Thought Leadership

5 Predictions for Direct Selling in 2017

TL;DRBig data, faster payment platforms, intelligent communications—this post takes a look at five of the top predictions for direct selling in 2017.

“What’s in store for the direct selling industry in 2017?”

That’s the question Hyperwallet asked a handful of direct selling experts to answer last week. Will direct selling companies adopt technology in new and innovative ways? How will the regulatory environment change for the direct selling space? Are there early signs that our industry is in for a big change in 2017?

Here are five of our favorite predictions for what developments we might see in direct selling next year.

Artificial Intelligence

Michel Bayan, Co-Founder of DirecTech Labs and Founder of The SourceDS

Big data + AI are revealing patterns of behavior previously invisible to us - @MichelBayan Click To Tweet
Michel Bayan - Co-Founder of DirecTech Labs and Founder of The SourceDS

Michel Bayan – Co-Founder of DirecTech Labs and Founder of The SourceDS

The big discussion this past year has been about the power of data and the looming shadow of regulation. Next year, we’ll discover that the former likely holds the solution to the latter. There’s been much talk about the power of big data and artificial intelligence to reveal patterns of distributor and customer behavior previously invisible to us. Major organizations use AI today to predict our behavior, providing better customer experiences and increasing wallet share. In 2017, savvy direct selling companies will use this technology to:

  • Sharply increase retention and minimize churn
  • Accurately forecast a distributor’s revenue generation in the coming pay periods
  • Predict the short- and long-term impact of promotions
  • Increase the performance of loyalty programs
  • Create a more profitable and ethical separation of customers and distributors

AI will discover truths we’ve never considered and suggest specific actions to various company departments and the field. It’s a sea change from the current way business tactics and overall strategy are devised and executed. The companies that adopt AI first (even in small increments) will experience hyper-growth sustainably, ethically, and easily within the realm of compliance—but it may not be easy. Many executives have yet to adjust to the new paradigm of modern business where ideas and gut are often trumped by data science. Being willing to be wrong must become a part of executives’ DNA.

Your big win in AI will come from incremental steps - @MichelBayan Click To Tweet

My advice? Your big win in AI will come from incremental steps, rather than a major plan that sucks up months of time and resources with little to no achieved business value and a massive budget before you’re expected to see any benefit.

Michel Bayan is the CEO and co-founder of DirecTech Labs, a data science company specializing in direct and social selling. He’s been helping direct selling companies around the world turn data into action since he co-invented the first mobile apps for direct sellers in 2010.

Distributor Relations

Brett Duncan, Co-Founder of Strategic Choice Partners

In 2017, companies will launch programs to truly separate customers from distributors - Brett Duncan Click To Tweet
Brett Duncan - Co-Founder, Strategic Choice Partners

Brett Duncan – Co-Founder, Strategic Choice Partners

2017 feels like it will be the turning point we’ve been talking about for so long in direct sales. We’ve seen the shift coming—felt it happening—but now I believe we will see it take place in tangible and even fundamental ways. It’s exciting.

In discussions with my clients and through research I’ve conducted within the industry, I believe the biggest focus will be on an updated attitude about and approach toward our people. Companies will launch programs and update classifications to truly separate customers (individuals who want the product) from distributors (individuals who want to earn income by sharing the product).

However, the real win will come in how companies further segment their distributor base. The growth opportunities in the midst of the “you economy” lie not in creating more full-time distributors, but in facilitating—even celebrating—the distributor who simply wants to earn a couple hundred dollars a month on the side. These are people who love our products and love the idea of sharing them with people.

I daresay this group has always been the bedrock of direct sales, but we haven’t focused on them like we will in 2017. For them, we don’t need to promote a career; we need to promote flexible extra income.

Brett Duncan is Managing Principal for Strategic Choice Partners, a business development firm for direct selling companies. Brett specializes in helping companies develop success-accelerating strategies both at the organizational and departmental level, and is considered a top expert in marketing and communications within direct sales.

Trend Recognition

Michele McDonough, Co-Founder of the Women’s PowerCircle

Technology adoption will remain crucial for direct selling companies in 2017 - Michele McDonough Click To Tweet
Michele McDonough - Co-Founder, Women's Power Circle

Michele McDonough – Co-Founder, Women’s Power Circle

In this seasoned direct seller’s opinion, direct selling companies will continue to do what they must to adopt new and innovative ways. Unless companies are monitoring consumer trends and the rapidly-evolving world of technology, they’re not staying current with the demands of consumers and the changes that are taking place within the direct selling business model minute-by-minute.

Most direct selling companies want to learn and to stay current—seeking optimal solutions, avoiding costly mistakes. That’s the reason we created the Women’s PowerCircle: to offer top female direct selling executives the information they need to stay current with trends and—often—get ahead of the curve.

For example, the consumer preferences of our ever-changing audiences—Millennials, Gen X, Gen Y—will continue to direct the way that direct selling is communicated to the customer and the distributor.

Additionally, the regulatory environment is defining a clearer way of doing business—which has been a long time coming. And with this new political landscape, we can expect to see many more changes coming our way!

Michele McDonough is a direct selling strategic consultant and co-founder of the Women’s PowerCircle, a community of like-minded women in high-level entrepreneurial and executive roles within the direct selling business model. Through the years, Michele as served as a board member, start-up specialist and business consultant, and executive recruiter for some of the industry’s largest brands.

Intelligent Communication

Brian Palmer, CEO of Krato

For direct selling, 2017 will be the year of intelligent communication. - Brian Palmer, @Krato_Com Click To Tweet
Brian Palmer - CEO, Krato

Brian Palmer – CEO, Krato

Email open rates are declining, which means it’s getting hard to keep in contact with distributors and customers. You might send an email to 10,000 people, only to find that 800—8 percent—have actually opened it. A few years back, you could send the same email to the same group and have an open rate of somewhere between 50 and 70 percent!

Why the decline in open rates? People are busy. It’s easy to ignore an email when you’ve received dozens of emails from other companies before 10AM. Distributors, party hosts, and customers will only open your email if they believe that it was really meant for them, specifically. But how can direct selling fix this?

Why the decline in email #openrates? People are busy. - Brian Palmer, @Krato_Com Click To Tweet

In 2017, more and more companies will be inclined to provide a mobile application where they can engage their users with intelligent communication, which will allow them to segment and communicate to users based on actions, interests, and behaviors. For example:

  • A customer who has not placed an order in the past 30 days could receive an app notification with a special promotion
  • A party host could receive a timely reminder to send guests an invitation to her party
  • A distributor who has just achieved a new rank could receive a congratulatory message

This intelligent communication will forever change the direct selling industry.

Brian Palmer is the CEO of Krato, a progressive company that helps business owners unlock the full potential of their direct selling ventures by leveraging modern mobile technology. Prior to that, Brian was CEO and founder of South Hill Designs until it was acquired by Youngevity.

Commission Payments

Patrick Crosson, SVP Global Sales at Hyperwallet
2017 will be the year of faster #payments. - @pjcrosson Click To Tweet

Patrick Crosson - SVP Global Sales, Hyperwallet

Patrick Crosson – SVP Global Sales, Hyperwallet

I strongly feel that 2017 will be the year that the direct selling industry makes major efforts to increase the speed and frequency of commission payments. The party plan and network marketing models are already improving the timing of their payouts—next year, I believe that many direct selling organizations will follow suit.

And why shouldn’t they? The direct selling companies that already pay out instantly (or even within a few days) have seen increased distributor sales actions and loyalty, ultimately resulting in higher company revenue. Part of this, no doubt, can be attributed to the influx of young direct sellers in the industry. Millennials won’t wait between two and four weeks to receive their commissions—there are too many other independent earning opportunities to put up with those kind of lengthy payment delays. Direct selling companies still relying on traditional, slow payout methods (like paper checks) are losing distributors, and will continue to lose market share as well.

Millennials won’t wait between 2-4 weeks to receive commissions. - @pjcrosson Click To Tweet

Technological advancements have changed many aspects of our industry, and payments are no exception. Today, there are ways for direct selling companies to easily pay per week, per day, per party, or even per SKU. Organizations can send real-time (or near real-time), local-currency commission payouts around the globe in a variety of methods: prepaid card funding, bank account funding, debit card funding, and so on. The technology is here: companies just need to take advantage of it.

And those are the companies that will succeed in 2017.

Patrick Crosson is SVP of Global Sales at Hyperwallet, a worldwide payout provider to millions of independent workers. A payments and mobile industry veteran, Patrick has been a valuable partner to direct selling companies in implementing new technologies and improving

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