Data Tracker: Internet salesmen

Direct selling is less under siege from the Internet than was expected. While traditional direct sellers have seen a big drop in sales in developed markets, this has been more on account of product failures or miscommunication about the brand, a report by Euromonitor says. However, if one looks at selling communities that include direct-to-consumer businesses that the Internet has spawned (Example: Dollar Shave Club, now a part of Unilever), it seems that this is perhaps the best time for brands to explore the direct-selling model

• The most successful direct sellers will win by continuing to set down stakes in the most relevant communities, but also using a smart web presence to differentiate themselves from their competitors 

• Many direct sellers are focused on developing countries where basic goods are more in demand and affordability is a big concern

• Unmet demand is not just a function of economic development. In many developing countries, for example, deodorants do not sell well, as they are simply not seen as necessary

• Direct sellers’ futures are tied to that of the communities they serve; despite globalisation, the Internet is allowing humanity to become more tribal once again, thanks to social networks and improved communication

• Direct sellers that succeed will make use of online networks to supplement their community-centric business model

• Direct selling’s greatest strength is its sales force, but products matter as do distributors

• Local networks can get wider with social media, but direct sellers have been slow with digital innovation

• The popularity and fluidity of the Internet provide perfect forums for discussion and information distribution; an example of successful use of the Internet is AUN socks, a direct seller of socks that opened a store on WeChat and uses the Renrews selling system that allows its followers to sell to their friends and makes it easy to keep track of  commissions

Here are three of the top trends that impact internet sales:

• Personalisation: Big data and the self-selecting nature of the Internet will help move products that appear personalised and meet individual needs

• Convenience: More options means more for current customers to buy and more to attract new ones. An example is Amazon’s delivery system that can stretch or shrink wait-times based on what the customer is willing to pay

• Engagement: The Internet (mobile in particular) increasingly offers avenues for escape and entertainment. Brands that can make interaction fun will benefit the most

Source: Direct selling and communities in the Internet age, Euromonitor International