Direct-selling organizations have some advantages over traditional sales organizations during employee onboarding. Instead of being locked into a Human Resources-defined schedule, direct-sellers start people off in the field with experienced sponsors who collaborate daily. They can start to deliver training in many geographic locations every day.
Each direct-selling advantage also comes at a cost, especially as software and content delivery become central to onboarding. The lack of an established training program reduces consistency, which results in less effective communication of the brand and sales messaging, leading to poor conversion rates at a critical phase in the new employee’s experience.
If a sponsor fails to perform their training role, making the new distributor familiar with and committed to the company’s mission, the recruit is likely to leave within weeks of enrollment. A novice direct-selling representative, like 73 percent of employees who are brought onboard through a Human-Resources directed program, wants to start with an orientation to the company’s mission and policies. Early comprehensive orientation is essential to a new recruit’s sense of confidence.
Direct-selling organizations that have continued to rely on manual training tools and sales reporting leave management detached from individual training outcomes, unable to respond to gaps in the onboarding process with new content and process refinements. The result is an industry-wide distributor retention rate that trails the economy as a whole. Meanwhile, retail and brand marketing companies are rapidly adopting digital training tools, raising the stakes for direct-selling brands that want to remain competitive in the age of personalization.
According to Training Magazine, 22 percent of companies increased onboarding spending in 2017 while 17 percent added to ongoing product knowledge training expenditures. The same survey also found that sales onboarding using online tools was embraced by 91 percent of sales organizations last year, compared to 80 percent in 2016. Sales managers using platform technologies are tuning into each challenge faced by new reps and tracking how new hires perform overall to optimize their training programs.
Paper- and sponsor-based training don’t deliver the feedback required to continually improve onboarding outcomes. With emerging sales and personalization platforms direct-selling companies can transform sales training into sales activity, not hypothetical presentations and sales exercises, from the first day a distributor joins.
Onboarding First Action: Sell
Recruiting is expensive. Attrition steals valuable sponsor-distributor time that could be spent on revenue-generating selling. Quantum Workplace estimates that the cost of recruiting a new employee averaged $4,129 in 2017. For direct sales organizations, a lost recruit is a tax on the sponsor and the company. The fastest-growing sales networks focus new, often impatient, distributors on selling activities from Day One to reduce attrition.
The new distributor who makes a sale in the first two weeks is likely is likely to stay engaged with the company for six years, while almost all their recruitment cohort will depart the program within five years because of lack of success. Success breeds confidence in the program. Direct selling companies have 90 days to ensure their overall return on recruiting investments, they must engage with new distributors through mobile-first tools that maximize feedback and personalize training.
Sponsor-distributors also need tools to help engage, train, and retain new enrollees. Every moment spent on non-selling activity during that time is potentially wasted, so sponsors don’t have time to watch over each recruit’s shoulder to ensure they follow the training process. Platform-based software using machine-learning can step in to support sponsors during the onboarding process, offering the trainee supportive messages and video to address day-to-day process issues. Mobile tools connect sponsors to recruits based on data-driven insights about enrollees’ progress against goals, ensuring they receive human support when it is most needed. This augmented human training approach can extend systematic training for months, exceeding the Society of Human Resource Management’s recommended three-month minimum.
Blending real sales activity with content and sponsor messaging that reinforces company values and policies is an antidote to the high attrition rates in direct selling. The experience of selling a product can turn a doubtful recruit into a long-term contributor. Because most sales reps fail to follow-up with prospects more than once, rather than the five to six times engagements required to close a sale, early training must reinforce the importance of daily sales activity. Those actions and the conversions produced will sell the enrollee on the importance of following the company sales process.
The keystone of early sales success is consistent personalized training delivered in real-world sales tools.
Sandy, Utah-based LifeVantage provides new distributors free iPhone or Android apps that begin onboarding at enrollment, including real sales actions they can take on Day One. Serving a customized stream of video training combined with tasks such as entering contacts and sending outreach messages, the LifeVantage App encourages new distributors to take steps that help speed initial sales. The LifeVantage app alerts distributors immediately when a prospect responds to a message or media shared, an important factor in converting sales. The Harvard Business Review reports that sales follow-ups within an hour of an expression of interest are seven times more likely to have a meaningful conversation that moves the prospect toward a closing.
Today’s economy exacts a harsh toll on companies that fail to adapt. Younger workers are more inclined than previous generations to move on from organizations that cannot demonstrate a commitment to their success. Because it takes as long as eight months for employees to achieve their full productivity, “technology can save onboarding from itself” by extending training at scale, as Robert Ferrazzi, CEO of Ferrazzi Greenlight wrote in the Harvard Business Review in 2015.
No company can afford to have an informal and unmeasured onboarding program. The rise of new technology platforms lets managers, marketers, and data scientists look into their onboarding process to understand where it works and where it falls down.
The combination of onboarding and real sales activity creates previously unimaginable incentives for the new recruit to concentrate on their training. Tools like the LifeVantage App provide actionable feedback about the new distributor’s progress. Smart salespeople know what to do with actionable information, they will use it to sell.
See You In San Diego
Gig Economy Group and LifeVantage will be presenting at the upcoming Direct Selling Association 2018 Annual Meeting in San Diego, June 17 through 19. We look forward to meeting you at the event, where our team will be exploring critical questions about the future of direct selling. Schedule a demo or reach out to meet and talk at our suite during the event.
We would also appreciate your joining our blog team for a discussion at the event about the challenges facing the industry. We will be writing about direct-selling in the weeks before DSA 2018 and would like to include your thoughts in our reports. Send email to schedule an interview.