Direct selling companies who experienced revenue growth through the pandemic share their strategies for success and the steps they’re taking now to prepare for the future.
Business as usual was forever changed in 2020. The pandemic, with its supply chain nightmares, quiet quitting epidemic and what felt like endless uncertainties, shifted many workplace paradigms seemingly overnight. In the three years since, it has been common for even the most well-known brands to flounder amid the challenging economic environment.
But these circumstances have also revealed rising stars and leaders within the direct selling industry. These top brands proved through their pioneering and strategic responses how to build and maintain momentum in the midst of circumstances that no executive had ever faced before, and their examples will now play an influential role in the decisions that shape the industry moving forward.
DSN looked at the approaches, behaviors and trajectories of 17 companies (including four publicly traded ones) within the channel who experienced three consecutive years of revenue increases—from 2020 to 2022—through the pandemic and beyond, to discover what the industry can learn from these trailblazers.
Pandemic Puppies and Other Unique Growth Opportunities
The pandemic was a boon for some industries, like suppliers of hand sanitizers and disinfectants but a dramatic bust for others, like hospitality providers. For direct selling companies who built momentum during this time, discovering the unique needs created by living life in a pandemic, and then wielding the pre-existing advantages of the direct selling model, was a major force for maintaining stability and capitalizing on untapped revenue potential.
“For many businesses, the effects of COVID were headwinds that shut them out of business,” said Roger Morgan, pawTree Chief Executive Officer. “For pawTree, the effects of COVID were tailwinds. There were definitely a lot of people who got new puppies, but people were also home more, spending time with their pets and being more attentive to the issues that our products could address. On top of that, we had already moved away from in-person events as our predominant way of sharing and selling, so our field had the tools and habits they needed in place. And one of our greatest tailwinds was that we are an online-sales-only company. That was a well-established trend before COVID, so when people shied away from retail and buying off of physical shelves, we weren’t negatively impacted by that weakened distribution channel.”
Building Trust through Transparency
Uncertainty was the predominant theme in the early months of the pandemic. Where to source materials to maintain inventory; how to navigate international COVID regulations; and when it would be wise to come back to the office were all questions without clear answers in the beginning. Distributors and customers alike needed to be presented with a clear vision for what life could be like on the other side of these extraordinary obstacles, while also receiving assurance that their company had their best interests at heart.
For Amare Global, leaning into compassion and kindness was the first step to creating a safe environment for its team members and has also played a key role in integrating Kyäni, which it acquired in September 2022, into its legacy of bringing mental wellness to the world.
“Our company name and primary core value is love,” said Jared Turner, Amare Global Chief Executive Officer. “At Amare, we want our corporate employees and field organizations to feel loved, inspired and valued. We are focused on operationalizing love throughout our organization to create a community and culture of belonging and support.”
Without a lengthy shared history to fall back on, reassuring the field and customers was even more challenging for young companies, but BELLAME saw it as an opportunity and a way to build transparency and trust from the ground up.
“When COVID hit, we were only 19 months old, so we were still new to our industry, our vendors and our field,” said Melissa Thompson, BELLAME Founder and Chief Executive Officer. “The biggest corporations were closing their doors all around us, so we had a lot to prove. The challenge of uncertainty, however, became an optimal opportunity to build trust within all facets of our business. Transparency became the antidote to it all. From transportation delays to global supply chain issues, we were completely open at every turn. Doing so allowed us to build trust, which has brought amazing opportunities our way.”
Transparency and a continual feedback cycle have been essential components of inGroup’s phenomenal growth. As Chief Operating Officer Anthony Varvaro explained, “Our year-over-year growth is due to a subscription model that has a high perceived and real value to our Members. Our existing Members continue their memberships and new Members continually join. We continually refine the membership and partnership opportunities and incorporate feedback that we take in from our Members and Partners to give more value and more earning opportunities, resulting both top-line and bottom-line growth.”
Building trust with customers has helped Utility Warehouse experience exponential revenue increases, the company ranked #10 on the DSN Global 100 list this year.
“Our partners are growing more and more confident in what we are offering and they are recommending UW to their friends and families in increasing numbers,” said Stuart Burnett, Utility Warehouse Co-CEO. “By doing so, they are earning meaningful additional incomes that are helping them meet the growing pressures on their personal finances.”
Learning to Love Remote Work Culture
Remote work seemed like a fantasy for employees and a nightmare for employers pre-2020. Today, office culture has shifted. Forced closures and social distancing measures gave executives a crash course in remote management, but those who rose to the top learned to not only accept, but also embrace and expand upon this new reality.
“Although our corporate team works remotely from across the globe, I feel more connected with them than I did when I had teams report to an office daily,” Thompson said. “It is amazing how efficient and productive our workflow has become.”
Surprisingly, distance has drawn the leaders of these growing companies closer. Morgan says the efficacy and happiness of his pawTree team can’t be attributed to one specific action, but rather a wide range of efforts to make sure they are appreciated and well-equipped. They’ve been innovative and thoughtful in their approach including inviting the management team to participate in incentive trips; giving raises to make sure team members are appropriately compensated; and ensuring a good awareness of the division of responsibilities across departments.
Digital-First Is Key
It can be easy to forget what it was like in 2020, before a pandemic-induced virtual world took over the sales and marketing approach for most companies. The brands who stood out among their peers were those that were already leaning heavily into creating a digital experience for their customers and distributors.
“Our brand was born through an audience of online followers long before anyone knew we were creating a single product,” Thompson said. “When the pandemic locked us all into a purely digital world in 2020, it was a space that we were quite comfortable inside. Having custom built our own digital platform, commission engine and back office, we were able to put our energy and resources into creating sophisticated marketing tools that made sharing our brand easy.”
Consumers and distributors have accepted the use of digital tools and an online-only business model at a rapidly accelerated pace since 2020. The companies that saw revenue momentum used this opportunity to not only double down on their existing digital infrastructure, but also scale new innovations, like PM-International, who implemented PM DirectCash, which pays online sales income immediately to distributors; and FASTer Way to Fat Loss and eXp Realty, both of whom tapped into powerful lead generators.
“eXp Realty is building on the momentum of the past several years by ensuring we always remain on the cutting-edge of technology so we can continue to deliver on our agent value proposition,” said Michael Valdes, eXp Realty Chief Growth Officer. “We have a robust set of resources that help drive agent success at each step of the real estate journey while simplifying their business with our future-focused technology. Today, eXp continues to be an attractive model for leading teams and independent brokerages because we solve for their pain points. And we offer better compensation options, including our competitive split, cap and equity opportunities.”
The Rise of the Enhanced Affiliate Model
Looking to the future, many of these leading companies are deciding how they can prepare now for the next big wave of change that waits on the horizon. For pawTree, that means taking a fresh look at its own mode of operation and considering ways it can outsmart competitors from outside of the industry that are eager to encroach on its market share.
“Complacency is the kiss of death,” Morgan said. “You’re always tweaking and turning dials, continuing to stay in a state of hunger for learning and understanding the consumer and the seller. All of that has pointed us to an affiliate sales program, which we’ll be launching in the next year.”
Switching to an affiliate-based model has become a pattern that many industry powerhouses have already begun to adopt. For them, it’s a way to give field leaders the marketing campaigns and tools that provide the financial benefits of a network marketing opportunity without sacrificing the community of support that the channel is known for.
“This affiliate model movement sparked with the onset of the pandemic. However, it has continued to evolve and gain momentum over the past three years,” Thompson said. “Pioneering a new business model is an ever-evolving movement—one that we believe will not only maintain our momentum in the years to come, but that of our entire industry.”
And at FASTer Way to Fat Loss, Founder and CEO Amanda Tress credits the affiliate model with her company’s continued success. And that success is impressive. Q1 2023 was the company’s best since launching in January of 2016, and March was their biggest month ever—they paid 46 percent more in commissions to affiliates in March than they did in the previous month of February.
FASTer Way offers two tracks in their affiliate program: Certified Coaches and Ambassadors. The Ambassadors are primarily bloggers and social media influencers who simply refer the program to their followers and receive a one-time commission for their efforts. Certified Coaches go through an in-depth FASTer Way certification course that equips them to run their own FASTer Way businesses, accompanying their clients throughout their journey. They therefore have multiple opportunities to earn on each client.
Whatever path an affiliate chooses, Tress recognizes the importance of nurturing the relationship. “Right after launch I was so focused on the products and the client experience, I realized I had been neglecting our Ambassadors and Certified Coaches. The strength of that relationship is key. We are always looking into ideas for incentives and trips and retreats because they are such an important component of our mutual continued success.”
Preparing for the Next Big Thing
The last three years have been a lesson in flexibility. The companies that have continued to succeed have proven how to stay true to the industry’s DNA, while being willing to explore new and innovative ways to serve their customers and distributors. No matter the compensation plan or sales model, this blending of the old with the new has served as a way for brands to stay nimble and relevant as well as served as guardrails for those at the helm who have masterfully led their companies to growth during a season of aggressive change.
“Digitization will bring many simplifications and savings in handling day-to-day business and will make it possible to reach masses of people and work without limits,” said Wolfgang Klaer, PM-International General Manager International Sales and Support. “But virtual customer assistance can never and will never take the place of a direct customer contact. Direct sales is a person-to-person business. This will always remain the case, and it should.”
The Secret Sauce
Eleven industry thought leaders share their go-to revenue growth strategies.
“We’ve placed a substantial focus on driving stability in customer retention rates, and with customer satisfaction metrics at all-time highs, we’ve seen retention return to and hold at normal levels. We continue to take steps to mitigate cost pressures, drive efficiency and build financial resilience into our model. We’re already seeing some of the impact of that work begin to play out, and while it will take some time to work through our business cadence, we remain highly confident in both the long-term efficacy of our model and our prospects for stable and sustainable growth.” —Dan Chard, Medifast Chairman & Chief Executive Officer
“I think this comes down to investment and innovation—in product development and how we connect with people; the quality and surety in our supply chain; and great analytics to support decision making. A key part of our success is our commitment to and involvement with up-to-date health and nutrition research. This provides a solid foundation for our new product development and ensures that we are producing the highest quality health and nutritional products available in the world today.
—Graeme Clegg / New Image Chairman & Founder
“It was precisely in the pandemic that the strength of PM-International was revealed. While other companies suffered major setbacks or even had to close their doors, PM-International quickly adapted and played to its own strengths: the ability to make quick decisions as a family-owned company; enough financial cushion to easily buy up necessary raw materials; and an innovative nature which helped us adapt our communication tools at lightning speed.” —Wolfgang Klaer, PM-International General Manager International Sales and Support
“One of the questions we ask ourselves is ‘If you were going to launch a company to compete with your own brand, knowing what you know, what would you do?’ If you’re not willing to act on that answer and make exciting changes that might rock the boat, someone else will.” —Roger Morgan, pawTree Chief Executive Officer
“Our growth didn’t come without challenges. We were able to prosper virtually when we were talking about our products and services, but we struggled to build relationships virtually. For us, returning to live events has brought a lot of energy and enthusiasm to the field and has been key to our continued growth.” —Don Thompson, Legal Shield President, Network Division
“Our innovative products and incredible earnings opportunity are beyond valuable, however, the key to our continued growth is rooted in the behavior of servant leadership. Even in our highly digital world, we are focused on serving our Brand Partners and building relationships. I personally host a Skype Chat, 7 days a week, with my top 65 leaders and sellers. Unscripted, regular live zooms for constant communication, transparency and collaboration. Without a doubt this is what fuels our growth.” —Melissa Thompson, BELLAME Beauty Inc. Chief Executive Officer and Founder
“The key drivers for our momentum since 2020 have been to prioritize and focus on as many interpersonal touchpoints as possible. We encouraged small gatherings and culture building events just to get people together. We rolled out our first in-person ACTIVZ Academies and ACTIVZ schools throughout our largest market, Mexico, which had a remarkable spill-over affect into our secondary markets. Focusing on building strong relationships throughout the field and especially with mid-level leaders on up, we’ve greatly benefitted from the unity that’s been created which is now taking our company into momentum.” —Ryan Thompson, Activz President and Co-Founder
“Amare is a true pioneer of the mental wellness movement, and we have an excellent team that is committed to providing clinically researched products that encourage a baseline of both physical and mental wellness and resilience. We are seeing the marketplace respond by rewarding the company with triple-digit growth. We operate in 50 countries worldwide, and believe people everywhere are seeking the solutions we offer. We have a goal of reaching one million homes within the next five years and are well on our way to achieving this milestone.” —Jared Turner, Amare Global Chief Executive Officer
“Our secret sauce is really our agent-centric model, which was designed to withstand varying market conditions. This uniquely positions us to continue investing in our future and iterating on our industry-leading agent value proposition. From the beginning, we have always believed that when you put the agent first, the rest will follow. And in our case, it truly has. It is why we continue to thrive when many of our competitors are not.” — Michael Valdes, eXp Realty Chief Growth Officer
“I would have to say our business model is our secret sauce. The model is continually adjusting itself to market conditions and provides the perfect balance of recurring and new revenue to guide it through all market conditions. It’s the business model that ensured inGroup made it through the COVID years with constant sales and has allowed it to leverage the recovery at a phenomenal rate. —Anthony Varvaro / InGroup Chief Operating Officer
“Our success in 2022 reflected the value of guidance that our sales force brings to middle-income families and the important role they play in encouraging clients to take action. For three consecutive years, Primerica has issued more than $100 billion in term life insurance face amount. And while inflation and market volatility created headwinds, our representatives successfully helped their clients invest $10 Billion in 2022 toward their future financial goals.” — Glenn Williams, Primerica Chief Executive Officer
Content updated from the July/August 2023 issue of Direct Selling News magazine.
