Free goodies! Extra cash! Not bad for a few hours of sipping on sparkly drinks and socializing with friends.
Direct selling companies are taking the modern consumer landscape by storm, proving that a personal touch can go a long way.
Selling products and services to people in their homes or offices is not a revolutionary concept. With home-based parties dating back to the 1930s-era traveling salesman, many consider this approach to be old hat. However, direct selling has proven to be one of the most popular and effective strategies in today’s sales game—showing faster growth than the entire U.S. economy in 2012.
Last year, the United States Direct Selling Association (DSA) announced a national sales total of more than $31 billion—an increase of nearly six percent from that of 2011.
Stanley Home Products in the 1930s and Tupperware Home Parties in the 1950s set the stage, but, over this past decade, there has been a boom in the number of people pursuing this alternative retail path.
It is no surprise that the biggest surge of 1 million new sellers came in 2009 following the complete nosedive of the U.S. economy. Even with its resurgence in 2012, a significant number of Americans still need an additional source of income. To date, the direct selling industry has created 15.9 million entrepreneurial careers for Americans.
The massive uptick of both buyers and sellers can also be linked to tech innovations that have made it possible to connect with a vastly broader audience. The rise of social media outlets, in particular, has helped to build brand interest organically through friends’ photos, “likes,” or “retweets” online.
Women have been the group most attracted by this unique business structure. Currently, 80 percent of all direct sellers in the U.S. are women. Although individual motivations have varied, the positive benefits of getting involved in direct sales are great.
With a fairly low initial investment, direct selling has been an effective way for many people to earn supplemental income. Brand reps are able to set their own hours; be home for their children; finance life’s essentials, like kids’ braces or unexpected medical expenses; and afford extra luxuries, like a new car or family vacation.
“There are few jobs in the world that let you totally control how much and when you work,” says Lauren Rabin, a sales representative for the contemporary women’s clothing brand KOKOON.
Ninety percent of those involved in direct selling run their businesses part-time, but the number of full-time sellers has shown steady growth over the past few years. Although the average gross income for a direct sales consultant is much less, some women have reported annual incomes of more than $100,000.
“You can participate as a hobbyist or you can turn this into a six-figure income,” explains Sarah Pearsall, a senior stylist for the jewelry and accessories brand Stella & Dot.
Stella & Dot grew an astounding 760 percent between 2008 and 2009 and has launched 5,000 flexible careers for new entrepreneurs. According to a 2012 interview conducted by More Magazine, company CEO and Founder Jessica Herrin has already paid out more than $100 million in commissions to its 20,000 sales reps since 2007.
The potential revenue is no doubt an attractive feature of this business model, but the reason women mention first and foremost for their membership is the opportunity direct sales has provided to build and maintain strong female friendships.
“It’s just so much fun and a great way to socialize with people,” says Muffy Hendershot, an Evanston resident and Jameson Sotheby’s real estate broker. “Plus, it’s a great excuse to drink, eat and shop.”
Generous reward incentives are another attractive feature of direct selling, and a practice that has been a cornerstone of this platform since the beginning. Hostesses are given a discount on merchandise, as well as a portion of total party sales to use toward their favorite items.
“I went to a party, and there was so much stuff I wanted!” Hendershot says. “I thought, ‘Hey, I’ll have a party!’ I was able to get everything on my wish list.”
Outside businesses have also gotten involved. Tami Conway, owner of three Dailey Methodlocations in Chicago, has held events in her studios for the past five years. For her, hosting has been “…a great way to connect…and offer [our clients] more…” Conway says. “We also enjoy supporting [them] in their professional ventures.”
Direct selling ultimately circles back to the personal connection it has provided for countless women. In a world inundated with endless Facebook posts and Pinterest boards, what all seem to crave is the instinctive need for human interaction. With direct sales and new membership expected to climb even further, friendship really does seem to be the foundation to sell.
“I think women love an excuse to get together…they enjoy socializing and shopping with one another,” Pearsall says. “We’re all so busy, it’s difficult to see friends, let alone plan a shopping date. A two-hour trunk show fixes that.”
Start Selling
A family-owned business offering lovely styles of everyday and costume jewelry collections.
- Hostesses: Invite guests to shop and receive 20 percent of total party sales in jewelry.
- Advisors: Get your business going with the “Startup in Style Kit” and begin earning free jewelry and fabulous vacations.
This fashionable clothing and accessories line offers trend-driven separates and flattering workout wear.
- Hostesses: Have friends join you for a great shopping experience in the company of a CAbi consultant. Learn important product info and how to create your unique look with the help of a friendly professional. Receive 50 percent off all CAbi merchandise.
- Consultants: Receive training and mentoring so you can offer shoppers valuable product information and outfit suggestions. Earn a base commission of 20 percent on items sold, plus additional benefits.
A small company looking to grow, all products are made in the USA. Women love KOKOON’s feminine silhouettes, colors and bold prints, comfortable fabrics, and wearable designs.
- Hostesses: Invite guests to view KOKOON’s latest apparel offerings; receive 10 percent of your total party sales in clothing, plus a 30 percent discount on all merchandise, including sale items.
- Representatives: No formal training is required; the event’s host and her guests casually peruse the latest collection. KOKOON reps write up the orders but admit, “These clothes sell themselves!”
Offers an assortment of affordable, boutique-style accessories created by New York designers. Items have been worn by celebs such as Jennifer Aniston and Carrie Underwood.
- Hostesses: Invite your girlfriends over to shop a chic selection of merchandise. Enjoy 25 percent of party sales in free goodies, as well as a 50 percent discount on all brand items.
- Stylists: Thoughtfully display products for party guests, and help shoppers find what speaks to them. Share tips and tricks to help guests create their own unique looks.
An exclusive, botanical-based beauty brand developed using only pure, safe and beneficial ingredients. The company offers skincare, cosmetics, and health and wellness products.
- Hostesses: Learn about Arbonne product offerings from a trained consultant, and test a variety of health and beauty products at home with friends.
- Consultants: Specialized training helps you to effectively demonstrate a variety of products for party-goers. Receive up to 35 percent in commission from the resale of discounted products, plus 15 percent commission on orders placed when you register Preferred Clients.
Headquartered in Addison, Ill., this company offers a line of high-quality kitchen tools, food products and cookbooks, along with tons of recipes that can be found online.
- Hostesses: Pick the meal, supply the ingredients, and treat guests to an evening of group cooking or baking, product testing, and delicious eating. Along with a $15 Hospitality Bonus, hostesses receive free products and shipping, along with other heavy discounts.
- Consultants: Prepare a Pampered Chef recipe of the hostess’ choosing while demonstrating the latest products for guests. Consultants receive a commission of at least 20 percent of party sales, plus free brand merchandise.
This classic home-party company still offers the best and most innovative solutions for food storage, meal preparation and social gatherings.
- Hostesses: Host a party online, or invite guests to a themed party such as a “Totally Tuppertini” cocktail party or an afternoon spent on healthy “Meals in Minutes.”
- Consultants: Come prepared with the best products to suggest for each party, and provide guests with quick and simple product demonstrations.
