Direct selling companies have made their mark primarily because of the unique distribution technique in selling consumer items to customers. Marketing of merchandise is done directly and away from a permanent retail outlet. What makes direct selling different from conventional marketing methodologies? Which is more beneficial or lucrative? Sales professionals state that direct selling establishes a bond between sellers and customers. It can be done one-on-one, in groups and through online sales. Customers gain from direct selling because of the expediency and service that the approach provides them. This includes the individual presentations and enlightenment made by the distributor about the products. Direct Selling Approach Distributors of the best direct selling company are regarded more as members rather than just ordinary sales persons. They are compensated for their efforts or sales with a commission based on their sales quotas instead of fixes salaries. Some direct sellers make use of the multi-level marketing approach and compensation scheme. This is considered more rewarding since the members are rewarded with commissions not only for their own sales but for a fraction of the consummated transactions by other members of the sales force. The traditional retail dispersal procedure calls for a substantial amount of the retail price to be apportioned to include selling costs, promotions, marketing and advertising. The costs also consist of maintaining retail presence and labor as well as wholesale and distribution. This cost scheme is not appropriate in the direct selling sector. A Different Selling PhilosophyDirect selling companies manufacture their own commodities while the sellers act as the wholesaler with low operating costs. There are no brokers or middle men involved. The significant savings generated in marketing are paid out to members as commissions not only for their achievements but to push them to recruit and teach new members about the direct selling phenomenon. The advantages of direct selling firms over long-established distributors are:
- Low operating expenditures as all sales commissions are based on performance.
- There is minimal expense to market new products through person-to-person distribution outlets.
- Direct selling has no limitations and subject only to regulatory approvals. It can promptly spread into other countries and expand the earning opportunity of distributors. Commissions are paid on all sales made by the sales force regardless of country of origin.
The favorable reception of products is normally very high. Consumers purchase them on a regular basis. Direct selling companies put in significant resources into proficiency training for network leaders to make sure that they acquire full understanding of the organization’s products. Direct sellers concentrate on marketing goods that conform to vital consumer requirements as sources for product lines. Naturally, this is expected to foster repeat business. The industry has become exceptional in the sense that it has few employees but a big marketing network. In many countries, consumers understand little about the industry through the mass media. The truth is direct selling does not market itself using the media. Direct sales activities are done in the homes of potential customer, in social circles and family gatherings which are often held in clients’ residences. There are no permanent retail shops where customers can learn about the products and the industry in general.