Nerium Sets Sights on Asia Pacific with Upcoming Expansion

Nerium International is targeting an up-and-coming anti-aging market for its next international expansion. The fast-growing skincare company has announced plans to launch its business in South Korea this June.

The 4-year-old brand first ventured beyond the U.S. last year with expansions into Canada and Mexico. In the same year, revenue increased 80 percent to $403 million, making Nerium the No. 40 direct selling company in the world and the No. 21 company in North America.

With its South Korea launch Nerium will introduce a patented new ingredient into its Optimera skincare line, which consists of just three anti-aging products.

“While every international expansion is significant, this launch is especially unique as we are introducing Optimera with the new SIG-1273 ingredient, offering advanced scientifically based products to our South Korean customers,” Nerium Founder and CEO Jeff Olson said of the company’s revamped formula. The patented SIG-1273 molecule, an antioxidant that mimics the skin’s natural age-fighting mechanism, is the product of 20 years of research by Princeton University biochemist Dr. Jeffry Stock.

Nerium President Roy Truett said that a receptive culture and high demand for anti-aging products influenced the company’s decision to enter South Korea. According to a recent report by Transparency Market Research, the global anti-aging market is poised to grow at a compound annual rate of 7.8 percent through 2019. The report indicates that South Korea and a handful of other markets in the Asia Pacific region will soon lead the world in sales of anti-aging products and devices.

Industry veteran BJ Choi will head up Nerium’s key new market as Country Manager of South Korea. Choi has accumulated more than 20 years of experience with various direct selling companies in the region.

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Nerium Mexico Expansion Features Revamped Product Line

Amid expansion into Canada and Mexico this year, Nerium International has tweaked its product offerings with an eye toward future growth. The anti-aging brand promises international consumers the same “real science, real results,” but its signature skincare line has gotten a makeover.

Nerium’s U.S. line consists of NeriumAD Night and Day treatments and a separate body contouring cream. In place of the NeriumAD brand, the company has introduced Optimera skincare to international consumers. The new product shares the same fundamental science as NeriumAD, said Nerium Chief Marketing Officer Amber Olson Rourke, with the added benefit of being globally compliant. According to the company’s website, Optimera Night and Day Creams include an “exclusive, patent-pending SAL-14 extract with a cutting-edge plant cell duplication technology.” The overhaul reflects a deliberate, long-term approach to expansion.

“For Canada and Mexico, we took a lot of the same properties, and the things we’ve found to be effective from an anti-aging perspective, to form a true global product built on the same foundational elements,” Rourke shared.

In Mexico, where Nerium launched in October, the company has hosted thousands at its grand opening events across the country. The connections formed by Latino Brand Partners in the U.S., as well as the groundwork laid by Nerium, created a warm market for the company.

“We didn’t do a soft launch. We spent a lot of time preparing to launch—we had an in-country executive team, in-country logistics and in-country support,” Rourke noted. “We were able to take what we’d done in the past and apply it to Mexico.”

Nerium has found that its values, culture and business model—with a focus on teamwork, home parties and selling to friends and neighbors—resonate with Latino customers and Brand Partners. Another aspect that has made an impression on Rourke is the enthusiasm and dedication of Nerium’s partners in Mexico.

“In the U.S., people kind of dip their toe into the water,” she notes “…There they are all in, excited, grateful and committed to the work it takes for anyone to change their lives and build a business.”

Nerium Doubles Office Space with New Headquarters

Nerium cultivates a familial culture at its corporate headquarters, and it looks like that family will be growing in the near future. The burgeoning skincare company, which incorporates Friday morning breakfasts for its employees, off-site recognition luncheons and complimentary chair massages at the close of each month, is moving to a new headquarters twice the size of its current space.

The home office will cover 75,912 square feet of a property adjacent to Nerium’s Addison, Texas, headquarters. The company chose to remain in the area where it launched in 2011 from a 5,432-square-foot space.

“As an employee-friendly company, we wanted to stay within three miles of our current location; we were thrilled when we found our new state-of-the-art facility, which will allow us to focus on our field as we continue to grow,” Chief Operating Officer Al Richey told DSN. “With its open floor plan, our new headquarters creates a collaborative environment that supports our ‘loving, caring, sharing’ motto.”

Having achieved annual revenue of $219 million in just two years, Nerium is now gearing up for international expansion. The company will open for business in Mexico next month, looking to build upon record growth in the U.S. and Canada. In its three-year history Nerium has maintained a laser focus on developing products backed by science and proven results. Currently, the company’s skincare line features just three products.

“Since inception we have aspired to create real products and real opportunities for our Brand Partners and our customers, and our focus remains the same as we grow,” shared Co-CEO Jeff Dahl, who joined the company earlier this year with a strong background in international expansion. “We believe launching the Mexico market creates huge opportunities for all Brand Partners to expand their businesses and exposes new prospects to the Nerium experience.”

The Road to $1 Billion

by J.M. Emmert

DSN Cover, April 2014

When Inc. magazine named Ambit Energy America’s fastest-growing private company in 2010, the then 4-year-old company’s annual revenue already had reached $325 million, making it one of the 40 largest direct selling companies in the world.

A year after the Inc. article appeared, the revenue number had doubled to $664 million. And 24 months later, Ambit did what very few direct selling companies have been able to do: break the billion-dollar barrier.

Hitting $1 billion in revenue is a milestone for any business, and to do so in seven years puts Ambit’s growth on a trajectory in line with some of the most recognizable brands of the past few decades: Apple (six years), Facebook (six years), Amazon (four years), eBay (seven years) and Google (five years).

Technology certainly helped. Co-Founders Jere Thompson Jr. and Chris Chambless have pointed to the company’s data processing technology as a key factor in Ambit’s rapid expansion. And Ambit, like all modern direct sales companies, leverages the connectivity afforded by the Internet as well as social media platforms in its sales strategies.

Yet despite the ubiquitous nature of technology, the billion-dollar milestone remains elusive for many direct sellers. In order to better understand what it takes to break through that barrier, we decided to study some of the members of direct selling’s Billion Dollar Club: six from the United States—Ambit, Amway, Avon, Herbalife, Mary Kay and Nu Skin, as well as Germany’s Vorwerk, Brazil’s Natura and Peru’s Belcorp.

What is it that makes them billion-dollar companies? What do they have that other companies are still trying to learn and to possess? In our review, we identified four key drivers behind the members of the Billion Dollar Club.


Growth Comparison ($0-$1 Billion)


1. They were founded by outstanding leaders.

Which one would you invite to dinner: the visionary, the revolutionary, the dream-builder, the groundbreaker, the risk-taker, the mover, the shaker or the history-maker? In the Billion Dollar Club, you’ll find them all sitting at the table.

Take Amway’s Jay Van Andel and Rich DeVos, for example. Van Andel was a firm believer in and fierce advocate for free enterprise, and DeVos was among the first proponents of teaching distributors to start with believing in themselves.

“We were just two guys from Ada, Michigan, USA, who wanted to have a business of our own,” DeVos says on the company’s website. “We were two kids (it still feels like that sometimes) who were hungry for success and who wanted to give others the chance to be in business for themselves, too.”

The current generation at Amway is building upon that foundation. Co-CEOs Steve Van Andel and Doug DeVos have led the company to record sales growth marked by continued global expansion to more than 100 countries and territories.

Avon offers a similar lesson in the power of strong foundational leadership. As a salesman in the 19th century, David McConnell was far ahead of his time in recognizing that women could be successful sales professionals. Beginning in 1886 with Mrs. P.F.E. Albee, he tapped the power of a female salesforce to go door-to-door extolling the virtues of products from the California Perfume Company, the forerunner of Avon. By 1920, he had built a $1 million business, which adjusted for inflation would be nearly $12 million now.

Today, CEO Sheri McCoy, whom Fortune magazine ranks as among the 50 most powerful women in business, exemplifies McConnell’s vision of building the company for women. She joined the Avon team in April 2012, bringing with her 30 years of experience with Johnson & Johnson, and now leads a $10 billion business with more than 6 million independent sales representatives.

2. They offer distinctive, high-quality products or services.

Having bold, visionary leaders is critical to building a billion-dollar company. So, too, is creating products that bring true value to the marketplace. The club members reviewed here have done just that.

The United States has the largest cosmetics industry in the world, with estimated revenue of nearly $55 billion. Amway, Avon, Mary Kay and Nu Skin are all able to thrive because they continue to be at the forefront of scientific research, developing new products designed to enhance the lives of customers.

Nu Skin, for example, spent more than $46 million on research from 2011 to 2013 and has made several key acquisitions that brought new technology into the company. Its Pharmanex health supplements product line comes from the acquisition of Simi Valley, Calif.-based Generation Health Holdings Inc. in 1998. Since then, Nu Skin has gone on to purchase substantially all of the assets of Madison, Wis.-based LifeGen Technologies LLC in 2011 and Malvern, Pa.-based Nox Technologies Inc. in 2012, which added more anti-aging technology to the Nu Skin portfolio.

Avon significantly upped its research and development game in 2002, announcing plans for a state-of-the-art R&D center and a $100 million increase in research spending from 2002 to 2005. The company has continued that commitment, spending $67.2 million on research and development in 2013 and launching more than a dozen new products.

Unlike its personal consumer product peers, Ambit is using direct sales to introduce customers to a relatively new product category: energy. Deregulation in many utility markets is giving consumers a choice when it comes to purchasing their retail electric and gas services.

Since its launch in Texas in 2006, Ambit has used direct selling to spread the word. Co-Founder Jere Thompson Jr.’s mother and father were the company’s first customers, and received the first bill. Today, Ambit has more than 1 million active customers.

3. They target growing markets.

In order to hit the $1 billion mark, choosing where to sell can be just as critical as choosing what to sell. Of the nine companies in our report, six of them have a presence in more than 35 markets around the globe. Only Belcorp (16), Natura (seven) and Ambit (one) have managed to make the Billion Dollar Club with less.

According to a September 2013 DSN report, advanced markets—the United States, Japan, Korea, France, Germany, the U.K., Taiwan, Italy, Canada and Australia—accounted for $89 billion in retail sales in 2012. Emerging markets such as China, Brazil, Mexico, Malaysia, Russia, Colombia, Thailand, Venezuela, Argentina, Peru, Indonesia, India and the Philippines accounted for $65 billion. Those markets, however, are home to 85 percent of the world’s population; gaining a foothold there now establishes a foundation for future growth.

Take Brazil, for example. Natura has established itself as the biggest cosmetics company in its home country. The No. 2 cosmetics name in Brazil? That was U.S.-based Avon, which counts Brazil as one of its largest markets and where it keeps some research and development operations.

4. They invest in their people.

In the end, while leadership can create a desired path, quality products can help establish a business, and new markets can help bring a company’s story to a worldwide audience, it all comes down to the people who say yes to the opportunity to represent the brand.

The nine companies in this report have more than 20 million salespeople combined across the globe. Those salespeople are of every age and ethnicity, with diverse educational backgrounds and diverse reasons for wanting to be an entrepreneur. In fact, according to the U.S. Direct Selling Association, most people who join direct selling come for one of five things: supplemental income, recognition, rewards, social connections or product discounts.

Six of the nine companies currently have more than 1 million salespeople who, for the most part, are compensated on a multi-level structure. The most-frequently used sales method is person-to-person, which accounted for 80 percent of sales in 2012. Vorwerk, Mary Kay and Belcorp employ the party plan method as well.

The founders and leaders of the Billion Dollar Club companies recognize and value the diversity among their salesforces. Family men like Belcorp’s Eduardo Belmont and the brothers Carl and Adolf Vorwerk have shown that fostering a culture of love and respect brings in the greatest returns on investment. Motivators like Herbalife’s Mark Hughes and Natura’s Luis Seabra set out to help people change themselves so they could, in turn, change more lives for the better. And Nu Skin’s Blake Roney, Sandie Tillotson and Steve Lund are among the many philanthropists in direct selling who have reached out a helping hand to those in need.

A key to becoming a billion-dollar company is to have people talking about it. So whether the talk comes from the standpoint of a 150-year-old legacy or a new, spirited startup that has re-energized the industry, happy salespeople translates to happy customers; and happy customers is always a winning formula.


Youngevity Announces Expansion into Russia and Israel

Photo above: Outside Youngevity’s corporate headquarters in Chula Vista, Calif.

California-based Youngevity International recently announced the expansion of its direct selling business into Eastern Europe and Israel. The multi-dimensional company markets nutritional and personal care products as well as gourmet coffee through commercial, retail and direct sales.

Youngevity plans to establish a presence in Russia by the third quarter of 2014 with a distribution and sales support center in Moscow and various distribution points across the region. The company has appointed industry veteran Ricardo Spilman as Director of Sales and Operations for Eastern Europe and Israel.

The company is strategically positioning itself with an eye toward rapid international growth, said Steve Wallach, Youngevity’s Chief Executive Officer. “Youngevity currently ships its products to over 60 countries, but this accounts for only 8 percent of our revenue. We believe that the global demand for our products is apparent and we are poised to make an impact internationally.”

Read more on Youngevity’s international expansion.

Rodan + Fields Plans Expansion into New Headquarters

Rodan + Fields Dermatologists has more than doubled its current office space with a new lease on a 62,500-square-foot space on San Francisco’s Spear Street.

The rapidly growing company will move into five floors of the building next summer. President and General Manager Lori Bush reports that the company has experienced a monthly revenue jump of 250 percent over the last two years, exceeding $100 million in sales in 2012 alone.

Rodan + Fields was founded by Dr. Katie Rodan and Dr. Kathy Fields, the creators of Proactiv® Solution, who wanted to make dermatology-based skin treatment more accessible. The direct selling skincare company offers individuals the confidence of healthy, radiant skin through clinically proven skincare regimens.