Direct Selling

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Direct Selling

Direct Selling is a dynamic, vibrant, rapidly expanding channel of distribution for marketing products and services directly to the end users. It involves marketing of products and services directly to consumers in a person-to-person manner, away from permanent retail locations.

In other words, Direct selling can best be described as the marketing of products and services directly to consumers in a face to face manner, generally in their homes or the homes of others, at their workplace and other places away from permanent retail locations.

It typically occurs through explanation or personal demonstration by an independent direct sales person. These sales persons are commonly referred to as direct sellers or Network Marketers.

Direct Selling is the sales industry's umbrella term for personal sales methods that include Multi Level Marketing (MLM), Network Marketing, Referral Marketing, Relationship Marketing and even the Home Based Business.

In fact Direct Selling goes much beyond marketing of a products or a service of a particular company to customers. Instead it requires a person to recruit more people (who would consume their products for self-use as well as sell it to others) and to lead them through continuos education, training and motivation.

Direct Selling has proven to be a highly successful and effective method of distributing products and services directly to consumers over many years, which compensates an independent distributor through commission.

In Direct Selling a distributor receives commission on multi levels i.e. from his direct sales and from the sales generated by his direct sales called the team sales. The most successful person in such a business model has several layers of distributors working below him, each layer earning money for the layers above.

During the initial stages of this industry evolution in the beginning of the 19th century in the USA, almost every business model offered a compensation program that had multi levels from where one would receive sales commission or sales incentives. Hence the industry was initially referred to as Multi Level Marketing.

Due to American's craze for shorter versions, MLM, the abbreviation of Multi Level Marketing became a more popular term.

Unfortunately, since a series of financial scams, frauds, and Ponzi schemes devastated the image of the industry during 1920s and 1930s, associating with a MLM company was becoming a thing of the past.

But as all things sail through the lean patch, MLM too passed the test of the time. Sensible entrepreneurs, those, who had understood the potential of the industry, were committed to revive it to help it regain its past glory.

Old wine in the same bottle though the industry was re-christened as Network Marketing Industry, which was later upgraded to Network Distribution.

After the landmark victory of Amway, the grandfather of Network Marketing, the industry was referred to as the Direct Selling industry and many progressive countries went on to establish National DSAs (Direct Selling Associations) with self-regulations in order to safeguard and nurture the industry.

Today, direct selling industry has evolved and developed into a wide array of companies, product ranges compensation plans and cultures.

This unique, powerful system of free enterprise continues to grow attracting more and more people towards it. As we are in the 21st century, direct selling has never been so well respected, so healthy, so attractive or so rewarding.

Wall Street Journal sings of its glory and Fortune 500 companies are embracing direct selling to sell their products directly to end users. It is now an industry that has crossed an annual turnover of 100 Billion US$. People form independent sales organizations, where sales people themselves, rather than the company, hire, train and manage their own sales force.

In essence, each person has the opportunity to build his or her own sales organization with the company providing products and paying handsome commission cheques.

In the United States of America, which is leading this industry, one of every three American is believed to purchase products through independent distributors. Similar is the case with most of the advanced countries of Europe and the rest of the world.

It is only natural that based on these trends and consumer behavior elsewhere in the world, Indian consumers too are inclined to follow suit. A burgeoning economy and an even faster growing middle-class population with an increased disposable income, the Indian consumer is finally come of age discerning taste, the demand for quality and value for money.

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