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F E AT URE / INNOVATION IN COMPLIANCE AT LE-VEL

COMPANY PROFILE / LEGALSHIELD COMPANY PROFILE / MONAT

VOLUME 17 / ISSUE 2

FEBRUARY 2021

DIRECT SELLING

REDEFINED WHY INDUSTRY LANGUAGE AND THE BEHAVIORS THAT SHAPE IT NEED TO CHANGE.


With Gratitude to Our Direct Selling Clients and Partners for Making Exigo the Established Global Leader.


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E D Direct Selling News is excitedE to C present O G N I Zthe

Customer-Centric Recognition (CCR) Program to celebrate companies that are leading the way toward a sustainable, customer-centric future for the industry. Qualifying companies utilize business models that boast high customer-to-distributor ratios and prioritize customer sales.

Submit Your CCR Program Application Today.

The CCR Program is based solely on a company’s customer-to-distributor ratio taking into consideration the following definitions:

■ Distributor—someone

who DOES have a distributor agreement in place ■ Customer—someone who DOES NOT have a distributor agreement in place ■ Active is defi ned as each customer and distributor must have made a product purchase during the last six months. Active customer and distributor counts are limited to those in the U.S. and Canada.

Companies must have been in business for at least one year and have a minimum of $5 million in annual revenue. Qualifying companies must attain: 5:1 up to 10:1 for Gold status and 10:1 or more for Platinum status.

Companies who wish to learn more or to submit an application can go to www.directsellingnews.com/ccr or contact editor@directsellingnews.com

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THE I N D U ST RY AWA R D S J O I N

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1 2 T H A N N U A L D I R E C T S E L L I N G N E W S G LO B A L C E L E B R AT I O N VIRTUAL EVENT - MONDAY, APRIL 19, 2021 8:30 PM – 10:00 PM (ET)


W E

H A V E

M U C H

T O

C E L E B R A T E !

Unveiling the leading direct selling companies in the world achieving more than $100 million in annual revenue Celebrating Customer-Centric Companies that are leading the way toward a customer-centric future for the channel Recognizing the 2021 Best Places to Work in Direct Selling Finding out who will claim this year’s coveted Bravo Awards: Bravo Growth awards (Domestic and International), Bravo Leadership award and a new Bravo Global Good award for companies leading the way toward meaningful global responsibility. Honoring industry Legends with more than 50 years of experience in the channel, including Legends honoree and host, and DSN Contributing Editor, John Fleming And so much more!

H O S T S STUART JOHNSON Stuart has served the direct selling industry for more than 30 years as sole founder and CEO of SUCCESS Partners and Direct Selling News. His passion for the channel encompasses a broader commitment to build and connect the direct selling community through exclusive industry events such as Direct Selling University and Direct Selling News Global Celebration.

JOHN FLEMING John has set the standard in sharing the direct selling story with professionalism and commitment. A member of the Direct Selling Association’s Hall of Fame, the Direct Selling Education Foundation’s Circle of Honor, John is also the very first recipient of the DSN Bravo Lifetime Achievement Award and in 2021 is an honoree of the elite Legends group.

Save the date and make plans now to attend this virtual event for an unforgettable evening designed to celebrate, inspire and motivate! This event only takes place once a year and is open to all. We are excited to announce that with the support of our event Partners and Sponsors, we are presenting this must-attend virtual event for free. Details to register coming soon. To nominate your company for the Global 100 List, visit dsnglobal100.com. Submission deadline: March, 15, 2021


C O N T E N T S F E B R U A R Y

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Innovation in Compliance at Le-Vel: Why It is Vital in Our Industry B  Y D R E W H O FFMAN

46

SPOTLIGHTS

LegalShield

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MONAT Global

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LegalShield: Our Time is Now B Y J EN N Y VE T TER

MONAT: Re-imagining Together B Y B E TH D O U G L AS S S I LC O X

78 ONE VOICE

64 Exec to Exec Interview

Wayne Moorehead Interviews Ryan Napierski

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W O R K I N G S M A R T/

Our Future: The Nano Influencer Economy

Reimagine Payouts—From Checks to Tech

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B Y R O D G ER S M ITH

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NE W PERSPEC TIVES/

Strategic Preparation B Y TO N Y J E ARY

IN EVERY ISSUE 6-7 AD INDEX // 17 FROM THE EDITOR // 19 INDUSTRY NEWS // 40 FORWARD THINKING // 97 DSA MESSAGE // 98 VENDOR DIRECTORY //

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Serving the Direct Selling and Network Marketing Executive Since 2004 A SUCCESS Partners Company

FOUNDER AND CEO

Stuart P. Johnson CONTRIBUTING EDITOR

John Fleming EDITOR

Patricia White editor@directsellingnews.com C R E AT I V E D IR E C T O R

Julio Garcia

54 COVER STORY

DIREC T SELLING: REDEFINED

Why industry language and the behaviors that shape it need to change.

SENIOR ART DIREC TOR

Susan Douglass ART DIREC TORS

Laura Castillo Jenny Paredes PRODUCTION MANAGER

Virginia Le COPY EDITOR

Peter Tepp BUSINESS DE VELOPMENT MANAGER

Melinda Bogoslavsky advertising@directsellingnews.com CONTRIBUTORS

David Lee Sarah Paulk Beth Douglass Silcox Jenny Vetter

BY SARAH PAULK

Direct Selling News (ISSN 15546470) is published monthly by SUCCESS Partners, 5800 Democracy Drive, Suite 100, Plano, TX 75024. Periodicals postage paid at Lake Dallas, TX and additional mailing offices. POSTMASTERS please send change of address to 5800 Democracy Drive, Suite 100, Plano, TX 75024. Subscription Rate: Free to direct selling and network marketing executives; all others in USA and Canada $50. Overseas subscriptions are $100. All subscriptions must be paid in U.S. dollars. ©2021 Direct Selling News All rights reserved. Material may not be reproduced in whole or in part in any form without written permission. No statement in this publication is to be construed as a recommendation to buy or sell securities or to provide investment advice. Direct Selling News 5800 Democracy Drive, Suite 100, Plano, Texas 75024 / Phone: 800-279-5249 www.directsellingnews.com

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Direct Selling News is a mustread for any direct selling advisor or executive. Our direct selling specialists read DSN to stay on top of industry trends, client news, and other business forces that impact our clients. We know we can count on Direct Selling News for insights and analysis not found anywhere else in the industry.

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Exigo

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Strategic Choice Partners 504-252-4500 / STRATEG I C CH O I CEPARTNERS . C O M PAG E 43

Direct Selling Association 2 0 2- 4 5 2- 8 8 6 6 / D SA . O R G PA G E 91

Direct Scale Natural Health N H- STAR . C O M / PA G ES 14-16

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NOW TECH Powered by SUCCESS Partners 31 0 - 4 2 8 -9 9 3 6 / S U C C ES S PARTN ER S . C O M PA G ES 25, 103, 104

Transformation Capital LLC 214-3 0 8-6020 / TRAN S FO RMATI O N CAP. C O M PAG E 77

Metrics Global

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Inside Back Cover

Nexio

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E’RE EXCITED to announce that Direct Selling University (formerly known as SUCCESS Partners University) will take place virtually Monday, April 19-Friday, April 23, 2021, from 1:00 pm to 3:00 pm (ET) daily. Industry executives and legendary thought leaders from leading companies will present the vital information, action items and trends you must know to guide your corporate and field teams to new levels of success. APRIL 2021

19

21

T H U R S DAY

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DIRECT SELLING

DIRECT SELLING

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1:00 pm - 3:00 pm (ET)

1:00 pm - 3:00 pm (ET)

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M O N DAY

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DIRECT SELLING UNIVERSIT Y 1:00 pm - 3:00 pm (ET)

23

DSN GLOBAL CELEBRATION 8:30 pm - 10:30 pm (ET)

Direct Selling University is still dedicated to the betterment and advancement of our channel and the executives that lead it. So, why the name change? We wanted to put the focus where it belongs: on the entire channel that has provided so much to so many. WE INVITE ALL

And, best of all, with the support of our event Partners and Sponsors, we are

DIRECT SELLING

presenting these game-changing, educational and inspiring events at no cost to

EXECUTIVES,

you. That’s right—you and your teams can attend both events, the DSN Global

EVENT PARTNERS

Celebration and Direct Selling University FOR FREE!

AND SPONSORS AND DSN ADVERTISERS TO ATTEND THE

Save the dates to join us online for the virtual DSU Week—five jam-packed days of the most prestigious, inclusive, comprehensive and exciting content and awards in direct selling.

CAN’T MISS

And, as an added bonus, registered attendees will have unlimited replay access

EVENT OF THE

after the broadcast. It’s the best way to catch speakers you may have missed, re-

YEAR!

watch your favorites or share relevant content with your team.


SPE A K ERS

ROW I -

WAYNE MOOREHEAD, Young Living , CMO KINDRA HALL, AUTHOR, SPEAKER & SUCCESS CHIEF STORYTELLING OFFICER

ROW II -

STUART JOHNSON, CEO OF DIRECT SELLING NEWS, NOW TECHNOLOGIES AND TRANSFORMATION CAPITAL MELODIE NAKHLE, Amway, MANAGING DIRECTOR EUROPE, SOUTHERN AFRICA, AUSTRALIA & NEW ZEALAND TRAVIS GARZA, Plexus, PRESIDENT, SALES & MARKETING

ROW III - TYLER WHITEHEAD, Nu Skin, PRESIDENT WEST REGION ORVILLE AND HEIDI THOMPSON, Scentsy, CO-FOUNDERS & CO-CEOS ROW IV -

AMBER OLSON ROURKE, Neora, CO-FOUNDER & CMO JOSH ELLIS, SUCCESS MAGAZINE, EDITOR IN CHIEF


ROW I -

JACK FALLON, Total Life Changes, FOUNDER & CEO

ROW II -

DAVID VANDERVEEN, It Works!, SR. EXECUTIVE OF INTERNATIONAL STRATEGY RAYNER URDANETA, MONAT, CEO

ROW III - NATHAN MOORE, Mary Kay, PRESIDENT, NORTH AMERICA HEATHER CHASTAIN, Shaklee, PRESIDENT & CSO RUSS FLETCHER, Xyngular, CEO KATY HOLT-LARSEN, Kyäni, PRESIDENT ROW IV -

MAURICIO DOMENZAIN, Immunotec, CEO DEBBIE BOLTON, Norwex, CO-FOUNDER

ROW IV -

LOGAN STOUT, ID Life, FOUNDER & CEO


SPE A K E R S

ROW I -

MICHELE GAY, LimeLife by Alcone, FOUNDER & CEO GLENN SANFORD, eXp World Holdings, FOUNDER & CEO | SUCCESS, CEO ALEXY GOLDSTEIN, NewULife, CEO AMI PERRY, NOW Technologies, VP BUSINESS DEVELOPMENT

ROW II -

RAY HIGDON, RANK MAKERS, CEO & BEST SELLING AUTHOR

ROW II -

GARRETT MCGRATH, The Happy Co., PRESIDENT | ANMP, PRESIDENT LYNNE COTE, Princess House, PRESIDENT & CEO

ROW IV -

AMELIA WARREN, Epicure, CEO NOAH WESTERLUND, NOW Technologies, SVP BUSINESS DEVELOPMENT

SAVE T H E DAT E S ! DSU WEEK APRIL 19–23, 2021 | 1PM - 3PM DAILY (ET)

DSN GLOBAL CELEBRATION MONDAY, APRIL 19 | 8:30PM - 10PM (ET)


50 LEGENDS

LEGENDS

This year’s event will also be the release of an exclusive Legends Interview Series, produced by Direct Selling News. Honoring industry titans with more than 50 years of experience in the channel

HONOREE &

and hosted by former DSN Publisher and Editor

HOST

and honoree, John Fleming. These prerecorded interviews will be an amazing and insightful glimpse into the past, present and future of the channel.

JOHN FLEMING AVON AND DIRECT SELLING NEWS

Roundtable discussions will be combined with thoughtful one-on-one conversations where each of these elite leaders share their wisdom, insights and experience.

ROW I -

Rick Goings Avon, Tupperware Rudy Revak Xyngular, PUREhaven

ROW II -

Larry Thompson Herbalife, PM-international Jerry Brassfield NeoLife International Stan Fredrick Mannatech, Wine Shop, Saladmaster, Colesce Couture

To inquire about event Partnership and Sponsorship opportunities, email melony@directsellingnews.com.


A D V E R T O R I A L

C O N T E N T

NATURAL HEALTH: AN INTERNATIONAL MLM COMPANY FOCUSED ON WELLNESS.

The key to successful business is knowledge of the mentality and culture of people in any country. THE NATURAL HEALTH ORIGINS

Natural Health was established on August 2, 2017. The President and CEO is Sergey Anatolyevich Patrakov—a young and successful entrepreneur. In a short time, the management team opened offices throughout Russia, and then in Kazakhstan and Kyrgyzstan. To date, Natural Health already has representatives in 14 countries in Europe and Asia, and about 200,000 partners have joined the company. The young company is actively developing and building an international business in the Wellness industry. Natural Health is not only engaged in the production of products using innovative

technologies of the European level, but also sells its own products. One of the main tasks is to develop unique, innovative products. At the moment, more than 200 inventions have already been patented, which were worked on by scientists and scientific specialists of the highest category. The safety and quality of products are confirmed by international certificates. THE NATURAL HEALTH MISSION

The real mission of Natural Health is to create a high-quality product from natural resources for a full and healthy life of humanity. The company produces health products that have no analogs in the world.


A D V E R T O R I A L

THE NATURAL HEALTH PRODUCTS

The Natural Health catalog includes several lines of products for beauty and human health. Today, the company has expanded production, which is carried out at several modern industrial sites in Russia, Turkey and Kazakhstan. The products are aimed at comprehensive health improvement and effective prevention of various diseases. The production process takes into account the optimal balance of natural ingredients and the latest technologies, the quality of which is monitored by professors and candidates of medical and chemical Sciences, doctors and quantum physicists from different cities of Russia. The company is actively engaged in the energyinformational direction in preventive medicine, aimed at correcting the function of organs at the cellular level. The production technology uses extracts from medicinal plants and relict (“live”) water, which has a cluster structure and stores information about a healthy organ for a long time. Old and damaged cells that are not able to rebuild gradually die, and their place is taken by young and active ones. Over time, the organ is restored and begins to work effectively.

C O N T E N T

Today, in addition to energy information products, the following lines are produced: • Food products—oxygen cocktails made from natural ingredients and collagen. • Cosmetics—body cream-masks based on therapeutic mud with the addition of valuable natural components. • Orthopedics—this line includes the most modern innovative inventions of orthopedics in recent years-pillows with shape memory and cooling side, a baby cocoon, as well as a ring pillow for comfortable sitting and prevention of various diseases of the musculoskeletal system. The exclusive lines include a serum for the skin of the face and neck, a genetic test, as well as products with macro-and microelements for the overall health of the body. BUSINESS IN THE COMPANY

The structure, which is a proprietary development of Natural Health, allows each buyer to become an independent entrepreneur and build their own direct sales business while receiving


A D V E R T O R I A L

privileges from the company. Management is in daily communication with all its partners and is ready to promptly assist in achieving the goals of each. Business with Natural Health is: • Strong mentors and help at all stages of work • Effective marketing plan with bonuses and rewards • Social program-cumulative ranking system of leadership • Regular special events and events with partners • Cleansing and recovery of the body The company pays great attention to the spirit of competition—there are marathons and Championships so that everyone can show their potential and realize their entrepreneurial talents. THE FUTURE

By 2030, Natural Health plans to reach 5,000,000 distributors worldwide and become one of the world’s top 3 direct sales companies. More and more partners join the Corporation every month. As leaders and distributors reach new heights and build strong teams, they receive regular rewards from management.

C O N T E N T


FROM THE EDITOR Painting the Channel in a Positive Light.

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HANGE HAPPENS! And oh boy, did 2020 ever bring about change! Change in the way we live, the way (and even where) we work and the way we connect with others. As we move into February, we wanted to acknowledge and embrace the positive changes we see in the direct selling channel. The secret of change is to focus all of your energy, not on fighting the old, but on building the new is one of my favorite quotes from Socrates. May you find inspiration on building the new 2021 within these pages. In our cover story, Direct Selling—Redefined, found on page 54, you will discover why industry language and the behaviors that shape it need to change. “The distinction and understanding that the words represent about how our business truly operates, that is really important,” says John Parker, Amway Chief Sales Officer and Regional President West. “In the end, what matters more than the words we put on top of our business are the experiences we’re providing customers.” Drew Hoffman, President and Chief Legal Officer at Le-Vel, contributed our feature article located on page 46. He shares his expertise and the innovations on compliance happening at Le-Vel. “It is incumbent upon all of us who serve and lead in this industry to set the right tone and send the proper messages throughout our organizations. When we do this, it not only helps our individual companies, it also helps the industry at large,” states Hoffman. One of the many exciting changes happening at DSN is our new Executive Insights series. Check out our inaugural interview on page 64, with Wayne Moorehead, Chief Marketing Officer at Young Living, interviewing Ryan Napierski, President at Nu Skin. On page 70, learn about LegalShield and their solutions that help small business owners with the resources they need to move forward in this ever-changing world. “Our services have never been more needed than during the crisis we’re facing this year,” states Glenn Petersen, President of Business Solutions. In 2020, MONAT chose to “be part of the solution” according to CEO Ray Urdaneta. MONAT had a tremendous year, and their performance is an industry bright spot. “We’ve aimed to strike the right balance between informative and concise…punchy copy, eye-catching social posts, and brief-but-informative videos have all been a part of this approach,” says Colin McCormick, Director of Marketing Communications. Find more inspiration in the MONAT company feature beginning on page 78. One of DSN’s highlights of 2020 was the introduction of our Customer-Centric Recognition Program. We feel it is essential to be a customer-centric industry where we build strong retail bases, and opportunity seekers will follow. Find the latest list of Customer-Centric Recognized companies on pages 38 and 39. If you have any questions or want to apply, visit DirectSellingNews.com/ccr/. At Direct Selling News, we endeavor to be a source, resource and thought leader for all in the direct selling channel. So, if you have a suggestion, a need or an inspiration to share, please reach out. We would love to hear from you. All the best,

PATRICIA WHITE | EDITOR | PWHITE@DIRECTSELLINGNEWS.COM FOLLOW US ONLINE:

@directsellingnews

@DSNUpdate

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2021 VIRTUAL EVENTS MONDAY, APRIL 19 - FRIDAY, APRIL 23, 2021

TH A N K YO U P L AT I N U M S P O N S O R S

To inquire about event Sponsorship opportunities, email: melony@directsellingnews.com.


IN THIS ISSUE

T HE MON T H IN NE W S A F F E C T IN G O UR C H A NNE L

Leading Off

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DSA Supports Legislation Defining Direct Sellers as Independent Contractors

M A IN S T OR Y

DIREC T SELLING A SSOCI ATION WORK ING T O “CORREC T TIK T OK ’S MISUNDERS TA NDING”

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SEC Proposes Changes to Equity Compensation Rules for Gig Workers

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53 Percent of Shoppers Say the Pandemic Has Permanently Changed the Way They Buy

32

Transformation Capital Financial Analysis

36

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ikTok’s historic ban on multi-level marketing sent shockwaves through the direct selling industry. In December, TikTok updated it’s version of its community guidelines. Under a section of policy prohibiting various types of “Frauds and Scams”—which used to focus on outright Ponzi schemes, get-richquick hoaxes, and phishing attempts—the company became the first major socialmedia platform to declare that multilevel marketing was verboten as well. In a Special Information Session webinar last

CCR

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month, the Direct Selling Association expressed its disappointment with the decision, stressing that the ban was punishing the entire industry for actions made by companies and individuals who have not abided by the DSA’s stringent consumer protection guidelines. “We vigorously support policies that prohibit deceptive claims on how much income can be earned or product efficacy, but also believe that to cast a net widely over an entire industry that provides supplemental incomeearning opportunities for

millions of Americans is inadvisable,” the DSA wrote in a reactive statement distributed to members. Differentiation from the worst offenders has been one of direct selling’s most difficult challenges, but it is not a new obstacle for the industry or the DSA. Whether additional social media compliance, new language, distributor education or a reactive statement from the … To read the full news feature, scan the QR Code, or visit http://bit.ly/DSNQR

T H E Y S A ID I T !

This research shows that shoppers are increasingly moving online and using their dollars to support brands that reflect their personal values, and impact their local community. — B R I D G E T W E S T O N , C h i e f E x e c u t i v e O f f i c e r o f S C O R E w w w . d i r e c t s e l l i n g n e w s . c o m    1 9


I N D U S T R Y N E W S For full article visit

directsellingnews.com /category/news/

News in Brief  

DSA Supports Legislation Defining Direct Sellers as Independent Contractors

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he Department of Labor affirmed its final ruling on the classification of independent contractors under the Fair Labor Standards Act (FLSA). This final rule explicates that the core factors to be evaluated are “the nature and control over an individual’s work and the opportunity for profit or loss.” With these two elements met, the remaining factors will serve only as guidelines, and the actual exchange of money and compensation will be more controlling than a contract. The DSA filed comments on the proposed rule “requesting that the final rule should clearly define direct sellers as independent contractors” since the final rule did not definitively include it. Within the final ruling were six examples to clarify when an individual meets the requirements to be classified as an independent contractor, none of which were within the direct selling, sales or retail categories. The final rule is expected to take effect on March 8, but

this may not take place, as the Biden Administration has implied that they intend to “freeze” the rule once in office on January 20. Business groups and independent contractor groups, of which the DSA are members, have entertained conversations about challenging this with legal action. The trade association made clear in its DSA Washington Update, distributed to members this week, that it will continue to support legislation that specifically defines direct sellers as independent contractors: “We have already secured a commitment from Rep. Tim Walberg (R-MI) to re-introduce a version of H.R. 3522 in the 117th Congress. Independent contractor issues are likely to be on the agenda for this Congress. We will continue working with the Government Relations Committee and Independent Contractor Working Group to engage on these issues and communicate direct sellers’ unique places in this conversation.”

Natura &Co Signs Open Letter to Call for EU Cosmetics Animal Test Bans

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atura &Co sent a signed open letter to the decision makers of the European Union asking them to uphold the EU animal cosmetic testing bans. This ban serves to help consumers choose cruelty-free products and encourages the continued development of animal-free testing. “We believe in the power of the collective voice, and that’s why we’re uniting with Cruelty Free International, the animal welfare community, and our peers in the cosmetics industry to support this important call to action,” says Roberto Marques, Executive Chairman and Group Chief Executive Officer of Natura &Co. “Natura &Co and its businesses have long used

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FEBRUARY 2021

proven, scientific non-animal methods to test cosmetics ingredients and products, and we’ve done so while ensuring the very highest standards of safety and efficacy.” “We invite every individual, company, and organization who cares about animal welfare to call on the European Union to uphold its animal testing ban,” Marques says. “During the holiday season, we also invite consumers to flex their purchasing power by choosing to shop cruelty free.”


SEC Proposes Changes to Equity Compensation Rules for Gig Workers

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he Securities and Exchange Commission has proposed including workers within the gig economy, who do not have a traditional employment relationship with a company, in the potential changes to Rule 701, which offers exception “for offers and sales of securities by a private company under a written compensatory benefit plan or written compensation contract for employees, directors and consultants, among others.” This expansion is temporary, expiring in 2026, but would allow issuers to offer compensatory securities to gig workers. A few limitations include: • No more than 15 percent or $75,000 of compensation during a 3-year period can be securities; • Securities offered must be following a written agreement and not for capital-raising purposes;

• The amount and the terms of the securities offered can’t be dependent on bargaining or the option to choose between securities and cash; • Issuers have to ensure securities won’t be transferred illegally; and • Only workers providing services over qualified platforms, and not platforms used for the sale of goods are included.

Zilis Acquires Zrii and its Latin American Market Presence

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BD company Zilis announced its acquisition of Zrii LLC, a nutrition, skincare and personal care products company. Zilis will now inherit Zrii’s presence throughout Latin America and will have a new headquarters in Bogota, Colombia. CBD sales in Latin America are projected to see exponential growth in the coming years. “Zrii has made a significant investment in building a robust infrastructure throughout Latin America,” says Steven Thompson, CEO and Founder of Zilis. “By adding the Zrii platform to Zilis, we will collapse the timeframes normally required for this type of aggressive expansion by multiple years, thereby providing our Independent Ambassadors the opportunity to develop their organizations throughout the region. We’re extremely enthusiastic about the possibilities this acquisition presents, and I am excited to welcome the entire Zrii organization to the Zilis family.” With this acquisition, Zilis now has operations in Colombia, Costa Rica, Ecuador, Guatemala, Mexico, Panama and Peru. This instant expansion is in addition to the company’s recent launch into the European market.

New Avon Company Changes Corporate Name to The Avon Company

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ew Avon Company, the 135-year-old beauty company, has announced it has changed its corporate name to The Avon Company. “Our name has changed to more clearly represent our vision and provide a more independent front as we continue to grow and build upon the business,” said The Avon Company CEO Paul Yi. “It better captures Avon’s diverse array of brand and product offerings such as belif, Mission Luxereve, CHI, Physiogel, and Daily Essentials home products.” The company’s previous name was a holdover from corporate restructuring efforts and will be officially retired. With multiple new brands and cross-brand partnerships, this name change is expected to better reflect Avon’s singular history. w w w . d i r e c t s e l l i n g n e w s . c o m    2 1


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2020 Direct Selling Growth in Review: 30 Companies Grew Revenue By More than $100 Million

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or the past ten months, Transformation Capital has been evaluating the financial performance of both public and private direct selling companies that are domestic and have a minimum of $50 million in annual revenue. December revenue results were flat and slightly lower than November due to the holiday season and a higher baseline that was set by sequential revenue growth in the preceding months. However, on a year-over-year basis, December 2020 results far exceed 2019. In 2020, at least 80 percent of companies grew revenue as compared to 2019, with at least ten doubling in revenue yearover-year. A total of 30 companies grew their revenues by more than $100 million and at least ten more than doubled their annual revenue. Three private companies, including MONAT and Scentsy (which more than doubled their revenue), grew revenue by more than $400 million in 2020. In the public tracking set, eXp World Holdings and potentially Herbalife appear to be on track to grow more than $400 million as well. In addition, ten companies recorded record annual revenue after experiencing some period of decline. With this growth, Transformation Capital believes renewal in these legacy companies as well as revenue spikes point to an industry-wide renaissance within the domestic direct selling market. Based on these findings, it is projected that domestic selling revenue will set a new record high in 2020, easily

surpassing the $36.12 billion benchmark set in 2015. With revenue growth projected to be in the 7% range on a year-overyear basis, the total revenue is expected to reach $37.7 billion. These projections are supported by the financial performance of public companies. The Transformation Capital Direct Selling Index (TDSI), a market cap weighted index of all domestically traded direct selling companies with a market capitalization of at least $25 million, rose 77.1 percent between the end of February and December 31,2020. This compares to a gain of only 20.5 percent for the Dow Jones Industrial Average (DJIA). With the remarkable growth experienced in 2020, Transformation Capital expected a positive year-over-year revenue trend to continue through at least the first quarter of 2021. There is some potential for more heavy-handed regulatory challenges with a Democratic administration, but the industry is better prepared now to weather enhanced scrutiny than ever before. The industry’s positive trends exhibited in 2020 are expected to continue, and the momentum built up over the last ten months will surely positively impact 2021.

Tupperware Named One of America’s Most Responsible Companies

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ogether with Statista, Newsweek recognized 399 companies across industries with varying size and revenue who are acting as good citizens and neighbors to the communities where they operate. Tupperware was ranked #200 on Newsweek’s second annual list and #18 in the consumer goods category. “It is an honor to be recognized by Newsweek for the commitment we’ve made to create a better future for

generations to come,” says Miguel Fernandez, CEO of Tupperware. “As we celebrate our 75th anniversary next year, I’m excited to accelerate our commitments to our planet, our people and how we operate to continue delivering the loved and trusted products we’re known for.”

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I N D U S T R Y N E W S

ARIIX Reports Record Sales in 2020 for European Market

Herbalife Nutrition Earns Health and Safety Certification for its Innovation and Manufacturing Facilities

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RIIX announced record-breaking sales in the European market, reporting $104 million and a growth rate of 209 percent. This increase is expected to result in $250 million for 2020. The company reported $220 million in 2019. ARIIX experienced a series of record-breaking sales weeks in 2020 and set new records for European sales. The launch of the company’s new skincare brand Lucim, and the relaunch of the Puriti Multi-Effect Air Purifier contributed to the regional growth, as well as the company’s transition to allvirtual events, which drove social media engagement to increase by 300 percent. “I could talk about the strategy, I could talk about the hours involved, but I think it is most important to talk about how grateful we are for each and every one of our NewAge ARIIX family members,” said Cameron Bott, Area President EMEA/CIS/Export Markets. “All I can say is thank you from the bottom of our heart. Thank you for persevering and excelling through what many have experienced as an incredibly challenging year. Thank you for being honest and open in discussions and for strategizing with us. Thank you for your tenacity and strength. And thank you for embracing what it really means to be a brand partner. I’ve never met a group of people, both in the field and on the corporate team, that have as much passion for this industry as our family does. That passion is the driving force behind this great success. We love what we do, we’ve just begun, and have no plans of stopping anytime soon!” The European market is now the largest region for ARIIX, encompassing Germany, Spain, Switzerland and French territories.

H

erbalife Nutrition’s innovation and manufacturing facilities earned the ISO 45001 Occupational Health and Safety Standard from NSF-ISR, a recognition given to companies who are actively protecting employee health and safety. This is Herbalife’s third certification from NSF International, an independent global laboratory. “The ISO certification process is demanding so each team member must be dedicated to the pursuit of quality and safety,” said Mark Schissel, Executive Vice President of Worldwide Operations. “By achieving ISO 45001 certification, we demonstrate our continued commitment to excellence and best practices to support a healthy and safer work environment.” Both facilities operate in accordance to U.S. Good Manufacturing Practices, which sets regulatory standards for dietary supplements, acidified foods and food products, and the company’s quality control laboratory maintains ISO/IEC 17025 accreditation through the American Association for Laboratory Accreditation. The North Carolina and California locations are two of five such facilities Herbalife operates around the globe.

PM International Sales Reach $1.7 Billion

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M International, a European-based direct selling company, experienced a 54 percent increase in sales in 2020. The company’s total sales reached $1.7 billion, up $600 million from the previous year. PM International was founded in 1993 and surpassed the $1 billion benchmark last year.  DSN

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News Impacting Our Channel

OPTAVIA Survey Reveals Americans Plan to Embrace Healthy Habits in 2021

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edifast, on behalf of its health and wellness coaching program OPTAVIA, conducted a survey of 1,414 U.S. adults to discover the approach and adjustments Americans plan to make to their routines in 2021, and the habits they turned to in 2020. The results show that 63 percent of Americans have already implemented healthy routines since March, including exercising for a mental health boost (24 percent), healthier eating (23 percent), being more mindful (22 percent), and getting better sleep (20 percent). “The unprecedented nature of this year has accelerated a shift in how Americans view their health and wellness,” says Dan Chard, Chairman and Chief Executive Officer, Medifast. “Instead of making grandiose changes on January 1, people are prioritizing their health year-round and taking a more holistic approach to wellness. Based on these survey findings, we believe this shift will continue into the future.” Additional findings that will impact 2021 include: • 61 percentof Americans plan to prioritize healthy eating habits over work-life balance 2 6    D I R E C T S E L L I N G N E W S  |  

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• 70 pecent of Americans would rather sleep better than meet a fitness goal • 43 percent of Americans say the pandemic has altered their perspective of what it means to have a healthy mind • More than half of Americans ages 18-34 say the pandemic has changed the way they are thinking about (54 percent) and prioritizing (55 percent) their health and wellbeing Nearly all of the survey participants (96 percent) who made health-related changes during the pandemic plan to continue them into 2021. “It’s clear people are now thinking about health and wellbeing more holistically,” says Dr. Wayne Scott Andersen, OPTAVIA Co-Founder. “However, instead of trying to eliminate destructive habits or set overly ambitious goals destined to be abandoned, the key to reaching your health goals in 2021 is to focus on positive, small behavior changes that can add up to lifelong healthy habits.” The survey was conducted October 19-20, 2020 with a margin of error of +/-3 percent and 95 percent confidence.


53 Percent of Shoppers Say the Pandemic Has Permanently Changed the Way They Buy

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ccording to new statistics gathered by SCORE, most shoppers (73 percent) report trying out a new shopping behavior during the pandemic, and 53 percent say that their shopping habits have been permanently altered. Health was a high priority, with 32 percent saying the deciding factor in their purchasing choices was the protection of their health and their family above all else. The pandemic has also made customers mindful of shopping local, with one in four buyers saying they purchase a majority of their gifts from small businesses. With these new habits, 33 percent of consumers have tried a new brand, with 79 percent planning to continue using these new finds; 29 percent have used a different retailer or website, with 75 percent planning to continue doing so; and 22 percent have switched to a new digital shopping method, with 81 percent intending to continue. Many companies have seen a boost from all this online shopping and industry categories are expected

to see impressive growth in online sales in the coming year, including: • 97 percent growth in online skincare and makeup purchases • 96 percent expected growth for accessories • 81 percent increase for household supplies • 78 percent expected growth for snacks Generation X is most likely to shop small (29 percent) and younger consumers, specifically Gen Z (ages 18-24), say the Black Lives Matter movement will factor into their holiday shopping choices, with 21 percent planning to shop Blackowned businesses and 12 percent planning to shop brands that publicly support the BLM movement. “This research shows that shoppers are increasingly moving online and using their dollars to support brands that reflect their personal values, and impact their local community,” says Bridget Weston, Chief Executive Officer of SCORE.  DSN

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I N D U S T R Y N E W S

Executive Announcements

DAN CHARD, Medifast, CEO and Executive Chairman Medifast Chief Executive Officer Dan Chard will now also serve as the company’s new executive chairman. Chard will replace former non-executive chairman Michael MacDonald, who spent more than twenty years with the company. Chard has helped lead the company with historic revenue levels since beginning his role as CEO in October 2016. Part of his responsibility has included overseeing the continued development of the company’s coachled branch, OPTAVIA, which has been the driving force behind the company’s record revenues. Chard will continue in his role as Medifast’s CEO.

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ASHISH KHAN, Amway, Chief Technology and Platform Officer Amway announced Ashish Khan will be the company’s new Chief Technology and Platform Officer. Khan brings with him career experience in brand technology and enterprise architecture and has firsthand knowledge of how to lead a brand through digital transformation, including consumer experience, product innovation and supply chain. This new role expands Amway’s commitment to being a leader in social commerce. “Ashish has amazing global experience and is the perfect technology leader to support our vision of unleashing entrepreneurship and helping ABOs turn their passions —whether that be fitness, beauty, adventure or cooking – into profits,” says Amway Chief Executive Officer Milind Pant.

CHRISTINA RECKARD, Southwestern Family of Companies, Vice President of Marketing Southwestern Family of Companies announced Christina Reckard will take on the role of Vice President of Marketing. Reckard brings career experience in marketing, public relations and small business growth and will lead all marketing efforts for the international conglomerate’s 20 companies. “Christina’s strategic marketing and ecommerce background is the perfect skillset and leadership we need as we move the company forward,” says Dustin Hillis, Chief Executive Officer of Southwestern Family of Companies. “The variety of companies Christina has worked with—from Ramsey Solutions to local small businesses to the music industry—is a huge benefit to our diverse range of businesses.”


CONNIE TANG, Ruby Ribbon, Board of Directors Ruby Ribbon announced Connie Tang will be added to its board of directors and will join the women-led board, which includes Lori Bush, Cynthia Ringo and Jennifer Trzepacz. Tang’s commitment to mentoring and inspiring women in business worldwide aligns with Ruby Ribbon’s mission to support and empower women as consumers and entrepreneurs. “As an early investor, I have been watching Ruby Ribbon for years,” says Tang. “I am so impressed with what Ruby Ribbon has accomplished in 2020. I look forward to working with Clint and the Ruby Ribbon home office team as we support and empower our national network of stylists in this new era of growth.” “We are thrilled to welcome Connie Tang to our board of directors,” says Ruby Ribbon Chief Executive Officer Clint McKinlay.

ALLA BALIUK, ARIIX, Wellness Council ARIIX announced the addition of Alla Baliuk to the ARIIX Wellness Council. Baliuk is a medical biologist from Ukraine with a master’s degree in biology and chemistry, who specializes in genetics and IVF. Baliuk also worked at the Medical Hospital of Israel, where she focused on endocrinology. “We are pleased to welcome Alla Baliuk to the Wellness Council,” says ARIIX Chief Product Officer Deanna Latson. “Her expertise is impressive, and her enthusiasm for education and helping others improve their lives is inspiring. We look forward to her contributions as part of the council as we work together in the future.” In addition to her two decades of medical practice, Baliuk is also a certified nutritionist, alternative psychologist, NLP practitioner and immune diet therapist.

KAREN MCELHATTON, Avon Products, Inc., Chief Technology Officer Avon announced Karen McElhatton will take on the role of Chief Technology Officer. McElhatton brings almost two decades of international technology experience. “Digital transformation is critical to our Open Up & Grow strategy,” says Avon Chief Executive Officer Angela Cretu. “Karen’s appointment will ensure we have the very best technology roadmap to enable us to be effective and agile so that we can compete in a highly digitized marketplace. By digitalizing our representatives and creating an omni-channel shopping environment, we will reach more consumers, with a personalized, high-touch, hightech experience. I am so excited to welcome Karen to the Avon family.”

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I N D U S T R Y N E W S

ALEXANDER HOFFMANN, Plexus Worldwide, Vice President of International Sales, Latin America Plexus Worldwide announced Alexander Hoffmann will be the company’s new Vice President of International Sales, Latin America. Hoffman will lead sales efforts and revenue generation activities for the company in Mexico and throughout the region, including growing the Latin America market and all Hispanic regions while providing guidance and market direction for the executive team. “Alex’s reputation and success as an entrepreneur and world-renowned direct seller will help our company continue to cater to the cultural nuances of the market in Mexico,” said Travis Garza, President of Sales and Marketing for Plexus Worldwide. “Plexus is thrilled to add his leadership as we grow and foster an excellent environment for our Ambassadors, to maximize our growth opportunities for the company throughout the region.”

COURTLAND PEARSON, Tranont, Chief Sales Officer Tranont announced that it has named Courtland Pearson as the new Chief Sales Officer. Pearson brings almost three decades of international business and direct selling leadership experience. “Courtland has worked closely with field leaders throughout the course of his career and has executed impactful strategies, programs and processes that have facilitated growth and expansion in many international markets,” says Tranont COO Russ Losee. “His attention to detail and his connection with field leaders of all levels makes him an incredibly valuable addition to our team.”

TYLER WILLIAMS, Seacret Direct, Chief Strategy Officer/North America Seacret Direct has named Tyler Williams as its North American Chief Strategy Officer. Williams brings 18 years of career experience in sales and marketing and has been a leader in creating organizational strategies within the global health and wellness category. “Tyler is exactly the kind of leader we need as we look to continue to grow the North America business and team but also to help us with our global footprint,” said Izhak Ben Shabat, Founder & CEO of Seacret Direct. Williams has played an important role in opening and leading Asian markets in his previous roles and is an accomplished executive in the direct sales industry.

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ORVILLE AND HEIDI THOMPSON, Scentsy, Co-CEOs will take a Three Year Leave of Absence Scentsy Co-CEOs—Orville and Heidi Thompson—will relocate to London, England to serve as mission president for The Church of Jesus Christ of Latter-day Saints beginning summer of 2021 until June 2024. Current Scentsy President Dan Orchard will be promoted to interim CEO and will assume primary responsibility for the company’s operations during their absence. “In the past couple of years, we have intentionally worked with the executive team to bring Scentsy to a point where the day-to-day operations do not require our direct involvement,” Heidi Thompson says. “And we are confident in being able to step away for a few years and perform this honorable service.” Upon return, Heidi and Orville plan to reassume their roles as coCEOs in 2024.  DSN

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w w w . d i r e c t s e l l i n g n e w s . c o m    3 1


I N D U S T R Y N E W S

Transformation Capital Large Cap Direct Selling Stocks Outperformed the Market in 2020

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HILE DECEMBER is commonly a quiet trading month, large cap direct sellers extended and consolidated their gains. The month of holiday breaks reflected a quiet period for the markets as a whole, but also signaled a slight upward performance of the Transformation Capital Direct Selling Index (TDSI), which rose 2.9 percent, as compared to gains of 3.3 percent for the Dow Jones Industrial Average (DJIA). Prior to the pandemic, on February 28, the TDSI held at $45.74. Since then, the index has risen 77.1 percent, to $81. This is in comparison to a much slimmer 20.5 percent gain for the DJIA. The TDSI includes large cap, difficult to move stocks, that have risen 1,037 percent (TUP), 560 percent (EXPI), 145 percent (MED) and 128 percent (NUS). These stocks, plus three more, represent the seven stocks within the large cap tracking set that have more than doubled since February 28. This performance has been driven by significant company growth, as well as growth within the industry as well—both domestic and European markets. These markets, which saw rapid and steady growth in 2020, were believed to be in decline one year prior.

The large cap tracking set outperformed the markets as a group, with each stock posting gains, save two exceptions who posted small losses following huge November gains. Small cap tracking sets did not follow suit, showing relative weakness. All but two small cap stocks posted losses for December 2020, which provided an anchor effort on the overall performance of the index. S TA ND OU T S A ND M A JOR E V EN T S On January 3, Herbalife Nutrition (NYSE: HLF) reported that it would be repurchasing $600 million worth of its shares from its largest shareholder Carl Icahn, of Icahn Enterprises. As this dips below the threshold of stock ownership within their agreement, Icahn’s representatives will also relinquish their seats on the company’s Board. After initial uncertainty on January 4, the stock surged higher, following Icahn’s statement of continued belief in the company and observation of how the transaction will reduce shares outstanding by approximately 10 percent. Standouts within the large cap tracking set include eXp World Holdings (NASDAQ: EXPI), which continued its remarkable performance by adding 18.4 percent to its gains and standing 560 percent above February levels. Within the small cap tracking set, Nature’s Sunshine Products, Inc. (NASDAQ: NATR) was the lone standout with gains of 20 percent following a 19 percent increase in November. The stock has moved steadily higher since reporting strong financial results on November 9. THE TCAP DIRECT SELLING INDEX The TDSI is a market capitalization weighted index of all domestic public direct selling companies with a market capitalization of at least $25 million. The index is rebalanced

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monthly and no single issue is permitted to represent more than 20 percent of the total value of the index. In the event that a particular issue would exceed 20 percent, then the excess weighting is redistributed amongst the other index components. The index delivered slight gains over the course of the month rising 2.9 percent higher as compared to a 3.3 percent increase in the DJIA. TDSI data is tracked back to March 1, 2020 and the index now stands 77 percent above February 28, 2020 levels, as compared to a gain of approximately 21 percent for the DJIA. “During the month, the number of sell-side analysts maintaining ‘buy’ and ‘hold’ ratings on industry stocks increased slightly, while the number of analysts recommending investors ‘sell’ industry stocks continued to decline,” says Stuart Johnson, CEO of Transformation Capital. “As of the end of the year, approximately 95 percent of analysts covering industry companies had ‘buy’ or ‘hold’ ratings on those companies with nearly 60 percent being ‘buy’.”

LARGE CAP STOCKS Tupperware Brands Corporation (NYSE: TUP) declined slightly over the course of the month, a bullish sign following its impressive runup over the course of the last several months. TUP now stands 1,037 percent above its February closing price and has been the leading performer within the large cap tracking set. On December 3, the company announced the completion of its refinancing of senior notes, changing their due date to the fourth quarter of 2023. The stock surged nearly 9 percent higher on more than five times average trade following this announcement. Nu Skin Enterprises, Inc. (NYSE: NUS) rose 6.1 percent and now stands 128.4 percent above its February 2020 closing price. The stock began December with a choppy pattern of trading, moving back and forth above and below its 50-day moving average, but appears to have found support beginning on December 21 and has generally trended higher since then. w w w . d i r e c t s e l l i n g n e w s . c o m    3 3


I N D U S T R Y N E W S

Herbalife Nutrition, Inc. (NYSE: HLF) traded in a pattern similar to NUS, with choppy patterned trading, but rose only 0.3 percent for the period. HLF traded 48.5 percent above its February closing price as of the end of December. With the announcement of Carl Icahn selling his controlling shares back to the company, shares outstanding will be reduced by more than 10 percent, delivering significant value to shareholders. Since the announcement, the stock has moved approximately 8 percent higher. Icahn retains approximately 8 million shares, or 6 percent of shares outstanding. Medifast, Inc. (NYSE: MED) following an impressive 45.3 percent advance over the course of November, MED declined slightly in December (-3.3 percent) and now stands 145.5 percent above its February 2020 closing price. USANA Health Sciences, Inc. (NYSE: USNA) rose slightly (2.6 percent). Its gain of 16.6 percent makes it

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the only member of the large cap tracking set that has underperformed the DOW (+20.5 percent) during the pandemic. USNA has consistently held above its 50-day moving average, indicating a relevant level of institutional support, but since setting its 52-week high in July, the stock has not done much of anything. eXp World Holdings (NASDAQ: EXPI) rose an additional 18.4 percent in December and was the leading performer in the large cap tracking set. EXPI has been the second leading performer in the tracking set and during the pandemic period with gains of more than 560 percent since February 28. Primerica, Inc. (NYSE: PRI) rose slightly (2.8 percent) following a strong November during which it advanced 18.5 percent. PRI virtually matched the DOW’s performance in December.


SMALL CAP STOCKS The group as a whole showed some weakness in the period with six of the eight stocks within the tracking set declining during December. One notable exception was Nature’s Sunshine Products, Inc. (NASDAQ: NATR), which rose an additional 20 percent after posting 19 percent gains in November. The stock has traded consistently higher since the company’s announcement of financial results in early November and now stands 82.3 percent above its prepandemic levels. Taking a wider view, every stock within the small cap tracking set, with the exception of LFVN has posted gains during the pandemic period and all but two have outperformed the DOW. S H O R T I N T E R E S T D ATA A N A LY S I S AND FORECASTS As indicated by the TCAP “days to cover” chart, short interest has generally declined across the industry since the markets reached their mid-March COVID-19 induced lows. The last month saw a slight increase, which TCAP attributes to both lower trading volume as well as many industry stocks trading at or near 52-week highs in recent weeks. Overall, the TCAP Direct Selling Short Interest Index stands at 3.4 days to cover, up for 2.6 days as of November’s report. Short interest is not always a clear indicator. Increase in short interest can be a bearish sign of increased sentiment among investors that a stock is likely to decline. Conversely, as a stock moves higher, a significant short interest can serve as extra fuel on the fire as investors scramble to “buy to cover” their short positions and mitigate losses.

This is a summarized report; for more information, please contact info@transformationcap.com.

L OOK ING F OR WA RD As 2021 begins we plan to take an in depth look at what occurred in 2020, as well as the how and why. In late January or early February you can expect a report from us providing our view of 2020 as a whole, as well as a detailed analysis of what to expect in 2021. From a high level, we expect the first half of 2021 to continue the same trends we have seen over the last several months, including continued year-over-year growth within the domestic market. However, from a stock perspective, we see significant risk related to the domestic political environment following the Democratic sweep of the Georgia Senate races. We believe Democrat control of the senate may result in significant selling within the equity markets. While the markets appear stable so far, we still see the potential for significant downside. We also believe that the Democratic victory heightens the regulatory risk faced by the industry as a whole. However, we do not believe the election results will have any immediate or short-term impact on business operations within the industry, so, the question we will be looking to answer going forward surrounds the staying power of the current momentum within the market. Have we reached an inflection point that will carry the industry over the next several years? Our hope is definitively “yes” and we will do our best to continue to provide you with timely and actionable data and analysis.   DSN

TRANSFORMATION CAPITAL, LLC is a boutique investment banking, business development and corporate finance advisory firm primarily focused on the direct selling vertical, as well as ancillary businesses. Located in Dallas, Texas, Transformation’s core service offerings include both buy and sell-side M&A advisory, equity and debt financing, as well as joint venture and partnership opportunities. For more information please visit our website at: www.transformationcapital.com

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D IRECT S ELLIN G N EWS

Digital Momentum Rankings Direct Selling News in partnership with Transformation Capital presents the third Direct Selling News Digital Momentum Rankings monthly list. The purpose of these rankings continues to be to evaluate and acknowledge the companies experiencing significant growth in their online presence within the last 30 days.

Components

The list represents months of analysis across the three core pillars of social media marketing: web traffic & SEO analysis, Facebook activity, and Instagram activity.

Eligibility

A company is included in the Transformation Capital Direct Selling Momentum ranking when it has an active website, at least one active social media account, and at least 50,000 followers or fans for a single account (Facebook or Instagram). As noted, our initial ranking methodology focuses exclusively on three primary drivers of online presence: web traffic, Facebook activity, and Instagram activity. We’ve aggregated roughly a dozen metrics from these three sources and assessed their change over the last thirty days in an attempt to measure the growth in a company’s online audience, or momentum.

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A brief explanation of Direct Selling News’ proprietary methodology follows:

Web Traffic & SEO

We analyze web traffic statistics as a measure of general interest, including searches, visits and clicks on a company’s domain. Additionally, we analyze third-party referrals and associated keywords and popular phrases across the web. By assessing change in these metrics over time, we estimate demand for the company across the web.

Facebook & Instagram Activity

We gather a collection of thirty-day metrics to assess social attention, engagement, momentum and brand awareness.

A Note on Facebook vs. Instagram

To ensure appropriate credit is given, our metric analysis considers which platform– Facebook or Instagram—appears to be the primary for each company. As an example, if a company has 20,000 Instagram followers and 80,000 Facebook fans, all Facebookrelated metrics will be weighted at 80 percent (80/100) of the total weighted social media metric score.


JANUARY’S RANKING LIST represents another significant improvement to capturing the “big picture” of social media: with a larger pool of data, the Facebook and Instagram metrics now consider a moving 7-day average of fan/follower engagement. What this means for companies (of all sizes) is that growing the consistent engagement of existing followers and fans (through likes, reactions, comments, shares) has a more positive impact on the momentum rank. More emphasis will be placed on growing follower count, but this new adjustment rewards all companies nurturing their existing followers and encouraging them to participate and engage with the company via social media.

JANUARY ’S

TOP 50

MOMENTUM R ANKINGS ARE:

# COMPAN Y NAME

# COMPAN Y NAME

1 JUICEPLUS

2 6 MARKE T AMERICA

2 PURE ROMANCE

2 7 MASKCAR A

3 MANNATECH

2 8 TUPPERWARE

4 HERBALIFE

2 9 USANA

5 A C N

3 0 NATURE’S SUNSHINE

6 NU SKIN

31 PRÜVIT

7 K YANI

3 2 MATILDA JANE

8 LIFE VANTAGE

3 3 RODAN + FIELDS

9 USBORNE BOOKS

3 4 4LIFE

10 AMWAY

3 5 NEOR A

11 TRUV Y

3 6 JAFR A

12 EPICURE

3 7 LUL AROE

13 JEUNESSE

3 8 PARK L ANE

14 UNICIT Y

3 9 PRIMERICA

15 BE ACHBODY

4 0 PART YLITE

16 PAMPERED CHEF

41 IM MARKE TS ACADEMY

17 31 GIF TS

4 2 PRINCESS HOUSE

18 FORE VER LIVING

4 3 SHAKLEE

19 SENEGENCE

4 4 BE AUT YCOUNTER

2 0 ISAGENIX

4 5 MARY K AY

21 STELL A & DOT

4 6 IT WORKS!

2 2 CABI

4 7 X YNGUL AR

2 3 YOUNGE VIT Y

4 8 YOLI

2 4 OP TAVIA

4 9 WORLD FINANCIAL GROUP

2 5 DOTERR A

5 0 THE AVON COMPANY

For more information or questions, submit your inquiry to preston@directsellingnews.com.

This is a summarized report; for more information, please contact info@transformationcap.com.

TRANSFORMATION CAPITAL, LLC is a boutique investment banking, business development and corporate finance advisory firm primarily focused on the direct selling vertical, as well as ancillary businesses. Located in Dallas, Texas, Transformation’s core service offerings include both buy and sell-side M&A advisory, equity and debt financing, as well as joint venture and partnership opportunities. For more information please visit our website at: www.transformationcapital.com

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The CCR Program is based

solely on a company’s customerto-distributor ratio taking into consideration the following definitions:

n

Distributor—someone

who DOES have a distributor agreement in place n

Customer—someone who

DOES NOT have a distributor

Be Customer‑ Centric Recognized.

agreement in place n

Active is defined as each

customer and distributor must have made a product purchase

Direct Selling News is excited to present the Customer-Centric Recognition (CCR) Program to celebrate companies that are leading the

during the last six months. Active

way toward a sustainable, customer-centric future for the industry. Qualifying

customer and distributor counts

companies utilize business models that boast high customer-to-distributor

are limited to those in the U.S. and Canada.

ratios and prioritize customer sales.

Companies must have been in business for at least one year and have a minimum of $5 million in annual revenue. Qualifying companies must attain: 5:1 up to 10:1 for Gold status and 10:1 or more for Platinum status. ®

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Companies who wish to learn more or submit a CCR Program Application can go to www.directsellingnews.com/ccr/ or contact editor@directsellingnews.com


D

IRECT SELLING COMPANIES with a strong retail base of satisfied customers are

experiencing impressive growth and deserve recognition and acknowledgment for their

efforts. With evolving consumer expectations and regulatory scrutiny, customer‑centric equals success for everyone—distributors, direct selling companies, and the channel as a whole. The DSN Customer-Centric Recognition Program acknowledges these companies.

GOLD

/ 5:1 up to 10:1

P L AT I N U M

/ 10:1 and above

MONAT GLOBAL

A CN

NEORA

BHIP GLOBAL, INC.

PERFECTLY POSH

IT WORKS!

TOTAL LIFE CHANGES

KYNECT

LE-VEL

LULAROE

NU SKIN, INC.

SCENTSY, INC.


F O R W A R D T H I N K I N G

MANAGING REMOTELY

A Remote Workforce Presents Unique Challenges for Managers.

T

HE SHIFT TO REMOTE work, whether fulltime or part-time, has not only impacted workers, it’s required managers to adapt their styles, develop new skills, and overcome unique challenges. Struggling with trust, adapting to new forms of communication, and finding a balance between providing too little and too much direction seems to be the top issues, according to recent studies. In a Harvard Business Review survey and report, 40 percent of managers said they have low self-confidence in their ability to manage workers remotely, and 38 percent believe remote workers typically perform worse than those in an office. Maintaining employee motivation was another top concern, as 41 percent of managers surveyed agreed with the statement, “I am skeptical as to whether remote workers can stay motivated in the long term.” “When such doubts creep in, managers can start to develop an unreasonable expectation that those team members be available at all times, ultimately disrupting their work-home balance and causing more job stress,” the report says.

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Harvard Busines Review’s FIVE TIPS for Better Managing Remote Workers 1.

START AT THE HIGHEST LEVEL POSSIBLE. Key Point: “The managers who struggled with leading remote teams had low job autonomy and excessively controlling and low-trust bosses.”

2. PROVIDE PRACTICAL AND MORAL SUPPORT FOR

4. TRAIN MANAGERS IN HOW TO DEVOLVE JOB AUTONOMY AND TO CHECK IN RATHER THAN CHECK UP ON. Key Point: “Frequent and regular communication is

REMOTE WORKING WITHIN THE ORGANIZATION.

even more important when employees have autonomy.

Key Point: “Ensuring workers have the equipment

But rather than checking up on people as a way

needed, providing resources to support staff

to micromanage them, managers need to check

wellbeing, allowing extra leave for workers if needed,

in with people and provide them the information,

and giving training to support flexible working.”

guidance, and support to work autonomously.”

3. EDUCATE MANAGERS ABOUT THE POTENTIAL

5. TRAIN MANAGERS IN HOW TO MANAGE BY RESULTS.

BENEFITS OF REMOTE WORKING—WHEN IT IS

“When you give people the discretion to decide

DESIGNED WELL.

for themselves how and when they will work, it is

Key Point: “If autonomy is low and micromanagement

important to assess whether they are delivering the

high because of managerial mistrust, benefits

results. Hence, managers need to put more focus

of remote work are unlikely to arise.”

on the outputs of the work than the inputs.”

AV OIDING MICROM A N A GING Managing remote workers with skepticism can often lead to micromanaging, which can increase stress levels and result in lower production. Twenty-one percent of workers in the survey agreed their manager constantly evaluated their work, with 11 percent agreeing that their supervisor “keeps very close tabs on me by frequent checking.” Of those reporting high levels of monitoring (more than four on a five-point scale), 49 percent said they were often or always anxious doing their job. The “always-on” expectation can lead to burnout, especially with technology allowing instant communication at any time. A Tech Republic poll showed 27 percent of remote employees experience virtual-meeting burnout, known as “Zoom fatigue,” saying they are “trying to pay attention, but often zoning out.” Many said they spend more time in virtual meetings than they did with in-person meetings when they were in an office. Randall S. Peterson, professor and academic director of the Leadership Institute at London Business School, says it’s crucial for managers to understand how their workers feel and to focus on the quality of the interpersonal relationships. The goal is to make employees feel connected and trusted. Instead of checking up on workers to “make sure they’re working,” a more productive approach for managers may be to check in to see how they can best support them.

E QUIP P ING R EMO T E W OR K ER S T O SUC CEED Empowering remote workers with tools, tech support and training, while communicating positive messages were important factors for helping increase managers’ confidence. On-boarding remote and on-site employees, so they have the confidence to do their jobs effectively is key. Managers who cultivate employee wellbeing tend to convey a sense of connection and certainty, which is increasingly important in a time of uncertainty. “It’s more important than ever for managers to ask whether people are getting their ABCs: their autonomy, belonging and competence,” Peterson says. “Leaders who don’t get that from their own boss will tend to overcompensate with the people they’re managing; they’ll micromanage, and that’s not helpful.” Many companies expect to maintain at least some semblance of remote employee’s post-pandemic. Such a landscape likely will include a blend of telecommuting and face-to-face workers. Working from home was significantly on the rise since before 2020. Since 2005, regular remote work (not including selfemployed individuals) has grown by 140 percent, according to Skip the Drive. According to Owl Labs State of Remote Work, 42 percent of remote workers plan to work remotely more often over the next five years.  DSN w w w . d i r e c t s e l l i n g n e w s . c o m    41


F O R W A R D T H I N K I N G

ATTITUDE

Showing Optimism

A

NEW SURVEY shows that, despite uncertainly heading into 2021, small and mediumsized business owners remain positive. A new American Express survey published at the end of October reveals a high level of confidence and optimism from small and midsized business owners despite an economic downturn and widespread shutdowns through 2020. The inaugural American Express Entrepreneurial Spirit Trendexi surveyed 1,000 small and mid-sized business owners and 1,000 consumers. Eighty-one percent of the business owners believe the benefits of running their own business outweigh the current challenges, while 75 percent are optimistic that their business can recover. Respondents cited financial stability (89 percent), being their own boss (88 percent), turning a passion into a business (86 percent), creating jobs (85 percent) and the flexibility to set their own hours (85 percent) as the top benefits of being a business owner. Having learned from the challenges in 2020, 82 percent said they are better prepared to handle a future crisis.

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Using recourses and technology is now a priority to help business owners navigate through unprecedented times. Among the most sought-after resources are virtual business conferences and webinars (47 percent), virtual networking events (44 percent), advice on leading through a crisis (44 percent) and learning ways to destress and stay mindful (42 percent). MONE Y M AT T ER S The survey shows that cashflow and money management are top priorities, causing business owners to cut back on spending and transitioning more services online. The top four money management activities were:

41% INCREASING marketing efforts 40% INCREASING products/services online 36% CUTTING expenses 35% DIVERSIFYING revenue streams Making critical changes, sometimes incredibly quickly, has been a necessity for small business owners over the past year. Some have had to drastically change their business model either temporarily or permanently. The survey shows that 76 percent of business owners have pivoted their business model in some way, and 73 percent of those respondents say they plan to do the same in 2021. O T HER NUMBER S A Ceic Data study shows that United States business confidence grew 18.8 percent in November 2020, but that compares to an increase of 21.6 percent year-over-year in the previous month. Published in October 2020, the Wall Street Journal Vistage Small Business CEO Confidence Index shows that the proportion of small businesses projecting that economic conditions will improve jumped 15 points from the previous month, reaching 56 percent. It also shows that 24 percent of small businesses have brought all employees back to the workplace full or part time, while 40 percent have brought some back, and 6 percent are now fully remote.  DSN

Now What? If this is the question you keep asking, we can help. 70+ direct selling clients since 2015. 300+ years of direct selling experience.

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F O R W A R D T H I N K I N G

MUST READS ORIGINALS: HOW NON-CONFORMISTS MOVE THE WORLD Author: Adam Grant (Penguin Books, 2016)

I

n Originals: How Non-Conformists Move the World, Adam Grant—best-selling author of Give and Take—addresses the challenge of improving the world, but now from the perspective of becoming original: choosing to champion novel ideas and values that go against the grain, battle conformity, and buck outdated traditions. How can we originate new ideas, policies, and practices without risking it all? Grant explores how to recognize a good idea, speak up without getting silenced, build a coalition of allies, choose the right time to act, and manage fear and doubt; how parents and teachers can nurture originality in children; and how leaders can build cultures that welcome dissent. The payoff is a set of groundbreaking insights about rejecting conformity and improving the status quo.

RESILIENT: LESSONS LEARNED, LIVES CHANGED Author: Kathy Coover, Co-Founder of Isagenix International (Isagenix Worldwide, 2020)

W

hat kind of resilient are you? When it matters most, how will you respond? In Resilient: Lessons Learned, Lives Changed, Kathy Coover shares the lessons she has learned and teaches a simple system to identify life’s watershed moments, employ the right mental approach and take action towards living your dreams. Resilient reveals how to adopt the attitudes, traits and in-the-moment behaviors of great leaders. Life’s greatest successes are just beyond the moments when things seem too hard.

ENTREPRENEURS ON FIRE Hosted by John Lee Dumas (Apple Podcasts)

E

HAVE A LISTEN

ntrepreneurs on Fire is one of the leading business podcasts today. Hosted by John Lee Dumas, it has won the Best of Apple Podcasts award. Dumas’ main goal is to deliver the inspiration and strategies you need to FIRE UP your entrepreneurial journey and create the life you’ve always dreamed of. Dumas interviews legends of business growth and financial freedom. Some of his guests include Tony Robbins, Seth Godin, and Tim Ferriss. This podcast is for anyone who is looking for some inspiration to enhance their business and entrepreneurial journey. DSN

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Innovation in Compliance at L e-Vel: W hy It is V i t al in Our Indus tr y

B Y

D R E W

H O F F M A N


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F E A T U R E   /  

I N N O V A T I O N

I N

C O M P L I A N C E

In this article, I am going to discuss how Le-Vel approaches and views regulatory compliance and why it is vital for companies and leaders in our space to proactively move their companies and the industry forward in this critical area. However, this piece is not intended to proclaim that Le-Vel is perfect with regards to regulatory compliance—we are not—or that every company should do exactly as we do. Each company has its own way of dealing with this subject, and there is no one “right way.” As the President and Chief Legal Officer of Le-Vel, I am laser-focused on growth, on morale in the field, on excitement, and on generating continued forward motion from a business perspective. Therefore, know that all of the actions discussed in this piece are done with those non-negotiable business fundamentals in mind, as well as, legal and regulatory considerations.

A

T LE-VEL, THE significance of regulatory compliance is ingrained throughout our entire culture. Beginning with our coCEOs Jason Camper and Paul Gravette, myself, our Chief Compliance Officer Christopher Schmidt and including the entire corporate team and our leaders in the field, we pride ourselves on the amount of time and resources we put into regulatory compliance. These efforts are employed, in conjunction with the outstanding guidance provided by our primary regulatory counsel at Covington & Burling, in an effort to continually stay ahead of the curve and anticipate the many twists and turns in an ever-evolving regulatory landscape. THE F TC AND OUR INDUSTRY Our industry has been the subject of increasing regulatory scrutiny for years. And now, with Operation Income Illusion announced in December, coupled with other recent actions taken and statements made by the FTC (such as “Seller Beware”, the Keynote by Commissioner Noah Joshua Phillips at the DSA Legal & Regulatory Summit on October 15, 2020), the glare of regulatory oversight is only getting brighter. It is incumbent upon all of us who serve and lead in this industry to set the right tone and send the proper messages throughout our organizations. When we do this, it not only helps our individual companies, it also helps the industry at large.

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Each company has its own way of dealing with regulatory compliance, and there is no one ‘right way.’

F O U N D A T I O N A L E L E M E N T S O F L E - V E L’ S R E GUL AT OR Y C OMP L I A NCE P R O GR A M Le-Vel, from day one, has operated with an eye towards regulatory compliance. There has never been a signup fee, website fee, or fee of any kind to join or remain with Le-Vel as a Promoter or a customer. There have never been sales minimums or quotas required in order for Promoters to earn commissions. We have never paid commissions for recruiting. Our product has always shipped directly to the end consumer rather than being purchased and resold by Promoters. In addition to the above elements that have been part of the company since inception, there are many other compliancerelated practices, tools, and policies we use and have implemented that have served us well. Some examples include: maintaining a strict policy prohibiting the sharing of income or commissions earned; our marketing focusing primarily on the products as opposed to the opportunity, leading to less risk of improper lifestyle or income claims and a very robust customer to promoter ratio; using an automated system, as well as a manual auditing system, to scour social media and the web for any non-compliant posts, and using noncompliant posts as an opportunity to reach out to Promoters to provide 1-on-1 training; utilizing an abundance of targeted training videos; sending continuous and timely compliance communications to the field.

We have incorporated these practices for many reasons, both business-oriented and for legal/regulatory considerations. For the purposes of this article, there are two primary regulatory risks that we are attempting to mitigate through the use and implementation of the above practices. First, our conservative policies, training and proactive compliance program help to minimize the likelihood of illusory income claims and improper lavish lifestyle claims, which are a major focus of the FTC. It is imperative that individuals not be misled by marketing, requiring transparency and clarity regarding the opportunities available and the likelihood of success. Second, because there are no fees, quotas or required reselling, any potential harm to individuals is substantially minimized. If, after joining Le-Vel, a person decides the company is not for him/her, the individual can leave without any dollars spent outside of their personal product purchases. From the standpoint of a regulator, this inquiry—what harm do individuals incur—is very important in determining whether action should be initiated. Aligning your business fundamentals and regulatory program with those two aspects in mind: 1. Minimizing improper claims and ensuring transparency regarding the opportunity 2. Minimizing any potential harm to participants —not only mitigates regulatory and legal risk, it is also an excellent business practice, encouraging business sustainability and long-term growth. w w w . d i r e c t s e l l i n g n e w s . c o m    4 9


F E A T U R E   /  

I N N O V A T I O N

For information re the Le-Vel VIP Bonus and Le-Vel Getaways including the likelihood of earning the VIP Bonus and a Getaways, click here...

I N

C O M P L I A N C E

For information re the Le-Vel Auto Bonus, including the likelihood of earning the Auto Bonus, click here https://bit.ly/2Gxh8fY For information re the Le-Vel Millionaire Award, including the likelihood of earning the Millionaire Award, click here...

THREE NEW COMPLIANCE PRACTICES Given my view that regulatory scrutiny will increase in the future, we decided that the aforementioned steps, policies, and practices should not be the end of the equation and greater safeguards were required. As a result, we have taken many steps to mitigate regulatory and legal risk over the past 18 months. Three such substantial steps are detailed below. SOCIAL MEDIA DISCLOSURES Stemming from a comprehensive internal review, we implemented a new policy mandating that Promoters include a simple and conspicuous disclosure when posting about the rewards available to Promoters. This social media disclosure contains a link to our Income Disclosure Statement (“IDS”). The IDS sets forth average income, likelihood of hitting certain ranks, time it takes on average to hit certain ranks, likelihood of achieving certain rewards, and more for two sets of Promoters: 1. Any Promoter who orders product 2. Team building Promoters 5 0    D I R E C T S E L L I N G N E W S  |  

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In short, when an individual sees a post showing the success of a Promoter in achieving a certain reward, the accompanying disclosure clearly and accurately provides such an individual with the information necessary to understand the likelihood of achieving that reward, as well as a simple and accurate understanding of the overall opportunity. We were unsure if the field would take to this policy right away. However, adoption has been incredible, in large part because we explained the purpose of the policy and showed them how this not only protects their businesses but will also help them further connect with consumers through greater transparency. We found that being open and transparent with our field, rather than simply setting the policy without explanation, was unequivocally the right choice. Although this policy was a bold step, after countless hours of discussion, we knew it was the right path forward. Individuals must know the chances of achieving success and qualifying for specific rewards so that they can make an educated decision whether or not to participate. This policy ensures


It is incumbent upon all of us who serve and lead in this industry to set the right tone and send the proper messages throughout our organizations.

such transparency and openness. Consequently, I believe industry-wide adoption of such a policy is in the best interest of individual companies, as well as the industry as a whole. IDS REVIEW ADDED TO SIGN UP PROCESS The second step involved a change to our sign-up process. When an individual comes to Le-Vel.com to enroll as a Promoter, they must first view our IDS and affirm that they reviewed it. As a result, individuals will see black and white data regarding average earnings and the likelihood of receiving certain rewards before deciding whether or not to join Le-Vel. Further, it allows us to show, if necessary, that individuals were not only given access to such information but did review this information prior to joining Le-Vel. This is a simple and easily implemented practice that adds meaningful value from the standpoint of transparency. w w w . d i r e c t s e l l i n g n e w s . c o m    5 1


F E A T U R E   /  

I N N O V A T I O N

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Regulatory compliance is good business.

C O M P L I A N C E

PROMOTER CERTIFICATION PROGRAM The most effective compliance programs are ones in which the field buys into the program and understands the details, the purpose, and the benefit of the program and specific policies. With that in mind, Co-CEO Jason Camper envisioned the use of an engaging and interactive Compliance Promoter Certification Program, which we recently kicked off. This Program, which utilizes quizzes and other interactive tools, reinforces our policies and moves our Promoters from passively reading policies and passively viewing compliance videos to proactively thinking through important compliance issues and their solutions. The field has embraced the Program, proudly posting about being certified and showing off their certified “badges.” Given that compliance is generally not considered the most exciting of topics, it has been great to see both our executive leadership and the field view this important area as a valuable and essential piece of the company. W H AT NO W ? There is no exact formula or perfect compliance and legal program. A successful program emerges from a combination of factors, including thoughtful decisions based upon facts available, the assistance of experts on the subject, and company-wide acceptance that a proactive compliance program is critical to the long-term success and sustainability of the business.

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While there is no perfect formula, there are two pieces that must be present. It is imperative that companies seek to: 1. Manage and minimize lavish lifestyle/income claims and provide transparency to potential and current participants 2. Ensure the business is not operating in a manner that causes harm to participants in the business. Consequently, companies must implement solution-based policies, tools, and practices with an eye towards these two fundamental issues. FINAL THOUGHTS Regulatory compliance is good business. It is right for both customers and potential customers, for individuals participating in the business, for companies, and for the industry as a whole. I know others see it the same way, and I appreciate companies that look to lead in this area. I suggest that, as leaders of this industry, we continue to be focused, continue to listen, and continue to be willing to make changes when necessary. A company should not make wholesale changes simply for the sake of making them, but, rather, we should all be prepared to wholeheartedly embrace change when major shifts occur and the writing is on the wall. In other words, proactivity is key and putting one’s head in the sand is not the proper course of action. If we lock arms and focus on moving forward together, the OFalready TAGLINED world and regulators alike will seeUSAGE what we know— LOGOS lives are being enhanced on a daily basis and our industry and The tagline "AUDIT.TAX.ADVISORY" the companies operating the right way serve as the vehicle for only accompanies the logo in circumstances where context requires such incredible transformations.  DSN clarification about what Squire can do

Modernize Leapfrog your competitors with technologies built for 21st century businesses.

NETSUITE IS THE WORLD’S MOST DEPLOYED CLOUD ERP SOLUTION

Learn more at a briefing seminar at

One-tagline version of full color logo

netsuite.squire.com ( 801) 225-6900

for current and potential customers (the audience). For example, Squire.com and its

subsequent web pages feature the oneDREW HOFFMAN IS THE CURRENT PRESIDENT AND tagline version (HIGHER

CHIEF LEGAL OFFICER OF LE-VELONLY) BRANDS. DREW, PERSPECTIVE of the SquireA logo because the PLAYER, subpage content FORMER PROFESSIONAL SOCCER JOINED

Secondary-tagline version of full color logo

AUDIT · TAX · ADVISORY

throughout the site provides adequate

LE-VEL FOLLOWINGcontext A DISTINGUISHED to visitors. CAREER AT AN INTERNATIONAL LAW FIRM AND THE FOUNDING OF A

On the other hand, if the team attends a national financial trade show where Squire should differentiate itself from a neighboring financial software company, then trade show banners need to include the tagline, “Audit-TaxAdvisory.”

SUCCESSFUL LEGAL AND CONSULTING FIRM.

Treat the secondary tagline like it’s part

One-tagline version of white logo

w w w . d i r e c t s e l l i n g n e w s . c o m    5 3


C O V E R

S T O R Y  

/   R E D E F I N E D

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RE DEFINED W H Y IND U S T R Y L A N G U A G E A ND T HE B E H AV I O R S T H AT S H A P E I T NE E D T O C H A N G E .

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S A R A H

P A U L K


C O V E R

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In this world where rumor travels at light speed, who we are and what we do matters. How the broader world sees us matters. — RYA N N A P I E R S K I , N u S k i n P r e s i d e n t and Chairman of the Advocacy Committee for the World Federation of Direct Selling Associations

D

IRECT SELLING has had a record year. In spite of all the challenges 2020 dealt, approximately 80 percent of direct selling companies grew their revenue as compared to 2019, with 30 growing by more than $100 million and at least ten more than doubling their annual revenue. Three private companies, including MONAT and Scentsy, grew by more than $400 million, and two public companies, eXp World Holdings and Herbalife appear to be on the same track. It’s a pattern that continues, as the category shows consistent, month-over-month growth during the ongoing pandemic. Relationship marketing obviously has staying power, and even companies who shy away from using the “direct selling” label know it. This year, big-name brands are turning to the social selling template to fashion upgrades to their business models, like L’Oréal, who in the last month of 2020 purchased a minority stake in Replika Software, a platform that empowers brands to “activate at scale social sellers to inspire their networks and generate e-commerce sales.” E-commerce already represents a quarter of L’Oréal’s sales revenues, and this next step will leverage what the company’s Chief Digital Officer Lubomira Rochet describes as

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Speaking the Future:

Who are we? Where are we going? What should we be called?

an “ecosystem of social sellers for the beauty category” in an attempt to “crack this new channel” of social commerce. For brands like L’Oréal and others, “social commerce” means allowing customers to shop on social platforms with the guidance of middle men and women who are experts, influencers and brand representatives—or, rather, a leaner take on the commission-based social selling model direct selling is known for. A L ANDMARK BAN Imitation may be the sincerest form of flattery, but it’s not all good news. There’s a reason why brands are lifting the healthiest layers from the business model while downplaying its ties to the actual industry. In December of 2020, TikTok became the first major social platform to ban multi-level marketing, lumping it in with Ponzi schemes and fraudulent activity under their community guidelines. In pop culture now, the terms “mlm” and “pyramid scheme” are officially synonymous. TikTok will certainly not be the last, as anti-mlm movements build traction. The Subreddit r/antiMLM, which now has 675,000 followers, is a landing page for posts from people who receive spammy emails from friends they haven’t spoken to in decades, spouting fraudulent claims about income potential and unrealistic product results.

anguage will catch up to behavior, as industry leaders have explained, but in a field in which innovation is essential to stay competitive, is there time to wait? Buzzwords like social selling, social retail, social commerce and social sharing are already taking the main stage with more frequency while more historic terms like network marketing and multilevel marketing are being emphasized less. But there is more linguistic room to run for companies who are ready to grow their influence outside of the industry and continue building their legacies within it. For the direct-to-consumer model, for instance, the language is still remarkably seller-focused. Fresh titles may appear more relevant, but most point inward toward the company itself through combinations of words that describe the distributor. If the industry is going to become as customercentric as it is aspiring to be, it will need language to lead it there. That may mean setting the tone through words that point outward toward the customers they long to serve. In a personalized customer-centric future, the focus will be less about brand evangelizing and recruitment, and more about the interpersonal interactions between industry micro-influencers and consumers that build product loyalty and a renewed reputation. “Clearly the industry is looking for where it will go in the redefining,” says Stuart Johnson, CEO of Direct Selling News, NOW Technologies and Transformation Capital. “This is more than semantics. It warrants our attention and I’m looking forward to the discussion.”


C O V E R

S T O R Y  

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In the end, what matters more than the words we put on top of our business are the experiences we’re providing customers. —JOHN PARKER, Amway Chief Sales Of ficer and Regional President West

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On the legal side of the issue, the Federal Trade Commission is ramping up efforts to crack down on network marketing companies participating in fraudulent activities. Its Operation Income Illusion, announced in December of 2020, is focused on work-from-home scams, pyramid schemes and companies who make promises about income opportunities that in actuality cost consumers more than they earn. The distrust of the multi-level marketing label is pervasive, particularly with the youngest generations, as evidenced by their favorite social platform’s landmark ban. And yet the model is performing at peak levels, with external industries urgently innovating their digital approach in order to copy the social selling playbook. So how does the direct selling industry redefine its mission, approach or methods to keep its most valuable puzzle pieces while eschewing the elements it knows cannot fit into a credible and successful future? DISRUPTION FROM THE INSIDE OUT “For companies to succeed in this new economy, we must continue to be disruptors while we evolve ourselves to be even better stewards of the empowerment opportunity we represent,” Nu Skin President and Chairman of the Advocacy Committee for the World Federation of Direct Selling Associations Ryan Napierski told participants at the SUCCESS Partners University (SPU) 2020 event. “In this world where rumor travels at light speed, who we are and what we do matters. How the broader world sees us matters.” In his presentation, Napierski did not refute the existence of bad apples within the model, saying, “In my 25 years in this industry, I’ve had the privilege of knowing some of the most amazing and reputable business leaders on the planet. I’ve also had the unfortunate experience of associating with some individuals who saw themselves as far less than the potential that they and their businesses hold. If they would think more about building a sustainable enterprise over time, not a flash in the pan, they would, in fact, contribute to building a better industry, economy and world.” Being healthy requires recognizing illness and addressing symptoms and root causes. Negative experiences are the ones that gain publicity from onlookers. Still, if industry leaders would acknowledge the damage inflicted by toxic companies as unacceptable, it would provide more credibility to the category’s heritage of ethical, legal opportunities. Napierski’s refusal to sweep under the rug the flaws of the industry to which he’s devoted his life serves only to strengthen the opportunity. The world is telling the industry— through bans and sanctions—that trust has been broken. Leaders who are willing to follow Napierski’s example will help mend it. w w w . d i r e c t s e l l i n g n e w s . c o m    5 9


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Today’s direct seller is a connector between consumers and products.

CHANGING THE L ANGUAGE How industry insiders talk about their companies, compensation plans and representatives affects how the world views the opportunities they represent. Language changes over time, and so has the direct selling industry. Amway, for instance, originally referred to its representatives as distributors—because they did, in fact, purchase products, sell and distribute them to customers. Today, they refer to their organization leaders as Independent Business Owners, which the company believes is a better reflection of the role of its entrepreneurial representatives, who manage sales, customer satisfaction and team support. In contrast, the company handles distribution and delivery. This connection between the words used to describe the industry and its real-world impact is inextricably linked. However, the words themselves have less influence than the behaviors they derive from. “The distinction and understanding that the words represent about how our business truly operates, that is really important,” says John Parker, Amway Chief Sales Officer and Regional President West. “In the end, what matters more than the words we put on top of our business are the 6 0    D I R E C T S E L L I N G N E W S  |  

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experiences we’re providing customers. Whether we describe ourselves as being in direct selling or social commerce or network marketing, I think that’s much less important than the experience customers are having, and the experience what we call Independent Business Owners are having.” BUILDING CUSTOMERS, NOT TEAMS Franchise owners, food delivery workers, and even the #sponsored content from influencers have become natural bridges between customers and products. Overall, society doesn’t begrudge the association these people have to a brand, even though they profit off of the relationship and resulting purchases. In the same vein, today’s direct seller is a connector between consumers and products. Like a franchisee, they make an investment in owning their own business and then reap the profits of building it. There is a difference, however, in that direct sellers are also building organizations through recruitment. At SPU 2020, a number of executives highlighted the importance of building customers rather than teams as a key element of not only compliance but future growth. Direct Selling News has also announced a Customer-Centric Recognition (CCR)


Program that celebrates companies creating a sustainable, customer-centric future for the industry and that boast high customer-to-distributor ratios. Team-building is still a central ingredient in the direct selling model, but the shift away from recruitment is undeniable and timely. This switch, while a momentary upheaval for some companies, is another in a long line of changes the industry has adjusted to, especially in the wake of a pandemic. Pure Romance Chief Executive Officer and President Chris Cicchinelli describes what it was like to shepherd his company through the drastic transformation from being an in-person “party-based” company to an all-virtual company basically overnight.

“At Pure Romance, our motto is: Change is inevitable; growth is an option,” Cicchinelli says. “We need to change, and we’re going to grow from this. We’re going to come out of this a stronger organization, but we have to get uncomfortable for just a little amount of time.” The pandemic has proven to direct selling leaders that they know how to change direction on a dime and successfully bring their organizations along with them. A course correction as significant as reexamining the recruitment model and the ways it is implemented would be well outside of the industry’s comfort zone, but, as the sudden and unexpected all-virtual approach to direct selling has shown, that’s often where the most powerful innovation resides.

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If an innovative startup wants to put us out of business, we want to think like them. —CHRIS CICCHINELLI, Pure Romance Chief Executive Officer and President

JOINING THE GIG ECONOMY Category giants like L’Oréal are just the beginning in what will surely be a full bandwagon of brands arriving on the social commerce scene in a disruptive rush. As opinions skew negative in the marketplace concerning direct selling, relationship marketers would be wise to embrace their natural fit within the gig economy rather than insist on the #bossbabe and #buildingmyempire mentality that has attracted scorn. By embracing the “gig” title and leaving behind non-compliant promises, companies can disrupt themselves before the world around them does it for them.

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“We are all really more conscious about disruption now,” Cicchinelli says. “As a 2021 project, I’m starting the conversation inside of our organization, asking how we would put ourselves out of business. If an innovative startup wants to put us out of business, we want to think like them.” REDEFINING THE INDUSTRY In 2021, leaders can expect to see a continued adoption of “social selling,” “social retail” or “social commerce” as key replacements for the labels that have garnered the industry distrust. Still, it will be critical to remember that the reputation of the industry is not dependent on finding just the right campaign or words that will change consumers’ minds. Instead, acknowledging that a lack of compliance by others has caused harm, and then committing to behaviors the industry is already skilled at, like philanthropy and life-improving (rather

than life-changing) income, is the way forward in stomping out the reputation-tarnishing pyramid schemes and succeeding for generations to come. Ethics matter, reining in hyperbole matters and, yes, reputation matters. Redefining direct selling through behaviors that organically inspire positive language from those on the outside looking in should be priority number one. “I don’t think it’s about picking words and then trying to build a business to support that,” Parker says. “I think it’s innovating our businesses and then the language and the words we use to describe it will become very apparent.” Based upon the research conducted for this article, the future will be about building brands that serve their customers efficiently and personally by the independent contractors who facilitate the relationship.  DSN

CONTACT SALES payquicker.com/DSN solutions@payquicker.com

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WAY NE MO OR E HE A D

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Wayne Moorehead Talks with Ryan Napierski About the New Normal, What Keeps Him Up at Night and More.


R YA N N A P IE R S K I

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EMEMBER WHEN it was easy to network with your peers during impromptu hallway or dinner conversations at industry events and the resulting insights that came out of those conversations? DSN’s new Executive Insights series is the next best thing to those priceless exchanges. The debut interview brings together Wayne Moorehead, Chief Marketing Officer at Young Living and Ryan Napierski, President at Nu Skin, in a one-on-one discussion about disruption, the New Normal, what keeps Ryan up at night, and so much more. Here is a brief look at parts of their conversation. To watch the entire interview, visit DirectSellingNews.com. WAYNE MOOREHEAD: Thank you, Ryan, for being here today. When Stuart and Direct Selling News reached out to me with this opportunity to be the kickoff episode where one Direct Selling insider gets to interview another—you were the first name that came

Great question, Wayne. Funny that you use the term new normal. —Ryan Napierski

to my mind. I’ve always seen you as someone who’s able to understand and embrace the dynamics of change, identify those that are going to have the greatest impact and create the greatest change. We’re all wrestling with this new normal because of the seismic changes that we experienced. We have closed out what was probably one of the most dynamic and challenging years. Trends and changes that were predicted to be decades out accelerated rapidly and are now staring us in the face. So this concept of new normal is something that we’re all still processing. How much is this concept of the new normal present in your mind, on an individual basis and at Nu Skin? w w w . d i r e c t s e l l i n g n e w s . c o m    6 5


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RYAN NAPIERSKI: Great question, Wayne. Funny that you use the term new normal. I just gave a speech last week and used that exact phrase. That this is a perpetually new state of normal, that the change and disruption are prevalent and exciting. For our leadership team and me, we absolutely have learned to love the disruption. Our industry happens to have been through multiple cycles of disruption. We’re in one now—that is more exciting and transformational in a favorable way than any of the preceding disruptive periods. This new one, social commerce, is the most exciting transition or disruption that we’re seeing for our industry, largely because of macro trends. When you talk about value creation in any industry, the macro trends that are driving that now with the gig economy, with social commerce, influencer and affiliate marketing—those all feed so nicely together with the traditional or the analog direct sales model. As companies lean into those macro trends, with the right strategy, there’s enormous potential. There isn’t a day that goes by that we’re not talking about a disruptive force and how Nu Skin is leaning into that disruptive force. WAYNE: Over the last several years, you and the leadership team there have made a big push from a technology standpoint. Obviously, technology was vital to us even being able to stay in business the past 10 or 12 months, to be able to interact and connect with our distributors and members. Can you talk a little bit about how the focus on technology changed for you? RYAN: Technology is the scalability element of the whole future-looking model. We initiated a pretty heavy technology transformation. Knowing that we didn’t have the capabilities in-house, I had to partner with some external firms to bring the right technology leadership in. We overhauled our technology. And we’ve been overhauling and going cloud, security, customer-first. We’re rebuilding all our processes internally. It was pretty disruptive, pretty transformational work. 2020 catapulted us forward to the future that we thought was coming, but we projected that to be 2023 to 2025. And so it accelerated the pace of change. Everyone has talked about the return to normal. For our leadership team, we said, “Absolutely not. This is the new 6 6    D I R E C T S E L L I N G N E W S  |  

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normal. We will continue to lean into this.” And largely, Wayne, because it’s so favorable to our industry, and to the companies that are leaning into the change. It was both— the last 10 months catapulting us in, but then burning the bridges behind us and saying, “We’re here.” Now we’ve got to learn how to win in this new market. For us, there really is no going back. We have transformed the way we see the world and our own leadership capability as well. WAYNE: I think we’re going to be adopting a fairly similar model. I agree with that approach from kind of the collaboration and a culture standpoint, there needs to be some type of cadence of in-person meetings. There may be more flexibility in a hybrid model where it’s not the 9:00 to 5:00. Or where people are spending two hours of every day in the car, but we’re seeing a lot more efficiency. I think employees are happier with the flexibility. As time goes on, everyone’s getting a little anxious to get back and kind of interact and a little more face to face interaction. How do you see kind of in-person events? I think a lot of us experimented this year with virtual events and found some success and advantages there and some obvious disadvantages. RYAN: It is a blended approach. Culture is such a critical part of not only a company, but the entire organism, including our affiliates, members or consultants. I do believe that we will have a blended approach moving forward continuously. What I love about the digital first events are that we can connect much more frequently, and they’re very effective in conveying information. The motivation and aspiration elements of our business that are inherent in the channel growth I think do require some more direct in-person interchanges. We’ll be experimenting throughout 2021 and beyond with more of a blended hybrid approach. WAYNE: From a work-from-home standpoint, as you look at the employees, the ability that technology lets us connect wherever—as far as talent acquisition or retention, geography isn’t a limiting factor anymore. How are you and Nu Skin thinking about work-fromhome going forward?


People are realizing human connection, relationships and flexibility matters. —Ryan Napierski

RYAN: My assessment of the work remote model is that there have been significantly more pros than cons. If I were to score the various characteristics of the work environment, most have improved. The only con that I’m really worried about, that is collaboration. I think not having that ability to sit in the same room and whiteboard and collaborate on something is one area that we’re struggling with. It’s critical to the strategic work. When I look to the future, I think absolutely Nu Skin has and will continue to adopt a work remote model for all the good reasons. As we’re scaling that and accessing new capabilities, it is critical and allows us to work much more effectively. I would anticipate that we will be opening our offices back up for a more shared remote to on-premises work environment. I would imagine it’s going to be a blend moving forward, but I do anticipate a return to the office in partial form, particularly for our collaboration work around the strategy and the mapping side of things. WAYNE: I agree with that approach from a collaboration and a cultural standpoint. There needs to be some type of cadence of in-person meetings. There may be more flexibility and employee satisfaction in a hybrid model. As time goes on, everyone seems to want a little more face-to-face interaction.

I want to talk a little bit about momentum. I remember being at the SUCCESS Partners University event two years ago…interacting and talking to a lot of companies that were down from a revenue and growth standpoint. At that time, there seemed to be an ominous change that was happening, where I think everyone was looking around going, “Whoa, what does this mean?” And with 2020, we saw increased awareness and demand for a many of our products, which created this tailwind or momentum. What changes did you see at Nu Skin from a momentum standpoint? RYAN: The advantages that our model presents of being able to shop online, work remotely with products that help people played the industry’s advantage in our favor. And what I like to say more than anything is we were able to provide solutions to a world that was really true in need— from work, products, opportunity, culture and community. When people were stuck at home, working remotely, they have an opportunity to connect with a team and be a part of something bigger than the problems they were facing. I think we provided solutions for what people needed. Now, as far as looking forward to the momentum, citing your specific question. I believe that people have gotten a taste for what life can be. People are realizing human connection, relationships and flexibility matters. We provide all of that. We provide the opportunity for people to interact one-on-one. We provide the opportunity for people to have more flexibility in the way we work, anywhere, anytime. We provide solutions for their actual consumption needs. The momentum that we started to build in 2020 will continue as we lean in and transform ourselves. w w w . d i r e c t s e l l i n g n e w s . c o m    6 7


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WAYNE: When you’re thinking about 2021 and the business landscape, more than anything, are there one or two things that are really keeping you up at night? RYAN: Internally what keeps me up at night is—are we walking the walk or just talking to talk? Because we’re all getting more proficient technologically and digitally, and we can talk about what we’re doing. A great example, I was on a call this morning with 240 of our top leaders here in the U.S. We’re not meeting the customer need yet. We still have a whole bunch of problems. So, when I look at that, I say, “Well, we can sit around and pat ourselves on the back. The scaling of the business is causing breaks all over the place and the cracks become wider. So, are we as a team, are we patting ourselves on the back and just talking the talk, or are we really walking the walk and making certain that we’re driving the action, everyone throughout the company? At an industry level, what keeps me up at night is the misunderstanding and misinterpretation of our industry at a regulatory level, at a commercial level and at a human level. I think we have to be very candid with ourselves in that regard—that we have not historically done a great job always. I’m saying collectively as a direct sales unit, we have not done a good job of being truly customer-obsessed. If we’re serious about being customer-obsessed and about capturing the market opportunities ahead of us, it’s on us to talk the talk, walk the walk, act the way we want to be seen. We need to rebuild or reposition ourselves, not just with a narrative or a storyline, but to truly get into the grassroots behaviors of our channel, of our Salesforce and help them to learn that there’s so much more success when we actually represent ourselves for what we have—amazing products in an easily accessible manner, a trusted person to person relationship, word of mouth and becoming a part of a community or a brand that actually values you instead of seeing you as a transaction. My worry is that we as a collective industry don’t acknowledge that, or maybe more that we’re going

If we’re serious about being customerobsessed and about capturing the market opportunities ahead of us— it’s on us to talk the talk, walk the walk, act the way we want to be seen. —Ryan Napierski

for the short-term gain and win, rather than looking at this long-term and saying, we really have an opportunity as an industry to grow from a $200 billion global industry to a $2 trillion global industry, to a 20 trillion. There’s no reason why we shouldn’t be ten times the size we are today with what we have to offer. WAYNE: I agree we need to work to change the perception and positioning of the entire channel. Not just at our own individual company level, but at that industry level. I think we all need to come together, but I believe that we can have real impact and real change on that.

Final question. What gets you out of bed in the morning? What are you most excited about for 2021 from a business perspective? RYAN: Scalable empowerment. What I love most about this industry is that we are an industry of empowerment, right? We provide people with the opportunity to really direct their own future with effort, with work, with a commitment. It’s hard work, but we are an empowerment engine as an industry. What excites me the most is the scalability that a digital-first industry actually provides. So, what I’m really excited about, what wakes me up prematurely, because I need my sleep, is that just, are we moving fast enough? Are we taking advantage of this unique opportunity that’s in front of us?  DSN To watch the entire interview, visit DirectSellingNews.com.

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COMING APRIL 2021! BEST PLACES TO WORK IN DIRECT SELLING

Last Year’s Best Places To Work

PRESENTED BY DIRECT SELLING NEWS

DIRECT SELLING IS THE ORIGINAL PEOPLE BUSINESS. Measuring field engagement is critical to any company’s success, but the field is only part of the people equation. Once again, Direct Selling News has partnered with HR technology company Quantum Workplace to celebrate the important role direct selling companies play as employers in the marketplace and to identify the best of the best when it comes to creating engaging work environments. The Best Places to Work in Direct Selling will be featured in a special publication distributed in our April 2021 edition.

FOR SPONSORSHIP OPPORTUNITIES, PLEASE CONTACT MELINDA BOGOSLAVSKY mbogoslavsky@directsellingnews.com

SPONSORED BY ®


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LEGALSHIELD /

LegalShield: Our Time is Now Many have found solutions through LegalShield, whose small business membership gives business owners the resources they need to move forward. BY JENNY VETTER

S

JEFF BELL

CEO

DON THOMPSON

PRESIDENT

TILL REELING from the challenges of 2020, small business owners are desperately trying to protect their livelihoods and rebuild what they’ve lost. Many

LEGALSHIELD FOUNDED:

have found solutions through LegalShield, whose

1972

small business membership is giving business owners

HEADQUARTERS:

the resources they need to move forward. However, increased demand for LegalShield’s innovative legal services and privacy protection isn’t limited to business owners. The company has seen growth across the board, heralding a potential renaissance for this industry mainstay.

Ada, Oklahoma TOP EXECUTIVES:

Jeff Bell, CEO Don Thompson, President PRODUCTS:

Legal services

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P R O T E C T ION AT E V ER Y L E V EL In a season of uncertainty for industries across every sector, LegalShield is experiencing a level of growth that the company hasn’t seen in 20 years. Chief Executive Officer Jeff Bell connects that growth to the intersection of two things: the minefield of today’s legal pitfalls and the evergreen nature of LegalShield’s membership offerings. “There has never been a time in recent history where issues of justice and personal security have been larger on the world stage,” Bell explains. “Our business is based upon a service with eternal demand, not a product with a shelf life. Our vision is a world where access to justice and security is equal for every human, no longer simply sold to the highest bidder.” LegalShield has been providing membership-based pre-paid legal services since 1972. While the mission of the company hasn’t changed—to protect and empower people with the tools and services they need to affordably live a just and secure life—the value and coverage of the company’s memberships has continually evolved to meet the changing needs of both businesses and individuals. Today, customers have access to two base membership plans—Personal Plan Coverage or Business Coverage based on the level of services a business needs. Both plans include a selection of legal services provided by attorneys with an average of 22 years of experience and can be upgraded to accommodate more specific needs, such as trial defense, owning a home-based business, gun ownership, or rideshare. Business owners also have access to LegalShield Business Plus, which offers a broader selection of features and benefits, including marketing and technical support. “Our product enhancements and technological advancements continue to anticipate the evolving, diverse needs of our members,” says Glenn Petersen, President of LegalShield Business Solutions. “It’s rewarding to know that our legal and identity services are invaluable tools that address members’ critical financial and family vulnerabilities, including those caused by COVID-19 and privacy and reputation management concerns.” 7 2    D I R E C T S E L L I N G N E W S  |  

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UNPARALLELED OPPORTUNIT Y As the only provider of legal, reputation and privacy services in the direct sales industry, LegalShield offers an unrivaled proposition to prospective network marketers; however, it’s not just an unchallenged position in the industry that sets the opportunity apart. Don Thompson, President of LegalShield’s Network Division, enjoyed over 20 years in the field before accepting his current corporate leadership role. He explains


There has never been a time in recent history where issues of justice and personal security have been larger on the world stage. —JEFF BELL, Chief Executive Officer

how LegalShield’s compensation structure offers unlimited opportunities—for life. “We’re a little bit different in that we are offering a subscription-based service,” Thompson shares. “So, it’s not that every month we’re reselling (a product) to the same customers. Instead, we’re offering plans that members value for life. Associates are able to earn commissions on new memberships and overrides, while continuing to be paid

a percentage as a residual for the lifetime of that book of business. The member is protected when they need us—when they need their legal rights. And the associate is compensated for the lifetime of that membership as well.” This lifetime perspective has resulted in both a loyal membership base and a loyal field, with the average LegalShield leader holding a 20 plus year tenure with the company. w w w . d i r e c t s e l l i n g n e w s . c o m    7 3


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“Our products and services are not ‘once and done,’ adds Petersen. “They instead address countless vulnerabilities by providing invaluable protection and empowerment at any stage of a member’s life. Our services have never been more needed than during the crisis we’re facing this year. It’s been a siren call for thousands who don’t just want to sell socially, but to make a difference in the world while they do it.” Bell also noted last year’s tumultuous employment landscape as an open door to the LegalShield opportunity. “As more people were furloughed or laid off, our home-based business presents the best of all worlds,” Bell explains. “There’s no massive investment in inventory, we offer a service that improves people’s lives when used, and this is a chance to develop a real leveraged and residual income for life.” Unlike other network marketing opportunities, associates can see great success whether they choose to focus on building teams, or personally producing business. LegalShield sees an average of 10 times more memberships sold than new associates recruited each year. 74    D I R E C T S E L L I N G N E W S  |  

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We’re offering plans that members value for life. Associates are able to earn commissions on new memberships and overrides, while continuing to be paid a percentage as a residual for the lifetime of that book of business. —DON THOMPSON, President of Network Division

“In many network marketing companies, everything’s based on recruit to sell,” says Thompson. “Although 2021 was a record year for recruiting at LegalShield, not everyone you speak with will want to join the business. However, what sets us apart is that everyone you talk to does need to be protected and empowered with access to our suite of products. Since you’re getting paid off your active membership base, you can earn a lot of money through building up a large book of business of people that both you and your team have enrolled.”

Prior to 2020, LegalShield had already made large investments in a prospecting app and a user-friendly business associate back office app. Additionally, associates were very familiar with using Zoom to supplement in-person meetings. This allowed LegalShield to quickly pivot in 2020, and create an all-virtual experience for associates to continue growing and building their business with record growth. “We successfully pivoted to a virtual international convention and a leadership convention with more than 12,000 participants at each event,” adds Bell. LegalShield’s Network Division grew recruiting by over 80 percent in 2020, ending the year with over 4.4 million people covered by the services LegalShield provides across the United States, Canada and the United Kingdom. In 2020, LegalShield’s Provider law firms received over 2.2 million requests for new service from members. w w w . d i r e c t s e l l i n g n e w s . c o m    7 5


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CFO Steve Williamson assists employees in preparing boxes for the Salvation Army.

CEO Jeff Bell (Left) and CFO Steve Williamson (Right) receive award from United Way's Regional Director James Jackson (Center).

As more people were furloughed or laid off, our homebased business presents the best of all worlds. —JEFF BELL, Chief Executive Officer

MORE GROW TH TO COME Last year saw growth across the board for LegalShield— financial growth, thousands of new members and associates and expanded product offerings. “Our legal services and privacy management offerings have grown faster in 2020 than any of the prior five years,” says Bell. “We’ve added a number of great supplements to our legal membership and added some fantastic tools to help small businesses launch and grow their ventures. We also radically expanded the number of services offered to our IDShield members.” 7 6    D I R E C T S E L L I N G N E W S  |  

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IDShield is LegalShield’s privacy and reputation management solution, available as a separate subscription membership to individuals and families. In 2020, the company added privacy consultation and reputation management to IDShield, as well as access to licensed private investigators who educate members in safe internet and email usage. As LegalShield begins its 49th year in business, the momentum the company gained in 2020 is only expected to continue. This year is set to include more expansions to small business plans, more robust trial defense and gun ownership supplements, as well as new LegalShield and IDShield personal plans in the second half of 2021 and a “telalawyer” service, similar to the telemedicine services that gained so much popularity in 2020. Also anticipated are an updated core architecture of the company’s back-office and fresh, best-in-class user experience for LegalShield members. “We’re going into 2021 with the mantra, our time is now,” says Bell. “Our Vision 2025 is to protect and empower more than 2,000,000 new members annually and to reach 10,000,000 global memberships in force—and we’re well on our way. In our next five-year cycle, we will continue to advance that mission on a massive scale, by reaching millions more active members, with scalable technology and a thoughtful, personalized user experience backed by thousands of lawyers and professionals.” DSN


A boutique investment banking, business development and corporate finance advisory firm with a primary focus on the direct selling vertical.

Stuart Johnson, the Founder and Chief Executive Officer of SUCCESS Partners and Direct Selling News, is a cofounder of the new firm. Transformation Capital’s experience and relationships are unmatched within the direct selling community.

SERVICES OFFERED INCLUDE: • Buy side and sell side M&A advisory • Equity and debt financing • Proprietary transactions • Joint venture and partnership opportunities • Institutional advisory

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Visit us on the web at: www.transformationcap.com or contact our partners directly as follows: info@transformationcap.com | 214-308-6020

Stuart Johnson, Partner | spj@transformationcap.com Ryan Bright, Partner | jrb@transformationcap.com

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Re-imagining Together MONAT Global Accentuates Its Online Advantage, Sales Surge. BY BETH DOUGLASS SILCOX

F

IFTEEN THOUSAND MARKET PARTNERS set to converge on Atlanta last September, and coronavirus surges. That’s when MONAT Global scuttled their in-person festivities and re-imagined what “together” means with a

large-scale, virtual event that not only upped the entertainment and experiential value for its field but also gathered their largest audience ever. Fifty thousand participated online, a number that President Stuart MacMillan calls one of his proudest MONAT moments.

LUIS URDANETA

CHAIRMAN/ CO-FOUNDER

RAY URDANETA

CEO

STUART MACMILLAN

PRESIDENT

MONAT GLOBAL FOUNDED:

2014 HEADQUARTERS:

Doral, Florida TOP EXECUTIVE:

Luis Urdaneta, Chairman and Co-Founder Ray Urdaneta, CEO Stuart MacMillan, President PRODUCTS:

Anti-aging hair, skin, and wellness products

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Impact kits, couriered to every attendee, gave them all something new to crack open daily during live, 90-minute segments spread over four days. They hired James Corden of Carpool Karaoke fame as emcee, hosted a virtual black tie and gown gala in their Market Partners’ own living rooms, and contracted film crews in California, Chicago and Miami to surprise major award winners live at their own front doors. Feeding off the energy of its millennial and Gen Z field and utilizing the online advantage their youthful demographic created for their business, MONAT inspired, guided and made good on its promises to deliver naturally based products. They not only delivered their products but also a fun and rewarding business opportunity, a culture of family, and service with gratitude despite all that 2020 dished out. MONAT channeled positivity and applied massive creativity and resolve to perfect the pivot and flip potential negatives into undeniable positives. When lockdowns brought other companies to their knees, MONAT’s sales growth soared more than $400 million and more than doubled the revenue year over year. They launched a third product category expansion into wellness in 2020, opened new international markets in Ireland and Poland, and boosted their gratitude-focused culture by creating the nonprofit MONAT Gratitude. 8 0    D I R E C T S E L L I N G N E W S  |  

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B UIL DING ON L AT IN A MER IC A N SUC CE S S MONAT’s founding family has a rich history in direct selling going back 30 years. Luis Urdaneta worked as a direct seller for nearly two decades in Latin America before launching a beauty and wellness company called L’eudine Global with his son Ray in 2001. They established offices in Maracaibo, Venezuela and Miami, Florida. In 2008, the company formed Alcora Corporation, a holding company, which included the L’eudine brand and products. Working with B&R Products, a Miami-based manufacturer and formulator which they later acquired in 2013, Alcora exported FDA compliant products to Latin American markets to much success. By acquiring B&R—complete with high production capabilities, formulation library, lab and chief scientist— Alcora had a full-service supply chain management entity that could conduct research and development, analyze trends, and meet quality assurance standards. Bringing these capabilities into the fold held great potential for the company.


MONAT chooses to ‘be part of the solution.’ — R AY U R DA N E TA , C EO

MODER N N AT UR E—MON AT In the early 2010s, few Americans were talking about naturebased, premium haircare products, but Ray Urdaneta, one of Luis’s sons, recognized a U.S. market niche waiting to be filled. He spent some time at SUCCESS Partners University, which piqued his interest in growing into the North American market Soon pre-launch planning and recruitment was underway, a comp plan in place and a product catalog that included eight premium shampoo and conditioning products and one oil intensive therapy—something atypical to the American premium haircare marketplace. In October 2014, MONAT Global launched in the United States with 500 market partners. The next year came Canada. The U.K., Ireland and Poland followed in subsequent years. MONAT chugged along, growing its product line, gaining momentum and earning market share in the premium haircare space, which attracted some haters. “When you go from zero to the number one premium haircare company, you’re a disrupter. Not everyone was happy with the fact that a direct selling company was in the professional, premium haircare space,” MacMillan says.

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We’ve aimed to strike the right balance between informative and concise…punchy copy, eye-catching social posts, and brief-butinformative videos have all been a part of this approach. —COLIN MCCORMICK, Director of Marketing Communications

Terrific field leadership rebuffed the discourse and pulled MONAT through. By the end of 2017, MacMillan says, “We were the number one premium haircare company in the world by revenue. It was phenomenal.” EVOLUTIONARY GROWTH In 2019, the company evolved into the healthy skincare space in an equally impressive manner. MONAT’s skincare line produced $7 million in sales in the first three hours, then blew 8 2    D I R E C T S E L L I N G N E W S  |  

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away aggressive sales forecasts in three short weeks. Their supply chain capabilities stretched thin, so MONAT took cues from retail counterparts and drew positive media attention to the product line with 25,000 eager customers in queue. To be a player and compete with the Sephoras and Nordstroms of the retail world, MONAT leaned into a retail look, feel and branding. It worked. They saw little need to benchmark themselves as a direct selling company, instead, they engaged their young demographic online as best-in-class in the health and beauty sector. MONAT is not interested in running a distributor buying club. They want to focus on the customer experience, the products and the sale. Their goal is a 10:1 customer to distributor ratio. To date, they are nearing 2 million customers and have 400,000 Market Partners worldwide.


There are a few other successful companies that have straddled the direct selling and retail worlds. MacMillan says it works for MONAT because they offer unique products that people want to buy. It’s also a hip, cool brand that’s aspirational to a community of primarily young women drawn to that. It’s MONAT’s responsibility to maintain it and grow it. And grow it they have. During a year when so many companies—direct sellers or not—struggled, MONAT pushed forward with a popular foray into Wellness. The five-product collection, developed in partnership with holistic expert Dr. Brent Agin, supports proper nutrition, rest, exercise and collagen production. This line is tied to a fairly aggressive global expansion plan that will take MONAT into the Pacific and widen its European footprint. But regardless of MONAT’s future plans, the company’s 2020 performance inspires and is an industry bright spot. MONAT chooses to “be part of the solution,” CEO Ray Urdaneta says. “Our success was phenomenal. We are up more than $400 million over last year,” MacMillan says. So what stars aligned to make this possible? MONAT’s success amid the pandemic is threefold, according to MacMillan.

1. MONAT stayed open. When their retail competitors like Neiman Marcus and salons could not, MONAT offered premium products for sale online with at-door delivery. Lockdown was a tipping point for new customers to try the brand. 2. So many people wanted work. Not only was MONAT bringing in phenomenal numbers of Market Partners during the summer of 2020, but distributor activity rates (which ideally hover around 30 percent) went to 40 percent and higher after COVID. People signed on, had the motivation and the time to build a business. 3. People craved community. “Through our virtual MONAT and the way, we did business online, we gave lonely people a place to hang out,” MacMillan says. SUCCEEDING ONLINE Of course, MONAT’s young field demographic and customer base—who exist in large part online anyway—gave the company an advantage over those with older, less familiar and less adaptable sales fields. The transition to total online sales and recruitment was smooth and made smoother by the company’s evolving messaging. w w w . d i r e c t s e l l i n g n e w s . c o m    8 3


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Our success was phenomenal. We are up more than $400 million over last year. —STUART MACMILLAN, President

“We’ve aimed to strike the right balance between informative and concise—giving our audience the educational information they need about our products, while making content ‘bite-sized’ and immediate so that it’s both ingestible and shareable. Punchy copy, eye-catching social posts, and brief-but-informative videos have all been a part of this approach,” says Colin McCormick, Director of Marketing Communications. At a time when nothing seemed clear in the broader world, MONAT’s consistent themed messaging to Market Partners offered a wide-angle look that connected important dots. How does a rank advancement promotion, sponsoring push, product launch and training event work together to help build a business? 8 4    D I R E C T S E L L I N G N E W S  |  

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“We’ve made a conscious effort to present these elements as parts of a whole rather than individual pieces, thereby making them easier for our Market Partners to understand and apply,” McCormick says. And they met Market Partners where they live–online— through Facebook Live, YouTube, Zoom calls, and Instagram takeovers. A recent promotion—7 nights of 7-minute Zoom calls—provides the exact amount of just-in-time training for Market Partners to take hold of monthly opportunities and run. “We’ve always been a company shining the light on topperforming Market Partners to share best practices, and that certainly has continued as we want our Market Partners to know, like any great family, we are successful together,” says Natalie Johns, Vice President of U.S. Sales.  DSN


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Our Future: The Nano Influencer Economy B Y

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VER THE NEXT TEN YEARS, the U.S. economy will experience the largest transformation in history. While the undercurrents of change are supported

visibly by big technology, evolving government regulation, and global health crises, our economy’s new raison d’etre lives much closer to home: baby boomers will pass $30 trillion onto the next generation by 2030. And though millennials today own just 3 percent of the nation’s wealth, PNC Financial estimates they’ll collectively inherit $59 trillion by the time they’re as old as their parents are now. The powerhouse consumer brands of tomorrow will recognize not only shifting purchasing power but markedly different behaviors across all channels of distribution.

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NE W F R ON T IE R S IN DIGI TA L Case in point—millennials are twice as likely to be influenced to purchase a product because of social media than boomers. Word-of-mouth remains the most powerful source of truth for all consumers, 80 percent of whom purchase particular products or brands based on recommendations from people that they know. Millennials are still having these conversations and giving these recommendations, but their greater trust in social media signals that said conversations and recommendations happen online. The influence of everyday people underscores everything we do in the world of direct selling. What we’ve learned over the last 100 years of consumer to consumer commerce is only corroborated by digital retail. For example, referral web traffic converts to revenue at twice the rate of paid and organic search. In short, people buy from people they know.

The powerhouse consumer brands of tomorrow will recognize not only shifting purchasing power but markedly different behaviors across all channels of distribution.

For us experts in the world of what’s now being called nanoinfluencing (the online pattern of recommendation to purchase between everyday people that happens through social media), this power of relationships isn’t new news. It’s just happening online instead of in person; despite virtually no in-person influencing last year, many of the company’s clients shattered revenue records through their influencer e-commerce channels. The larger world of retail e-commerce, then, needs what we have: The power of everyday people. 8 8    D I R E C T S E L L I N G N E W S  |  

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S TAT US QUO IS S TA GN AT ING Successful direct-to-consumer brands like Purple, Allbirds, and Dollar Shave Club proved early in the e-commerce age that brands no longer needed an in-person buying experience to be viable. And as artificial intelligence, machine learning, and the promise of a blockchain-backed future make headlines, e-commerce revenue continues to grow at a breakneck pace—but despite our best algorithmic efforts and technological advances behind the scenes, consumers remain less sticky when shopping online. Cart abandonment rates are high, conversion rates are low, and price switching is rampant. The new social commerce economy, and nano-influencing in particular, eliminates many of those brand-weakening, price-switching moments. When a consumer purchases on a recommendation from a real-life human, the purchase funnel is shorter, effectively harnessing the existing trust and relationship to increase the conversion rate. To differentiate from behemoth competitors like Amazon and Walmart, retail e-commerce brands need a more personal shopping experience. Many brands have found success with micro-influencers, defined by an engaged social media account with less than 100,000 followers. These folks typically have a more niche following, so brands can more reasonably predict the interest of an influencer’s followers in an effort to increase engagement. For example, a cosmetics brand would much more likely partner with a young female micro-influencer than a male athlete micro-influencer, knowing that the followers of the former are far more likely to be interested in cosmetics than the followers of the latter. But managing these relationships takes significant time for a brand, and their engagement rates still fall far from those of the everyday person. When it comes to social commerce, it’s about the quality of followers more than the number you have. And as it stands today, this new breed of nano-influencers has by far the best relationships with their followers. This shouldn’t come as a surprise given that most of the folks under the definition

of “nano-influencer” are everyday people with hundreds, rather than thousands, of followers who interact with their established circle of family and friends rather than strangers that have found them online. They’re typically more authentic and provide much more personalized attention to every interaction on their accounts. These relationships fill in the gap where it fails with larger influencers, and it’s indicative of the larger problem with retail e-commerce: a lack of personal connection. Successful companies in the future of retail, then, must strike the balance between modern digital and peoplebased marketing. In fact, the rise of social commerce shows us that shopping is (and always has been) an inherently social experience. Social commerce sales are on the rise even in spite of a drop-off in inperson shopping. Ultimately, conversations about brands and products are still happening—in fact, they’re happening more often than ever before with social media, and customers prefer to make loyalty purchases online rather than in-store (which opens is an entirely different conversation about loyalty and long-term customer value).

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When a consumer purchases on a recommendation from a real-life human, the purchase funnel is shorter, effectively harnessing the existing trust and THE ROLE OF DIRECT SELLING The last ten years have taught us that starting a business relationship to increase in the digital age is easy. In the next ten years, however, the brands that grow at scale will employ a human-first touch the conversion rate. augmented by the power of technology. What we have learned T HE F U T UR E O F W O R K IS E V O LV IN G The rise of the gig economy, too, signals the legitimacy of social commerce where nano-influencers are compensated for their recommendations. Multiple streams of income through mediums like Uber, Lyft, and Airbnb are the new norm, particularly amongst the ever-important millennial demographic and their younger counterparts in Gen Z. Simply put, our nano-influencing workforce is waiting in the wings. Here, what we’ve learned about personal connection from seller to brand in the world of direct selling is crucial. Some of that comes from the money folks make as an independent seller, but it’s important as we enter the broader world of influencers to emphasize the way that products authentically fit in those influencers’ lives. Effective influencing is authentic and personal—it doesn’t work when it’s not. Tech investors at Adreesen Horowitz (the cash behind the early years of Facebook, Twitter, and Stripe) dub this new kind of opportunity “monetizing individuality. ” When you combine an individual’s niche interests with their existing personal network, you’ve effectively harnessed the same niche targeting of a micro-influencer while giving end customers one-toone attention provided by an immensely scalable network of everyday people. 9 0    D I R E C T S E L L I N G N E W S  |  

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about that human touch in the last 100 years of direct selling will play a pivotal role in the success of the emerging nanoinfluencer economy. First, start with products that inspire people. Iconic brands in our industry have been successful because their products created a meaningful and often emotional improvement to customers’ lives. Next, learn to tell your brand story through the eyes (and mouth) of your best customers. Nano-influencers have deep, 1:1 connection with their online followers because of offline relationships, and their ability to tell a personal brand story holds power. Finally, give nano-influencers incentive to tell your story. Brand loyalty builds when the exchange of value is a two-way street; here, both the brand and its nano-influencers have skin in the game when nano-influencers are financially motivated. Above all, know that the power of people wins in the digital economy. Success will come at the nexus of personal relationships, great products, and scalable technology. DSN RODGER SMITH IS THE CEO OF DIRECTSCALE. HE BRINGS HIS EXPERIENCE IN DIRECT SELLING TOGETHER WITH HIS PASSION FOR TECHNOLOGY AT DIRECTSCALE HEADQUARTERS IN OREM, UTAH. TO LEARN MORE, VISIT DIRECTSCALE.COM.


Direct Selling’s Best Stands Strong Together THAT’S WHY THE DSA FAMILY IS GROWING 2020 has shown us all that direct selling companies and their salespeople believe in the values of community, home, and unity. From unparalleled educational opportunities, virtual and in-person networking events, and the singular voice we bring to government and policy makers on behalf of independent contractors, DSA convenes the leaders who define the channel’s future today. Visit DSA.org/membership to learn how you can be a part of the DSA family, or how you can maximize your membership. ENGAGE with DSA in exciting new ways in 2021.

Visit DSA.org/membership to learn more


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STRATEGIC PREPARATION BY TONY JE ARY - THE RESULTS GU Y

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S WE LIVED PAST the first year of COVID in 2020 and we are into 2021, we all want to consistently be looking at how we can create wins and build momentum toward taking the right actions—and of course, that includes how we can motivate ourselves to take those actions. One of the very best ways to do that is with a concept called strategic preparation. We invested months in producing a new book with that title and just released it. Here are eight selected highlights we hope you will consider that will impact you. 1. THINKING AHEAD: You’re better prepared personally and organizationally when you think deeply about your values, your purpose, and your goals, and you make thinking on these an intentional habit. By gaining clarity on what you want to accomplish and then on the action items that will take you toward your goals, you evoke a pulling power in that direction. Thinking ahead and then writing down and visualizing your goals activates your reticular activating system (RAS), which is your brain’s way of filtering out what does not matter and guiding you toward what does. You not only see the goals in your mind; you also begin to see things around you that will help you achieve your goals. If you don’t write down what you’re thinking, then your brain is not as clear about

what is important, and your RAS filters out things you might need to help you achieve your goals. Decide what you want and plant that goal in your mind. Then be intentionally strategic about everything you do, and that will lead to better and better results. 2. INVESTING IN YOURSELF: According to super achievers, including people like Warren Buffett, the best investment you can make is in yourself. We believe you must make a commitment to yourself and prepare every day for your future, and part of that plays out in delayed gratification. For example, as I was writing this article, we had just come off a Zoom call where we were brainstorming about the title of a book we were writing for one of our clients. We realized we had not invested the time to build a tool that presents the fifteen or twenty attributes that really make a title of a nonfiction book work. We immediately decided to build such a tool, which can harvest great dividends for the future. By investing the time to do the research and build that tool now, we are better prepared to help a client find the right title when that conversation comes up again. Often when we invest in creating tools for our toolbox, we’re investing in ourselves, which positions us to create better and faster results.

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3. HELPING OTHERS WIN MORE (DOING FAVORS): When you help people win now, it creates winning opportunities for you in the future. (That’s pretty obvious.) People like to be led by and do business with people who do things for them and who work to build a platform of trust. And an additional perk is that often when you are helping or doing favors for others, you build an internal vibe, or energy, which produces an excitement that enables you take more action yourself. 4. SAVING FINANCIALLY: Practicing delayed gratification and saving financially (e.g., having a reserve budget for your business) often puts you in a position where you can take the right action at the right time instead of settling for a shortcut. Or it can sometimes allow you to be more thorough in what needs to be done. If you have the reserves to invest, then you can buy a tool—maybe an audio series, a video course, or even an app—that would allow you to supercharge your team. 5. INSPIRING YOURSELF: Own this little nugget. Inspire yourself with intentional actions and by deploying good habits. Think of the actions you could take now that will align with your goal achievement. These actions could include simple things like.

3Getting up early and working out 3Going to bed early and reading 3Developing your to-do list daily—both the night before and again the next day

3Constantly be inspiring yourself by getting things done fast and marking the X’s in the box. “Done” is one of my favorite words that inspire me. 6. SEE THE OTHER PERSON’S PERSPECTIVE: So many times, we filter the world around what matters only to us versus filtering it through what matters to others. And “others” can often be team members who are teaming up with you to help you take action. Be more strategically prepared by taking the time to really get to know your team members’ priorities and perspectives, and do your best to fulfill wins for them. In many cases, you can create what we call an elegant solution, where you’re so mentally prepared that you can accomplish not only what you want, but you can help the other person accomplish what they want at the same time. That may involve building their career, their arsenal, their thinking, or even just their experiences. 9 4    D I R E C T S E L L I N G N E W S  |  

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The best investment you can make is in yourself. 7. BUILDING TOOLS: Tools work! The bigger your arsenal of tools, the more leverage you have available. Having the right tools at the right time can make a world of difference in preparing you and your people for success. When you have a powerful tool chest, you’re supercharging your potential. You don’t have to recreate the wheel each time something needs to be done. As direct selling becomes more and more the business model of choice in these times, business executives are doubling down on tools because tools really matter! 8. STUDY MORE OFTEN: There is no doubt that learning should be a lifelong pursuit. I read books and glean wisdom daily, and I’ve actually been coached by the same guy for over three decades. Learning strategically from the wisdom and insight of others helps you be more successful, period. How are your study habits? Are you being coached? When you sharpen your thinking, you get better results. Wise advice can also help you avoid pitfalls that could derail your top actions for success.


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If you want different results, you need new and different thinking—it’s that simple. New information stimulates both your reasoning processes and your creative juices and helps you think and prepare better. Prepare for extraordinary results by seeking advice from people who have produced the extraordinary results you want to duplicate Pick a few of these to zero in on that fit you and highlight them. Heck, take a photo of this page to remind yourself to work on implementing them in your life. I’ve just shared with you what I’ve learned over the years of my own personal journey in becoming more strategic. I hope it’s impacted you and maybe given you an “aha” or even an epiphany about the importance of being strategic and using it as a major component in your own journey to success. Cheers to strategic preparation, helping others win, seeking and taking good advice, and really preparing now so your future will be even brighter. Let’s make 2021 a year full of many wins.  DSN


TEACHING TOMORROW’S BUSINESS LEADERS DSEF Fellows Make a Difference for Direct Selling More than 190 DSEF Fellows are changing the way direct selling is taught in universities across the US by using the Foundation’s teaching content, research

“The DSEF pedagogical support materials address real-world, timely marketing practices. I especially like the CUTCO/Vector ‘The Cutting Edge of Quality’ video case. It not only highlights a successful approach to disintermediation and direct selling, it reinforces the importance of sales as the sole driver of creating revenues in any firm. DR. LOU PELTON Associate Professor of Marketing University of North Texas

“As a DSEF Fellow, I was able to develop a teaching case that connected my research interest in effectuation and social entrepreneurship with the founders of Trades of Hope. As a bonus, many students were introduced to the direct selling distribution channel as an avenue for social entrepreneurship. DR. CHRISTINE MOLLENKOPF-PIGSLEY Assistant Professor & Program Director Applied Organizational Studies Minnesota State University Mankato

and case studies. Here’s what they have to say about how DSEF benefits students and direct selling.

“My students have pointedly benefited from DSEF case materials. The Big Data video is highly insightful and garners substantial discussion. The Cocoa Exchange case, particularly the related video, is wonderful for discussing corporate social responsibility, women’s empowerment and direct selling. DR. WILLIAM F. CRITTENDEN Professor, International Business and Strategy Northeastern University

1667 K Street, NW, Suite 1100, Washington, D.C. 202-452-8866 • info@dsef.org • www.dsef.org


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re they doing this because of direct selling’s reputation?” That is one of the most common questions asked when government officials take action against direct selling companies. And when media and channel critics report on such instances, the channel’s reputation can further suffer. After all, such stories are generally thought to be good clickbait. The industry’s continued effort—as well as individual companies’ work—is ongoing. There are times when the channel’s ever-growing corporate compliance departments do not catch issues before regulatory or self-regulatory entities bring them to their attention. When companies are faced with shaping a response, DSA is often asked, “just tell me what we can say!” Even dissecting recent Earnings Claims Guidance by the Direct Selling Self-Regulatory Council (DSSRC) or Federal Trade Commission (FTC) guidance, straightforward answers can be hard to come by. As we all know, reputations aren’t built overnight: reputations are built on more than mere words: actions are needed to substantiate these words, as one serves to support the other. While we often talk about “positive messaging,” words are only as good as the channel’s ability to live up to a high standard of marketplace ethics. One of DSA’s key functions is providing educational forums through which executives may connect to learn about the industry’s best practices that can be put into action within their companies. Also, offering individual companies and the industry the opportunity to gain a standard

BRIAN BENNETT is the Vice President, Government Relations & Policy for the U.S. Direct Selling Association.

base of knowledge for good compliance practices is critical, as well. A program providing both is key, and DSA’s first Direct Selling Compliance Professional Certification Program (DSCP-CP) is the answer. Launched in January 2021, this twelve-hour intensive course sponsored by industry supplier partners BakerHostetler and Kelley Drye, seeks to achieve these goals. The 200 participants listened and engaged during the course of the four-day program and had to pass a test at the end to achieve certification. Participants were made up of seasoned executives who wanted to sharpen their understanding to individuals from other backgrounds who wanted a substantive education on these issues. Although not a replacement for content offered during DSA educational events, the certification demonstrates the industry’s commitment to these principles that can be communicated to regulatory and self-regulatory entities. It cannot prevent actions and is only granted on an individual basis. Although knowledge gained from the program won’t provide a definitive answer for every issue, the knowledge you gain should help guide all executives toward a solution. The certification is scheduled to be offered later in 2021 and twice annually thereafter. We hope the program becomes ubiquitous across the industry. As we gain a critical mass of executives participating in the program, this will start translating what we achieve with this certification to the marketplace and decrease fodder for scrutiny. We can only improve the war on reputation if we win the battle on marketplace ethics.  DSN

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PAYQUICKER 400 Linden Oaks, Suite 320 Rochester, NY 14625 844-258-3006 www.payquicker.com

STRATEGIC CHOICE PARTNERS

Nexio manages the chaos of payments offering: • Faster roll out for distributors or partners • Simplifies payment processing for corporations

SCP offers the most holistic consulting services specific to direct selling companies today. We’ve worked with more than 70 companies over the last three years alone, and served more than 250 years collectively in the industry.

727 North 1550 East 3rd Floor, Orem, UT 84097 877-267-4324 www.cmsonline.com Complete Merchant Solutions (CMS) is a full-service US merchant account provider representing multiple banks. CMS safely and securely supports many types of payment processing for direct selling companies.

We are the industry’s leading payments partner, long-established advocate, and problem-solver. Our unified commerce & payments platform will connect you to a global marketplace, enable your international expansion strategy, and fuel your exponential growth plans. Let us show you how. Contact Us: info@metricsglobal.com

NEXIO

2201 Long Prairie Road, Ste. 107-316 Flower Mound, TX 75022 407-891-9265 https://strategicchoicepartners.com/

COMPLETE MERCHANT SOLUTIONS

METRICS GLOBAL, INC 1160 N. Town Center Drive, Ste. 100 Las Vegas, NV 89144 702-757-9600 www.metricsglobal.com

727 N 1550 E, 3rd Floor Orem, UT 84097 1-877-551-5504 www.nexiohub.com

Nexio does this by being integrated with the majority of back-office software solutions in the Direct Sales Industry.

D E S T I N AT I O N S / E V E N T V E N U E S

INTERNATIONAL PAYOUT SYSTEMS INC.

C O M M I S S I O N P AY M E N T S E R V I C E S

AccountingSuite tracks orders, inventory, and projects in the cloud. Our affordable Direct Seller Edition is perfect for individual sellers or companies may buy in bulk at a discount to include in a seller package to create another revenue stream.

C O N S U LTA N T S / M A N A G E M E N T

ACCOUNTINGSUITE 600 California Street, 12th Floor San Francisco, CA 94108 888-328-8275 www.accountingsuite.com

C R E D I T C A R D / P AY M E N T P R O C E S S I N G

C O M M I S S I O N P AY M E N T S E R V I C E S

A C C O U N T I N G S O F T WA R E / S E R V I C E S

Vendor Directory

DISNEY DESTINATIONS P.O. Box 10,000 Lake Buena Vista, FL 32830-1000 321-939-7129 www.disneymeetings.com World-class convention hotels in destinations around the world. Discover the magic of Disney for your meetings, events or incentives.


D I S T R I B U T I O N / F U L F I L L M E N T/ L O G I S T I C S

A 20,000-seat arena and 100+ unique restaurants surrounding our convention center makes Columbus feel custommade for direct selling conventions. With arts, live music and more, there’s always something to do in the capital of under-theradar cool.

CANADA CARTAGE LOGISTICS SOLUTIONS

1615 Clark Blvd. Brampton, Ontario L6T 4W1 905-564-2115 x2 www.canadacartage.com/logistics Single Source Solutions, Order to Delivery B2C Solutions, On-Time Order Fulfillment, Real-Time Inventory Visibility, NHP Site Compliant, SOP/GMP Compliant, and locations across Canada.

A2B FULFILLMENT

GLOBAL ACCESS

150 Stewart Parkway Greensboro, GA 30642 866-843-3827 www.a2bf.com

9815 S. Monroe Street, Ste. 510 Salt Lake City, UT 84070 877-811-8108 www.globalaccess.com

Since 2001, a2b Fulfillment has been helping companies work smarter by outsourcing business support services, including order fulfillment, customer care, and valueadded solutions. Its same-day fulfillment philosophy ensures that customers aren’t waiting, and its one-call customer service resolution standard keeps them coming back.

International expansion expertise and technology and logistics solutions that grow clients’ businesses and brands around the world.

D I S T R I B U T I O N / F U L F I L L M E N T/ L O G I S T I C S

EXPERIENCE COLUMBUS 277 W. Nationwide Blvd., Ste. 125 Columbus, OH 43215 614-222-6121 www.experiencecolumbus.com

D I S T R I B U T I O N / F U L F I L L M E N T/ L O G I S T I C S

D E S T I N AT I O N S / E V E N T V E N U E S

TO BE INCLUDED IN THE VENDOR DIRECTORY, CALL 1-800-279-5249

STALCO INC. 64 Bakersfield Street Toronto Ontario M3J 2W7 647-367-2459 ext. 200 www.stalco.ca Stalco is your Canadian Distribution partner for all your requirements, including: regulatory approvals and management, importation (tracking and customs clearance), fulfillment (kitting, pick and pack, shipping), same day order processing, 2-4 day tracked delivery, and returns management.

VERST E COMMERCE FULFILLMENT

300 Shorland Dr., Walton, KY 41094 800-978-9307 www.verstlogistics.com

Verst offers robotic picking, 99% order accuracy, 6.5+M sf scalable warehousing space, air/rail-served, 1-2 days to over 85% of the U.S. Services include pick-pack, labeling, kitting, and custom packaging. Our Business Is… An Extension of Your Business

AMWARE FULFILLMENT

LACORE LOGISTICS

VISIBLE SCM

4505 Newpoint Place Lawrenceville, GA 30043 678-377-8585 Sales@AmwareLogistics.com www.AmwareLogistics.com

900 Wilmeth Road, McKinney Texas 75069 214-817-4802 www.lacorelogistics.com

5160 Wiley Post Way Salt Lake City, UT 84116 385-355-8840 www.visiblescm.com

LaCore Logistics provides distribution and order fulfillment services. Our highly automated distribution center provides both domestic and international direct-to-consumer shipping solutions. We offer omni-channel fulfillment solutions ranging from marketplace fulfillment for leading marketplaces to businessto-business fulfillment for leading retailers.

Choose Visible for efficient fulfillment processes and market-leading customer experience. Benefit from multi-carrier solutions, high-volume shipping rates, custom packaging, fulfillment, and a real-time inventory management system— with a 99.84% order accuracy rate.

Handle fulfillment for 5 of the DSA top 100 companies. DSA member with 15 fulfillment centers, nationwide, for 1-2 day delivery to 98% of the U.S. Offering discount parcel solutions, kitting, same-day shipping, and a full menu of value-added services.

PMS 70% Black

PMS 7686

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KATAPULT EVENTS 5840 Red Bug Lake Rd, Ste. 140 Winter Springs, FL 32708 407-915-9060 www.katapultevents.com Fresh. Exciting. Bold. Your field deserves the best and we help you deliver. Out-of-the-box creative production with experienced show management. We execute on budget and make you look AMAZING!

Since 2007, Hanna Shea Executive Search has been the go-to search firm in support of the direct selling industry. Hanna Shea finds top talent for companies in need of building or improving an executive leadership team for organizational success.

ATLANTIS PARADISE ISLAND

E.A. DION, INC. 33 Franklin McKay Road Attleboro, MA 02703 800-445-1007 www.eadion.com

A full-service event production company specializing in helping DSA’s tell their stories. Creativity + Technology = Unforgettable Experiences.

Dion’s jewelry solutions are perfect for career path, sales & recruiting, corporate anniversaries and incentive travel recognition awards.

FEBRUARY 2021

Fossil Group is a global watch company specializing in the innovation and design of watches, wearables, jewelry, and leather goods. Our owned brands include Fossil, Michele, Misfit, and Skagen, and licensed brands, Armani Exchange, Diesel, Emporio Armani, kate spade new york, Marc Jacobs, Michael Kors, Misfit and Tory Burch.

1080 Caribbean Way Miami, FL 33132 Royal Caribbean International’s Corporate Sales Team 800-529-6916 www.royalcaribbeanincentives.com

Create lasting memories for your top producers. Reward & WOW them with a resort experience nestled in the world’s largest open air aquarium.

MULTI IMAGE GROUP

FOSSIL GROUP 901 S. Central Expressway Richardson, TX 75080 469-730-7619 www.fossil.com

ROYAL CARIBBEAN INTERNATIONAL

1000 S. Pine Island Road Plantation, FL 33324 800-722-2449 www.AtlantisBahamas.com/meetings

1701 Clint Moore Road Boca Raton, FL 33487 800-523-2682 www.mig.cc

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INCENTIVES/RECOGNITION

HANNA SHEA 1835 W Chandler Blvd 103, Chandler, AZ 85224 844-344-7177 www.hannashea.com

ICONIC SHIPS. EPIC ADVENTURES. ULTIMATE EVENTS. Royal Caribbean® transforms events into the ultimate productivity paradise. Impress your attendees with epic venues, vibrant restaurants, onboard thrills and beautiful destinations.

M A NUFA C T UR ING/ P R OD . DE V E L OP ME N T

Excite & ignite your direct sales force by using Bartha­—the highest quality event production and staging company nationwide!

E XECUTIVE RECRUITMENT

BARTHA 600 N. Cassady Avenue Columbus, OH 43219 800-363-2698 www.bartha.com

INCENTIVES/RECOGNITION

E VENT PRODUCTION

Vendor Directory

PROGRESSIVE LABORATORIES

3131 Story Road W Irving, TX 75038 972-518-9660 www.progressivelabs.com 40+ years of quality manufacturing of nutritional formulas specializing in capsules and powders. FDA registered and 3rd party UL certified facility.


NOW TECH 5800 Democracy Drive, Suite 100 Plano, TX 75024 310-428-9936 www.successpartners.com GROW NOW! The SUCCESS Partners’ NOW app drives results for direct selling companies making it incredibly simple to connect, communicate and convert. A mobile system designed for maximum duplication that promotes customer acquisition activityNOW. Contact us for a demo today!

SMART OFFICE SOLUTIONS, INC.

217 N. Westmonte Drive, Ste. 1007 Altamonte Springs, FL 32714 800-891-8601 www.SmartOfficeSolutions.com Your mobile strategy should be as smart as the phone in your pocket. Make a powerful statement about the value of social networks and personal connections with the SmartMobile app. Transform every share, text, call, and email into a positive sales and recruiting result.

SOCIALSALES.IO 2024 W. 15th St., Ste. F-324 Plano, TX 75075 214-659-1549 hello@socialsales.io www.socialsales.io Convert your social fans into paying customers. Our global SaaS platform includes the tools your sales force needs to succeed in today’s social selling environment. Scalable to fit any sized organization from startups to large global enterprises.

S O F T WA R E / T E C H N O L O G Y S O L U T I O N S

SUCCESS Partners is a full-service agency that creates strategies and solutions for direct selling companies to strengthen their brand, engage customers and boost their bottom line.

MOBILE APPS & COMMERCE

SUCCESS PARTNERS 5800 Democracy Drive, Suite 100 Plano, TX 75024 800-752-2030 www.successpartners.com

S O F T WA R E / T E C H N O L O G Y S O L U T I O N S

MOBILE APPS & COMMERCE

MARK E TING/BR ANDING

TO BE INCLUDED IN THE VENDOR DIRECTORY, CALL 1-800-279-5249

DIRECTECH LABS 929 Colorado Ave Santa Monica, CA 90401 310-730-1246 CustomerCare@directechlabs.com www.directechlabs.com The AI-powered messaging and analytics platform. Be a better opportunity in the gig economy. Actionable dashboards and automated opportunities that get your field and customers engaged into measurable action anywhere in the world.

BYDESIGN TECHNOLOGIES

EXIGO

9503 Princess Palm Avenue Tampa, FL 33619 813-253-2235 www.bydesign.com

1600 Viceroy Dr., Suite 125 Dallas, TX 75235 214-367-9933 www.exigo.com

Award winning SaaS solutions including Geneology Management & Commissions, Inventory, Replicated Websites, Premier Rep Tools, Branded Mobile App, Virtual Parties, E-vites, Hostess Rewards, Bookings, Social Sharing, Promotions, & Shopping.

The global leader in cloud-based Platformas-a-Service (PaaS) for direct selling companies. An open framework for billiondollar giants to startup companies. Exigo supports MLM, Party Plan and Affiliate models, operating in single global markets.

DIRECTSCALE

INFOTRAX SYSTEMS

350 South 400 West, Ste. 225 Lindon, UT 84042 801-701-3285 www.directscale.com

1875 S. State Street, Ste. 3000 Orem, UT 84097 801-431-4900 www.infotraxsys.com

Scalable software for your company and your sales force that’s delightful and easy to use.

Software & SaaS solutions for startup, emerging, and global direct selling companies. See our ad on the back cover.

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1208 E. Kennedy Blvd., Ste. 222 Tampa, FL 33602 813-277-0625 www.idstc.com

Global Operations Management Software. Advanced Comp Plan Programming. Sales Force Backoffice & Automation. Web Site Design & Replication.

JENKON

55 Shuman Blvd., Ste. 350 Naperville, IL 60563 866-698-3848 www.thatchertech.com

Thatcher Technology Group provides Sales Force, Compensation and Incentive Management Software for the Direct Selling Industry.

XIRECT SOFTWARE SOLUTIONS

915 Broadway Street, Ste. 400 Vancouver, WA 98660 360-256-4400 www.jenkon.com

686 E 110 S Unit 104 American Fork, UT 84003 385-448-1800 www.xirect.com

From Startup to Enterprise, Jenkon provides Direct Selling companies an award-winning, scalable platform unifying the future of direct selling: Openness, connectivity, omni-channel and conversational marketing.

MW2 DIRECT 2033 Gateway Place, 5th Floor San Jose, CA 95110 408-573-6310 www.mw2consulting.com/direct Combine the Magento Platform with powerful social and direct selling features available in the MW2 Direct platform. Solving Digital Transformation for direct selling with personalization, party management, influencer marketing, commission, analytics.

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THATCHER TECHNOLOGY GROUP, LLC

Scalable software from startup to enterprise. Your delivery expert in Commissions Calc / Consulting, Replicating Websites, E-Commerce, Reporting, Promotions, Localization, Multi-Currency, and more- The Perfect Cloud-based Direct Selling Software Partner!

FEBRUARY 2021

SOVOS 200 Ballardvale Street, 4th Floor Wilmington, MA 01887 1-800-334-1099 www.sovos.com Save time and money with a smarter tax information reporting solution. Sovos solutions keep up with regulatory changes, perform TIN verifications, and automate your organization’s entire 1099 and 1042-S federal and state reporting process.

TOOLS, RECRUITING & TR AINING

INTERNATIONAL DIRECT SELLING TECHNOLOGY CORP.

S O F T WA R E / T E C H N O L O G Y S O L U T I O N S

TO BE INCLUDED IN THE VENDOR DIRECTORY, CALL 1-800-279-5249

TA X S E R V I C E S

S O F T WA R E / T E C H N O L O G Y S O L U T I O N S

Vendor Directory

SUCCESS PARTNERS 5800 Democracy Drive, Suite 100 Plano, TX 75024 800-752-2030 www.successpartners.com SERVICES THAT SPARK GROWTH. From sampling and physical starter kits to digital marketing, we’ve got you covered. We serve by working alongside you to design, develop, and deliver solutions that benefit you, your distributors, and your customers.

GET CONNECTED

To those who need your services.

Confidence in your media partner’s extensive reach and deep knowledge in the industry is a priority for PLT Health Solutions when promoting our brands and Direct Selling News is one of those partners. —STEVE FINK, Vice President


SAMPLING WORKS!

In 2020: ■

Millions of samples distributed.

Millions of new customers acquired.

The Top 5 NOW App clients will collectively grow almost a billion dollars in revenue!

Let’s Talk Sampling. Contact us today at app@successpartners.com or call 310.428.9936.

What Are You Waiting For? PROVEN TECHNOLOGY FROM A TRUSTED PARTNER


IT’S HOW PEOPLE WANT TO SHOP. Simple. Frictionless. Engaging.

Video commerce gives your customers an intuitive, modern shopping experience that produces results. In four short months, one client experienced: ■

230% Revenue Growth

22k+ New Users

358% Increase in Customer Acquisition 5-Star Customer Rating Average

Experience the NOW App + Video Commerce difference. Request a demo today by emailing app@successpartners.com or by calling 310.428.9936.

PROVEN TECHNOLOGY FROM A TRUSTED PARTNER


Your window to the world. F O R Y O U R G L O B A L PAY M E N T S E X PA N S I O N A N D O P T I M I Z AT I O N Metrics Global’s unified commerce and payments platform enables you to sell anywhere and everywhere. Your customers expect a localized and seamless buying experience, and we deliver it globally with one simple technical integration point. We connect you to a functionality-rich, cloud-based technology platform that scales to fuel your market expansion strategy and drives optimization and efficiency within your payments infrastructure. Top direct selling brands partner with us to provide best in class payment solutions that add meaningful business value; ease of integration, speed to market, localization, payment method optionality, and transaction security. Contact us at connect@metricsglobal.com

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WE’RE WITH YOU EVERY STEP OF THE WAY Looking for an out-of-this-world commission solution? Fill your mission control team with the experts at InfoTrax. We’ll show you how to use FlexCloud to explore new strategies, take advantage of industry trends, and find the new life hidden in your comp plan. Contact us today to see what your data can do for you. It’s time. Take off with FlexCloud.

801.431.4900 | infotraxsys.com

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Direct Selling News February Issue 2021