May 6, 2013 Leave a comment
by Jennifer Workman Pitcock
- Launched: 1997
- Headquarters: Chula Vista, Calif.
- Top Executive: Steve Wallach, CEO and Chairman of the Board
- Products: nutrition, gourmet coffee, weight management and mineral makeup
When Youngevity Essential Life Sciences and Javalution Coffee Co. merged to form AL International in 2011, the executives assumed they were in for some surprises. But the biggest surprise of all was how smoothly everything dovetailed together. With the additional merger of Financial Destination Inc. (FDI) that October, this newly formed entity has outperformed all expectations.
“I was surprised by the growth that occurred even while we were learning about each other—how quickly we succeeded and how much positive came out of the marriage of these companies,” says Bill Andreoli, who founded FDI and now serves as President of Youngevity.
CEO and Chairman Steve Wallach believes that’s because they all understand the direct selling space. CFO Dave Briskie co-founded and was CEO of Javalution Coffee Co. with JavaFit, a line of healthy coffees sold via direct sales. But his primary experience is in traditional businesses.
“I was surprised by the growth that occurred even while we were learning about each other—how quickly we succeeded and how much positive came out of the marriage of these companies.”
—Bill Andreoli, Founder of FDI and President of Youngevity
“Steve and Bill’s whole lives have been in direct selling,” Briskie says. “Among the three of us, that’s a perfect balance.”
AL International’s blend of direct sales and traditional business is a winning combination. In 2011 AL International netted $40 million in sales—$16 million more than Youngevity and Javulation’s combined sales the previous year.
And in 2012 the nutritional and coffee company’s sales nearly doubled year over year with sales over $75 million. That exceeded the Opus Research Group’s prediction of $66 million by almost $10 million. “We beat the 2012 forecast, and we anticipate that continuing,” Briskie says. “The 2013 forecast is $87 million. I’d be disappointed if we didn’t do more.”
One Big Happy Family
|(Pictured left to right from top) Steve Wallach, CEO and Chairman of the Board; Bill Andreoli, President; Michelle Wallach, Chief Operating Officer of Youngevity; Dave Briskie, Chief Financial Officer, President of Commercial Development, Director; Vanessa Hunter, Vice President of Marketing; Steve Schulz, Vice President of Training; and Mike Randolph, Vice President of Leadership Development.
Renowned researcher, veterinarian and naturopathic physician Joel Wallach founded Youngevity (then known as American Longevity) in 1997 along with his wife, Dr. Ma Lan. His conviction that everyone benefits from 90 essential dietary supplements keeps him going. At 72, he’s still on the road 300 days a year, sharing the company’s nutritional message.
As early as 2003, Youngevity fueled its growth by partnering with and acquiring other direct selling companies. In the year and a half since the merger, the number of companies that have joined the Youngevity family has continued to grow. It now exceeds 20.
“We want to be one of the top 10 direct selling companies. We know in order to do that we need to expand internationally.”
—Steve Wallach, CEO and Chairman
But Steve prefers not to focus on the number of acquisitions. For him, it’s about people, products and places. “People are the most important asset,” he says. “We look for great people in the field, terrific leaders.”
And the executives at Youngevity aren’t egotistical enough to think that they have a corner on the market when it comes to good products. “When we partner with or acquire companies, we get fantastic, amazing products. For instance, Projoba’s lead product PollenBurst is one of our top 10 best-selling products companywide,” Steve says.
Since the merger, Youngevity has become even more intent on expanding globally. Though the company already has a presence in more than 50 countries and 10 percent of their revenue comes from international markets, they know that must increase to reach their goals.
“We want to be one of the top 10 direct selling companies,” Steve says. “We know in order to do that we need to expand internationally. One way to do that is to find companies that have great products and great people who already have the licenses and logistics figured out in countries where we want to go.”
Youngevity’s company headquarters in Chula Vista, Calif.
Rebranding the Message
When FDI and Youngevity merged, Youngevity gained the considerable talent of Andreoli. He is the force behind the rebranding of Youngevity’s message. With more than 400 products, Youngevity needed a clear focus. In November 2011, Youngevity launched its 90 for Life campaign, which Andreoli masterminded.
“The 90 for Life campaign was something we came up with to summarize Doc Wallach’s 40-year message,” Andreoli says. “That became the slogan for the company. Before 90 for Life, you could go to four different meetings, and at each one they would be pushing a different product line based on what they liked best.”
Andreoli is behind the company’s revitalized training program, as well. “We’ve expanded the tools available to our distributor base,” he says. “We offer live seminars, recorded seminar webinars, conference calls, DVDs and videos in the back office. We teach our people to leverage the tools.”
In the merger, the entire FDI team was kept intact. Along with training, Youngevity puts in great effort to recognize people, which has energized the distributor base. Seeing people receive big checks, rings, plaques and other forms of recognition is inspiring. “All of a sudden they believe they can build a business,” Andreoli says.
In January of this year, Marilu Henner came on as Youngevity’s brand ambassador. Because of health issues in her own family, she’s been interested in nutrition her entire adult life. “Her deep knowledge of nutrition makes her a great brand ambassador for Youngevity,” Andreoli says. “That’s essential. Our people would see right through someone who doesn’t believe in what we’re doing.”
Already, Henner is creating a niche. She’s involved in some Youngevity conference calls and training, and the company is looking for products to formulate based on some of her passions.
Social Media Makeover
It’s been less than a year since Youngevity began harnessing the power of social media, but in that time, they’ve created a close-knit, thriving online community. They’re on several social media sites, including Facebook, Twitter and Pinterest. Already they’re seeing the impact on their bottom line: Because of social media, some dormant customers have reactivated their accounts after a year or more.
“Social media may have its curses and its challenges, but at Youngevity, it’s been a blessing. It has re-engaged people who for one reason or another took a different path. Social media has brought them back around to us,” says COO Michelle Wallach.
It’s an opportunity the company almost missed. In 2011, in a meeting with the Wallachs, Henry Weinaker told Michelle that if she hired him, he would make her social media great. She declined, saying, “Why would I pay you to do something that I can do for free?”
He agreed that she could, but told her she wouldn’t. Three months later, she realized he was right. “I didn’t have enough knowledge or tools to do it every day,” she says. “I called and apologized, but he had moved on.” Just a couple months later, they crossed paths again. This time, Weinaker was available.
With Weinaker’s guidance as Director of Social Media, Youngevity has gone from zero to 150,000 engages a week on social media sites. Michelle and Weinaker believe that’s because they carefully craft their content.
“Every time Michelle and I get ready to post, we ask ourselves, ‘How would friends of our fans react to seeing this post?’ It’s not simply about targeting our current base,” Weinaker says. “It’s about what would appeal to the broadest audience. We want anyone who sees it to say, ‘Wow, that’s really cool,’ because that’s the only way to grow an audience online.”
Michelle adds, “The posts aren’t about advertising or shoving Youngevity down anyone’s throats. I own the company, and if that’s what we were doing, I’d turn myself off. Henry has educated us on including the subliminal message that Youngevity sent this out without including a product ad. It’s not about selling. It’s about sharing something with them that gets them really inspired and excited.”
It’s a big mindset shift, but Michelle has come to see the value in the social media fan base. Some may not have much money to spend with the company. But they are advertising and spreading the word about Youngevity without any money going into their pocket. “That becomes more valuable to me than the person who is spending $50 and not sharing the Youngevity message,” she says.
Keeping the fan base engaged requires consistency. To keep them coming back each day, Youngevity has incorporated special days like Chocolate Fridays with giveaways of Youngevity healthy chocolate, as well as Deal Day Wednesdays and Take a Pic Tuesdays.
“We stay focused on the basics,” Weinaker says. “We’re always trying to get better at core things. Our greatest challenge every day is content. Content is the king of engagement. Every day, we try to outdo ourselves. How can we get even better? You can’t lose if you do that.”
They believe their success comes down to the relationships being built online. “We’re really friends with our fans,” Weinaker says.
Michelle adds, “I have a well-paid marketing team. It’s their job to sell the products. It’s our job to keep everybody focused and feeling like they belong.”
Spotlight on Products
Along with tweaking Youngevity’s branding, Andreoli is constantly looking for ways to better market Youngevity’s products. At the end of 2012 the company launched the Healthy Body Challenge. The foundation of the Healthy Body Challenge is the healthy body packs. Distributors and customers are encouraged to “Choose Your Challenge,” and select one of seven packs: Healthy Nutrition, Weight Loss, Blood Sugar, Bone and Joint, Digestive Support, Brain and Heart, or Athletic Performance. By referring three friends, distributors and customers can get their own product free. “Everyone fits into one of these categories,” Andreoli says. “That’s why it’s worked out so well.”
The company is especially excited about the results of clinical research studies performed by Clemson University-Institute of Nutritional Research. The purpose of the clinical research was to discover potential benefits of Youngevity’s signature core products, Beyond Tangy Tangerine and Ultimate Classic. The study showed the products to be safe—they did not show any genotoxicity. Also, they heightened the body’s protective responses to possible inflammation.
One of AL International’s biggest milestones in 2012 was becoming a public company. Steve says the company decided to become public to create transparency. “We in the industry are always trying to improve the credibility of the industry,” he says.
As CFO, much of the responsibility fell on Briskie. That’s on top of his many other duties: Since the merger, he’s continued to run CLR Roasters, AL International’s traditional coffee roasting company, which sells coffee to numerous cruise lines, major retail giants such as Wal-Mart, and various restaurants as well as supplying the coffee used in the JavaFit line.
Despite the added workload, he believes going public was the right decision because it strengthens the company by allowing distributors to become investors. “Part of our comp plan is structured so that they can earn stock options,” he says. “Many distributors actually invest in the company.”
Though Youngevity is proud of the investment they’ve put into becoming a public company, it has been an expensive, time-intensive commitment. Briskie estimates it will cost about $1 million each year to retain their status as a public company. But he thinks that, for their company, the cost is worth it. “Inevitably our distributors run into someone who has suffered a bad experience. Being public provides a great deal of comfort to our customers and distributors that we’re going to be here for the long-term.”
Be the Change
Giving back has always been an important Youngevity value. Early on, the company required its distributors to devote designated hours to charitable endeavors. This month the company will roll out its Youngevity Be the Change Foundation at the company’s annual convention.
The program will be funded through a partnership between Youngevity and its distributors. Distributors will contribute one-half of their commissions on specific “Be the Change” products, and the company will match this contribution at a minimum of 150 percent. The money will go to the foundation, where it will be distributed among approved charities. The company even expects to expand the foundation in the United States and worldwide as the program gains traction. Youngevity will underwrite the cost of running the foundation and administering the program.
Briskie emphasizes that Be the Change is more than just monetary donations. “We are developing ‘Be the Change Days’ that will take the outreach program to the streets, where we will roll up our sleeves and work together alongside our distributors to improve the lives of others within various local communities.
“As CFO of the company I am very passionate about the program,” Briskie says. “It will be one of our greatest achievements as a company.”