Back to News January 23, 2019

Focused on MLM Recruitment? Fine—But Don’t Lose Sight of This

Did you attend the DSA Fall Conference in Virginia this past November? I was there.

One of my favorite keynote sessions was delivered by a futurist Mike Walsh who is very concerned about a trend he sees in our industry. I share his concern.

Allow me to summarize: today’s direct selling companies are hyper-focused on protecting their network. They’re all about MLM recruitment: recruiting new distributors, keeping them happy, and helping them advance to new tiers within the company. There isn’t anything wrong with that! In fact, that focus and behavior is desired but it can’t overshadow the company’s products and services.

Some seem to believe that if they can just attract enough sales reps, their companies will eventually achieve the sales volume they really want.

I’m not here to say MLM recruitment isn’t important. And I’ve written before about getting the most out of your sales reps.

But I also think that if we’re only focused on building our network, we’ll eventually find ourselves in serious trouble. Ultimately, it has to be about the products we offer and not the body count.

Why Impressive Sales Numbers Are Sometimes Hollow

Why is it dangerous to focus solely on recruiting new distributors? One reason is that this approach tends to give us a skewed vision of what our sales volume really is.

Let’s say that a company has signed up 10,000 new distributors during this last year. But now suppose this company does a poor job of onboarding, welcoming, and nurturing these sales reps. A huge percentage of them will quit within the first year—and probably share their negative experiences with many of their friends and colleagues.

The company can try to recruit another 10,000 reps every year, but they’ll find that their task gets harder and harder. You probably think this is a “take better care of your sales reps” article. But that’s not where I’m going with this. I’m actually thinking about something else: your products.

Hey Wait: Aren’t You in This to Sell Products?

Mike Walsh, the futurist who spoke at the DSA Fall Conference threw out something that he called a “mind grenade.” He asked us to compare the way we do business to the way Amazon does business.

Amazon doesn’t care what mechanism sources new product sales. They just want to move product. The sourcing and delivery system are important aspects of the sales cycle but they are secondary to the product itself.

If you’ve ever read a blog and the author recommended a product on Amazon, you probably expect that this author got some kind of financial compensation for recommending that product.

There’s a thriving influencer culture on the web. One blog post by an ultra-popular blogger can result in thousands—even tens of thousands—of sales.

Bloggers and other social media influencers know the power they wield—and they’ll only wield it when they believe in the product being offered and when there’s something in it for them. Social influencers care about their audiences and don’t want to tarnish their images by recommending products that don’t match their reputation, but in the end that commission is how they make a living.

How should your direct selling company approach these unofficial sales reps? How do you leverage the power of an influencer without damaging your relationships with your distributor network? Better yet, how can you utilize influencers to enhance your distributor network?

 

How to Track Distributors Who Aren’t Really Distributors?

Social influencers who “sell” your products with their recommendations aren’t official distributors, of course. They simply direct eager customers your way. Sometimes, they direct thousands of eager customers your way.

How can you encourage them to keep doing so, even though they don’t work for you? Affiliate commissions are the most reliable way to reward social influencers for sending you business. But you can actually help them send you even more potential customers by offering them discount codes specifically for their readers.

Now, how can you track the effectiveness of these programs and maintain relationships with the best social influencers creating significant new product volume while protecting your distribution network at the same time? Thatcher Technology can help.

Within our system, you can make any influencer a distributor. They won’t have any downline or hold any inventory—but you’ll be able to track the customers who buy through their website.

You can also use Prowess to keep track of the discount codes you offer your influencers, and the incentives you give them as a result.

There’s a lot more we can tell you about best practices with affiliates and influencers – it’s something to think seriously about. If you’d like to learn more about how Prowess can keep track of all your channels of business. Click here!

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