We at S4DS have identified some variables that must be taken into account when creating or enhancing the direct sales channel in your company.
These are fundamental aspects that must be met specifically for current direct sales, since many factors and many trends have changed.
FUNDAMENTAL ASPECTS IN DIRECT SELLING
It is important to identify the profile of the person to whom we want to sell, there must be a properly identified prototype to be able to address this “buyer person” in the right way with the right products and by the appropriate means.
It is the task of each company to do this research and create a fictitious human, with which they can visualize all the strategies of reach, attraction and subsequent loyalty.
It is important to know what are the factors that motivate the end customer to keep him captivated
Motivadores in direct sale for the final client:
- Product: must be innovative, have an added value.
- Story: The end customer must also have a reason to commit and become loyal to the brand, it is not enough to have a taste for the product
- Convenience: It goes hand in hand with omnichannel, get the product easy and through different means in addition to having immediate logistics so the end customer will have their product in an effective way.
- Relationship: Show that it is a consultative sales model; the consultancies and the influence / consultant relationship with the final client is constant.
Engage vendors with a cause
- There must be a story behind the products (storytelling)
- Possess a differentiator / added value.
- That captivates and achieves a scalable model.
- Motivation goes beyond money.
- The story should be addressed to both the consultant and the buyer
The influencers and consultants of the company must be motivated and updated with relevant contents such as:
- Motivation of the network
- Product Information
- Company information
- Articles about Sales
- How to use social networks for sales
In this way they will be able to learn about the news of the company, the product and share the information to their entire network, which will benefit their communication, interaction and knowledge.
On the other hand, the influencers will have this factory at their disposal to motivate all their followers and reach more audiences.
In addition each influencer must be passionate and be active in social networks in order to give sufficient visibility to the products that the company promotes through them.
The company can provide content but the influencers must be motivated to produce content on their own and keep their followers participating and interacting with the influencers and therefore with the brand.
- Differentiator Product
- Consultative sale
- It should be an aspirational and differentiating product in order for influencers have emotion and conviction to offer them in their social networks, this will also help to make loyal and motivated clients.
- The products that require advice are key for the consultant and for the final customer, thus generating added value throughout the purchase process. The consultative sale is totally aligned with the trend of influenced marketing.
- Being a product that needs to be sold through consultants, distributors or influencers, it is necessary to have a relatively high margin since this person normally receives from 10% to 50% and must be attractive above other companies that can offer a higher margin.
- It must be a product that has re-purchase, a product that is purchased once a year may not be as profitable for a distributor and may lose its spirit in the sales process.
- It should allow cross-selling to increase the value of the ticket each time the customer makes a purchase, that is, that there are complementary products to create cross-selling strategies.
- Direct selling has always allowed consultants to manage their time, their income and their lives in general.
- Show Direct Selling as a channel that allows you to lead life in a more calm and controlled way
- The consultant or influencer will always have the money as the main motivator or at least within their top 3.
- It is important to analyze the margins that the company is able to provide to the consultant.
- Most direct sales companies offer from 10% to 50% commission.
- Gifts, prizes and other offers are also essential to motivate the consultant to remain active in direct sales.
- To motivate your sales force, it is necessary to constantly acknowledge the achievements of the distributors,
- Creating plans and ways to recognize the work well done to your salespeople is essential to keep them active.
- Setting goals for each of them and recognizing them with different benefits will help create a successful direct sales model.
- Around 30% and 35% of people involved in direct sales remain in the industry because they like to interact and increase their social circle.
- This channel is a place to generate sales and be economically independent
- Creating friendships, being in contact and constantly sharing is a fundamental pillar in direct sales.
- Intermediation margin
- Emotional elements
A compensation plan represents from 50% of the contribution margin of the product:
Depending on each type of business model and each company this can varies, some companies have less margin to give great commissions but are able to give offers and rewards that are perceived with more value than a high self commission.
Commissions and Intermediation Margin
Commissions must be clear to the consultants from the beginning, a good percentage (10% to 50%) for them is an initial incentive combined with the other remunerations.
Higher commissions when reaching certain sales levels (if the margin allows it).
- Value perceived by the client: sometimes companies give a lower percentage to their representatives but offer gifts and additional offers that the consultant perceives with greater value than a high percentage.
- This strategy can be even more profitable for companies because they deliver gifts that have greater value for the customer but are actually less expensive for the company.
- These awards influence the decision to join the company and continue to strengthen and motivate people.
- Gifts of the brand or discounts (usually the distributor sells the product because he likes the product he sells and wants to have it).
- This category includes those motivation strategies for the entire sales force. They can be incentives for achievements, sales or simply as loyalty.
- Trips (analyze what motivates the sellers).
- Meetings, events and festivals: make all the representatives feel part of a team and feel that they are part of a common cause.
- Optimize programs such as the first 90 days of the distributors (if a distributor manages to reach his goals during these first days, it is possible that he continues to make a career in direct sales).
The key processes are mentioned below:
Order to Cash
- Reception of the order
- Flexibility means payment: Offer different methods of payment for clients, cash, credit, debit, paypal, different cards, consignment, bank transfers.
Cash to deliver
- Inventories: On the part of the company, do not allow the consultants to have inventory.
- Preparation of the order: Controlled by the company.
- Delivery logistic: It should work as in a traditional e-commerce, the product is delivered directly to the final consumer and not to the consultant, doing this in this way costs and delivery times are reduced.
- Customer service
* The concept is just in time, in minutes the order is received and processed, the delivery must happen from one day to the next
It is possible that if you follow these recommendations you will have a successful model in direct sales. Our software as a service has all the functionalities that will allow you to carry them out.