Roundtable: Direct message from the direct sales industry

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August 23, 2017 (From left) Jeanette Bennett, BusinessQ Magazine; Greg Darlington, Nu Skin;
Justin Prince, Modere; Jarom Dastrup, Zija; Jake Hadlock, Tavala; McKinley Oswald, Sound Concepts. (Photo by Dave Blackhurst/UVBizQ)

Utah Valley is the direct sales’ global upline, and these 5 are putting work in network marketing. Werk!

Jeanette Bennett, BusinessQ: In the past decade, what have been the biggest shifts in the direct sales industry?

Jake Hadlock, Tavala: For Tavala, the biggest change has been the customer component. A lot of network marketing companies have had to change the way they interact with customers. For us, we were able to focus on that and create a strategy from our founding. If you were starting a company 10 years ago, you wouldn’t have thought, “How does a retail customer fit into what we do?” But we start with today’s consumer in mind.

Jarom Dastrup, Zija International: In the past decade, the biggest change has been the evolution of technology. Ten years ago, we were still learning how to implement technology in business. I’ve watched companies learn and adapt and implement technology efficiently to build, to keep the opportunity real, and to manage attrition. I agree with customer acquisition. If you have a solid story and science behind your products, then it should be easy to go out, share it and have someone experience the product. The training comes afterwards, and technology is a huge part of that. The reach you have and the amount of information someone can watch or participate in gives them a better chance to succeed.

Greg Darlington, Nu Skin: Social selling has changed the opportunity for our business and also added customers. It has allowed us to transform. Network marketing was the original “gig economy,” or side job, but that was 25 years ago. Now with social selling, everyone can create a little space to share a demonstrable product.

Having a seller from out of state come see the manufacturer’s headquarters helps build the seller’s belief in the company. Now their business that previously just came in a box is something more as she experiences it in person. – McKinley Oswald, Sound Concepts

Justin Prince, Modere: You used to hear the promises in network selling of “You can have a Ferrari. You can live in a yacht in the Mediterranean.” That hasn’t gone away, but we don’t talk about it as much as we used to. It’s more about helping others. Opportunity meetings used to be all about the grandeur of what it could be. That doesn’t resonate now. There is authenticity now, and social has done this. You have to be more transparent. You can’t sell this dream of the wealth you can accumulate five years from now. You need to show them how to make a dollar today.

McKinley Oswald, Sound Concepts: Social tools are huge. Distributors are running their businesses from their phone, for example sharing a video and then getting a notification that someone is watching it. The tools still exist for a distributor, but it is a different set of tools. It’s a totally different economy.

Bennett, BusinessQ: What are the current trends in the industry?

Darlington, Nu Skin: Recently we’ve seen a lot of traction on products any consumer can purchase. At Nu Skin, we like the premium products as anchors to provide value to our product line, but our current strategies include focusing on products in the $25-$50 range. We focus on demonstrable products.

Oswald, Sound Concepts: Customers now aren’t looking for a product that may work. They want it to work right now.

Darlington, Nu Skin: It’s the same with the payout. They want a business product that can yield results pretty quick.

Oswald, Sound Concepts: They want to see a change immediately —whether that’s in using the product and improving how they feel, or as it pertains to the business opportunity.

Prince, Modere: Our biggest competitor in this space is not one another. Our biggest competitor is Amazon. The world is changing. You have to provide more value now. You have to justify the value to alter where people do their shopping. I’ll ask my friends, “Do you guys remember the mall? The place we used to go when Amazon was a river?”

“The savvy network marketer is a digital marketer now. They are building landing pages, building lead capture and using AdWords. The social selling part of it is huge.” – Jake Hadlock, Tavala

Dastrup, Zija International: Cultures are beginning to grow with these new concepts and the personal care items that are $20-$30. Moms are being introduced to the product by a girlfriend from the gym. At Zija, we are tapping into the mommy culture. Our ultimate anchor is the customers.

Hadlock, Tavala: The savvy network marketer is a digital marketer now. They are building landing pages, building lead capture and using AdWords. The social selling part of it is huge. They will post their “before and afters.” With any project that is readily demonstrable, they can get on Facebook Live and sell clothes or show how their lipstick doesn’t wipe off. Those are impactful because you’re showing the proof of concept right in front of the people. It makes them put themselves in that situation.

Prince, Modere: Personal branding has changed a lot. Ten or 20 years ago, there were networkers who were building their own personal brand. Now they have their own hashtags. They are doing Facebook Live, and they’re a “somebody” now. These are normal people building their own little brand of celebrity. It’s very powerful. They become authorities in their marketplace.

Darlington, Nu Skin: For Nu Skin, we’ve traditionally created ourselves as a brand, and that has been our focus. But now Nu Skin is a platform. Instead of it being about a big company, Nu Skin is about each person. Nu Skin is a platform for individual success, and it’s wonderful!

Bennett, BusinessQ: Are there concerns that your brand becomes less consistent over many personal brands?

Greg Darlington, Nu Skin

Darlington, Nu Skin: For us, it’s more power to that individual. It takes a little bit more work on our end to manage, but we’re happy to have that individual be the star. That’s what it’s really about anyways.

Oswald, Sound Concepts: The best stars are created by the rock solid brands behind them. When someone creates their own brand and they start succeeding, they need a strong foundation backing them or they will go somewhere else. The bedrock of a solid company drives people forward.

Prince, Modere: With personal brands comes compliance risk. Distributors sometimes think they can say anything, but they can’t. There’s also a risk of people creating a following and then leaving the network and going to someone else’s network. But there are ways to mitigate those risks.

Dastrup, Zija International: I’m a team player for the industry. I believe in the industry. I believe in what we do. I view it as if we are the NFL. We are all teams, and we are all competitive and want to win. The minute we stop respecting the rules of the game and each other, there’s foul play and then it gets messy and dirty. That’s when we start having problems. Here’s a question for all of you: How do we as leaders in the industry continue to keep the boundaries fair and equitable and allow opportunities for people, without distorting the name of multi-level marketing?

Prince, Modere: That’s a hard one, but if we provide a good enough opportunity, they will stick with us. In networking, we get more recognition and more edification than other industries. If someone leaves my network, I look internally first to see what the reasons might have been. I’ve even called them and said, “Good luck on your next opportunity. Thanks for your hard work. What could we have done better for you that would have enabled you to stick with us?”

“We have a call center close to BYU and UVU. We have tried to move it out of state or to another country, but if you want to have a good person who is happy and loves their job, Utah is the place … We get a great value in a Utah Valley person compared to anywhere else. They are entrepreneurial, happy, willing to work and positive.” — Greg Darlington, Nu Skin

Dastrup, Zija International: I tell my employees all the time, “I want to build you, mold you and refine you. The best compliment to me is having a competitor coming after you. If that’s what is best for you and your family, we are so grateful you spent part of your journey with us. But if you do leave, don’t use proprietary information. Continue to do what you’ve been doing here that has created value that has attracted you to another company.”

Oswald, Sound Concepts: Reiterating Justin’s point, I think Nu Skin, Zija, Modere and Tavala are great examples. You’ve had big-name distributors leave. But at the end of the day, you guys succeed and continue to grow regardless. You provide value, and that brand has given people the foundation they’ve learned from and then they take with them.

Bennett, BusinessQ: What is it about Utah that makes it a great place to create and build direct sales companies?

Prince, Modere: We have a reputation. There are other networks in other places, but there are a ton here. The reasons? First, Utah tends to lean more Republican, which leans toward openness to natural products, free enterprise and capitalism. Also, Mormon influence is a big thing. For example, if I served a mission in Japan, and a company has a call center opening that needs Japanese, I can do it.

Darlington, Nu Skin: That’s funny. The first job I had was at call center, and I speak Chinese. (everyone laughs)

Prince, Modere: People say it’s hard to build here, but I think every city is the hardest one in the world to build in. Some big networkers have grown up here. Nu Skin is a great example. Our business wouldn’t be our business without the influence of Nu Skin.

Darlington, Nu Skin: It’s wonderful for companies to have had Nu Skin influences in every tier of the social or business strategy. Utah Valley provides the highest quality. For example, people in college need a call center job. We have a call center close to BYU and UVU. We have tried to move it out of state or to another country, but if you want to have a good person who is happy and loves their job, Utah is the place. Moving up to the middle tier, we get a great value in a Utah Valley person compared to anywhere else. They are entrepreneurial, happy, willing to work and positive.

Bennett, BusinessQ: Would you describe your industry as competitive or collaborative?

Justin Price, Modere

Dastrup, Zija International: I believe there is unity. My personal theory is when the technology advancement of 2000 happened and all the money was made in the marketplace, it was easy to take anything and open it up online and shove a product down the pipeline. It distorted what it was all about, which is growing people and providing good products. Even four years ago, it was a blood bath. Companies were desperate to grow, and they forgot the morals, respect and rules of the game. Now, some regulations have come out and we are being more proactive. We’re saying, “Hey guys, if we don’t follow these rules, we’re all done.” Together we need an abundance mindset. There are more people to reach out to than we could shake a stick at for the rest of our lives. There will be people who will come and go. But we can’t distort the rules. Utah is competitive because we are an opportunist culture. We are really good about dreaming big. I see the direct sales industry closing in a little bit. The ones that are standing right now are trying to work together and create a good name and a solid opportunity.

Bennett, BusinessQ: Is Utah County a great place to have your company’s big annual events? What do you love about bringing your global teams here?

Darlington, Nu Skin: We’ve tried other places. We always feel bringing them to Utah is a good thing. They find it’s such a unique environment here.

Dastrup, Zija International: The first thing people talk about every time they come is, “I flew in and saw those mountains!”

Prince, Modere: I was at a leadership retreat this weekend in Missouri. Most of the people there were from Kansas City. Every one of them said they wanted us to bring them to Utah. But here’s my question. If your company was based in Dallas, would your people still want to come to Utah? Do people want to come here because it is mecca for their company or because Utah is awesome?

Darlington, Nu Skin: We do balance between going outside and coming here to the home base. When people come to our offices, we like to say, “Welcome to your home. This is your building that you can have a meeting in. If you need an office, there’s one over here.” When we do an event in Salt Lake, part of that event is they come to Utah Valley and visit our headquarters.

“Opportunity meetings used to be all about the grandeur of what it could be. That doesn’t resonate now … You have to be more transparent. You can’t sell this dream of the wealth you can accumulate five years from now. You need to show them how to make a dollar today.” — Justin Prince, Modere

Dastrup, Zija International: We are the same way. Visiting our offices is a big part of it. Their belief in Zija anchors and ties them to us when they have the experience of being in our space.

Oswald, Sound Concepts: We get it from a different angle since we attend so many events in and outside of Utah. Having a seller from out of state come see the manufacturer’s headquarters helps build the seller’s belief in the company. Now their business that previously just came in a box is something more as she experiences it in person.

Darlington, Nu Skin In the past, we’ve focused on getting as many people in a big room for four hours, turning the lights off and talking, but I think there is a fundamental shift going on. We have groups that want an individual experience at the office. We have a monthly training where we have people fly in, but it’s starting to spread out where people are coming in almost every day. Because of social, experiences have become more individual.

Dastrup, Zija International: If we truly believe in growing people, then we need to have the right people in the room and provide the best recognition we possibly can and the best education we can. So let’s get down to the nitty gritty. Let’s talk product application. Let’s talk overcoming objections. Let’s talk how you acquire customers and insulate your business with customers. We need to really teach them the profession. Teach them the trade rather than the tricks of the trade.

Jarom Dastrup, Zija International

Prince, Modere: I like that. Do you accomplish that through breakout sessions? How does Zija do that in regional meetings?

Dastrup, Zija International: On a regional event, we stay main stage in the main room and block out the training sessions throughout the day. At our international convention this year, we will have 70 breakout sessions. Some topics are bigger, but we don’t want any more than 400 people in a room. Most of the classes have about 100 people in a room.

Darlington, Nu Skin: Events are focusing on the individual rather than the mass discussion. And it’s personalized to what they need.

Dastrup, Zija International: To have 70 breakout sessions sounds crazy. But it’s really eight topics taught multiple times. If every person wants to hear the same thing three times, they can. We are equipping and building each person so they can go out and influence.

Oswald, Sound Concepts: We participated in the Zija event last year and actually did a breakout session on how to use marketing tools. The brilliance of this was there’s no longer one silver bullet way for people to build. By providing the opportunity for small groups of 40-50 people, we heard the feedback, “That was just what I needed.” It was a brilliant way to do it. People raved about that experience. It was more logistically challenging for your team to deal with, but I thought it went off great.

Dastrup, Zija International: Everyone wants to learn, but when it’s a presentation, naturally your attention span will go. You’re going to be on your social media and miss the nuggets. We’ve tried to cultivate an environment that facilitates conversation rather than presentation. People have the chance to raise their hands and ask questions.

Darlington, Nu Skin: You get a lot more out of an environment like that than sitting on the top row of Vivint Smart Arena in the dark.

Bennett, BusinessQ: What makes the direct sales business model brilliant on both the corporate side and the distributor side?

Hadlock, Tavala: From the corporate side, network marketing is brilliant because exponential growth is built into your founding. Every company wants to experience the network effect at some point, where people start telling other people and you get that exponential growth. From a distributor standpoint, it also makes a lot of sense. You can get in for a very little cost and you can start making life-changing money. We had a lady who had worked with a couple marketing companies before in Arkansas, and she had never taken off. She just qualified for her first home as she’s been working with us. That’s a killer story. It’s such a low barrier to entry. In our country, there is this growing divide. Because of that, people think there is a lack of opportunity today. For the distributor, there is so much opportunity to get started for little to no money. It is an incredible experience.

Dastrup, Zija International: I look at the responsibility that comes from the corporate side. The three I always focus on are, first providing solid scientific-based products and having a story behind it. Second, you have to pay on time. You cannot miss. It has a domino effect on the family. The third is the back office or the management. Like Justin said, it’s all about the people. I love that. You can be really good at a couple things corporately, and then get out of the way of the team.

Bennett, BusinessQ: Many companies in this valley would love to work with your entities as vendors. What is the best way to do business with network marketing companies like yourselves?

Dastrup, Zija International: Have a proven track record. Because we are in an opportunist state and culture, there are all kinds of good ideas. Even when it’s presented, I find myself going, “This is awesome!” Then I ask them about the fruits of it. Show me that it’s worked. Show me the process. Very few can. I don’t want to be a guinea pig. If you have a new idea and there’s substance, then I’m there. For example, I’ve worked closely with McKinley for the past 18 months and have had phenomenal success working with him and his company with our tools and technology. So I would tell people to come in after they have a track record. I understand and love startups. I encourage people to take their dream and materialize it. But understand that before you go out and hit a home run, you are going to hit some base hits and then we will get you into Wrigley Field.

“Millennials are willing to go to work. In fact they’ll work 24 hours a day if they know you’re relevant, you’ve got good products and you’ve got an honest company. They have no problem putting forth the effort to get courtside seats.” — Jarom Dastrup, Zija International

Darlington, Nu Skin: If you are best in class, we will partner with you. There’s no question that is our philosophy, whether it’s in manufacturing or technology.

Prince, Modere: The majority of the population is not involved in direct sales and is not looking to get involved. They don’t wake up and think, “Today is the day. I am going to be a multi-level marketer.” Anything that can give the industry credibility is good for the entire industry. Nu Skin, for example, advertises at Jazz games. The Jazz has its own inherent credibility outside of our profession. If I was an outside vendor, I’d do anything to help the business gain credibility. I would get you in a magazine with Tony Robbins or Southwest Airlines. That way it’s not the MLM guys saying MLM is good, it’s outside people. We crave for people to think that what we do is OK and legitimate.

Bennett, BusinessQ: What are some of the main myths people have about your industry that you would like to dispel?

Jake Hadlock, Tavala

Hadlock, Tavala: That it’s a legitimate business. In my generation where people are not as familiar with how direct sales works, I explain to them that this is e-commerce. Look at Amazon, which is one of the biggest e-commerce businesses. They have an affiliate program, which most people realize. If you give someone a link to buy something on Amazon, you earn a little bit of money. Our industry is that on steroids.

Oswald, Sound Concepts: One of the things that has changed the industry is the “gig economy.” This younger generation is looking for that side gig where they can earn extra spending money. Gone are the days where you say, “Come get your Ferrari and your mansion.” You don’t hear that anymore, which is refreshing. The industry did itself a disservice 10 years ago by taking pictures of Rolexes. That wasn’t what it was all about. That’s the beauty of what technology has done. Now people look at this more like, “I can make a couple hundred dollars a month selling whitening toothpaste, and that’s awesome.”

Hadlock, Tavala: Look at what our country went through with the great recession. It hit people hard. Those things don’t resonate anymore because we now look back at that time, and we see things like “The Big Short” where they did such a good job showing what happened. People’s lives were ruined, and so you really can’t throw out the incentive of a yacht or a car. It doesn’t resonate with people because we know it was hollow.

Bennett, BusinessQ: How have millennials changed your approaches?

Darlington, Nu Skin: It requires us to be real, authentic and have products they want and need. Their attention span requires us to adjust. We can’t just say, “Use our products and use them forever.” They are going to go out and look, so we have to have the best products, we have to have instant rewards and ways to get paid. We all have to up our game and do better if we are going to survive with millennials. They demand the best.

Hadlock, Tavala: And we need medals for everything.

Dastrup, Zija International: You can’t have courtside seats with nosebleed actions. Too many times we are creating that “you don’t have to do very much and you’re going to be courtside” mentality. Millennials are willing to go to work. In fact they’ll work 24 hours a day if they know you’re relevant, you’ve got good products and you’ve got an honest company. They have no problem putting forth the effort to get courtside seats.

Bennett, BusinessQ: Last thoughts?

McKinley Oswald, Sound Concepts

Hadlock, Tavala: We are striving for greatness in everything we do. I believe the people here at this table are trying to do it with their businesses as well. Seeing companies execute their jobs day after day will improve the perception of the industry.

Darlington, Nu Skin: If you look at all of our companies, we make incredible products and incredible technologies. We’re in this little valley, but our influence is so far-reaching.

Prince, Modere: The decisions we are making in boardrooms in Provo, Lehi and American Fork are affecting individuals and families around the world.

Dastrup, Zija International: To people who want to start a business, remember who the enemy is. It’s the people who are saying you can’t do it when you absolutely can do it. I believe every person can be successful.

Bennett, BusinessQ: I’m proud of this industry and our community. There are people around the world who have good feelings about this beautiful valley because of the good you do. Thank you!

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