Archive for October, 2008

I came across an interesting blog post today from a freelance writer who has covered direct selling in the past. I respect her because she always asks really great questions when she interviews me and does a fair and equitable job of laying out the facts. While I hesitated momentarily on linking to this post because it focuses on a specific product from a specific company, the point is really one that’s much larger – it has to do with price and value.

Reporters often ask me questions about how the price and quality of direct selling products compare with that of their in-store counterparts. I haven’t done any research to assess price or quality of direct selling products, so there will be no dollar figure or performance assessments here.

But what intrigues me about Leah’s post is her description of how the kitchen shears she bought ended up being such a useful tool for her that she bought another pair to have around the house. Were the kitchen shears so special that every household in America should have a set? Probably not – but they worked for Leah. Could she have picked up a comparable set of scissors at Target for less? Maybe, but they may not have cut the same way, or been as versatile as Leah found her favorite set to be. The point is, those scissors have value for her and that’s all that matters.

She also mentions that she left the direct selling party she attended with some other gadgets that she hasn’t really used yet. She saw them demonstrated and had to have them. Trust me – I know the feeling. I have plenty of items in my closet that I might have seen demonstrated in the store or featured at a direct selling party. I don’t regret having purchased them, I just don’t use them as much as I’d like to - witness with proverbial treadmill or gym membership.

But back to the discussion of value and quality. I can buy a $3 lipstick through direct selling – I can also buy a $50 lipstick through direct selling. I can do the same in a retail store. I can be disappointed with the quality of a product I bought in a store – or be amazed by it. The same is true for direct selling products. In any shopping environment, there is never a substitute for the consumer’s ability to evaluate a product and make a purchase decision. I don’t care if you are in a busy mall or your best friend’s living room, the assessment of value remains with each individual consumer. What has value to me, may be outrageous to you – and that’s the beauty of having choices.

However, neither price nor quality even touches on what really differentiates direct selling from a traditional retail store – often, the extra value for direct selling products and services comes in the form of the demonstration and personal service.

It’s true, demonstration of a product, whether in a store or someone’s home, probably sways a lot of people to buy a things they wouldn’t have purchased if that same product was just sitting on a shelf with only its packaging to speak for it – why do you think grocery stores set up sample stations on Saturday afternoons? It’s not to give patrons a free snack – it’s so you’ll be exposed to something you otherwise wouldn’t have noticed and buy it!

So, the next time you are invited to a direct selling party or demonstration, look at it as the opportunity to be exposed to new products and ideas that you otherwise might not have noticed. Don’t feel compelled to fall in love with anything – but don’t sell the experience short, either. You never know when you might find the perfect pair of kitchen shears.

As baseball great Yogi Berra once said, “It’s déjà vu all over again.”

This week I’ve seen several blog posts repeating the tired assertion that 99% of direct sellers lose money. One even referred to the myth as a “cold hard fact.”
As I’ve pointed out previously on this blog, more than half of direct sellers report that their net income from direct selling, after taxes and expenses, is positive. In addition, positive net income is reported by nearly half of new direct sellers – those representing their current company for less than a year.
I’m sure this post will encourage the same critics who spread the 99% myth to respond to this message with the same information, that quotes the same circle of people, referencing the same “research” again and again. You can go back and review all of those previous discussions on earlier posts on this blog if that information is of interest to you. I won’t repeat it all here.
Anyway, my purpose with this post is not to spend more time debunking the 99% myth with dueling facts and figures. We’ve done that already. More important are the stories of actual people, average Americans like those profiled in a few recent media stories I’ve linked to below, who personify the success direct selling can provide – whether success is $200 a month or much more. Take a look at these examples:

Direct selling has carved out substantial niche

Direct sales businesses boom as economy tightens

Direct sellers strike balance, maybe gold

There are a couple of key points from these stories worth mentioning.

Not everyone in direct selling earns a six figure income, but then, not everyone is looking to earn a six-figure income. Many of the people profiled are seeking a little extra income in their spare time and they’re obtaining it via direct selling. As I am proud to point out, the median income for a direct sellers is about $2,400. The average income is actually significantly higher, but statistically speaking, the $2,400 number is far more accurate – that’s based on the millions of people just looking for (and achieving) supplemental income.

One of the other theories posited by direct selling critics is that if you’re not already in the business, it’s too late and the market is saturated. Not true. As the stories above demonstrate, successful direct sellers are entering the business all the time.

As I’ve said numerous times on this blog – direct selling is not for everyone, and just as with anything in life, there are people who will try it and not find the level of success they were hoping for. Anyone considering direct selling should clearly define their personal goals and thoroughly research both the industry and the specific company they are considering. Hopefully this Web site will assist in those efforts.

So, keep in mind that despite the stories in the articles above, success in direct selling is not guaranteed. But contrary to what our critics would have you believe, neither is failure.