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Building Brand Trust In Gigged Markets

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Trust is the currency of economic activity. Trust is the magic that humans bring to relationships. Trust is essential to the success of direct sellers and brands alike in the era of e-commerce and on-demand work. Are you building your company around the human interactions that complete the digital connection with customers who discover your business online? Is your sales team equipped with the information that will make each pitch unique to the individual customer?

Rapid changes in work and marketing have placed trust back at the center of the brand success equation after three decades of declining trust among customers. It shows that increasingly virtual businesses must support one-to-one human interaction when it is critical to the sale, retaining an existing customer, or supporting referral and social marketing activities. Human representatives are the most important interface for trusted relationships, but they must be prepared with the right information at the right time to make a compelling case for consumers’ confidence.

A history of trust in English publications

For decades, from the 1840s until the dawn of mass communication in the 1960s, “trust” was a dull topic, mentioned with declining frequency in English-language publications for decades. Using Google’s Ngram Viewer, which analyzes the incidence of words in published books, it’s simple to conclude that as the world grew closer together through physical networks, trust was of little concern as a topic of discussion. In the chart to the right, the lowest level of discussion of trust represents the highest degree of trust achieved in society since 1800.

Authors talked about “trust” less because, we surmise, it was easier than any time in history to reach out and touch someone personally. For the first time, almost every customer in the developed world was within an easy drive or a plane trip of the salesperson who closed the deal. In the 1960s, relationships were physical and deals still involved a handshake. How the times have changed in 50 years.

Trust began to collapse in the early 1970s as we became more connected to the world through virtual information, starting when microwave transmission, which enabled news networks to “go live” with breaking news, and cable television appeared.

The introduction of industrial production, cinema, and radio, along with growing networks of physical retail and company presence in communities did not shake personal trust. But when television enabled by intercontinental microwave and cable connections that allowed real-time knowledge of far-off events, people tended to find more cause to question information and to distrust reflexively.

Why trust now?

In the 1990s, when the commercial internet was rolled out, followed quickly by wireless mobile data connectivity and, ultimately, the iPhone, “trust” became an important issue that rose to the highest levels of discussion volume since the 1840s. Not since the onset of modern production has trust been more discussed in literature and non-fiction. Understanding how to build trust through digital channels using personalization and, at critical moments in the customer journey, through one-to-one human interaction, is the content marketer’s primary challenge. Each trust relationship is flavored by the brand’s message and the dynamics of the salesperson-customer interaction.

During the 1990s, a lack of broadband network capacity prevented rich media from flowing to most internet users. It was described as the “last-mile” problem. It was widely assumed that broadband would introduce an extraordinary era of one-to-one communication, that when data was flowing at broadband speeds over the last mile of cable between publisher and audience, the world would be transformed. In fact, the world was transformed, but we know now that solving the last-mile data challenge broke interpersonal trust.

Today, trust in almost all institutions is faltering. Banks, business leaders, elected officeholders, and the media all fall well below 50 percent levels, according to the Pew Research Center. Pew argued in 2017 that over the next decade, the “fate of online trust” will be decided. Brands must put themselves at the forefront of rebuilding trust because “the internet was not designed with security protections or trust problems in mind.”

Vint Cerf, a co-creator of the internet, told Pew: “We didn’t focus on how you could wreck this system intentionally.”

The keystone of renewed trust will come from the combination of people and information presented skillfully when technology cannot be humane enough to convince a customer or a citizen that the facts and promises they receive are valid. As powerful as the combination of networks and data are, the person-to-person connection, including the confidence expressed through eye-to-eye conversation and the reassurance of a handshake, must be recreated for the gig era.

As workers transition from permanent employment in lifelong careers to rapid, often daily, switching between work on behalf of multiple brands, artificial intelligence and What’s Next coaching will enable sales and service to bring deep background information to every customer conversation. They will know everything necessary to capture the objections and unstated requirements that customers share with them, and their soft skills will determine whether the facts translate into a completed transaction.

Trusted processes can be engineered into systems that act without human intervention, but actually being trusted is the ultimate human ingredient in successful sales and marketing organizations.

The tools of trust

As we’ve explored in other postings, confidence in the information provided to salespeople during their onboarding process is essential to retaining new recruits. The same principle applies to consumers, whose expectations have changed dramatically in the wake of broadband connectivity.

Today, a would-be customer may conduct hours of research before contacting a brand or filling out a form on a website. People demand information early in their product/service consideration process, and the most successful online marketers now concentrate on effective pre-sales communication to lift conversion rates.

Direct selling companies are uniquely placed to combine the reach of digital networks with the intimacy of local personal interaction. By planning a content marketing and sales process that anticipates when enhanced interaction — a meeting or a phone call, as well as video conferencing — will turn the abstract information offered in content assets into concrete promises made by one person to another. Companies’ existing content libraries are the raw material of the responsive intimate sales process described here, but it must be combined with mobile tools that help sales representatives collect additional qualitative and quantitative information through conversation with the customer.

Based on the sales process and the unique characteristics of the customer-salesperson relationship, content can be reshaped on the fly to address customer concerns, as well as coach the sales rep to ask for the business at the right time. Using this roadmap, even negative results can be integrated into the sales process to refine the message and improve conversion rates. Artificial intelligence, such as Gig Economy Group’s machine learning techniques, can spot effective or ineffective messages long before human managers would discover trends in quarterly or annual sales reports.

Trust-building interactions are the engine of improved efficiency for business. Bringing the entire company’s resources in the form of data and contextually relevant content to each customer interaction provides feedback to improve products, reposition resources, and evolve messaging. It all begins with trust, but every transaction ultimately leads to a human connection or trust begins to falter. Have you prepared your sales and customer service teams to be magically aware of customer concerns, ready to send the right message at the right moment with a personal touch?

How Salespeople Can Start Selling On Day One

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Helping a new distributor during the “golden two weeks,” when those enrollees who close their first sales or distributor enrollments are most likely to become a high-earning, long-term member of a direct selling network, is the best onboarding investment. Bar none. It moves the potential sales rep toward confidently repeating the company’s sales process. Getting new enrollees to “work the system” from Day One with an organization creates the bond that drives network growth and improved revenue.

Distributors who start sales activities and close sales within 10 business days of enrollment will earn 71 percent more than a peer who takes just two weeks longer to make their first commission, an analysis of nine years of sales data by LifeVantage found. Direct selling trainer ServiceQuest reports that a 10 percent increase in distributor retention will produce 49 percent more revenue over 10 years compared to unengaged distributors.

The Gig Economy Group (GEG) platform and app eliminate all tool-centric training, providing easily understood functions to do one action at a time.

Machine learning tools can coach a newbie from their first moments with a direct selling company, but the most important action automation can facilitate is the adding of new prospects, initial messaging to those prospects, an established pattern for follow-ups and content sharing to build the prospect’s confidence in the salesperson, the company, and the trust relationship that will result in ongoing sales and auto-ship registrations.

McKinsey concluded that sales and marketing uses of Artificial Intelligence — the catch-all description that includes machine learning — will produce $1.4 Trillion to $2.6 Trillion in improved sales and marketing performance, with more than two-thirds of the value coming from enhancement of existing analytics. Your sales process, if mapped as part of machine learning adoption, is the raw material needed to increase revenue and retention.

The problem, or rather the reality is that 80 percent of new distributors never take any action. They either fail to take any action or get bogged down in trying to understand the company and the products or services they’ve signed up to sell. Without sales actions, there is no data to use when optimizing sales procedures.

First and foremost, direct selling companies must get new enrollees to start adding and working prospect relationships.

What’s Next is Step One

Focus new distributors on two necessary goals on their first day: 1.) Understanding their new company’s values, and; 2.) Adding and reaching out to their first prospects.

We’ve discussed how to map your onboarding process here. Let’s concentrate on the problem of getting people to act. Throughout any guided experience, whether it is delivering sales coaching or interpreting marketing data to suggest better selling steps, the “What’s Next” approach to app user experience is the most effective means of getting people to move through a sequence of activities to achieve a goal. During the first two weeks with a company, new distributors remain unsure about the company and its mission or processes.

A LifeVantage App action card suggests a video to share with a new prospect based on their interest, and over the next two days will remind the distributor to follow-up, along with the appropriate content so share next.

Onboarding content that provides a clear, concise narrative about the values and mission of the company sets the stage for action. Then, the barrier becomes the complexity of the tools themselves.

Too often, apps require users to learn many tool skills and go about it by walking through many steps before allowing people to start using the tool for its primary purpose, such as adding and communicating with a new prospect. As apps grow more sophisticated, these learning processes become more complex, raising barriers to success for the distributor who needs to do simple steps in the simplest way possible. Consider the vast breadth of capabilities of Microsoft Word or Adobe Photoshop, which most users never need and will not explore without a specific context, getting their job done.

Artificial Intelligence apps have to stay focused on the human actions they support, hiding all complexity that will prevent an aspiring distributor from taking the actions necessary to close their first sale. The Gig Economy Group (GEG) platform and app eliminate all tool-centric training, providing easily understood functions to do one action at a time. For example, on their first day, a distributor is asked to enter one or more new contacts. There are no elaborate instructions, just an “action card” that suggests what to do and, with a tap of a button, the tool to do it in the simplest form possible.

But data entry is not the salesperson’s main interest or a reason to be enthusiastic about their first day on the job. The GEG platform ingests the new contact data, reviews the information, and immediately suggests recommended messaging and content to share in order to start the prospect conversation. After the distributor sends their first outreach message to a prospect, the platform monitors whether the content has been viewed, as well as any responses sent by the prospect, so that it can coach the new enrollee toward the sale.

For example, in the GEG-based LifeVantage App, the action card (see image to the right) is generated in response to a new contact entered in the app. Assessing the prospect interests entered (or not entered) by the distributor, the platform suggests a specific video program to share with the contact to begin the conversation. If the distributor accepts the recommended action, the app delivers suggested text to use when sharing the video in the next screen, which is part of the messaging toolset. But the distributor’s experience remains focused on their next step in the relationship rather than navigating between different tools.

In this case, AI smooths the technological overhead of a complex set of application capabilities, leaving sellers to emphasize their strengths, which are developing relationships, choosing the right words, and delivering the information a customer needs at exactly the right time. At the end of Day One, the distributor has seen three short onboarding videos and has at least one, if not the recommended five, prospects in motion. Those actions translate into commissions, which keep distributors engaged and eager to grow their business.

Selling is hard work. Make it easier for new enrollees to concentrate on their strengths instead of the tools they must use to grow their personal funnel and move prospects toward the close. What’s next should always be related to the state of the distributor-prospect relationship, not the distributor’s competence with a set of digital tools.

DSA 2018: Direct Selling Recruitment & Retention with Sylvina Consulting

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The Gig Economy Group talks with Jay Leisner, President of  compensation planning and direct selling advisory company Sylvina Consulting. Part of our exploration of the future of direct selling, Leisner explains the role of residual value in differentiating the direct-selling business from emerging gig options that may attract distributors. Leisner also co-produces the Direct Selling Edge Conference in Salt Lake City this July, as well as other cities around the U.S.

DSA 2018: Mapping The Future Together

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Gig Economy Group present at the Direct Selling Association’s annual conference. Please join us to discuss the future of in-home and local sales enabled by brand content and smart sales coaching. We’re also conducting interviews with direct sales company leadership, vendors, and advisors to lay out the challenges facing the industry in pursuit of its biggest opportunities.

Join Darren Jensen, President and CEO of LifeVantage, and Gig Economy Group Senior Vice President of Business Development Yak Gertmenian for Improving Distributor Success with Artificial Intelligence Tools, at 3:30 PM on Monday, June 18 in Grand Ballroom 4. We will be recording the presentation and collect your ideas in interviews after the session.

We built the Gig Economy Group platform to allow anyone to sell anything using the right branded content and brand sales processes to ensure a comprehensive and satisfying customer experience. Our analysis of the e-commerce and retail world made clear that person-to-person relationships will endure and become more essential, not less, as the economy shifts toward care and service-centric customer experience. Empowering people will more information will ignite new intimate sales opportunities.

Would you join us to talk for 15 to 20 minutes for our podcasts and research program? If you’d like a demo of the Gig platform, we can share that, too. Schedule your session here.

Our demo and recording station will be set up in Marriott Suite #1871.

We look forward to meeting you at DSA 2018.

International Opportunity: Scaling Revenue Globally With Smart Platforms

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While it may not always feel like it in the United States, the world is becoming middle-class and people are adopting healthy, prosperous lifestyles that will reshape decades of established market behavior. As digital technology proliferates, global expansion is the greatest revenue opportunity for established and new direct selling companies, which could even grab market share from retailers struggling to bring customers into stores around the world.

Growth outside the U.S. has accelerated, beating domestic economic gains by 44 percent over the past couple years, according to the International Monetary Fund. China’s embrace of direct selling, which generated $33.9 billion in 2016 sales, just behind the U.S. total of $35.5 billion, is representative of the explosion in international opportunity. Direct selling must adapt to different regulatory and cultural settings to step into the void between modern retail, which has not penetrated many regions nor the in-home market, before new consumer behaviors consolidate. Once set, these habits will be long-lasting.

Are companies in the United States ready to adapt to the global marketplace? They’ll need smart tools that assist in identifying market-appropriate content and sales messaging in each international market. Brand content libraries will swell with variations on existing programming, as well as market-specific training for distributors, who must blend brand and local culture to create great customer experience. The same tools that personalize a U.S. sales relationship will provide support for localization of services globally.

The “Metail” Opportunity Goes Worldwide

The direct selling model may be more suited to delivery of goods and services in many countries where mobile phones and wireless infrastructure were the first digital infrastructure available. In these regions, consumers are already used to ecommerce, but more complex sales and services are challenging to deliver without a personal relationship. Retailers face massive capital and marketing investments in each territory they enter. Global consumers, like younger Americans, want a “metail” experience in which products and services align with their personal preferences and they have a human contact  with which to meet and exchange ideas and feedback — online or in-person.

It’s notable that direct selling is growing faster on an annual basis than retail across the world. Euromonitor International found that direct selling has seen higher annual growth than retail since 2012. While direct selling accounted for only 0.06 percent of global retail as of 2016, the industry has an opportunity to carve out one or more percentage points of retail sales by focusing on home-based relationships in emerging markets. That would more than double the size of the direct selling market.

Coresight Research adds a compelling idea: Using local influencers as  hubs of direct-selling networks who market products fulfilled by distributors: “In the digital age, the rise of influencers, or key opinion leaders (KOL) as they are called in China, has been dramatic. Influencers gain popularity on social media, which they monetize by advertising and selling products.” It is not necessary that everyone in the network be a closer. Adjusting compensation models to enable influencer marketing is another unique opportunity, which may be captured by direct sellers, ecommerce, or, even, retailers who solve the problem of compensation. But direct selling’s business model is the most prepared for virtual-physical hybrid selling.

Brands, too, may be more open to direct selling relationships in overseas markets. They can be the first in regions that have never heard of their competition, establishing brand beachheads through personal relationships.

For instance, Lenovo, the Chinese-owned computer maker, pioneered small-store distribution in China in the ’00s by giving shopkeepers in rural communities an ordering app to quickly replace each computer sold. The on-demand approach minimized the shop-keepers’ inventory risk while giving Lenovo virtually real-time access to consumer data in China. Even a shack without a paved floor could carry Lenovo products this way, and it lead to widespread adoption by Chinese consumers of a PC originally made by IBM.

That early presence in villages outside Chinese cities gave Lenovo an overwhelming advantage in the PC market as it gained footing in the country. By 2010, Lenovo held a 28.8 percent market share, with Dell trailing in a distant second place at 10 percent. It was constructed on person-to-person relationships augmented by digital tools.

First-movers With Smart Tools

Applying this approach to direct selling, a brand can be represented by an individual distributor even in the most difficult economic circumstances. Distributors are in a position to hold inventory briefly, deliver personal service that establishes a customer relationship that increases likelihood of follow-on purchase, and provide feedback that can be used to better target products.

Being first, whether to offer wellness products, beauty products, or technology in a market is an undeniable advantage. Much of the world is waiting for better consumer products and experience. With half the planet using mobile phones, 4.93 billion people in 2018, according to eMarketer, there are many new distributors and customers waiting for opportunities to earn, learn, and enjoy products introduced by friends, family, and local entrepreneurs using direct selling tools.

Great tools also create engaged distributors. Mobile and personalized training and sales coaching, especially in emerging economies, will establish strong distributor networks in new markets. Once engaged and earning, these workers will be far less likely to leave the organization, because it may represent their first middle-class work. As the world settles into greater overall prosperity, the first work relationships people have may be, like the fading notion of a career, permanent for generations.

Smart platforms that analyze the distributor’s behavior, the customer’s buying signs or objections (recorded by the distributor), and adjust sales programming and steps appropriately, are the foundation of a new distributed approach to sales. The technology-enabled customer-centric approach to direct sales counters the weak trust relationships of ecommerce without the overhead of retail.

The era of customers flocking to stores isn’t over, but that model no longer exists in isolation from ecommerce and direct selling competition. The question remains to be decided: Will U.S. and other direct selling companies step into these uncharted sales environments with confidence? They can with tools that help them learn from every interaction and tune their established communications and sales rhythms to newly opened markets.

 

 

Delivering Actionable Sales Process Analytics

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Sales managers must interpret and act on more data than ever. Since the appearance of the PC in the enterprise, the burden carried by sales management in every industry has grown heavier. Support roles, from the administrative assistant to accounting staff who helped with various aspects of reporting, have vanished from many organizations. Those jobs were taken over by software, starting with the spreadsheet, leaving managers with fewer people with which to consult and share ideas when making sales process decisions.

Personalization of the direct sales process was impossible in the traditional data reporting environment, but there is a change afoot. If your team is not listening to its market every day, it is falling behind competitors who do and as a result can deploy new targeted content to appeal to changing consumer preferences. Intelligent content management and sales coaching platforms provide coaching to sales managers, summarizing vast amounts of activity to identify patterns that can be applied to existing content and training libraries to deliver personalized customer journeys at scale.

After many years of growing data burdens, leadership can spend less time exploring data and more on refining the details of the customer journey. If an organization has mapped its sales process for machine analysis, each step a distributor takes with a customer becomes actionable data that signals to management how to adjust content and messaging for success. Intelligent content platforms look at past patterns, compares that history to current activity, and applies probabilistic analysis to the data to catch significant changes in customer sentiment early. Machine learning-enabled tools will also assist management with distributor training, engagement, and retention with insight into which salespeople are struggling and excelling, even before the close.

For example, a video shared early in the customer engagement may begin to perform poorly because the because market attitudes have shifted — even a phrase that has become a negative meme in social networks can change the perceived meaning of a corporate message if left unaddressed. The signal a machine learner sends focuses on the conversion expectations for the video. If customers start to express lower purchasing intent after viewing the video, the tool alerts management. It is not necessary to wait to see whether the prospect becomes a customer. The system can point out emerging misalignment of messages with a high degree of certainty and determine whether a change is significant rather than temporary. There is no need to hunt for what changed, the conversion data makes the emerging problem clear.

Sales and marketing teams can quickly review the asset to identify what changes are needed, produce a new video and release it immediately. Today, the signal is also much less noisy than in the spreadsheet era when outliers often stood out without context, leading to false urgency and unneeded content production expenses.

Personalization, without the noise

The rise of highly targeted customer messaging could drown an organization in data without machine learning to assist with separating meaningful changes in content performance from normal variations in a marketplace. Because personalization delivers stronger results, it can make heroes of sales leaders who anticipate and respond to changing market conditions.

Direct sales companies, which have typically relied on quarterly outcomes, not daily insights, to recognize which marketing and sales messaging work and which are misdirected, are used to building intimate customer relationships. If your company is ahead of that curve, it is better prepared to compete in the on-demand marketplace emerging today. If not, take a look at the retailers seeking to step into one-to-one in-home sales relationships with consumers.

Direct sellers that ignore the opportunity to personalize the one-to-one sales experience using media and targeted messages could lose customers to retailers aiming to deliver everything a consumer might want within hours. Amazon even has a key to many customers’ door.

Improved distributor coaching and resource allocation within a sales network in the mobile-first environment transforms the customer relationship. Personalization makes the customer the star of their own show, concentrating all of a brand’s resources of communicating consumer expectations back to headquarter and translating that into improved products and experience. A company’s response to customer feedback is essential to building customer trust and establishing shared values.

The same kind of coaching delivered to reps in the field through an app can provide sales managers insight in real-time into how their expectations and actual sales performance align or diverge. It is a practice every company is preparing to embrace, and the companies that succeed first will retain long-term advantages over competitors.

Once made, in-home relationships are tough to break, as direct sellers well know. Retailers understand this too after seeing foot traffic decline as ecommerce nears 10 percent of the total market.

Smart content now or, perhaps, never

The level of feedback available today enables individual communication with distributors based on their personal skills, personality, and product knowledge. Sales management can take a systematic approach to coaching, sending videos, training, or product collateral to distributors, and following the results conversion data the same day. After sharing a video about a product the distributor has not sold effectively, the platform can tell if their presentation improved based on customer feedback captured during the presentation. If distributors consistently over-estimate their chance of closing, the platform can also provide coaching and report to management that additional attention may be needed.

Intelligent content delivery is a window into every sales engagement. Gig Economy Group’s What’s Next approach to sales coaching tracks each interaction, suggesting content to share and analyzing messaging for terms and phrases that ignite customer interest. Positive changes can be propagated through the entire sales organization rapidly, with each new customer exchange testing the underlying assumptions of the management team to confirm strategic alignment and efficacy.

By matching distributor strengths to customer’s expectations captured through distributor feedback in a mobile app even the individual sales relationship can be tuned for improvements. As the data set available to a machine learning system grows, more sophisticated insights become available. For instance, an introverted rep could be coached to share more with an extroverted prospect or remain quiet and ask questions of another introvert.

In direct selling, content programming and messaging guidance has been considered less important than the one-to-one encounter between distributors and prospects. Rightly so, in the past, but that is changing as online becomes the primary venue for brand discovery by shoppers. With in-home selling investments by retail reaching record levels, direct sellers must study how content, salespeople, and customers interact.

The insights available at each step in the sales process can convert a prospect into a lifetime customer, right in their living room, where direct sellers already have the advantage over retail and ecommerce competitors. The alternative is giving up the home field advantage direct selling brings to the game.

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.

Personalization Advantage In On-Demand Markets: Direct Sales Or Retail?

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The economy is going on-demand, following consumers’ desire for immediate delivery of whatever they want. The sales landscape is erupting with innovation like Kilauea volcano, wiping out businesses that fail to adapt. The way out of the swath of destruction is personalization based on consistent content marketing and sales messaging. Is your company in the path of creative destruction or leading the way with technology to rapidly personalize messaging, test results, and share best practices across the organization?

Consumers have embraced personalization of sales experience, as well as product and services delivery to the home. They are also seeking more home-based work opportunities. More than 44 percent of Americans are adding side-work, or “gigs,” to enhance their income. More consumers welcome local expertise when considering a purchase and more people will be seeking part-time work. On-demand markets create both growth and distributor-development opportunities for direct selling brands. The flexible and in-home business model is becoming the norm.

Retailers, including Amazon, Facebook, and Walmart, are moving rapidly to bring the customer journey into the home, too. Amazon has begun deploying the Alexa voice infrastructure to facilitate in-home ordering, digital locks to provide secure home delivery, and, even, offer medical services. Facebook partnered last week with on-demand home services companies Porch, HomeAdvisor, and Handy.com to offer in-home services tied to products sold and delivered to the consumer. WalMart this week introduced Jetblack, a text messaging order service that will bring products to the customer’s home in hours in hours.

Direct selling and retail brands both face the onslaught of e-commerce, which is eroding the advantage of physical retail as pre-sales customer interaction shifts to digital devices. Trade and business publications frequently announce the end of retail, a claim that should be seen in context: e-commerce accounts for only 10 percent of U.S. retail revenue in 2018, according to eMarketer.com.

For example, Amazon reportedly “owns” 90 percent or more of online sales in home improvement tools, skin care, batteries, golf, and kitchen and dining accessories as of early 2018. However, as a share of the total market, Amazon converts only 10 percent of sales in these categories.

There is plenty of maneuvering room to counter e-commerce with personalized sales and service in the physical world. Resisting the change, though, will lead many companies into dead-ends. Sales experience is fragmenting due to the rise of technology, particularly mobile phones, and the consumer’s developing sophistication and dependence on social influence when buying.

Direct sellers and retailers alike will eventually follow food delivery, home services, and e-commerce into intimate relationships with the customer that start and end in the home. Direct sales companies cannot allow retail to get ahead in the race for individual customer experience. One-to-one selling remains a necessary part of the sales process.

The face-to-face advantage

Face-to-face selling is still alive and well, but it cannot ignore the digital personalization challenge. No longer will a single sales message work for every customer. Direct sellers, who enjoy the advantage of building on personal relationships, will need to craft their messages to deliver better customer experience than retail. Since retailers must first attract customers to their stories, direct-selling strategies are advantaged in the social marketplace. Distributors can develop friendships online to grow their business and forge strong local communities on Facebook, Pinterest, Instagram, and other social networks with the same level of investment of time as a major brand.

Source: eMaketer.com

The online threat, nevertheless, is existential for consumer products and services companies that fail to recognize change and invest to build personalized and one-to-one customer experience. eCommerce will reach 15.1 percent market share by 2021, claiming an additional $365.68 billion in revenue, mostly from retail stories.

Recognizing that they could be consumed by the digital lava rolling through Main Street in cities and town around the world, retailers are not standing still or playing golf in the volcanic smog. Retailers are leading the charge into artificial intelligence to win a personalization advantage, spending the largest amount of any industry, $3.4 billion in 2018 on cognitive systems to augment their online and in-store marketing, according to market research firm IDC.

The Boston Consulting Group reports that retailer expectations for personalization are very high. In a survey conducted during 2017 by the firm, two-thirds of respondents said they will see a six percent increase in revenue from personalization spending. Half of the respondent retailers with more than 25 employees said they were putting at least $5 million into the machine learning technology last year.

Both direct selling and retail will depend more on personalization to convert sales as mobile-native generations age and become the largest group of workers.

“Over 70 percent of retailers are trying to personalize the store experience. That’s never been higher,” Forrester ebusiness and channel strategy analyst Brendan Witcher told AdWeek. “The reason is because so many customers respond to it. We see nearly three out of four consumers responding to personalized offers, recommendations or experiences.”

Success starts before the sale

Direct sales’ challenge is to stay in front of digital marketing efforts by retailers, which can be accomplished by building best practices within an organization and disseminating them using automation. Pre-sales communication, starting online or in-person, must become a focus of investment to ensure messaging is consistent and relevant. Using machine learning, an enterprise content platform can analyze messages and propagate successful content and sales steps to sales representatives using mobile devices.

Brand discovery also increasingly takes place online. Direct selling marketers must develop campaigns that drive and qualify leads. Content platforms then hand leads off to representatives using automated sales process coaching to deliver all the context to present a personalized experience to the prospect. From the first to the last, every touch must reinforce the brand message to successfully close a sale and establish a long-term customer relationship.

Consumers today do more research, check facts and customer reviews, as well as depend on conversational confirmation of their buying decisions than any previous generation. Often, engaging with a brand, retailer, or distributor is the last step in the process. Marketers can respond with better pre-sales content that develops trust with consistent messaging through the entire customer journey.

Machine learning-coached sales reps can step into the digital engagement at critical moments to add the human element that establishes trust, something retailers cannot do during their sales process today. Feedback captured by representatives sitting with the customer gives the smart platform hints about how to personalize the experience, refining the suggested content to share and messages the distributor can use to move the sale forward.

“The key to closing deals is presales’ ability to shape conversations with the client to position the company’s solution as the ideal ones,” wrote McKinsey’s Homayou Hatami, Candace Lun Plotkin, and Saurabh Mishra in the Harvard Business Review.  “This approach is not about developing a ‘smoke and mirrors’ pitch, but rather investing the time to have a deep understanding of the client’s needs (met and unmet) and then highlighting those elements of the solution that can address them.”

The foundation for a consistent brand message begins with mapping every touchpoint in the sales journey, from pre-sales and discovery through content marketing and sales process steps. The “attribution modeling” process allows management to identify what it expects will happen at each step and, using a machine learning-content platform, rapidly test and revise messages. Instead of launching content one or twice a year, then waiting to see its impact on sales in quarterly or annual results, it can be adjusted as fast as software updates are today.

The speed of software is the new pace of sales in the era of personalization. Companies are beginning to adjust to this accelerated communications cadence, and the tools for in-home personalization are catching up to web-only interactions. The combination of digital and personal engagement is a breakthrough moment in sales.

Personalization is the path out danger for retailers and direct sellers that don’t want to wait for the lava of change to erupt under them. For now, the one-to-one selling community has a sustained advantage over retailers who must attract the customer to their stores. If retailers’ investment in machine learning and personalization goes unchecked, direct selling could fall behind despite their strong foothold in consumers’ homes.

Distributor Retention: Accelerating Time-to-First Sale

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Direct selling is challenging work, but the distributors who achieve early success do build long-term businesses, often as a sideline to a day job. The emerging gig economy presents direct selling companies a rare opportunity to claim more revenue across markets traditionally dominated by retail. As workers become more mobile, many are opting to mix gigs instead of dedicating themselves to one job from 9 to 5. In this mobile and values-centric environment, in-home sales and personal networks can connect virtually any product or service to a market.

The first step for a direct selling company is to win and keep a distributor. A new enrollee’s initial success can create a large network of personal relationships that convert into sales revenue. When their first sale converts within 14 days of enrollment, during the “Golden Two Weeks,” a new distributor is likely to stay with the network for an average of 72 months. That six-year commitment substantially improves the direct selling company’s revenue. Direct selling training company ServiceQuest estimates a 10 percent increase in retention grows revenue by 49 percent over 10 years.

Younger workers also tend to start seeking alternative employment if they don’t make an immediate connection with the company’s mission while finding sales success. Mobile apps connected to intelligent content and training platforms will be the primary point of customer engagement in retail and direct selling within five years. As much as 50 percent of customer relationship management already takes place in the cloud and market researcher IDC predicts spending on artificial intelligence to deliver personalized customer experience will grow by 46.2 percent CAGR between 2016 and 2021.

The next step in the evolution of one-to-one selling is personalization, the delivery of targeted training to distributors and, in turn, helping them to present exactly the information each customer will respond to with a purchase.

A personalized experience that begins when a distributor enrolls in a direct selling network unlocks early sales success. Using a What’s Next approach to a brand’s sales process, sponsoring distributors working with smart mobile apps can address the recruit daily, even hourly, to keep them taking the steps toward a first sale.

First Impressions: Action and Purpose Ignite a Business

It’s also time to for direct selling to put the attrition issue behind it and point out that success in every business is hard to achieve and grow. Reinforcing the business challenge a new distributor is starting in combination with simple actions a new distributor can take is essential to moving the tentative recruit to confident selling. It’s not necessary to apologize for high attrition rates, the industry can focus instead on making more distributors successful.

Keeping a recruit today is difficult in every industry. Annual churn rates in retail are 53 percent compared to 56 percent in direct sales. Only traditional employment models have an advantage in hiring and even they face higher attrition rates when the economy nears full employment – 26 percent of the U.S. labor force quit their jobs in 2017, up from 20.3 percent in 2010. Moreover, 90 percent of entrepreneurs fail within five years. Success is hard-earned and, regardless of the form the company takes, an entrepreneurial success will never be easy.

At LifeVantage, Gig Economy Group’s first partner app takes the new distributor through a brief series of mission- and policy-establishing video programs then turns to get them to enter their first contacts as part of Day One activities. Then, a What’s Next process kicks in to get the distributor selling instead of finishing their contact entries and resting.

The LifeVantage app suggests actions the distributor can take with each new contact based on selections made in the app about customer interests, from buying health products to joining the network as a distributor. Drawing on a growing library of video programming, the LifeVantage app composes an introductory message to a new contact and attaches the appropriate video to share. Critically, this is not done in the background, rather the distributor can review and change the message and media selected or discard the suggestion.

The distributor’s choices help shape their understanding of LifeVantage’s process, and if they make changes or refuse the suggested content, the Gig Economy Group platform records the results. The platform can mine changes to identify improvements in messaging, so even a brand-new distributor will start to reshape the company’s sales process with improvements if their changes convert more sales. Final decisions about content and messaging rest with sales and marketing management, who are able to deploy budget based on real-world results that change conversion rates.

Contacts become the raw material for a conversation between the new recruit and the company, with activity and conversion data available for both to review. No contact is left untended. The app reminds the new distributor to make an initial outreach and to follow up at each step in the sales process. Customer feedback collected by the distributor also shapes the ongoing content and messaging selections targeted to each prospect, driving personalization from the first interaction.

The first day with a sales tool must result in first actions taken for three to five contacts at a minimum to convert a sale within two weeks.

Activity Breeds Sales

With a measured sales process, improvements can be rolled in daily to test and revise messaging, sales cadence, and training. The distributor’s experience is one of an intense focus on their process, reinforcing their psychological need to see investment in their potential.

In today’s sales environment, pre-sales activity is vital to closing a new customer. Content management platforms can push the right content, but without feedback gathered from customers by the distributor, it is easy to push a prospect out of their comfort zone. When a customer’s interest level goes down, the distributor is encouraged by the platform to revert to informational engagement, building the prospect’s trust using video and suggested messaging that identifies objections that can be addressed.

Failure to develop and keep a personal connection is one of the seven reasons salespeople don’t close deals. Using the wrong closing strategy, failing to listen, and the representative’s own insecurity also contribute to poor conversion rates. A smart platform that encourages feedback can adjust the suggested closing strategy, prompt the rep to listen and record feedback, as well as build product knowledge and confidence.

Yet it still comes down to making the calls that close the gap between prospect and sale. If the direct selling company does not help the new distributor follow up, providing the right messages and variations that address customer feedback, the rep will not close the deal and, if history is any guide, start looking for their next opportunity – one where they close in the first few weeks.

The proof, however, is in conversion. That requires extensive follow-ups, which many salespeople never have the determination to complete. An app can coach distributors through these steps until they become second nature.

With so many economic activities moving to the “edge of the network,” where people meet and interact with one another in person and through social and other digital channels throughout the day, direct sellers have an enormous opportunity to increase their share of the market. The tools are ready and people are living mobile lives that invite frequent trusted interactions. Is your company ready to move a new enrollee to their first sale in the “Golden Two Weeks?”

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.

Onboarding: Turning Training Into First Sales

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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.

Constant Improvement

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.

Mobile: The New Battleground for Sales Recruiting and Retention

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Message alignment and agility will determine sales success in the 2020s as a tidal wave of customer feedback becomes available to marketers. The next era of direct selling will be built on content management systems, customer relationship management, and smart coaching delivered to distributors through a mobile app that feels natural to digital natives.

Garrett Hughes of payment platform Hyperwallet recently wrote as a tongue-in-cheek challenge to the industry: “Is direct selling only for old people?” His point is deadly serious: If young network marketers are not excited by the tools provided, they will rapidly move on to other opportunities.

A new distributor who does not feel supported and achieve first-month sales goals start looking for more engaging and profitable sales programs within the first 30 to 60 days. In the mobile era, brand and sales messaging must be tightly aligned, capable of changing quickly in response to feedback from the field and customers. Direct-selling companies that want to win and keep younger distributors will need to execute a consistent messaging motion every day, delivering Twitter-simple meaning, mission, and sales messages through mobile tools.

Millennials and Generation Z (born after 1993, when the Web was introduced), who make and keep friendships around the world through digital channels, demand tools that allow the same connections at work. The old manual approach to sales preparation is foreign to them, they do not want to spend more than half the day preparing when they could be selling. They demand immediate access to the information they need, and according to Gallup, demand that their work and values match if they are going to stay in a job.

“Millennials don’t just work for a paycheck — they want a purpose,” Gallup wrote in How Millennials Want To Work And Live, a 2017 white paper. “They are also the least engaged generation of workers, because “[m]any millennials likely don’t want to switch jobs, but their companies are not giving them compelling reasons to stay. When they see what appears to be a better opportunity, they have every incentive to take it.”

We don’t intend to paint a caricature of Millennials. They are a complex and collaborative generation, and Gen-Z appears to be even more oriented to the larger world. What they want, though, is very different than previous generations due to the digital technologies on which they were weaned from television, the mall, and traditional approaches to retail and direct-selling experience.

Context creates meaning

Marketers recognize that their first function, before revenue generation, is pre-sales engagement. The Harvard Business Review reports “companies with strong presales capabilities consistently achieve win rates of 40-50% in new business and 90% in renewal business.”

Sales content must be offered to the consumer at the right time, with authentic context. Direct sellers are in a unique position to leverage personal interaction and establish a meaningful context in sales relationships. But most selling content still mimics static collateral or TV commercials instead of entertainment or informational programming. There is no room in the content marketing world for the interruptive commercial.

Not surprisingly, the power of personalized communication is essential to retaining direct-selling distributors. From the moment a new distributor enrolls in a direct-selling network, they must feel engaged. Before they begin selling, young digital-native distributors have no time for hours of searching to find useful training and product knowledge, it must be served up in logical and actionable order to keep them moving toward their first sale.

Young sellers also want video and interactive tools that feel like the apps they use in their personal time. SnapChat, WhatsApp, and Tinder are the new model of interaction, until those popular examples give way to newer, simpler tools, too. Simplicity is eternally valuable in software. Young distributors want to sell using video, by sharing programs with prospects that can be consumed at the customer’s leisure. The Content Marketing Institute’s 2018 Benchmarks, Budgets, and Trends-North America research shows that 76 percent of consumer marketers now invest in video programming.

The mantra “Every company is a media company” has become a commonplace, yet few companies succeed in communicating a consistent message internally through their sales channels and every customer engagement. VentureBeat reported that 60 percent to 70 percent of sales collateral produced by business-to-business companies goes unused. Companies must monitor media use and adjust their programming, not set out a year’s programming and hope for the best.

Marketing and sales teams working together based on media analytics can understand where gaps exist in the distributor’s journey to a sale as well as the customer’s decision-making process. Content stored away on a server is hard to find and companies are starting to view their collateral as steps in a process that can be recombined to address personalized seller and customer needs. Enterprise content management investments, which will rise by 16.8 percent to a total of $37 billion in 2018, are expected to rise to $67.1 billion by 2022, Markets And Markets reported.

Direct-sellers must rethink their sales process to integrate video and app-based sales management to remain competitive.

Crafting A Natural Rhythm

Mobile will redefine distributor and customer expectations. A new sales process based on deep understanding of the individual distributor’s strengths and product knowledge, as well as how they manage their business, from their contacts to their closing cadence, will redefine retention. Customers with buying options that span the world will demand intimate, confident engagement with each company they consider before buying.

Consider how much information is entered on a mobile phone each day — is your company tuning into the mobile distributor’s ability to capture the state of the customer? Millennials and Gen-Z workers interact with others through their phone more than they do in the physical world, a LivePerson poll found in September 2017. The transition to the next generation of direct sales will be built on the data collected on the phone.

The same survey found that 57 percent of young Americans would not leave the house without their phone while 72 percent of U.S. respondents over 35 years of age would choose their wallet over their mobile phone. That stark difference in priorities defines the generational change in direct selling. The phone, not the enterprise, is the organizing point. The inflection point is here.

What’s a direct-selling company do? It is not just a matter of hiring young people since a super-majority of direct-sellers are older. The Direct Selling Association reported that in 2016 that only 29.6 percent of distributors were under 35 years old. Network marketing organizations must support everyone while integrating advanced technology and elegant content management into the sales experience.

Providing each new distributor with a tool that starts on Day One to collect data, help organize and optimize the individual’s sales process, and accelerate the time to their first sale are the new table stakes in direct selling. Building on customer feedback, marketers must create flexible sales paths through content that the distributor can customize to the customer based on their emotional connection with the person sitting in front of them or someone across the world via Facebook or a Zoom conference.

The demand for meaning that characterizes Millennial and Gen-Z work aspirations provides a clear map for direct-selling organizations which have traditionally offered flexible work-life relationships. As Gallup wrote of these young workers: “More so than ever in the history of corporate culture, employees are asking, ‘Does this organization value my strengths and my contribution? Does the organization give me a chance to do what I do best every day?’ Because for millennials, a job is no longer just a job – it’s their life as well.”

Will your company reorganize its sales process, optimizing it constantly to achieve a natural rhythm delivered through a mobile app that fits the life and expectations of young distributors?

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.