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Jul, 08 2016

Home-maker’s Biz

​Direct selling, network marketing or multi-level marketing have been instrumental in bringing out thousands of women/ homemakers/ retired people and got them to embark on an entrepreneurial journey. Read on...

Direct selling, network marketing or multi-level marketing have been instrumental in bringing out thousands of women/ homemakers/ retired people and got them to embark on an entrepreneurial journey. It was like a viral that began with Amway in around mid-nineties that suddenly game some purpose to housewife to make better use of her time and social circle. Even the low margin did not bother them as this business model played high on giving them a distinct social identity. And many of them have done outstandingly well. Read on…

According to the IDSA, the direct selling industry is worth more than USD 180 billion globally and in India it is around INR 8000 crores with an impressive distributor base of more than 5.7 million. Women constituting 60% of the direct sellers have been the main driving force in this segment. Amit Chadha, Secretary General, IDSA explains, “Women have done outstandingly well in direct selling. Social norms and practices in Indian society offer a perfect opportunity for women of all social strata, the chance to try and excel in direct selling.”

Business Model

Direct selling, network/ multi-level marketing worked on the simple principle of enrolling more members where a part of the subscription amount is distributed among members at the top of the marketing pyramid. Direct Sellers deal in daily use products like soaps, detergents, shampoos, dietary supplements and most importantly cosmetics products.

The best part of this business is that these were products that are mainly used by women. Speaking on the same note, Rajat Banerji, Vice President, Amway India said, “The part-time or full-time income they earn and the business skills which we provide, has helped to create more successful female entrepreneurs. We are investing in women and their future, which will help with overall economic stability and the reduction of inequality. Amway has helped to empower millions of women around the world by offering them a low-cost, low-risk opportunity to achieve their goals by owning their own business.”

Likewise, Tupperware has imbibed the Chain of Confidence Campaign in its direct selling model, creating invaluable connections that last a lifetime. Chain of Confidence invites women to share in the immeasurable rewards of self-confidence and ensures the next generation of women will benefit from this knowledge.The company gives every woman the flexibility of time as well as target while an opportunity of having a wide circle of influence. The Chain of Confidence provides a support team of women all with a vested interest in personal and financial success.

Competing with the MNC brands

The direct selling industry has been in existence in India for more than two decades, it has yet not been able to garner significant recognition due to lack of regulatory framework for the industry, comparison and misunderstood as Ponzi / Pyramid schemes, according to Chhada. But still some brands have an advantage in the market even though they are dominated by MNC's because of their unique selling system.

The product has been their key differentiator and the word-of-mouth publicity and sales technique has made them swim through. “Our products are high performance, value for money products. The unique model of self usage, one-to-one selling, life changing testimonials, demonstration and the 100% satisfaction of the customers have helped us to sustain as a brand and as a business model,” pointed Samir Modi, Founder and Managing Director, Modicare.

Juan Carlos Posada, Sr. Director, Regional Marketing, South Asia, “Oriflame offer world class products and a dynamic earning opportunity. Flexible work life, excellent training and sales support and exciting offers allow our consultants to achieve their dreams.”

The biggest challenge, however, in this trade is that even though people take it up on an impulse, they become dormant after a point of time. Since there is negligible investment involved, maintaining the motivation level high is the greatest challenges faced by the network heads. This is the point where real team work and collaborative efforts come into play,

Zero investment, open to all, collaborative growth opportunity

At Tupperware, no initial investment is required. Tupperware manager will help to plan organize and ensure that the first party is a success and is enjoyable. All one has to do is to draw up a guest list and fix a date. The manager will help to display products, demonstrate its use and guide with how to place orders. The goal is that the first party is to set dates for future parties with as many people as they can.

Amway provides free training to all its distributors. The training offers specific skill development opportunity to all attendees in the area of selling skills, business development skills and team management skills. Banerji said: “We are now leveraging technology to reach out and connect better with the distributors. Amway India has recently launched Its Mobile Learning Platform for the distributors. This platform provides easy access to all the product details and videos which help the distributors explain features and benefits of the product better to the end consumers. Amway also offers web learning portal (E-learning) for ABOs. The training support empowers and educates the ABOs about Amway product range which helps them advise and sell appropriate products to their customers.”

Posada said: “There are no such criteria to get selected in our business. Anyone can join Oriflame, one should have the simple passion of dreaming big and can experience them getting fulfilled. We are there to help you along the way and most of the training and support is completely free. As a successful MLM business needs a good sales force.” 

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