what it is and how to succeed with this sales method – WAU
Direct selling is a distribution and marketing model with excellent returns for the seller and company and can be optimized with some good practices.
Anyone who knows a little about direct selling has certainly heard of an association between it and multilevel marketing, right?
This is because both have the same engine for dissemination and conversion, that is, the sale is carried out from one person to another, without the need for an intermediary. Isn’t that clear? So let’s clarify the three ways we are talking about!
A customer can buy a necklace of golden grass directly from the craftsman who made it, or at a store in the mall. The first situation would be a direct sale, and the second, through an intermediary.
In the case of multilevel marketing, the customer can also buy the necklace of golden grass from the seller, but this one, in addition to making profits on this purchase, will also make gains with percentages of sales from other salespeople that he has indicated, creating levels below him.
That is, they are similar, but not synonymous. This is also why they have different strategies, both for those who want to be a salesperson and for companies that want to implement this sales model in their business.
Is it your case? Then read more in this post about what direct selling is, what are the advantages offered to the business and the best tips to optimize your results.
What is direct selling?
For the business world, a good way to conceptualize direct selling is to say that it is a distribution and sales method that bets on the work of independent salespeople, freelancers or freelancers to carry out the marketing of products.
That is, it can be practiced directly by those who produce it, by a representative of a company or entrepreneur who assembles his own stock of products and sells directly to his audience.
Unlike salespeople hired with a formal contract, those who practice direct sales are remunerated exclusively by the commission on each conversion carried out.
They are also responsible for social security contributions and tax frameworks, as and if the type of sale is included, becoming an Individual Microentrepreneur (MEI).
The means and materials for promoting your sales are part of your strategy, therefore, they are part of the private investments that need to be made.
An entrepreneur can, for example, create a virtual store to offer his products in the online environment and social networks, and, in these cases, he is responsible for hiring accommodation and payment solutions.
Therefore, they are the ones who determine your sales strategies, workload they will dedicate, channels of dissemination and target audience who intend to work.
What advantages do they bring to the business?
At first, the number of obligations and challenges of direct selling seem to be greater than the benefits brought to sellers and companies that bet on this model, right?
But many world-class companies will grow precisely because they adopt direct sales to leverage their results. The Direct Selling News (DSN) magazine publishes annually the ranking of companies that had the highest revenue in this market, and, in 2018, the list was headed by:
- Amway, with revenues of $ 8.60 billion dollars
- Avon, with $ 5.70 billion in revenue
- Herbalife, with $ 4.40 billion
Besides them, Mary Kay and Natura, who at the end of May 2019, announced the purchase of Avon, also entered the list in 5 and 6 places. That is, it is a market in constant boiling, right? And this is one of the first advantages that we can list.
The direct selling market has a lot of room to grow, and a very open audience to welcome you. Customers seek and value personalized and unique consumer experiences, and nothing better than a negotiation close to the client.
For salespeople, therefore, it is a positive point, as more companies will invest in this business model to expand their commercial results.
And the stores and companies that invest in this distribution model will also benefit from the public that is more receptive to this type of sale and also from the versatility of the salespeople, since not all companies in this modality preach exclusivity to their representatives.
The proximity to the customer is also another benefit for salespeople and companies that bet on this model. This is because the frequent relationship increases the chances of recurring revenue, loyalty and even referral to other potential buyers.
It also allows gather feedbacks and perceptions about products and services in a more clear and realistic way.
Companies know that human resources are one of the biggest costs for a business, especially for those that need a large sales force.
By adopting the direct selling model, the company eliminates a considerable cost of your finances and other indirect ones, such as the reduction of investments in advertising.
Costs with printing magazines and catalogs, hiring influencers and other marketing strategies can therefore be easily recovered by the sales force most engaged in conversion.
We can also list as advantages:
- ease of purchase, which is being offered intimately to the customer;
- allows extra income to be earned by professionals working in other markets, this even ensures that it has different audiences to offer its products to;
- increased territorial sales coverage, as representatives can sign up for direct sales at any location.
What are your main models?
We quote Avon and Natura and the memory of their catalogs is almost immediate. They are the basis for one of the ways to make direct sales viable, which can also be done in other ways. Find out more below!
Door to door
Door-to-door sales are the most traditional of this model, and, as the name suggests, it is practiced by the salesperson’s personal visit to the potential customer.
In this case, he needs to present the products, take a showcase and even have a minimum stock of those with greater output to guarantee a sale on occasion.
Some of them, however, require customization or order for manufacture because of their added value or size. Selling luxury towels personalized with the customer’s name, for example, depends on the confirmation of the purchase so that the work is performed according to specifications.
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Catalog sales, as is the case with the traditional model of Avon and Natura, however, work with a specific product mix.
The reseller can also create a stock of the products to guarantee sales on occasion, to be able to make demonstrations about their benefits etc., but the most traditional form of purchase is by ordering and sending them later.
In the case of party plans, a thematic event is held to demonstrate the products. It is interesting and has a good degree of conversion, as potential customers who appear at the locations know the reason for their performance and go in order to find out more about what will be offered.
A makeup event, for example, may have the direct sale of lipsticks, eyeshadows, mascara and more.
Even events in gyms can be used for the presentation of light frozen foods, supplements and shakes that help to enhance the results of physical exercises.
It is a mix of other means and can also be started, precisely, by providing a consultancy service in a certain area or situation. In this case, a problem is presented and the consultant offers, among other solutions, the products that are represented.
It is important to say, however, that such a strategy must be carried out in a clear and honest manner to the customer.
How to optimize the direct selling strategy?
There are many ways to make sales viable, right? So, how do you get them to bring returns to the seller and the company?
Know your target audience
As they are direct sales and the relationship with the customer is very close, understanding their needs, desires and difficulties is a great way to develop new products and sales approaches.
A salesperson can, for example, adopt social media as his main channel of dissemination and distribution if his audience is concentrated in the digital world. The creation of a persona can help to personalize marketing actions, including.
Today social networks are considered one of the best channels to promote the authority of a professional or brand, as well as to generate engagement and interaction with your audience.
According to Social Media Trends 2019, 53% of companies use social networks to strengthen their brands, and 44.2% to generate engagement. Adding these two, we have more consistent sales, right?
Master the knowledge about your offered products and services
The seller’s credibility and authority are also critical to the success of the sale. Therefore, knowing the characteristics of the products, what they bring benefits and why they are essential for each customer is essential.
Studying your market, competitors and products to be offered, therefore, helps in converting sales and building the authority of the seller, who can use videos and tutorials on the internet and in private disclosures to promote them. In the case of party plans, it is essential.
Personalize your service
Direct selling, by itself, is already personalized. But it is necessary to go beyond personal relationships, as it is not always possible to make the model door to door.
Therefore, even when using technologies such as e-mail marketing, for example, it is very important to create solutions that personalize the service and make the customer feel unique and special for that offer.
Manage a stock of products
Whether for companies that adopt direct sales or for independent salespeople, customer satisfaction and loyalty is crucial. Therefore, making an after-sales relationship is crucial to ensure regular revenue.
Since digital media can also be used for direct sales, innovating in your means of communication and relationships is also fundamental. A good tip, both to promote new business and to maintain a frequent and relevant contract with the customers won is to invest in automation.
Wondering how you can do this in your business? Read more about marketing automation and find out!