January 6, 2015 Leave a comment
by Jeremy Gregg
Just 10 years ago there was no YouTube. There was no iPhone. Facebook was only a few months old. Today, these three technologies—online video, mobile phones and social media—have revolutionized nearly every industry on the face of the planet.
- 100 hours of video are now uploaded to YouTube every minute.
- If Facebook were a country, it would have the third-largest population on the planet.
- There are now more mobile phones in use (7.7 billion) in the world than there are people (7.1 billion).
These trends will certainly continue to shape our industry over the next 10 years. The future will also undoubtedly be affected by many other technologies: Text messages now outnumber phone calls by at least 2-to-1; online sales are surging while sales at brick-and-mortar stores are dropping; though first introduced less than five years ago, tablets now outsell desktop PCs by a margin of 2-to-1.
Indeed, the dominance of technology in our business lives is so prevalent, the conference theme for the 2014 World Federation of Direct Selling Associations’ (WFDSA) World Congress, held in Rio de Janeiro last November, was “Direct Selling: The Original Social Network.” The schedule included speakers from Facebook, Salesforce.com, the global service design consultancy Fjord Accenture and the market research firm GfK Group.
Direct selling companies that find ways to link the power of person-to-person sales with the power of technology will have a huge opportunity to gain market share, outgoing WFDSA Chairman Alessandro Carlucci says. “We must be prepared as an industry to offer alternatives to the customer, and the technology is only going to leverage the differentials,” he says.
Forrester Research, in its research report on tech predictions for 2015, agrees with Carlucci, according to Forbes writer Gil Press, showing that the competitive edge belongs to those who stay ahead with technology. Press recently blogged about his chief interpretation of the Forrester report, stating that “the gap between digital leaders and digital laggards will widen in 2015.” Press goes on to quote from the Forrester report: “2015 will serve as an inflection point where companies that successfully harness digital technology to advantageously serve customers will create clear competitive separation from those that do not.”
Investing for the Future
Some company executives still question how much technology to actually utilize, and how much to offer the independent representatives without complicating the business model.
At Medifast, a direct selling company marketing weight-loss products and programs, technical upgrades are underway to help the company serve a wide range of customers. “We are looking to meet people where they are, whether that’s on social, through an app or via some other technology,” says Meg Sheetz, President and Chief Operating Officer at Medifast and CEO of Take Shape For Life. “This has motivated our interest in wearable technology, virtual coaching and creating our new and improved dashboards.”
Medifast’s digital dashboards allow customers to track nutrition, exercise, meals, weight, sleep, well-being and more. Capitalizing on the trend to “wear” devices that transmit personal data such as heart rate or steps walked, Medifast has established a partnership with Fitbit®. Consumers with one of Fitbit’s award-winning activity trackers can now have their activity data linked to their personal Medifast Dashboard. But the upgrade includes a feature that the previous one lacked: a way to grant permission to health coaches (independent representatives) to view their customers’ progress in real time. This feature enables the coaches to better and more efficiently guide their clients, an investment that pays dividends for both the coach and the company.
Sheetz explains that in addition to providing the new tech tools available to the field, the investment also includes infrastructure to make it happen. Upgrading the back office and adding more business reporting tools in order to provide more data to executives for decision making is necessary, along with giving coaches more visibility to better manage their own businesses.
It’s no small cost when you are talking about creating and innovating new tools for the field and considering the internal changes the support will require. Lori Bush, President and CEO of skincare company Rodan + Fields, explains that her company faces this challenge: “We have been trying to get the balance of innovation versus core infrastructure right, which is a big challenge for a company growing as rapidly as ours. Our most recent initiatives are very focused on supporting our business to scale and globalize. This includes major re-platforming of our commerce web services and commissions-calculation engine, as well as our customer-facing applications.”
Cost and ROI are ever-present topics in the CEO’s mind. During the World Congress, Carlucci, who is also former President and CEO of Brazil-based Natura Cosméticos, moderated a panel discussion comprised of CEOs from seven of the top 10 companies represented on the DSN Global 100, representing a combined $38.5 billion in revenue. Mary Kay Inc. CEO David Holl, Amway President Doug DeVos, Oriflame Cosmetics CEO and President Magnus Brännström, Herbalife International Inc. CEO Michael O. Johnson, Avon Products Inc. CEO Sheri McCoy, and Nu Skin Enterprises CEO Truman Hunt expressed surprising consensus on the subject of technological development. Even in trying to keep technology implementation simple, these industry-leading CEOs agree that doing so requires a significant financial commitment. To that end, McCoy underscored the importance of testing new technologies on a small scale before an enterprise-wide rollout. “As we are trying to learn more, more experimentation and testing differing things in different markets is more important to me than the amount of money,” she says. “If it works, I’m willing to spend, but to me my message to the team is, ‘Let’s look at the return on investment and are we driving growth through our field force?’ ”
“Our most recent initiatives are very focused on supporting our business to scale and on globalizing. This includes major re-platforming of our commerce web services and commissions-calculation engine, as well as our customer-facing applications.”
—Lori Bush, President and CEO, Rodan + Fields
What Comes Next?
Many companies are directing a lot of their attention to social media and have an active presence on YouTube, Twitter, Instagram, Pinterest and Google+, with Facebook seeming to be the most critical part of their communication strategy. More than 1.3 billion people are… Click here to read the rest of the article.