heather Chastain: I love that pivot and that focus on the why. You know how to process the order, but that is not really what the magic is. That is not really where the relationships come from. That is not really where the change is made in the world, which is what we are all here to do—change the world one person at a time.
CEO KEYNOTE: TRACY BRITT COOL
Ruth Todd: Tracy, you were at Berkshire Hathaway, working alongside Warren Buffett. Tell us how you moved into direct sales.
Tracy Britt Cool: I spent ten years at Berkshire, five years working at headquarters on the investment side with our businesses across a variety of industries on how to help companies get to the next level. And that was particularly interesting to me and exciting and powerful. That is how I first got involved with Pampered Chef. The business had been in a challenged position. It had been declining for quite some time, and it was just in a tough spot. We had brought back Doris Christopher, the founder, in an interim role as CEO, and I came in to help her reorient the business and get it back to a better place.
At the time, I knew really nothing about direct sales beyond just being a customer at points, but I really felt like there were some interesting aspects of the channel. Specifically, I found it was a great combination of being able to build a brand, but to have something indescribable and amazing, which is the field organization. And that powerful connection between having a brand and having a special channel, that really is a true competitive advantage where you are not trying to sell through retail, you are not trying to sell a line. So as I spent time helping Doris and the business, I thought there was so much potential in this business. And as I met consultants and heard their stories, I thought it was incredibly powerful and impactful—and we were not realizing our full potential at Pampered Chef.
Ruth Todd: You mentioned some important words: “potential and power in the channel.” Were those surprises to you, as you started to recognize the specialness of the direct sales channel?
Tracy Britt Cool: It surprised me because I think from outside the industry. The view of the industry is sometimes a little sleepy, or a little slow, or it isn’t always the best industry. I had a good experience as a customer buying products and I knew about the brands, but it wasn’t the same experience. And so I was probably, appropriately so, influenced by what I had seen or read or experienced from friends or otherwise. But I think as I really started to understand the business, I felt two things that were incredibly instrumental for me to understand the power.
The first was the fundamentals of the business, very attractive in terms of what you can do, how you can scale the businesses, how efficient it is, and how meaningful. But probably more important than the financials or the results is really the power of the consultants themselves. You hear these stories about the power of the business and what it has done for them, their confidence, their income, their families. And then you hear what it has done for their communities and their teams. You hear those stories, and you realize even though it is a good business, it also is a great community partner and a great impact in the world, which I think is incredibly powerful and meaningful.
Ruth Todd: What was the surprise that was a head scratcher for you?
Tracy Britt Cool: I think the industry was a little slower back then in terms of how big it was and how much opportunity there was. And there are not as many companies that have been strong throughout the history of the industry. Oftentimes companies come and they go, and a lot of the more established ones have failed to innovate at the level that they need to stay relevant for today’s consumers.
Also, there was a huge shift happening in terms of technology and consumer behavior prior to me joining. I saw that in the industry, and I felt like there was so much potential and there was so much opportunity to refocus on today’s consumers and how today’s consumers want to shop and engage, which was very different than it was historically—specifically, moving from in-person events to moving much more virtually. I think at one time in the industry, the internet was a scary thing and I felt there was this huge opportunity to embrace it. And there absolutely were some companies really embracing it, but it probably wasn’t as wide as I would have expected, given the power of the channel. It seemed amazing to see what you could do through digital channels utilizing a field organization. I didn’t see it as threatening. I saw it as empowering.
Direct sales tends to do particularly well when there is a challenging environment. I don't think that is anything to be ashamed of. I think the reason is that this business does great things for people and for consultants, and it provides a little bit of happiness and great products for customers in tough times.
Ruth Todd: What was the biggest lesson that you learned leading Pampered Chef?
Tracy Britt Cool: It is hard running a business. Huge lesson. It is very, very hard. I told Warren when I started at Pampered Chef it would take me one to two years to turn around the business. I knew what we needed to do; I just needed to find the team and to execute. It took me over four years. I think that was incredibly powerful for me to learn that lesson. And having done it, I have much more appreciation for how hard it is to build a business, how hard it is to run one, and how hard it is to turn it around when it flops.
Ruth Todd: Now you’ve pivoted again—you’ve launched your own investment firm. Tell us what you’re focusing on as far as your opportunities in direct sales. You left Pampered Chef, but you didn’t leave direct selling totally.
Tracy Britt Cool: It was not an initial plan, to say the least. I did not think that we would start off by buying businesses in direct sales. That was not what we set out to do directly. But there was just such an amazing opportunity with Cindy Monroe and with Thirty-One Gifts.
I met Cindy Monroe years ago when I first started at Pampered Chef. I always admired the Thirty-One story and how impactful the business had been for so many different consultants and team members. It was really inspiring. Cindy called me early in 2020, before COVID-19 hit, and said, “I’m thinking about having a partner.” I thought it was an interesting opportunity to not only partner with her but to partner with the Thirty-One field, and to help take Thirty-One to the next level.
Ruth Todd: This is a great time for direct sales. Tell me what you see as the biggest opportunities for the industry as we move into 2021 and beyond.
Tracy Britt Cool: I think there’s immense opportunity. Direct sales tend to do particularly well when there is a challenging environment. I don’t think that is anything to be ashamed of. I think the reason is that this business does great things for people and for consultants, and it provides a little bit of happiness and great products for customers in tough times. And it provides opportunities for consultants to make a little extra income, to have flexibility. If there ever was a tough time and an uncertain time, 2020 was it. I think there are opportunities to help support customers and consultants and people in our communities, even more so than ever before.
Ruth Todd: What type of strategic planning should new companies focus on?
Tracy Britt Cool: I think what a new company needs versus a mature company really shifts and evolves. I try to boil things down to the simplest questions that you want to answer: where are we going to play, and how are we going to win?
So where are we going to play? What is our market? What is our product? Who are our customers? I think you want to be clear on that and try to answer the question because it will really help you. I think the best companies, like IKEA, are very focused on their customers. They are not trying to do the high-end customer. It is a very do-it-yourself functional but design aesthetic. Southwest—they are not trying for the bells and whistles. It is efficient. It is the same plane. They are very thoughtful about their strategy. So I think companies should home in on doing that and not try to be all things to all people.
The second aspect is, how are we going to win? What are we going to do better than everyone else? None of us are going to win against Amazon on shipping time or ease or convenience. That is not how direct sales is going to win. We are going to win more on experience, on customer service, on the community, and on the connection.
I think newer, smaller companies and startups can effectively think through those two questions.
And then I think your process should match that. So if it takes you one month to answer that question, great. If it takes you five months, then great. I am a big fan of your executive team helping to shape that process. But you need to have input from other people as well, deeper in your organization—individuals from the home office giving feedback and input from the field organization as well. I think the strategy process can be very daunting and overwhelming. You want to simplify it down to those questions and find a process that works for you and works for your team.
CEO KEYNOTE: ASMA ISHAQ
One of the reasons Modere is successful today is because it has a clear, well-established mission that is understood and shared by everyone in the company. Companies that are led with this kind of purpose have a unique advantage: we’re able to help employees gain a deep sense of personal responsibility for the business, which is not such a common phenomenon, unfortunately. A recent Gallup survey revealed that only 13 percent of workers in the US say they feel emotionally engaged with their employers.
I believe that the founder-led mentality that has contributed to our success over the past four years of my tenure at Modere can also be credited for our continued perseverance and growth through the unprecedented challenges we experienced in 2020. Founders and founder-led companies tend to abhor complexity and bureaucracy. They have a distinct bias toward action and an aversion to anything that gets in the way of a clean execution strategy.
Founders are also obsessed with the details of the business and have a strong focus on cost. As an owner, you are looking at cost very differently than a corporate employee, for example. And, most importantly, you celebrate the employees on the front line who are doing the crucial work of serving the customers. This mentality shapes our ability to respond to challenges and our approach to continuing to build our business as we step into a post-COVID-19 future. It also helps us find a balance between what has worked in the past and what will work in the future, and provides direction on what we’ll need to do to succeed in the new normal.
We have been redefining strategic objectives, including those that affect our employees, to help keep our business as fluid as possible. Like many businesses, we have shifted to a work-from-home policy for the foreseeable future, and we’ve been performing better than ever. We have seen many of our employees and team members not only persevere in this environment, but also step up to the plate, which reflects their sense of ownership and personal responsibility for moving our company forward. Remote working and this shift in lifestyle and work culture have helped Modere to perform optimally.
Moreover, in this new context we have released any expectations that the old ways will return. Instead, we are operating as if we are already in the future. If this were the future, how would we behave? How would we perform? How would we meet our objectives? We collaborate more. We are more flexible. We approach our discussions and decisions with a new immediacy. We are inclusive and more communicative than ever. Whereas previously we held our company-wide ”town hall” meetings on a quarterly basis, over the past year I have been conducting staff meetings via Zoom every week and all-team meetings at least every other week. I am actively engaging with everyone in our company more than ever before, and this has certainly worked to our advantage.
This brings me to my second point: 2020 brought a sense of urgency, to which Modere was able to respond precisely because of the founder’s mentality that we operate under. Thanks to our innate agility, our aversion to bureaucracy, and our constant communication, we have reached key decisions that, in any other context, could have taken several meetings over a period of weeks to make. We are successfully encouraging a culture of a different mentality, a different mind-set altogether.
Modere has moved from a just-intime to a just-in-case supply chain philosophy. We are redesigning supply chain to optimize resilience and speed. And we are making sure to preemptively plan for alternatives. It is unlike any other challenge we have had to scale to hypergrowth."
The next area in our business that has ascended to top-of-mind, and where we have adopted a new perspective—particularly because we have grown so much this year through it all—is our supply chain. According to a DSA Quick Poll survey, nearly 70 percent of companies are concerned about supply chain in this environment. Modere has moved from a just-in-time to a just-in-case supply chain philosophy. We are redesigning supply chain to optimize resilience and speed. And we are making sure to preemptively plan for alternatives. It is unlike any other challenge we have had to scale to hypergrowth. I think the businesses in our channel are better positioned to manage and sustain growth than most other companies, because they do not expect the kind of exponential growth that can happen in our industry.
Knowing this, we were probably better prepared than most, especially doing the work that we have been doing over the past few years. But really, COVID-19 has put a different level of pressure on supply chain, not least because so much of what is happening is outside of our control. Modere has offices all over the world. We are shipping all over the world. We’ve faced some extreme lockdown measures in Europe, and we’re very conscious of the need to be agile and responsive, and to figure out how we can continue to thrive and grow in any of these contexts.
The fourth area that has been top-of-mind is the concept of digitization. Our salesforce builds via technology, and 90 percent of their business is done online. In contrast to a typical, in-person meeting business model, our salesforce is not required to have personal contact with the end user, customer, or distributor. However, although we are fortunate that our unique social retail business model reduced our need to pivot, as many companies and businesses have had to do last year, we have been seeking ways to enhance our e-commerce platform by becoming creative in contactless opportunities. I do believe that is the way of the future.
If you live in a big city, you know that the trend is toward contactless transactions, whether it is your method of payment or the way FedEx is dropping packages off at your door. All these practices are changing, and many of them will not be going back to the way they once were. At Modere, we are looking for a variety of creative ways to present these kinds of opportunities in our business. This is the future of transactive communication in the world.
We will always have personal relationships being cultivated in our channel, which will separate us from many of our retail competitors. But there are changes happening in the digital world that can make us so much more competitive, and we are learning from those, being observant and reimagining new ways of doing things.
All these areas are helping us to adapt successfully to what is happening now. And all are grounded in the founder’s mentality I mentioned earlier—a focus on costs, removing layers and bureaucracy that hinder agility, acting quickly, being obsessed with the details, and creating value for the consumer.
CEO KEYNOTE: JILL BLASHACK STRAHAN
“Interesting” is my word for 2020. Yes, COVID-19 has made for an “interesting” year. Oddly, my second word is “blessed.” Eating at home had an astronomical surge. Deciding what to eat, searching for ways to entertain the kids, and finding fun ways to connect with friends is at an all-time high.
Tastefully Simple is blessed because we sell seasonings, sauces, and mixes. These products have been our niche for twenty-five years, since I started the business in a shed with no running water, packing orders on a pool table in Alexandria, Minnesota.
The ride was crazy wild. Our peak sales were in 2008 with $143 million. Then another kind of crazy began. Sales slid. Every. Single. Year. Since 2009. Eleven years. The last year in which we were profitable was 2012. Yes, you read that right. 2012. We depleted our $32 million reserves. Yes, you read that right, too.
One of the ways I coped with the intense pressure of being in a financial turnaround was journaling. Here is what I wrote on July 28, 2017:
I cannot stop crying. I could say that I can’t handle this roller-coaster ride, but it’s not an accurate metaphor. Roller coasters go up.
My mind is about to explode with all I have to do. Do I write my five Party Palooza scripts? Do I contact my investor advisor? Do I call potential investors? Do I follow up on the multitude of Post-it notes that are in my planner?
I recently read an organizational tip: “To reduce stress clear everything off your desk except what you’re working on." That has been immensely helpful this week. Yes, my mind is spinning out of control. But why the hysterical crying this morning?
It’s a crashing together of gratitude and fear and loss and hope and determination and hopelessness and frustration and love and guilt.
I shared with our HQ team and top leaders that I have committed another $2 million line of credit in addition to the $5 million line of credit I’ve already loaned to Tastefully Simple.
I made this decision because I believe in the future of Tastefully Simple. I was effin' committed. I was all in. I was galvanized. I felt at peace with the decision.
Then I had a call yesterday with a financial advisor. He was brutally candid. “Jill, this is a very risky decision. Will your $7 million loan be repaid? It’s highly unlikely. As a matter of fact, you will probably need to make an additional loan by the end of the year.”
I slid all the way back to effin' hell. So, what if he’s right? What if this doesn’t work?
Will I have to file bankruptcy? What kind of idiot am I? How did I end up in this spot? What am I going to do?"
Journaling was a lifesaver. It helped me get centered and gain more clarity. Ultimately, I chose to “listen to the whisper”—I honored my word with an additional $2 million line of credit.
By the grace of God, we didn’t need it.
Profit is driven by the three P’s: Plan, People, and Processes. We worked our butts off to simplify the business for our consultants, reduce expenses by more than $12 million, and get laser-focused on returning to the core of the business—sell, sponsor, and lead.
My friends, it is truly a miracle. We. Were. Profitable. In. 2020! The biblical seven-year drought came to an end.
I share our story with you to give you hope. Being a leader and running a business is not for the faint of heart. We can be soaring so flippin' high—and then we crash to the earth, feeling like we are gasping our very last breath. Those times suck. I mean, they really suck. And, as true entrepreneurs, we persevere, we learn, and we grow stronger.
Yes, 2020 was an “interesting” year. It was also a very “blessed” year for Tastefully Simple.
The unprecedented circumstances of 2020 drove so much change across every business function of every direct selling company. Business strategies, salesforce communications, marketing initiatives, and technology infrastructures were transformed. The challenge is how to carry this change into 2021.
The following panel of leading Change Makers shoulder the driving of this transformation, proving the impossible to be both achievable and actionable, becoming even more strategically obsessed with the need for customer-centric approaches, and gaining new strengths and preparedness that positions their companies to conquer future disruption.
Lori Bush: From your experiences and observations, when is a direct selling model more advantageous than other consumer marketing models and when is it of no competitive advantage, or maybe even a disadvantage?
Kirsten Aguilar: A few things came to mind when I was pondering this question, and my thoughts were pretty simple. I asked the question, Does your product need or deserve to be demonstrated? Is leaving it on the shelf or sharing it through a video enough? If not, direct selling could be a more advantageous channel. Also, has the business owner previously had any proven success by wordof-mouth sharing? Have they seen people already creating a buzz or talking about their product in the pre-launch or the early stages of business? Because that would be, of course, a good indicator. And then how are your profit margins? Can you afford to sell it at discount or wholesale? Because there are a lot of mainstream and retail businesses that do not consider that factor when jumping in. I have had those conversations with people who are surprised at the back-end side of our business. So simply, that would be an advantageous look at things.
I would say a disadvantage would be if the company ownership or the stakeholders do not have any firsthand experience in our industry. That can really open them up to a lot of surprises along the way. And if they have not really pinpointed what is strongly unique about their product, what is going to make it stand out, and what is going to help them go in.
Julie Cabinaw: A demonstrable product is gold in any channel, but we have a particular advantage in direct selling when we can show and share. So I think that is a tremendous advantage. I think every product has that opportunity.
From the other perspective, if it is a commodity, if there is not as clear differentiation, if there are a tremendous number of products in the space, it might be harder to enter that space. Or if there is a complicated or complex product that goes beyond just demonstration to where it must have long-term support, I think that is another one that can be challenging in our industry. Not insurmountable but you just really need to put together your thoughts even more carefully on how that relationship between a corporate entity and the direct sales rep would be for long-term support.
Both digital and social have become as common as the air that we breathe . . . Not engaging is not an option. We all need to know how to engage in the right way."
—Candace Matthews, Chief Reputation Officer, Amway
Sheryl Adkins-Green: First and foremost, the entrepreneur needs to determine their “why” and to make a decision that is more than just the product or service, but how they want to serve others. If their vision includes serving others through forming relationships, through forming a community, that to me is when they need to seriously consider how the direct selling model can work for their business.
Obviously, with e-commerce you can provide almost any product or service if all you are looking to do is transact and make some money along the way. But again, if that entrepreneur’s vision has a purpose behind it and that purpose is in service to other people, that to me is when they want to consider how to leverage a direct selling model.
Lori Bush: Today, all direct selling companies recognize the impact that social media is having on consumer behavior, and consequently, on direct selling. In your experience, what have been the most effective ways to integrate social media into a direct selling business model and into brand marketing for direct selling businesses? What was perhaps working previously but may not be working anymore? What has never worked, and in your opinion, should be avoided? What do you see for the future?
Julie Cabinaw: Social media is about connection. I think it is a tremendous brand builder. It has the power to facilitate relationships, and an ability to connect people to solve problems. And so that is really what is working today. When we keep those things in mind, in the social interaction, we increase the power of our connection.
Some things that were working previously may not be working anymore: I think the misuse of social media is to go directly to the sale, the conversion. We are going right to the bottom of the funnel all the time and trying to get that sale instead of respecting its position as having a different role at each point in awareness, interest, desire, and action. And so that comes into play when we think about the role of groups and overall brand marketing and the marketing of our consultants.
What has never worked or should be avoided: We have all said it a million times but teaching our field representatives to view it as a business tool and not really relying on that inner circle of their personal social connections to get them to where they need to be. How are you connecting beyond that? And how are you separating your brand identity as a businessperson from that of your personal connections?
Candace Matthews: We all must realize that both digital and social have become as common as the air that we breathe. And everything revolves around that experience and that social engagement. And so not engaging is not an option. We all need to know how to engage in the right way. I think one of the best things that we could possibly do is use social media to tell our brand stories in a very authentic way—using it to connect our experiences, to connect with communities. That is one of the things that our CEO, Milind Pant, has really grasped very well. He has a very active social media presence and is connected not only with our field but with consumers as well.
I think that what might not be working anymore, especially now, is relying on face-to-face. That is, with where we are right now globally, you cannot rely on the ability to be face-to-face. You must figure out how social plays, but you cannot just use social to blast things. It is got to be authentic and personal and real for the community that you are engaging with.
What has never worked or what should be avoided is exaggerating—using social media to say something that is an exaggerated story or an exaggerated claim because that hurts us all. The younger generation, they are digital natives. Many of us who have been in this industry are digital immigrants, and we are learning something that has been a part of their everyday life. And so we must engage with them in a way that is comfortable and authentic to them. And that is where I think we as an industry really must make sure that we are paying attention and learning and understanding.
Sheryl Adkins-Green: Social media really plays to a strength that our independent beauty consultants bring in terms of being caring and wanting to connect with others in the community. I think that was particularly important in 2020, as we all needed to rely on social media for motivation and inspiration—those messages of care and concern that we saw by so many people. I think that was particularly important in the direct selling industry because so many people saw and appreciated others—in our case, independent beauty consultants—and how they cared. They saw how they were supporting the frontline with donations of hand sanitizer that we were able to make available. They saw how they were caring about their customers and their family, and how they were juggling work from home.
And I think that authenticity truly resonated. I think it is something that distinguishes the direct selling industry, which is the genuine passion of real people, real women out there running their businesses, and at the same time supporting their communities. So for all those reasons, I think social media has been a strength and will continue to be one, because it is a platform for us to tell our story in relevant and authentic ways.
I would say paid influencers are a dead angle. There is just no value in that anymore. People can see right through it. We are out there looking for the real stories and people who are using and loving and needing our brand."
—Kirsten Aguilar, Executive Vice President of Global Marketing, SeneGence International
Lori Bush: Has social media challenged or supported the reputation of direct selling? Julie Cabinaw: I think in so many ways we hear more about the negative. But I think our brands have gotten out there in a much more amplified way because of social media. So I feel like net, it is positive.
Ashley Collins: I agree. I do think, overall, the net is positive. It is just keeping that positivity and not getting defensive and going into the negative. Let that go. Focus on yourself, the positive stuff that you bring. Do not let them get you down. That is challenging, but I think overall, it is positive, and it is essential, especially now more than ever.
Kirsten Aguilar: Yes, I absolutely echo both Ashley and Julie’s comments. We are in a social mediadriven world, right? It is everything that we do. At SeneGence, we are in the world of skincare and cosmetics. So what works for us is authenticity, being real. For both our distributors and people out there who are using our products, we are looking for people who genuinely like the experience of what they are using on their face and body, and we are always on the lookout for unique individuals who are being real and sharing their true selves. It has brought us such an amazing pool of people, who are, most of the time, free to interact with and work and share your brand.
I would say paid influencers are a dead angle. There is just no value in that anymore. People can see right through it. We are out there looking for the real stories and people who are using and loving and needing our brand. A few things that are working: transparency behind the scenes, real content, unfiltered and unedited images, show your flaws. For us, what is really working is to let our distributors and customers do the talking for us, sending out products in advance of launch to create a buzz. First impressions and unboxing, those are relevant right now. Trying not to be too strategic but having a content calendar, where we can look ahead and make sure we are having the right balance of the sales content with the feel good, recognizing holidays, or just giving people a reason to maybe laugh and smile and start the day.
And I would say what used to work and is not working now is counting on social media to do it all for us. People are fatigued. They are online more than ever. They do not want to be sold or convinced anymore. They want a portal for communication or an escape but no controversy. We must leave politics and race and anything that could possibly get in the way of the message out of it. And for us, we even avoid using social media for crisis management now. We used to do that, and now that is a face-to-face conversation or phone call. So it is just a totally new world.
Lori Bush: With the retail apocalypse, many brands that have previously seen success in other classes of trade are looking to direct selling. We are seeing more seasoned consumer packaged goods (CPG) marketers starting or joining direct selling companies in executive roles. What aspects of traditional CPG translate well to direct selling? And where does direct selling diverge from other consumer marketing models? What are some of the mistakes that you see CPG marketers struggle with, and struggle with most, when joining a direct selling company?
Julie Cabinaw: I think one of the biggest blessings people from the CPG space bring into a direct selling brand is the word brand. I think all our direct selling companies are amazing, but those CPG companies really understand the position of a brand, a brand framework, a brand voice. We are a food brand. So we are competing with off-the-shelf food that you can find in the grocery store. We just re-launched our website and really took it up to that brand experience level. Those are the kinds of things that I think are amazing additions from the CPG perspective.
I think the biggest divergence is a CPG marketer perhaps not understanding that a consultant is your best customer. She is not a means to an end. She is not just a distributor, like a wholesale distributor or other channel partner that you might have encountered if you have lived in the CPG space, where you are negotiating and you have a very strictly business relationship. It is a momentum business that is built off a relationship between you and that consultant and their team. When you disrupt that by taking an action where you are not appropriately communicating through the field, that is probably one of the biggest challenges that I think can happen, where we take autonomous action as a brand without including the field in the decision making and change management process.
Candace Matthews: I think one of the things we have in common is the brand-building. Building brands with a point of difference and understanding that your brand must have a great proposition and products that deliver against that proposition. So that is where the aspects of traditional CPG translate well. I think the biggest misunderstanding is not understanding the value that the people in this industry bring. So our field, our independent business owners are so critical. It is people who make the difference. When the value is brought to our customers, it is being brought through the people who are part of this industry. They really engage with the people who are their customers. They build these personal relationships and personal communities. And so that is important to understand when you are leaving a CPG company and coming to a direct selling company.
Sheryl Adkins-Green: Our independent beauty consultants are the brand and, of course, marketing products are part of what helped them be a successful Mary Kay brand. So it is a different mind-set than my days on Fruity Pebbles, where my product sat nicely on a shelf in a box and I had “control over the messaging.” In this instance, it is really about the culture that helps you in direct selling, that makes sure the people who are representing the brand and the company’s reputation embrace its values, the integrity of that company. I think it is also important that when someone is moving into direct selling that they understand and respect how important it is that for anything to be successful, it must be embraced by independent beauty consultants, business owners, the distributor network. If the salesforce does not understand the program, or the business objectives, no matter how creative and brilliant that promotion or program is, it will not succeed. So success really does come through helping others be successful. And that is something that certainly we have all learned, those of us who have been in this industry.
It is the same for millennials as it has been for every other generation. Can you solve a problem that I have? Can I relate to you as a brand? Will you meet me where I am in terms of how I want to work with you?"
—Julie Cabinaw Vice President of Marketing, Tastefully Simple Inc.
Lori Bush: For the last decade or so we have been talking ad nauseam about millennials. But millennials are no longer kids. Are you seeing their behaviors starting to shift as they are coming into their peak earning years? What are some of the key considerations in creating compelling business opportunities for millennials?
Julie Cabinaw: I think millennials have been the most overhyped generation there ever was. And that is not just because I am not one. I think they had the benefit of growing up when we had wide platforms to talk about them and to understand them and to dissect them that did not exist previously. And what it comes down to for a business opportunity or for a product opportunity, it is the same for millennials as it has been for every other generation. Can you solve a problem that I have? Can I relate to you as a brand? Will you meet me where I am in terms of how I want to work with you? I think maybe the newest contender in that— that is stronger than any other generation—is, Do I identify with your values as a brand? I think we have seen much more of that with millennials than perhaps we have with prior generations because they grew up knowing their voices were going to be heard, and that they have that ability to turn that conversation.
Ashley Collins: What I think is so important is they are critical to the future of our business. It is the largest population that is our future. And I think something so important to millennials is truly having that aspect of environmental, social governance. Millennials are passionate about being part of something bigger. To them, it is not always just selling a product making a dollar. They want to feel good about what they are doing, and they will stay with you. I think for our companies, what do we offer outside of just product and compensation? Are we environmentally conscious? Do we care about social issues? What is our culture? That is truly where the opportunity is to draw millennials in and have them stay with you because they will be loyal if they are reaping the benefits and feeling that connection and part of something bigger.
Kirsten Aguilar: Something that I like to keep top of mind when considering this particular group of people is they do not know a time when they did not have access to information at their fingertips. You cannot hide anything. And when making choices, they will always be able to find, if they choose to look, the negative, the backstory, the real side of things. So be open to having healthy and ever-shifting discussions. Internally, what I have found is that traditional hierarchy that some of us may be used to, where there are bosses and people under them respect them, and there is a reporting structure, maybe is not as valued, and those kinds of lines are always being challenged. So I would just say, be open to healthy dialogue and conversations all the time.
Sheryl Adkins-Green: As I think about that question, I think about the relevancy and the benefits of a direct selling opportunity for all demographics. I mention that because as certainly we have all seen underscored over the past several months, there are some fundamental things that people really care about—obviously, being able to provide for their families. And now, more than ever, understanding that requires flexibility, people wanting to make sure that they have some control over their financial future, and not being necessarily 100 percent reliant or dependent on jobs or careers that they, once upon a time, thought for sure would always be there. Whether it is millennials or Gen Z, I think people care about having as much control or more control over how they spend their time and they want more control over their earning opportunity.
Candace Matthews: Like many other demographics, millennials have a passion for entrepreneurship, but they look at it a bit as their side gig to start off with. And so how do we, in direct selling, make our businesses relevant to them as they start with it as their side gig? And the things that they are looking for right away are quick and easy earnings, in addition to connecting with that community. So I think we, as an industry, really must understand that and how can we make sure that our business opportunities are such that they will have a passion for them as much as all the generations prior. Q Lori Bush: We are hearing a lot about hybrid direct selling models. What does hybrid mean? How far afield do you think a company can go and still retain the loyalty and commitment of its salesforce?
Ashley Collins: I think all of us right now are looking at our models because of the gig economy, and getting paid faster is what they need. So it is important to evaluate that. How can they make money quicker? What perks can you offer? We just introduced a new program for our customers: when they refer people, they get bonuses on product. So that is somewhat of a different hybrid in that we are accessing another group. Rather than just the business builders, we are rewarding those loyal customers, so that they can refer others and then start seeing the benefits of the business.
Julie Cabinaw: Tastefully Simple is in the position of being a little unique in this area. We have been direct selling for twenty-five years. We have been on Amazon for two. We have been selling direct for a number of years as well. We did an experiment with pop-up retail. I think the key to this is we are really exploring each one of these channels and looking at the duality and the channel conflict and benefits that these things can bring. We are a small brand. By being on Amazon, we are introducing ourselves to new brands that we can then open as direct selling markets. And that is what we are seeing, with our presence both selling direct as well as through Amazon and through other experiments that we have conducted in other channels.
Candace Matthews: To me, hybrid is about taking what was relevant in the past and turning it into an opportunity for the future. As has been said before, that human connection is a big part of the past. And so how do we ensure that human connection and our relevancy and that caring carries on into the future? It is going to rely on a new way of leveraging social media to build that human connection. In the past, we really relied on our field or our distributors to share information with their customers. And now information is readily available, so we must ultimately work together to make sure that we are providing that information, both the products and the stories, and making it easily accessible through our distributors—as well as anyplace else that people may search, because it still plays a role.
We had to find ways to celebrate remotely, and we did. And it has been great because doing things virtually enabled family and friends to be more a part of some of the recognition we have been able to do."
—Sheryl Adkins-Green, Chief Marketing Officer, Mary Kay Inc.
Lori Bush: With all business sectors contemplating what return to work looks like in the context of the yet not fully determined new normal, what aspects of direct selling do you see reverting quickly post-pandemic, and what aspects do you think may be forever changed?
Kirsten Aguilar: Boy, what has not changed, right? It is interesting, specifically at SeneGence, that we have had quite a few amazing months in 2020. The pandemic brought us some of our busiest months of the year, and we were blessed with regulations at our corporate office locations—we never had to officially close everything down. So in some sense for us, it has been business as usual, as weird as that is to say, and we have led with that message to our field. I thought from day one, “Boy, oh boy, our reps were made for this. Let’s roll up our sleeves and get to work.” Everybody is home; we've got everybody’s attention.
Some things that I do not think have changed— and will always be important—are the connections that our representatives need. I see them as strong as ever. They need each other for praise and consolation and sharing of ideas and collaboration. And they need to be connected with each other to do this business. That has not changed but the physicality of it has. I think face-to-face meetings and large events quite possibly could be a thing of the past. Our big conventions will forever be changed, and in-home parties and demos are looking very different and could be a thing of the past. So how do we keep what is such an important part of our industry but move forward without the touch and feel element? That is technology, of course. Reliance on technology is lifeblood, and companies better continue to evolve or catch up quickly in that space.
Ashley Collins: We have experienced the same. We had record growth in 2020. But I think forever changed is that technology is 100 percent the way to do business. That is not going to go away. And those in-home parties, presentations, where you can read the room and gather people, those are a thing of the past. So we must be very mindful of what is available to us technologically and how we are using that. I also think our associates, a lot of them, are not full-time, they are part-time. They have a full-time job, and they may not be going back to offices. Office spaces are changing, so there is a lot more flexibility. They are not going to go back to the same kind of schedule. And so we are mobile. We are in technology. It is forever changed.
Sheryl Adkins-Green: Forever changed is going to be the role of digital as part of the business repertoire. It has been fun and exciting to see the dramatic increase in adoption of digital tools. A lot of our independent salesforce said, “Wow, I never used X, Y, or Z before but hey, I did, and I did not know what I was missing before. It has really helped my business.” So that is exciting, and that is forever changed. I know that the salesforce will continue to look forward to digital innovation as it is available. I know one of the things that we all miss are those in-person opportunities to celebrate and recognize the success of the independent salesforce. But I know for a fact, even that is going to be different by necessity. We had to find ways to celebrate remotely, and we did. And it has been great because doing things virtually enabled family and friends to be more a part of some of the recognition we have been able to do. But we do look forward to having more of those in-person moments when we can do so safely.
Candace Matthews: I completely agree. There is a study by McKenzie that said, “We experienced ten years of e-commerce growth in three months.” It has dramatically changed, and it will be forever changed. I think that what has been missed is that connection and how do we recognize people personally. And so we will figure out ways to do that. But I am not sure there is much that we can revert back to other than the desires that we had in the past.