Month: January 2017

2017 Look Ahead: The Tech Poised to Transform Direct Selling

As you consider where to invest in technology in the coming year, we’d like to highlight the three areas below as high-potential places to focus.  These lie at the intersection of mobile technology and advances in data & analytics.  When combined, they create powerful toolsets to grow and develop a direct selling field.

There are a number of options about how to deliver these capabilities, but the place to begin is to understand objectives and desired capabilities, then assemble the technological tools to achieve them.

Forming connections among customers, distributors, and the home office

“Gig economy” giants are great at one thing—connecting people who want to buy a product or service to a broad group of other individuals who want to sell to them.  While the connections formed are often transactional in nature in the “gig economy,” the ability to bridge stakeholders in a focused and accessible way offers great promise for longer-term relationships in direct selling. By combining the ubiquity and simplicity of “gig economy” apps with the long-term, personal relationships that drive direct selling, companies can further unleash the potential of our channel.

Only a handful of direct sellers have made significant strides in placing mobile technology at the center of the distributor and customer experience.  These companies have looked beyond using email and desktop social media to ways in which phones and tablets, with their portability and ubiquity, can go beyond taking orders or showing prospecting videos.

While the customer/distributor interaction varies from company to company, direct sellers should challenge themselves to think beyond common functionality to ways to tie customers to distributors in a durable way.  For example, rather than mobile-enable a party order, why not mobile enable the party experience?  RSVPs, customer contact information, reminders, directions, contests/prizes, host rewards, shopping, party interaction, and follow-ups are all integral to the experience, yet most direct sellers have few tech tools that involve guests, hosts, and distributors—and even fewer serve as the backbone of the interaction that ties them together.

Driving distributor success with information and coaching

Most direct selling opportunities have a finite number of business methods, or ways of “working” their opportunities.  These may be introductory parties, fitness challenges, online demonstrations, or classic “ten by ten” prospect identification.  All too often, the materials and training to support these methods come in binders, handbooks, PDF documents, or web-based training modules.

Technology now makes it possible to deliver dashboards, reminders, training, and targeted coaching to direct selling distributors on a mobile device.  This allows direct sellers to do something “gig economy” giants can’t: provide professional tools and training to grow a business.

Most direct sellers today have access to a “back office,” or a place to enter orders, track title qualification, and see order histories.  These interfaces typically offer tons of information, and they are usually delivered on a web-based system best suited for a laptop.   This approach to providing critical information to distributors is increasingly out of pace with trends in device usage.  In 2014, Americans spent more time on their desktop computers than mobile devices.  By mid-2016, the average American was spending two hours and 25 minutes a day on mobile.  That’s more than two and a half times the 52 minutes spent on desktop. [3]

Shifting our thinking from serving up a variety of back office reports to action-oriented, focused information is required to deliver via mobile.  This shift simplifies interactions and makes it possible to help distributors focus on what matters.  It also allows them to access that information at any time.   For example, rather than let a distributor browse her past orders, why not help her manage her customer base through replenishment reminders, cross- and up-sell recommendations, and reasons to reach out on anniversaries or birthdays?  Rather than show her progress toward her paid-as title, why lay out her what’s necessary to reach the next level in her business in simple terms?

Beyond the back office, mobile apps available today allow for integrated, interactive coaching and development in the critical first months after a distributor joins an opportunity.   These mobile app experiences can lay out the path of prospecting, follow up, training, and rewards necessary to help distributors understand the product, grasp the opportunity, build a customer base, and grow their teams.  They can prompt action, support follow-up, track progress, and deliver immediate rewards for fast start programs.

These apps also produce valuable data that allows the home office visibility beyond orders and signups.  It becomes possible to develop a rich, detailed understanding of what distributors are doing, and what predicts whether or not they’ll be successful.

Helping the home office team better understand the field

With technology-enabled interactions comes rich data about distributors and customers.  Turning this data into useful information can seem daunting and expensive, but that’s no longer the case.  While just a few years ago, business intelligence (BI) meant expensive software and cumbersome maintenance, that’s not the case today.  Agile tools and on-demand delivery platforms mean turning data into information is easier than ever.

The next evolution of BI in direct selling begins to incorporate distributor and customer lifecycle analytics, track segmentation, compare the behavior of incoming cohorts, and understand lifetime value of stakeholders.  Insight from these analytics can guide strategy and strategic execution, helping direct sellers to tune rewards, product offering, and business method.

Beyond insightful, strategic reporting comes predictive and mass-customization models, which identify the linkages among behaviors and outcomes, and help steer distributors and customers toward success.  Varying these predictive models by desired benefits, segments, or profiles, then enabling them in a BI tool can help direct sellers scale their relationship management efforts to broad groups of stakeholders.

Most direct sellers have, through their distributors, a vast pool of customers.  We have not seen any company in the industry fully embrace the use of technology to strengthen and maintain long-term customer relationships.  Most direct sellers have embraced loyalty or preferred customer programs, but the industry still has huge opportunities to look beyond these structures and use emerging technology to substantially increase customer lifetime value.

How we can help

Hepfer & Associates has deep expertise in helping clients define, evaluate, and prioritize strategic initiatives.  We’ve driven technology implementations ranging from multi-year ERP and core systems replacements to focused, custom-developed software.  As you work toward more robust technological solutions, we’re equipped to help evaluate options, define requirements, select vendors, and, ultimately, work with technology partners to implement.

 

[1] DSA 2015 Fact Sheet

[2] Penn Schoen Berland study, November 16-25, 2016

[3] Digiday, June 14, 2016