Forces Under 40 2017

by DSN Staff

Click here to order the March 2017 issue in which this article appeared.


DSN is thrilled to showcase the most outstanding young professionals working in direct selling companies today. These honorees represent all aspects of the business—from technology and marketing to finance and field services—and represent the fine talent of tomorrow. We know it is imperative to nurture and encourage the young leaders in our channel in order to secure the brightest future possible for all.

These dynamic young leaders are broadening the scope of the companies they work for as well as our entire channel of distribution. Based upon the enthusiastic nominations of the honorees presented here, the future is bright indeed. The program was open to all full-time professionals working in active direct selling companies who turned 40 years old on or after Jan. 1, 2017. The honorees are presented in alphabetical order with each profile including the thoughts and words of the honoree’s respective company.

We also want to thank our generous sponsors, Avalara and Fossil.


PROFILES:

…. Continue to the Honoree’s profiles.

 

 

Take Shape For Life to Take on New Name in Brand Evolution

Photo: Optavia Chia Berry Bliss Smoothie.


Take Shape For Life, the direct selling division of weight-loss firm Medifast Inc., introduced a new name and strategic vision to company Health Coaches during its recent National Convention.

The annual event took place in Austin, Texas, over the weekend, with more than 3,400 Health Coaches in attendance. From the stage, TSFL leaders unveiled a collection of new products under the Optavia brand, which it will adopt company-wide over the course of the next year.

“The announcement of Optavia marks a significant evolution in Take Shape For Life, putting it in prime position in the health and wellness market and the direct selling industry for growth and global expansion,” said Michael MacDonald, Chairman and CEO of Medifast.

The new name, meaning “optimal way” in Latin, is part of a wider effort to reposition the weight-loss company as a lifestyle company focused on optimal wellbeing. Since launching in 2003 as the direct selling arm of Medifast, TSFL has become the company’s largest segment, with revenue of $202 million in 2015. The parent company’s weight-loss plans and products also are sold through the web and national call centers, Medifast Weight Control Centers and a national network of physicians.

Under the Optavia brand, the company will operate as its own entity, offering exclusive products. “For the first time in the company’s history, we have created and built a fully exclusive offering that is only available to our family of Health Coaches and Clients,” said Mona Ameli, President of TSFL.

The company plans to add more health products, called Fuelings, to the Optavia line and upgrade its existing meals, snacks and bars to the new standard. The entire company is set to adopt the new branding and name by National Convention in July 2017.

For more in-depth coverage of Take Shape For Life’s brand transition to Optavia and new product roll-out, look for our August issue of Direct Selling News online and in print next week.

More Public Companies Report Q3 2014 Results

The following is a round-up of the latest publicly held companies to announce third quarter results:

At Nu Skin (NUS—NYSE), third quarter revenue was $638.8 million, down 30 percent over the prior-year period. The revenue dip partially reflects a limited-time introduction of Nu Skin’s ageLOC® TR90® weight management system in Q3 2013. The personal-care company reported earnings of $1.12 per share, ahead of Nu Skin’s 90 cents to 95 cents guidance for the quarter. The company expects fourth quarter revenue of $590 million to $610 million, with earnings per share of 72 cents to 77 cents.

“Our sales results are heavily impacted by our product launch schedule. Last year’s second-half launch, which generated approximately $550 million in sales, provides a difficult year-over-year comparison,” Nu Skin President and CEO Truman Hunt shared in the company’s report. “However, excluding product launch sales, the core business has stabilized and is trending positively sequentially.”

Primerica Inc. (PRI—NYSE) reported third quarter revenue of $339.2 million, up 9 percent year over year. Net income was down 3.7 percent to $41.6 million, or 75 cents per diluted share, impacted by accelerated equity compensation expenses related to retirement plan modifications and higher claims incurred in the quarter. The financial services provider lagged 8.43 percent behind the Zacks Consensus Estimate, but investors reacted positively to Primerica’s results. The company’s stock price gained 0.38 percent on the news to close Wednesday at $52.16.

Nature’s Sunshine Products Inc. (NATR—NASDAQ) reported increased revenue for the third quarter on Wednesday, with $94.9 million, up 2.6 percent from $92.5 million in the third quarter of 2013. Results showed lower earnings though, with 6 cents per diluted common share or net income of $1 million, compared to 29 cents, or $4.9 million in the third quarter of 2013. It was the fifth consecutive quarter of record sales for the health and wellness company’s Synergy WorldWide business, driven by South Korea, Japan and a return to growth in Europe.

“Sales in NSP North America have begun to improve with NSP United States and NSP Canada posting net sales growth for the first time since the second quarter of 2013 and the first quarter of 2012, respectively,” said Chairman and CEO Gregory L. Probert. “We remain cautiously optimistic about the future of this core market as our new products and sales programs continue to gain traction.”

Medifast Inc. (MED—NYSE) third quarter results came in ahead of expectations on Wednesday with net income of $4.9 million, or 39 cents per share. Excluding non-recurring costs, adjusted earnings came to 47 cents per share, or $5.9 million net income. The weight-loss company posted net revenue of $74 million. This was a decrease of 14 percent from net revenue of $86.5 million in the third quarter of 2013. Revenue in the direct sales channel, Take Shape For Life, decreased 11 percent to $49.9 million in the third quarter of 2014, compared to $56.2 million in the same period last year.

Guidance for Q4 revenue and EPS is below consensus, with net revenue to be in the range of approximately $69 million to $73 million and EPS in the range of 31 cents to 34 cents. For fiscal year 2014, the company now expects revenue to be in the range of $310 million to $314 million and EPS in the range of $1.59 to $1.62. As trading closed on Wednesday, shares hit $30.09, an increase of 23 percent in the last 12 months.

Take Shape for Life CEO Named One of Baltimore’s ’50 Women to Watch’

Take Shape for Life CEO Meg Sheetz is one of 50 Women to Watch in the Baltimore community, according to an annual list from The Baltimore Sun. Maryland’s largest daily newspaper whittled down more than 250 nominations to recognize an elite group of “the area’s most intriguing movers and shakers.”

“These are women who are very invested in Baltimore, and there is a lot of good being done out there,” said Sun Editor Anne Tallent. “Whether in advocacy or the arts or nonprofits or science and technology, they are making Baltimore a better place.”

TSFL is the direct sales division of Medifast, where the late Bradley MacDonald, Sheetz’s father and former CEO and Chairman of the Board at Medifast, brought her on board in 2000 as sales administration director. The 37-year-old is now Medifast’s President and COO, in addition to running the company’s TSFL division.

“Meg’s dedication and leadership at Medifast continue to …” Read the rest of the story here.

Medifast Deters Takeover Attempts with Stockholder Rights Plan

The board of directors at Medifast Inc. (MED—NYSE) has put in place a one-year stockholder rights plan or “poison pill” intended to discourage a hostile takeover from outside the company.

The weight-loss company adopted the plan “in response to the recent rapid accumulations of significant portions of Medifast’s outstanding common stock.” Waltham, Massachusetts-based ModusLink most recently built up a significant stake in Medifast. The supply chain and logistics company acquired 9.9 percent of Medifast stock through a series of transactions in July and August.

In its Securities and Exchange Commission filing, Medifast states the plan was not adopted in response to any specific takeover bid or acquisition proposal. The rights plan would trigger should an outside investor acquire 10 percent or more of the company’s stock. Existing stockholders would then have the opportunity to purchase additional common stock at a discounted price.

Medifast markets its products through several channels, including the personal coaching division Take Shape For Life. The direct selling subsidiary is Medifast’s most profitable division. Take Shape For Life generated $229 million in revenue last year to claim the No. 52 spot on the DSN Global 100.

The Most Influential Women in Direct Selling

by Beth Douglass Silcox

Order reprints of Meg Sheetz’s profile here.


Medifast, Products
Medifast


Meg Sheetz
CEO, Take Shape For Life
President and COO, Medifast

“How do you step into a leadership role when the person who was there before was such a huge figure?” Meg Sheetz kept asking herself this when she replaced her father, Bradley MacDonald, after his 2012 passing. He had been Chairman and CEO of Medifast Inc. and Co-Founder of Take Shape For Life.

“In direct selling a lot of these founders are very dynamic and have a lot of presence to them, so really trying to figure that out was interesting. Our field was wonderful about that. I think the family tie and family unity were certainly a big help,” she says.

Sheetz, however, brought strengths of her own, too. “I think women have the ability to sense things. I think men may drive harder at a particular thing, item, or goal; whereas women may have a more feeling aspect to business. I think in some cases that is a gift,” Sheetz says.

As a woman and as a younger person, in general, Sheetz has learned the value of smart generational leadership—the importance of respect and learning from people who are older and to some degree wiser. “It was a wonderful thing. It taught me that, for my teams, I want to hire people who are better and smarter than I am. I don’t know if I would have had that lesson if I hadn’t been in the situation that I was in. I learned so much from them, and from a leadership perspective I was able to balance the accountability piece with the respect and understanding of what they brought to the table and their talents,” she says.

Meg Sheetz, CEO, Take Shape For Life - President and COO, MedifastThe autonomy to get things done is paramount to Sheetz’s up-front and honest leadership philosophy. “I try to give our teams the freedom to make decisions they need to make. Results, though, are extremely important,” she says. “In our world, we have a strategy—a five year strategy. We update it on a year-over-year basis and come up with an implementation strategy. We use that tool to help us work together to make sure that priorities are aligned and that everyone in the organization it supports knows what needs to get done by when.” Big goals, even audacious ones, are easier to meet when measures are firmly in place and the entire organization pulls together.

Enabling the Take Shape For Life field organization to focus and grow, while expanding consumer knowledge of the brand, is important this year. From an internal perspective, this means gaining feedback from field leaders and offering up the right support infrastructure to facilitate that growth, like apps and a simplified back office. “The business should be at their fingertips and easy to do, and they should have reminders that come to them really quickly,” Sheetz says.

Brand enhancement comes through the new “Stop Challenge Choose” campaign for participants to share transformational stories with the public. She says, “It’s not just a before-and-after picture sort of thing. Yes, we help people lose weight, but our biggest goal is to help people keep it off and to really start learning the habits of health.”

Meg Sheetz on developing women…

“Our executive team sits down on a quarterly basis and has a discussion about who in the organization we see as having huge potential. We call out the promising aspects, no matter the rank within the organization. We have a conversation about what we see as their skill set and why we think they have potential.

In that process, we are able to bring forward strong women within the organization. And the great thing is we don’t have to purposefully search out women—they just happen to
be exceptional.”

Meg Sheetz on personal development…

“I have a coach, someone that I meet with monthly. We go over goals and what I am doing to get these goals accomplished. Sometimes it can be a tactical conversation, and sometimes it’s very much a psychological discussion about the role, what’s happening or maneuvering a situation. You practice it and get pointers that help lead you down the path.”

Take Shape For Life

Take Shape For Life changes people for good. Some 11,000 Health Coaches guide consumers toward weight loss quickly and safely using the Medifast 5 & 1 Plan, while teaching healthy eating habits that keep the weight off.

Last year, the Baltimore, Maryland-based company partnered with Villanova University’s Center for Obesity Prevention and Education (COPE) to provide all interested Health Coaches training and certification through the university’s nursing school.

Co-Founder Dr. Wayne Andersen’s book, Discover Your Optimal Health, hit both the New York Times and Barnes & Noble best-seller lists in 2013, while the company launched Healthy Happy Hours meant to engage people in a healthy living social environment. The single-day events included 900 happy hours and 2,000 community walks.

Take Shape For Life is the coaching division of Medifast Inc. Since 1980, Medifast has developed, manufactured, and marketed portion-controlled, nutritionally balanced meal replacements for weight loss. Medifast products and programs have been recommended by over 20,000 doctors since 1980. Medifast is publicly traded on the New York Stock Exchange.

Take Shape For Life posted revenues of $216 million in 2012, which ranked them 52nd on the Direct Selling News Global 100 in 2013.

Order reprints of Meg Sheetz’s profile here.

TSFL Optimal Health Day Promotes Active Lifestyle

TSFL Optimal Health Day Promotes Active Lifestyle


Take Shape for Life launched its first National Discover Your Optimal Health Day on Thursday, an initiative shaped around the company’s mission to promote healthy eating and exercise habits. The day takes its name from the New York Times bestselling bookDiscover Your Optimal Health, by Take Shape for Life Co-Founder Dr. Wayne Scott Andersen.

In light of the high obesity rates reported among Americans, Take Shape for Life Health Coaches organized a “walk across America,” holding more than 200 community walks to promote an active lifestyle. Over 18,000 participants walked a minimum of one mile as a result of National Discover Your Optimal Health Day. Health Coaches also hosted Healthy Happy Hour events across the country.

“The first steps in changing this nationwide issue include awareness, understanding and taking action. National Discover Your Optimal Health Day allows everyone to come together in order to begin to take positive steps towards making a difference,” said Andersen.

Read the full announcement from Take Shape for Life.

TSFL Co-Founder Authors New York Times Best Seller

Discover Your Optimal Health, a new book by Take Shape for Life Co-Founder Dr. Wayne Scott Andersen, has made its way onto the New York Times Best Sellers list. Following its July release, the diet and weight-loss manual reached the No. 4 spot in the “Advice and How To” category.

The book offers insight into making daily adjustments to reach and maintain a healthy weight. Discover Your Optimal Health is a guide to achieving long-term health, as indicated by the subtitle: “To live better, happier, and healthier into your 80s, 90s, and beyond.”

Dr. Andersen serves as Medical Director of Take Shape for Life and Executive Director of the Health Institute, a training and certification organization in the emerging field of health coaching. According to Dr. Andersen, “Discover Your Optimal Health was written as a tool to inspire people as they begin their health journey, and I’m glad to see so many people respond positively to the book in such a short time.”

The Take Shape for Life co-founder joins other direct selling leaders whose tomes have appeared on the New York Times list, including Nothing to Lose, Everything to Gain by Ryan Blair, CEO of ViSalus, and The Healthy Home by USANA Founder Dr. Myron Wentz and his son, CEO Dave Wentz.

Read the full press release from Take Shape for Life.

The 1 Percent Difference: Direct Sellers Continue to Make Positive Global Impact

by J.M. Emmert


IN THIS ISSUE:

• Cover Story • 10 Things to Know • Line List 
• Topping the Charts • Profiles • Celebration

BRAVO AWARDS: 
• Leadership • Growth • Momentum


Direct Selling News, June 2013

It’s fascinating to consider the numbers: Of the 7 billion people on the planet, a little over 1 percent are direct sellers.

Just 1 percent. At first, that doesn’t sound like much. However, 1 percent actually equals over 91.5 million people worldwide who have embraced the entrepreneurial spirit by choosing to become small-business owners.

Indeed, direct selling—that microcosm of people from all walks of life and from all regions of the globe seeking new opportunities—is having a tremendous impact on the global stage.

What can 1 percent do? Collectively, it can transform millions of lives for the better, effect much-needed social change, safeguard natural resources and stand at the forefront of job creation. And it can do it all amidst challenging economic times and changing consumer attitudes.


Over 91.5 million people worldwide have embraced the entrepreneurial spirit by choosing to become small-business owners.


Impacting the Economy

Challenges always walk hand in hand with opportunities. That is the nature of any business model. And the direct selling industry has certainly faced its share of challenges.

When the global economy began its decline in 2007 there was cause for concern. How would the industry react? Would it remain stable while the economy plummeted to depths not seen since the Great Depression? When U.S. retail sales steadily declined over the four-year period from 2006 to 2009, that concern grew exponentially.

But the industry always seems to reinvent itself. It is that direct selling moxie that always prevails—that spirit and courage and boundless energy—and allows the industry to shake off the threats, pull up its bootstraps and look for new opportunities to help its people succeed.

It is the ability of established companies to embrace change, and the dogged determination of startups that contribute to the continued success of the industry.


Of the Top 10 companies on this year’s DSN Global 100 list, eight reported double-digit dollar growth over the past three years.


Of the Top 10 companies on this year’s DSN Global 100 list, eight reported double-digit dollar growth over the past three years. And if the first quarter of 2013 is any indication, the future looks promising for direct selling. Several top public companies exceeded expectations or set new records for sales growth, including Herbalife (17 percent), Nu Skin (19 percent), Tupperware (3.6 percent), Natura (5.9 percent) and USANA (9.7 percent).

Looking closely at the Global 100 list, there might be something very telling about this industry and the people who comprise it. Seventeen companies with less than 10 years in the business made their way into the DSN Global 100 list for 2012, accounting for $5.3 billion of the $72 billion the listed companies achieved in 2012. Six of those 17 companies are less than 5 years old, proving that economic uncertainty cannot keep the entrepreneurial spirit down.

And that entrepreneurial spirit is what is needed most today. An estimated 200 million people worldwide are without jobs. Last month, the International Labor Organization reported that the youth unemployment rate is expected to climb from 12.4 percent to 12.6 percent, leaving some 73 million between the ages of 15 and 24 out of work.

So where will the jobs come from? According to a recent USA Today interview with the International Monetary Fund, the global organization dedicated to fostering high employment and sustainable economic growth, unleashing creative potential and the enterprising spirit will encourage growth and lead to job creation.

And when looking for companies that show significant growth and provide business opportunities for those millions out of work, look to the direct selling industry.

Greatest Growth Percentage

Impacting Public Perception


Growth companies and not large corporations are where the action is.


When Inc. magazine released its 31st annual Inc. 500|5000 ranking of the nation’s fastest-growing private companies for 2012, it noted that, “Now, more than ever, we depend on [these] companies to spur innovation, provide jobs and drive the economy forward.” Growth companies and not large corporations, the magazine noted, are where the action is.

The Inc. ranking, which offered a comprehensive look at America’s independent entrepreneurs with substantial sales growth, included several direct selling companies: Stella & Dot (No. 57), J. Hilburn (No. 221), Scentsy (No. 516), It Works! Global (No. 662), YOR Health (No. 1220), Ambit Energy (No. 1305), Initials Inc. (No. 1555), 5LINX Enterprises (No. 2900) and Isagenix International (No. 4951).

The success of such companies is just the tip of the iceberg for an industry focused on changing public perception of the direct sales channel of distribution. The Yankee peddler image that has pervaded the consumer consciousness for more than a century is slowly giving way to a new view of direct sellers.

Today, several direct selling companies stand with the giants in the corporate world. Berkshire Hathaway, parent company of direct sellers The Pampered Chef, Kirby and World Book, ranked fifth on the Fortune 500 list of America’s largest companies. Medifast Inc. (Take Shape for Life) was ranked at No. 10 on Forbes’ list of the Best Small Companies in America.

Tupperware was ranked No. 2 in the Home Equipment category for the World’s Most Admired Companies by Fortune. And Ambit Energy and Primerica were both recognized on the 2012 Information Week 500 list of Top Technology Innovators, an annual listing of the nation’s most innovative users of business technology.

Global Direct Sellers

Impacting Small-Business Owners

Over a century ago, Walker Agents, Fuller Brush salesmen and Southwestern representatives were among the direct sellers aided by a new invention that made it easier to reach customers: the telephone. Today, the innovative use of social media and mobile devices by technology-savvy direct selling companies has allowed would-be entrepreneurs to reap the benefits by staying closely connected to consumers.


What remains the greatest advantage is that direct selling is an environment in which all people have an equal right to success.


But technology is just one of the advantages for those testing the entrepreneurial waters in direct selling. What remains the greatest advantage is that direct selling is an environment in which all people have an equal right to success. Age, gender, religion, education or financial resources do not limit the opportunities.

For those individuals willing to put in time and energy, direct selling truly has significant earning potential. However, people get involved in direct selling opportunities for a variety of reasons, from making a car payment or paying off a debt to making a career change or building a large business. Some become direct sellers in order to purchase products or services they love at a discount. Certainly, being one’s own best customer has advantages.

And the industry—one about people and for people—makes the transition to owning a business easier. There are fewer barriers to entry, with most initial investments less than a few hundred dollars, and ongoing support is provided by their companies.

That support includes training in business skills as well as opportunities for personal development and coaching, which are unequalled in other industries.

The industry also empowers entrepreneurs to use their businesses to make a difference in the lives of others. Many direct sellers are drawn by a company’s corporate social responsibility initiatives. Direct selling, recognized as one of most charitable industries, comprises companies that have been founded on the principle of giving back to others.

In addition, many companies are focused on conservation, helping to create a sustainable environment. São-Paolo, Brazil-based Natura, the No. 5 direct seller in the world, was recently ranked the second most sustainable company on the planet by Canadian research firm Corporate Knights. Companies such as Viridian Energy, which is committed to renewable energy, and Momentis, which instituted a green energy initiative to help consumers offset their carbon footprint, are among the direct sellers striving to save natural resources.


Consumer Goods and Services Offered through Direct Selling


Impacting Consumers


Today a company is measured by its products or services as well as its behavior and respect for the community.


In today’s socially responsible culture, a commitment to others is not only a prerequisite of small-business owners, but also consumers. Today a company is measured by its products or services as well as its behavior and respect for the community.

Today’s consumers want to know the company behind the product—how it behaves and if it respects the environment. They want to feel that when they make a purchase, their money is working to help others, benefiting charities and organizations.

This change in consumer behavior—how and why people are deciding to buy—is changing consumer-supplier relationships. But what has not changed is the industry’s focus on providing quality products and services that enhance people’s lives.

Direct selling companies offer a wide variety of consumer goods, from cosmetics and wellness products to telecommunications and insurance. The most common sales method remains person-to-person, which accounts for 70 percent of sales. (The party plan method accounts for 35 percent.) According to the U.S. Direct Selling Association, 74 percent of Americans have purchased products from a direct seller.

The industry is intent on self-policing and protecting consumers by voluntarily following a strict Code of Ethics, set forth by national direct selling associations and overseen by the World Federation of Direct Selling Associations, which since 1978 has pursued the highest level of ethical conduct in the global marketplace.

If the $160 billion in global 2012 sales across the world is any indication, direct selling will continue to flourish. In fact, many companies are expanding their operations into both developed and emerging markets. Last month Amway announced plans to invest $20 million in a second manufacturing site in Vietnam. Nu Skin is expanding its operations in China, which it expects will top $1 billion in sales for 2013.


If the $160 billion in global 2012 sales across the world is any indication, direct selling will continue to flourish.


LifeVantage and Mannatech are launching in Hong Kong; Neways and Stemtech are venturing into Thailand. Jeunesse Global is opening operations in Australia and New Zealand. And Oriflame, the No. 9 direct seller, is expanding into India.


Top 10 Direct Selling Regions


A 100 Percent Difference

Whether the 91.5 million people around the globe who call themselves direct sellers have been attracted to the industry by the products or the business opportunity, one thing is clear: Direct selling empowers them to better themselves, their families and their communities.

This small minority is helping people enjoy the benefits of world-class products and services, live free from debt, join in the efforts to save the environment and reach out to those in need.

It’s clear that just 1 percent can make a 100 percent difference.


Participation in the DSN Global 100 Ranking

Direct Selling News will again host the DSN Global 100 Celebration in April 2014, based on each company’s 2013 performance. If you believe your company would qualify for the Global 100 ranking and you would like to be notified when research begins this December, please send an email with your complete contact information (name, title, company name and phone number) to editor@directsellingnews.com.

Direct Selling and Decision Making: Listening to Your Field Leaders

by Barbara Seale

Direct Selling and Decision Making

It’s a spin on the well-known commercial. Sales? Can’t do without ’em. Recruiting? It’s the future of the business. Informed, experienced opinions? Priceless.

Company executives regularly turn to field leaders for insights on a variety of topics, ranging from promotions and incentives to marketing, and, of course, compensation.

“Team National has been using field leadership committees since our inception,” recalls Angela Loehr Chrysler, President and CEO of National Companies. “My father, our founder, was always passionate about that. We value them as business partners and use them in pretty much every aspect of our business. There are very few decisions we make that don’t affect our sales field.”

The moniker “Team National” actually grew from the company’s beliefs and management style that embrace not just corporate employees but distributors as part of the whole team. Almost 200 field leaders—typically couples who form a distributorship—formally participate in advisory councils.

Direct Selling and Decision Making Listening to Your Field Leaders

Experienced Advice

MonaVie solicits the opinions of a small, rotating group of its Black Diamond distributors and above during conference calls that take place about every six weeks.

“Some of our best ideas come from leaders in the field,” says MonaVie Founder, Chairman and CEO Dallin Larsen. “I like to say that no major decision regarding the company’s direction is made without consulting with our District Advisory Board.” Larsen purposely keeps the group at around 10 members to ensure that everyone is heard. And he chooses the board’s members carefully. “I want to surround myself with people who have been through the various seasons of network marketing so they can bring differing perspectives and sound advice to the table.”

Top executives are often directly involved with the field-leadership discussions. Particularly for an international company, that can translate into long hours.“It’s a time zone challenge to have conferences with leaders from all over the world, but I’m personally involved as often as I can be,” says Greg Provenzano, President & Co-Founder of telecommunications direct seller ACN, which operates in 20 countries spanning  North America, Europe, Australia and New Zealand. Provenzano includes about 25 top producers in the group called the Circle of Champions, which has biweekly interactive phone calls. “That helps me keep the pulse of the organization and get real-time feedback so we don’t have to wait for market conditions to change before we’re alerted. It’s important to interact as often as we can without taking up too much time for either them or us.”

International company Tahitian Noni has established President’s Councils in each of its international regions—North America, Japan, Southeast Asia and Europe. Each council consists of between four and 12 distributorships. The company plans to create an additional council for South America in 2010.

“Normally, the members of our President’s team are selected from our top leaders and highest titles,” explains Daniel Hillstrom, Managing Director, U.S. Sales. “Depending on the maturity and size of the market, we will select the fastest- growing and -producing distributors. The councils are made up of the most active and growing leaders.” Each council has monthly conference calls, plus informal conversations with individual members.

Take Shape for Life CEO Michael McDevitt says that the company works hard to create a single, unified management system that includes both the field and corporate support organizations. It has a council of field leaders that comes to TSFL’s offices for two days four times a year to focus on field and corporate issues. In addition, every other week, an executive meeting gathers field and corporate leaders together by phone or in person.

“With this system, there’s really just a central flow of leadership, prioritization and culture,” McDevitt notes. “That’s allowed us to really have a level of alignment that is extremely powerful.”

Direct Selling and Decision Making Listening to Your Field Leaders

Quantity and Quality Time

At candle-maker Gold Canyon, some 15 top demonstrators participate in a monthly teleconference as well as one-on-one discussions during the month. Company President Curt Waisath makes a point of spending an hour a month with each leader, as well. Chief Marketing Officer Michael Norris says that the relaxed discussions provide the company with a lot of good information from the perspective of top leaders. But the company makes a point of also sampling distributors at lower levels of the organization.

“We don’t believe that only one forum is a good enough way for you to get a true understanding of what’s happening in the field,” he says. “When we’re bouncing around ideas for promotions, we have to expand the discussion to other groups, not only leadership. That gives you a better perspective before a launch.”

Gold Canyon values demonstrator input so much that it even devotes an entire day of its convention to focus groups. While the groups focus primarily on products, other topics are included in the discussion, too. Any distributor attending the convention can sign up to be in one of the groups, which are limited to about 20 people each.

“They provide a lot of guidance about what we should be doing in the future,” Norris says. “We can probe them about ideas we’re having, and they provide feedback.”

Gold Canyon has considered starting a marketing steering committee of demonstrators, but it hasn’t resolved how to keep such a committee’s perspective fresh.

“If you rotate too much, you don’t have continuity,” Norris notes. “If you don’t rotate, you get stale.”

“I want to surround myself with people who have been through the various seasons of network marketing so they can bring differing perspectives and sound advice to the table.”
—Dallin Larsen, Founder, MonaVie

Balancing Membership

National Companies has solved the rotation issue by basing council participation on distributor achievement, making it a form of recognition. When a distributor reaches Platinum level—which is based on business building—the distributorship automatically becomes part of the company’s Chairman’s Circle. Double Platinums make up the President’s Advisory Council.

“That has served us well because both committees are ever growing,” Loehr Chrysler says. “Without taking anything away from anyone, we’re always adding fresh blood and participants.”

The exception to that rule is the Executive Committee, which is made up of four couples and one individual, who are all chosen by the company’s top executive.

“The same folks my dad chose are still on the committee today. We haven’t changed or rotated the committee, though we have thought about the idea,” Loehr Chrysler says. “I literally took several weeks to review the idea and to discuss it with various leaders. I came full circle. Because the dynamics of that committee work so well, and because each individual was chosen because of their different locations, backgrounds and ages, each provides a different perspective. They have relationships and work well together. If we rotated membership, it would change the dynamic until we got back to our comfort level.”

Tahitian Noni blends rotation with committee tenure. It rotates memberships each year to ensure that the company is keeping a diverse and broad representation of its field leadership, but it asks some people to serve on its advisory council for multiple years. And its communications channels extend beyond councils.

“As a global and large organization, our local and regional managers all have key influencer groups that they work with on a regular basis to get input from the field,” Hillstrom notes. “We also have a Web site where any distributor can submit questions, suggestions or feedback directly to the president of our company.”

Members of Take Shape for Life’s leadership council serve for a two-year rotation, which begins after a “trial meeting” that introduces distributors to the process. They’ve found that the period lets distributors get their feet wet and understand how the council works so that they can provide meaningful feedback and be involved with the execution of plans during their term. TSFL believes that the relatively short period helps keep ideas fresh while not taking distributors away from their businesses for too long.

A key element of the TSFL communication process is a field-led organization called Team Global, made up of elected distributors who have achieved the second-to-highest rank in its organization. Among its responsibilities is keeping a pulse on the overall business and identifying rising stars. When the group gets together with corporate executives quarterly, they bring concerns that have been raised in their downlines.

“Definitely, it’s an expense to the business,” McDevitt says, “but it’s one that’s shown to have a return on investment that has been significant, both in the ability to have better flow of communication and better speed of the execution in the business. Now we have just so much more trust among the corporation and the field.”

Distilling Advice

MonaVie also makes sure its process enables distributors from around the globe to participate.

“We try to empower our general managers in international markets,” Larsen says. “Each has their own district advisory board made up of people they trust in their local market. Then I invite the GMs to listen in on my district advisory board of director calls. They provide the advice they’re getting from their boards. North America and each market have district advisory boards that deal with issues germane to those markets.”

Larsen leaves his options open for changing the membership of the councils.

“Every year, I’ll look at it and ask myself, Am I comfortable with the board? Is it serving the greater good of the company and distributors? More often than not, they’re one and the same. You want to make sure you have good, sound people there.” Larsen notes that the council engages in healthy debate, not always agreeing. But, in the end, the buck stops with him. “I can think of some times when we’ve been at an impasse and haven’t had complete agreement, but I’ve made a final decision. I can’t think of a time when the board hasn’t backed me up.”

The effectiveness of each council in influencing company decision making, and the rapport between the leaders and executives, boils down to a single factor: trust.ACN makes eligibility for membership in its Circle of Champions an earned position based on production, but the final choices are at the discretion of the company’s co-founders.

“We as co-founders look at each individual, making sure they’re operating their business with integrity,” Provenzano says. “The members of the Circle of Champions are an extension of the co-founders.”

Relationships Built on Trust

In the end, the effectiveness of each council in influencing company decision making and the rapport between the leaders and executives boils down to a single factor: trust.

“Because we interact so often and have such great rapport with our leaders, if there came a time when we had to make a difficult decision, they would understand our heart as a company, and that goes a long way,” Provenzano says. “This is a  relationship business at every level. If relationships are broken, whether from executives to leaders, or from leaders to the people in the field, or between the people in the field to their prospects, it just doesn’t work.”

Distributor leaders affect decision making in a wide variety of important ways that contribute to the company’s bottom line and also reflect its heart.

Gold Canyon recently revamped its Web site and its online shopping cart, thanks to field feedback. Leaders had reported that customers who tried to shop directly from the Web site were encountering problems.

“We got feedback saying that it was difficult for someone who isn’t a demonstrator to actually shop through the Web site,” Norris explains. “Within six months, we gave them a brand- new Web site and shopping cart. Their feedback has been very positive since then.”

Key Issue: Compensation

The most frequently mentioned business decision that distributors impact is compensation. Their input influences everything from monthly promotions and incentives to the structure of the plan itself. MonaVie recently changed the structure of its compensation plan based on distributor comments, reducing the number of legs that distributorships were required to build and actually making the business easier to build.

Tahitian Noni used distributor advice to make a major addition to its compensation plan, and then its advisory councils worked hand in hand with the company to roll out the program and train distributors on it.

Gold Canyon’s Norris emphasizes that when companies solicit and receive feedback, they’re wise to act on it or to make a point of explaining why they don’t implement a recommendation. Otherwise, they lose distributor trust.

MonaVie’s Larsen agrees, and he emphasizes that the relationship between the company and field leaders is a partnership.

“The degree to which you can build a partnership with leadership will be the degree to which a company can grow,” he says. “It’s about building trust that decisions are not made behind closed doors. Distributors know that they can only do so much. They can show the product and present the opportunity in an exceptional manner. But a certain amount of the future is out of their hands. That’s entrusted to the corporate office and its management. So it’s important that we listen to distributors.”

TSFL’s McDevitt also concurs, suggesting that his company’s current growth is a direct result of the close working relationship between corporate and field leaders. The company’s two-day sessions are punctuated by fun as well as business.

“We’re working hard for eight hours a day, but at the same time, we’ve got such a great culture among our corporate and field together that we have a lot of fun,” he says. “When the day is over, we get out, we go to dinner, we catch up, we hear about each other’s families and friends. We’re still lucky enough that although we are a growing business, we try to operate culturally as a small business, and we’ve been able to do that.”

Distributor advice is so important to company decision making that top executives often devote hours each week to it. National Companies’ Chrysler is so sold on getting field leader counsel that she participates in every advisory panel and makes a point of meeting distributors and soliciting their opinion at every opportunity.

“You can manage your time well enough that you can make a few phone calls.” She adds, “There is never a downside to running something past a committee and getting their input on how to handle something. It’s part of the process and part of getting their buy-in. Distributor advice goes hand in hand with growth. If they feel valued, a part of the team, then they’ll grow their business faster, which grows the bottom line faster. But you have to know that it’s going to take time. As an executive, you must delegate other aspects of what you can do, knowing that you can’t delegate building relationships with the sales field.”

In the Beginning . . .

If distributor input is important to an established company, just imagine how critical it has to be as a new company is getting off the ground.

Direct Selling News spoke with executives from three young companies who all said that distributor counsel was essential to their early success. Moreover, it started even before the company launched.

Although he had some 15 years of experience in direct selling, Ambit Energy Chief Marketing Officer Chris Chambless didn’t hesitate to solicit advice from the company’s early-adopter distributors.

“I definitely had a couple of my friends who joined me whose skills and opinions I respect. I spent a lot of time talking with them as we were developing the compensation plan and business presentation,” Chambless says. “One of the things about starting a business from scratch—the number of people you have to draw from is very small. Brian McClure, who is one of our founding national consultants, joined us very early on. He was a person I relied on to bounce ideas and strategy off of.” He adds, “A business has to reflect the personality of its founders but also its field leaders. If you don’t do that, then you limit your success. You have to be able to allow field leaders to tell the story that they’re part of.”

Even something as foundational as the company’s compensation plan demanded the distributor touch, Chambless believed. When it was being developed in 2006, Ambit’s plan was based on the comp plan he helped develop at a different company. As a field leader from that same company, McClure had experience with the plan.

“We spent a lot of time trying to decide the requirements that were good for the company and also allowed people to achieve pin levels,” he recalls. “Ultimately, that’s been a key factor in our success. Thirty percent of people who join our business achieve that first pin level. That’s off the charts compared to what it was at my previous company. It’s been a differentiator for the number who stick to their business. We keep a lot of people because we made some good decisions early on.”

At less than a year old, wellness company EIRO Research is off to a fast start, thanks in part to the early advice of its field leaders. Even before its “pre-launch,” distributors were active on the ground floor. They were involved in the design of the compensation plan and business presentation, as well as marketing materials.

EIRO CEO Chris Hausman recognized that while his strong business background was a plus, he lacked experience in network marketing. So he brought in key field leaders and other experienced direct selling industry executives.

“Essentially, our feeling is that the best thing we can do to design a compensation plan or set up a promotion is to get out of the way and let key field leaders and experienced people handle it,” he says. “We want experts designing them, specifically to support the field. [CFO] Joe [O’Connor] and I understand that in direct selling, it is critical that the corporate office be aligned behind the field and associates. There are two types of corporate mentalities. One sees the sales team as being there to support the home office. The other is where the corporate office is there to support the sales team. We’re the latter.”

He noted that the philosophy has already proven itself. When EIRO’s management designed a promotion and then introduced it to the field, it fell flat.

“We went back, consulted with our field leadership, redesigned the promotion, and it took off,” Hausman says. “That perfectly illustrates that field leaders know what kind of promotions and activities will drive the right behavior and support the field overall.”

Four-year-old ViSalus had an even more dramatic experience. Its top distributors rotate through what the company calls Mastermind Sessions, which meet for a full day about once a month. As many as 20 distributors who are top producers, loyal to the company’s mission and who bring perspective and good input, are invited to participate. During the dialog at several Mastermind Sessions, distributors and executives kicked around the idea of doing a weight-loss challenge that featured a money-back guarantee. Over time, the concept evolved into the strategy, message and marketing that backs up Body by Vi.

“Our entire company strategy and message shifted because of what started out as an idea that evolved,” says ViSalus Chief Marketing Officer Blake Mallen. “Ever since the launch of the challenge, our growth has been through the roof. We launched the challenge in July, and our business has grown in all categories ever since then.”

 

Original Story Published: December 01, 2009