MLM - Direct Selling News https://www.directsellingnews.com The News You Need. The Name You Trust. Tue, 19 Dec 2023 16:41:20 +0000 en-US hourly 1 https://wordpress.org/?v=6.4.2 https://www.directsellingnews.com/wp-content/uploads/2021/04/DSN-favicon-150x150.png MLM - Direct Selling News https://www.directsellingnews.com 32 32 `Ponzis, Pyramids and Schemes https://www.directsellingnews.com/2023/12/18/ponzis-pyramids-schemes/?utm_source=rss&utm_medium=rss&utm_campaign=ponzis-pyramids-schemes Mon, 18 Dec 2023 18:15:28 +0000 https://www.directsellingnews.com/?p=20454 Direct selling is prone to corruption within a pyramid scheme because the number of MLMs, or businesses that operate with a multi-level component, make it easy to “hide” the fraudulent element of the business long enough for those at the top to take significant profit before it collapses. How to tell the good from the bad.

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Direct Selling in the Digital Age

The direct selling network is thriving and predicted to continue its growth at a compound annual growth rate (CAGR) of five percent between 2024 and 2032, to reach a value of USD 385.17 billion by 2032. Entrepreneurs have more opportunities than ever to be personally empowered to earn money selling a product that they endorse. However, the channel’s early days of door-to-door sales have evolved tremendously over the years as technology has advanced.

Over a decade ago, the Journal of Personal Selling and Sales Management began to acknowledge that the industry had been forever impacted by the progress of a digital age. In their article “An Assessment of the Use of Technology in the Direct Selling Industry,” Ferrell, Gonzalez-Padron and Ferrell stated, “The traditional notion of direct selling is of an industry that is face-to-face and people-oriented, with a focus on building strong personal relationships with consumers. While technology can improve productivity, it challenges the customary ‘high touch’ tradition in the industry.”

Today technology has eliminated much of the human-centric nature of direct selling. It has undoubtedly allowed entrepreneurs to reach more potential clients much faster and led to the development of interactive tools to benefit consumers, but that same technology allows for decreased accountability. Unfortunately, when accountability is lost, the direct selling channel becomes a magnet for nameless, faceless bad actors.

a pyramid scheme in the hands of a fraudster.
Melnikov Dmitriy/shutterstock.com

The Plague of Pyramid and Ponzi Schemes

It’s been over 100 years since Carlo Pietro Giovanni Guglielmo Tebaldo Ponzi was arrested for mail fraud. The scheme which bears his name now recognizes any fraudulent business wherein money taken in from new investors is used to pay debt to earlier investors. In a Ponzi scheme, returns are promised at a future date, and they are paid off by those who “buy in” later.

In much the same way, a pyramid scheme relies on the recruitment of new members and usually requires purchasing products or services to pay those higher in the pyramid. The difference between the scheme and a legitimate multi-level marketing business (MLM) at first glance may be hard to distinguish. In a pyramid scheme, the investment is usually fraudulent from the outset. The investment “opportunities” may change, but the bottom line is that eventually there isn’t enough cash from new investors to sustain the growth.

Direct selling is prone to corruption within a pyramid scheme because the number of MLMs, or businesses that operate with a multi-level component, make it easy to “hide” the fraudulent element of the business long enough for those at the top to take significant profit before it collapses.

When Digital Product Sales Go Wrong

The gold standard in determining the validity of direct selling businesses is if they offer a legitimate product or service a consumer wants to buy. When it comes to digital products, however, it’s harder to gauge legitimacy and sometimes even to determine what product (if any) is being sold.

Kevin Thompson, an attorney specializing in MLM and a founding partner of Thompson Burton, believes the most important legal case that helped determine specific guidelines for legitimacy was the BurnLounge case. This early digital product and its misguided structure established a precedent upon which companies can be compared to this day. In 2007 the Federal Trade Commission (FTC) got wind of concerns with the company BurnLounge. The company proposed to offer consumers the opportunity to set up an online store where they could sell music and related merchandise. What the FTC learned was that retailers were mostly earning “credits” that could be converted to cash for an extra monthly fee that could only be earned by recruiting new members and selling music store packages.

“The promise of easy money is but a wolf’s trap laid out for sheep seeking taller grass.”

― James Jean-Pierre

There was actually very little merchandise being sold—Thompson suggested as little as three percent of revenue was from product sales—and a “significant number” of investors were losing money. Eventually, proprietor Scott Eliot settled with the FTC for nearly $118,000 in 2008. And in 2012, the California Central District Court ruled that the remaining defendants listed in the BurnLounge complaint owed $16.2 million in redress.

Among other legal standards, the BurnLounge verdict established the importance of real product being sold. And when payments and commissions driven by recruitment are the primary revenue source as opposed to sales to ultimate users, it will undoubtedly flag those companies as pyramid schemes.

The Securities and Exchange Commission (SEC) warned that potential MLM marketing programs may be pyramid schemes when there is an “emphasis on recruiting” and specifically to be skeptical if more compensation is earned for recruiting others than for product sales. A red flag is when the recruiter builds hope solely focused on opportunity—they’re usually misrepresenting what’s possible.

Crypto and MLMs

Social media platforms and messaging apps are fertile breeding ground for fraudulent investment “opportunities” involving cryptocurrency or foreign currency trading (forex). They often begin with an unsolicited pitch or an invitation to join an unfamiliar trading website.

When it comes to cryptocurrency and its promise of passive income based on recruiting and investment in a digital “product” as part of an MLM, the offering was almost destined to draw in business owners with fraudulent motives. As the cryptocurrency and forex markets exploded in the last decade (at one point Forbes suggested there were almost 23,000 cryptocurrencies), the nature of the digital currency itself makes it a prime target for a Ponzi scheme.

Investing in a digital product with a short-term rate of remarkably high returns with representatives that may have little to no education in finance or banking soliciting new investors are all signs of “bad apples.” Thompson said in a recent post, “It’s time to state the obvious: Crypto + MLM = Legally Impossible.”

Businessman drawing multi level marketing
Antlii/shutterstock.com

It’s a sentiment shared by many in the industry. As a general rule, cryptocurrency and other digital financial product companies are not legitimate network marketing opportunities. Thousands of cryptocurrencies have failed—whether because they were a scam from the beginning or because of poor management.

One of the biggest scams was OneCoin, which, according to the US Attorney’s Office for the Southern District of New York, generated over four billion Euros in sales revenue between fourth quarter 2014 and fourth quarter 2016 operating as an MLM through which members received commissions for recruiting others to purchase cryptocurrency packages.

In reality, there was no mining of coins. Founder Karl Greenwood, a citizen of Sweden and the United Kingdom, was finally arrested in July 2018; extradited to the US; and pled guilty to one count of conspiracy to commit wire fraud; one count of wire fraud; and one count of conspiracy to commit money laundering. His business partner Ruja Ignatova has been missing since 2017 and remains on the FBI’s Top Ten Most Wanted List.

Masking the Investment in Digital Products

When there is no tangible physical product being transferred from seller to consumer, it is much easier for the company to use its own structure to mask how investors can actually earn money. One of the latest scams was OmegaPro. Founded in 2019 by Dilawar Singh, the company did not offer any physical product, rather it offered online trading services.

For a $29 investment, members could purchase different levels of licenses. The commission structure got confusing from there, which is yet another hallmark of a pyramid scheme according to warnings from the SEC. Affiliates needed to earn different rank volumes to maintain their ranks with stronger and weaker legs with downline requirements. There were three levels of leadership pools. And 30 percent of earned commission automatically went to an e-wallet; the remaining 70 percent was added to the passive wallet. Confused yet?

The main problem was that there was never any indication OmegaPro held any license as a broker or was authorized by any authority. Spain, Peru, Chile and France all issued warnings about the organization. When OmegaPro collapsed in December 2022, it issued a statement that it had sold its investor database to BrokerGroup, which has questionable roots itself. It came as no surprise that OmegaPro was run from Dubai.

Why Dubai?

A huge number of digital and cryptocurrency companies are headquartered in Dubai. In 2021 they expected to have at least 1,000 cryptocurrencies in the country by 2022, but that may now be impacted somewhat by regulatory and licensing requirements implemented earlier in 2023. Why so many in one city in the United Arab Emirates (UAE)? One reason may be because they have no extradition treaty, but they can actually claim to have oversight.

According to the International Trade Administration, “The Department of Economic Development (DED) consented to the formation of the Direct Selling Association in UAE (DSA), an official member of the World Federation of Direct Selling Associations (WFDSA), in order to promote transparency and to regulate the sector.”

The DSA was established in 2009 representing 14 direct selling companies operating in the region. Although network marketing in Saudi Arabia is expressly prohibited, in Dubai it is almost encouraged even though technically, according to the Dubai-based Fotis International law firm, “…only 14 companies are legally certified to work as direct sellers in the UAE.”

Fotis International stated, “The DSA UAE’s mission is to promote the direct selling industry in the UAE and the Middle East and safeguard consumers’ rights by adhering to the peak level of business integrity” and that “legitimate direct selling companies play a vital role in the socio-economic development of the UAE and the Middle East.”

The DSA outlines specifics regarding registration requirements, trade licenses and consumer’s rights for direct sellers. However, these are expressly spelled out for UAE citizens with little mention of the responsibilities of the company to consumers outside of the region. It appears that if they don’t target UAE residents, companies can operate without fear of regulation. Behind MLM’s anonymous author says, “Within Dubai, so long as they don’t target UAE locals, scammers are free to scam anyone from anywhere.”

Global Legal Insights points out in their analysis of bribery and corruption charges that “as a civil law jurisdiction, UAE judicial judgments are not available publicly,” making it difficult to determine if any of these direct sellers are being prosecuted within Dubai for any reason. But chances are that any hint of corruption in foreign countries is likely evidence of concern for US investors, sellers and consumers. As Thompson posed, “When you see smoke overseas is there a fire domestically?”

Getting Caught

It is difficult to keep up with the lawsuits, name changes and faces affiliated with one company that shows up again with a new endeavor. Global Wealth Trade Corporation became Opulence Global. Melius rebranded to BE. Dubli, Inc. is now Ominto, Inc.—just to name a few.

The fact that they are changing names is not necessarily a cause for concern, but it does raise questions about the reasons behind the rebranding. Sometimes the name change is because they’re setting up a parent company to buy other companies. But in other instances, the companies could be trying to “juice” recruiting and hope the new name will reach new investors. Thompson said that usually the impetus to change names is because there is negativity associated with the previous brand but reminds investors the name change “helps zero with regulatory activity” if there is any.

Regulators are, however, catching up to those who are not doing right by the direct selling channel. iX Global claimed to be the “fastest-growing self-betterment platform” as a fintech company that taught investors how to earn passive money through cryptocurrencies as well as other AI trading self-managed accounts.

In July 2023 the SEC named 18 defendants including CEO Joe Martinez in suing the company for securities fraud. According to Behind MLM, prior to launching iX Global, Martinez was a promoter of Investview’s fraudulent Kuvera Global investment scheme. iX Global’s top promoters and earners are also former Kuvera Global promoters. In response to the lawsuit, ix Global reminded investors, “We do not offer any guarantees of ROI (return on investment).”

The concerns about MLMs and digital products extend beyond cryptocurrency, forex and other derivatives. Social networks, NFTs, discount shopping, legal services and all sorts of education platforms (such as the ones claiming to educate investors in crypto) are prime targets for pyramid and Ponzi schemes—and frequently linked to cryptocurrency companies.

Onyx Lifestyle reported to have in the first month of business in 2019 over 4,200 “members” (aka investors), and the company claimed earnings of over $10 million. The company offered “global banking through your personal account” in addition to membership tiers that provided a “premier membership card” that was “a key to luxury” along with exclusive access to events.

A class action lawsuit was filed in 2021. Travis Bott and Clif Braun were both affiliated with the organization and according to Behind MLM, “Travis Bott is a serial securities fraud offender. Behind MLM has attached him to multiple Ponzi schemes over the years. Travis Bott first appeared on Behind MLM’s radar in mid 2017. We tied Bott to Divvee’s illegal securities fraud offering, through Ryze AI. Bott reemerged in late 2017 with Westmyn, a shell company used to commit securities fraud through Investview’s Wealth Generators. Investview was subpoenaed and subsequently fined $150,000 by the CFTC in 2018. A year later Travis Bott went solo with Onyx Lifestyle. In mid 2021 what was left of Onyx Lifestyle was rolled into Digital Profit. Digital Profit imploded with a ‘bad trades’ exit-scam in August 2021. Investors lost hundreds of thousands of dollars.”

Behind MLM also recently reported on the bankruptcy filing of Lyoness in Europe. Stated reasons for the bankruptcy include the lingering effects of the pandemic, the ongoing energy crisis and inflation. But Beyond MLM remains skeptical of both the filing and Lyoness. As stated in their article, “Lyoness is a Ponzi scheme….Over the years, Lyoness has gone through many iterations, name changes and associated shell company registrations.”

Lyoness was declared to be a pyramid scheme and fined 3.2 million Euros in 2019 in Italy. The company ignored the ban and was fined an additional 3 million Euros in 2021. The company has been outlawed in Norway, Poland, Russia and Lichtenstein. It was revealed through the bankruptcy proceedings, the company is $110 million in debt in November 2023.

The adage “if it sounds too good to be true, it probably is” couldn’t be more applicable than when examining these schemes. “It’s amazing the BS consumers fall for,” Thompson shared.

Group of business startup people having a meeting project outside in the public park
Akarawut/shutterstock.com

The Threat to Legitimate Direct Sellers

Direct selling’s reputation suffers because of the actions of those who don’t play by the rules of the channel. Direct selling companies are becoming much more cognizant of how cryptocurrency schemes masquerading as MLMs threaten the identity and reputation of the direct selling channel.

Conventional wisdom calls for more self-regulation to protect sellers and consumers. The very real risk is that unethical, unsustainable cryptocurrency and forex schemes become synonymous with legitimate direct selling opportunities in the minds of consumers and entrepreneurs alike. Vigilance, oversight and transparency are all key and must be a priority for all direct selling companies and affiliated trade associations.

It’s also important that prospects exploring these opportunities exercise extreme due diligence. Fortunately, investors live in a world where they have more access to information than at any time in history. Every industry has bad actors, and every investor must do their homework and seek expert guidance to avoid fraudulent opportunities. But legitimate direct selling companies operate much differently than the bad actors discussed here.

The important differentiator for direct selling is the relationships upon which the industry is built. The channel’s uniqueness rests on the fact that there is a team of real people with real relationships driving the business.

And that collaboration is key. Maybe some of those lessons from those early door-to-door days are still applicable today. The distribution channel must be the priority, and the business is all about repeat sales and loyal customers. And if the industry continues to build on that foundation, direct selling’s future is limitless.


Top 11 Signs of a Bad Actor

Fraudulent investment schemes share some common traits that mark them as potential bad actors. They aren’t always easy to spot, and this list is in no way inclusive—but here are 11 big red flags that indicate the need for due diligence. It’s important to note how different these are from legitimate, sustainable and scalable direct selling opportunities offering tangible products and services.

View through a magnifying glass on Exclamation mark or Warning sign over red background
Toey Andante/shutterstock.com
  1. Lack of Actual Products or Services
    Pyramid schemes usually lack a legitimate underlying business. The primary source of revenue is money collected from new investors, rather than a genuine business activity such as sales of products or services.
  2. Promises of High Returns with Little to Low Risk
    Fraudulent schemes rely on unrealistic guarantees, inflated claims or the appearance of profitability to maintain trust and avoid suspicion.
  3. Lack of Transparency
    Evasiveness about the specifics of the investment strategy or vague and inconsistent information about operational practices allow for deception.
  4. Exorbitantly High Commissions
    High commissions paid on significant investments historically attract the wrong type of business builders. Stable, lasting companies promote steady incremental growth.
  5. Unregistered Investments
    Operators often lack the necessary registrations or licenses. Legitimate investment opportunities must adhere to regulatory standards and oversight.
  6. Difficulty Withdrawing Funds
    Obstacles impeding access to funds could be due to a lack of actual profits or an attempt to prolong the collapse of the scheme.
  7. Payouts Funded by New Investments
    A classic indicator of an illegal scheme is when returns paid to early investors come from the contributions of new investors, creating a cycle of dependency.
  8. Undue Pressure to Reinvest
    Investors can feel pressured to reinvest rather than cash out. This helps perpetuate the scheme by keeping funds within the system.
  9. Recruitment Driven
    By relying on a recruitment-driven structure where participants are encouraged to constantly bring in new investors, bad actors can maintain an illusion of profitability.
  10. Operational Secrecy
    The inner workings of the investment “strategy” is a closely guarded secret, discouraging investors from asking too many questions and prohibiting them from conducting due diligence.
  11. Too Good to Be True
    Savvy investors should be skeptical of any opportunity that offers disproportionately profitable returns when compared to conventional investments.

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Kannaway Announces Updated Branding Strategy, New Website https://www.directsellingnews.com/2019/07/12/kannaway-announces-updated-branding-strategy-new-website/?utm_source=rss&utm_medium=rss&utm_campaign=kannaway-announces-updated-branding-strategy-new-website https://www.directsellingnews.com/2019/07/12/kannaway-announces-updated-branding-strategy-new-website/#respond Fri, 12 Jul 2019 15:58:26 +0000 https://dsnnewprd.wpengine.com/kannaway-announces-updated-branding-strategy-new-website/ Medical Marijuana, Inc. announced that its subsidiary Kannaway® has launched a completely redesigned website and the rebranding of its globally recognized hemp-derived cannabidiol (CBD) products. The company hopes that consumers will find the new website easier to navigate for access to the products and CBD education that fits their unique lifestyles. Kannaway’s rebranded products are designed to be […]

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Medical Marijuana, Inc. announced that its subsidiary Kannaway® has launched a completely redesigned website and the rebranding of its globally recognized hemp-derived cannabidiol (CBD) products.

The company hopes that consumers will find the new website easier to navigate for access to the products and CBD education that fits their unique lifestyles. Kannaway’s rebranded products are designed to be more relatable to consumers and make it easier for them to incorporate CBD’s benefits into their everyday routines.

“We continue to see a large increase in consumer demand for high-quality CBD products as the U.S. hemp-derived CBD industry is expected to hit $22 billion by 2022,” said Kannaway CEO Blake Schroeder. “In response, we chose to redesign our website and rebrand our products so that consumers can easily educate themselves before discovering which products best fit their needs.”

In Q1 of 2019, Kannaway experienced an increase of approximately 130 percent in sales revenue as compared to Q1 2018.

“As awareness for CBD continues to spread, it is a priority for us to ensure consumers are well educated on the compound and understand how it may enhance their lifestyles,” said Medical Marijuana, Inc. CEO Dr. Stuart Titus. “Kannaway’s rebranded products not only provide the many benefits of CBD but are also aesthetically pleasing for consumers to use and display in their homes.”

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Southwestern Family Of Companies Announced the Promotion Of Kristi Anderson To Vice President Of Marketing https://www.directsellingnews.com/2019/06/05/southwestern-family-of-companies-announced-the-promotion-of-kristi-anderson-to-vice-president-of-marketing/?utm_source=rss&utm_medium=rss&utm_campaign=southwestern-family-of-companies-announced-the-promotion-of-kristi-anderson-to-vice-president-of-marketing https://www.directsellingnews.com/2019/06/05/southwestern-family-of-companies-announced-the-promotion-of-kristi-anderson-to-vice-president-of-marketing/#respond Wed, 05 Jun 2019 16:39:56 +0000 https://dsnnewprd.wpengine.com/southwestern-family-of-companies-announced-the-promotion-of-kristi-anderson-to-vice-president-of-marketing/ Southwestern Family of Companies recently announced the promotion of Kristi Anderson to vice president of marketing, a newly created position for the family of companies. In addition to leading a new team to create and execute marketing strategies and campaigns, Anderson will continue her involvement with the new business development team alongside chief executive officer Dustin Hillis, chairman […]

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Southwestern Family of Companies recently announced the promotion of Kristi Anderson to vice president of marketing, a newly created position for the family of companies.

In addition to leading a new team to create and execute marketing strategies and campaigns, Anderson will continue her involvement with the new business development team alongside chief executive officer Dustin Hillis, chairman of the board Henry Bedford, executive vice president and treasurer Cindy Johnstone and vice president and corporate controller Beth Jackson. As part of this team, Anderson will help the company integrate and develop new businesses as they are welcomed into the Southwestern Family of Companies.

“Kristi has helped Southwestern Consulting take its marketing efforts to the next level by redesigning the CRM functionality and crafting automated marketing campaigns for prospects. Additionally, she led the rebranding efforts for the entire family of companies and launched many new and updated brands and websites – all the while managing and growing the marketing team,” said Hillis. “We are excited to have Kristi apply the skills, dedication and focus that have helped Southwestern Consulting grow over the past three years, with her at the helm of the marketing department, on a larger scale with the entire global family of companies.”

 

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LifeVantage Launches in Belgium https://www.directsellingnews.com/2019/06/05/lifevantage-launches-in-belgium/?utm_source=rss&utm_medium=rss&utm_campaign=lifevantage-launches-in-belgium https://www.directsellingnews.com/2019/06/05/lifevantage-launches-in-belgium/#respond Wed, 05 Jun 2019 15:08:18 +0000 https://dsnnewprd.wpengine.com/lifevantage-launches-in-belgium/ LifeVantage (LFVN)  opened for business in Belgium, marking the company’s third European market launch in as many months. “Our expansion strategy in Europe has been deliberate and aggressive, particularly this calendar year,” said LifeVantage CEO Darren Jensen. “It’s indicative of the traction the LifeVantage biohacking movement continues to gain in that part of the world, […]

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LifeVantage (LFVN)  opened for business in Belgium, marking the company’s third European market launch in as many months.

“Our expansion strategy in Europe has been deliberate and aggressive, particularly this calendar year,” said LifeVantage CEO Darren Jensen. “It’s indicative of the traction the LifeVantage biohacking movement continues to gain in that part of the world, and we’re thrilled to now officially count the people of Belgium among our growing biohacking community.”

Select LifeVantage products have been offered in Belgium on a not-for-resale basis for approximately a year as part of the company’s Global Customer Acquisition Program. During that time, the country demonstrated consistent growth as a customer market, paving the way for the company to now open for distributor enrollments as well. It’s a blueprint that has helped drive much of the company’s recent growth and expansion in Europe.

“As a company, this model has allowed us to build a presence and customer base throughout Europe, which, in turn, is enabling current and new distributors to really hit the ground running in these respective European countries as they open,” said LifeVantage Chief Sales Officer Justin Rose.

LifeVantage opened in Austria in September, Spain in March, and Ireland in May. With the addition of Belgium, LifeVantage now serves 15 markets in North America, Europe, Australia, and Asia.

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U.S. Direct Selling Annual Retail Sales Reach $35.4 Billion for 2018 https://www.directsellingnews.com/2019/06/03/u-s-direct-selling-annual-retail-sales-reach-35-4-billion-for-2018/?utm_source=rss&utm_medium=rss&utm_campaign=u-s-direct-selling-annual-retail-sales-reach-35-4-billion-for-2018 https://www.directsellingnews.com/2019/06/03/u-s-direct-selling-annual-retail-sales-reach-35-4-billion-for-2018/#respond Mon, 03 Jun 2019 15:55:14 +0000 https://dsnnewprd.wpengine.com/u-s-direct-selling-annual-retail-sales-reach-35-4-billion-for-2018/ According to the “DSA 2019 Growth & Outlook Report: U.S. Direct Selling in 2018” released today by the Direct Selling Association (DSA) at its Annual Meeting in Austin, Texas, 2018 saw growth in retail sales, as well as the number of people selling and purchasing products and service through the direct sales channel. Growth & […]

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According to the “DSA 2019 Growth & Outlook Report: U.S. Direct Selling in 2018” released today by the Direct Selling Association (DSA) at its Annual Meeting in Austin, Texas, 2018 saw growth in retail sales, as well as the number of people selling and purchasing products and service through the direct sales channel.

Growth & Outlook is DSA’s annual survey that reports on the size and scope of direct selling in the U.S. and is audited by Nathan Associates, a third-party international economic consulting firm.

The annual Direct Selling Growth & Outlook Survey provided the following data on the industry:

Retail Sales

The direct selling channel generated $35.4 billion in retail sales in 2018 – up 1.3 percent from 2017. Wellness products remained the most popular product category in the U.S. in 2018, accounting for 35.6 percent of sales, followed by Services (22.6 percent), Home & Family Care/Durables (15.8 percent), Beauty & Personal Care (15.6 percent), Clothing & Accessories (7.7 percent) and Leisure/Educational (2.7 percent).

 

Direct Selling Population

The DSA further refined the 2018 data collection to better separate direct sellers from customers. This new research shows that the number of people selling products or services using the direct selling model grew 1.6 percent, with 6.2 million U.S. entrepreneurs selling in either a part-time or full-time basis.

Demographic breakdowns for both direct sellers and discount buyers include 6 percent (under 25); 19 percent (25-34); 26 percent (35-44); 24 percent (45-54); 17 percent (55-64); and 8 percent for 65 and older.

By gender, 75 percent of direct sellers in the United States in 2018 were women and 25 percent men. The percentage of women joining the channel increased by 1.5 percentage points from 2017 to 2018, men joining the channel dropped by 1.5 percent.

Ethnic and racial demographics for 2018 went unchanged from 2017. Eighty-five percent of those involved were White/Caucasian, 8 percent African American, 4 percent Asian, 1 percent American Indian or Native Alaskan, 1 percent Native Hawaiian or Pacific Islander and 1 percent other not identified.

 

Demand for Direct Selling Products

The DSA said in their press release that in 2018, there were more than 36.6 million people actively buying through the direct sales channel, with notable growth coming from an increase in preferred customers. This customer count excludes those who have not signed an agreement with a direct selling company.

“The U.S. direct selling industry is moving in a very positive direction,” said Joseph N. Mariano, DSA president and chief executive officer. “Retail sales were strong, thanks largely to the U.S. direct sales force and their ability to attract millions and millions of customers. The 2019 Growth & Outlook Survey also provided additional insights into the people involved in direct selling – particularly due to segmentation efforts – helping our member companies provide an even better experience for those who buy and sell through our channel. As we look forward and evaluate industry data, as well as national economic and retail projections, we believe the industry will continue to see modest growth during the next three years.”

For more information on DSA’s 2019 Growth & Outlook Survey: 2018 Direct Selling Data in the United States, you can also read more on this topic atwww.dsa.org/benefits/research. The DSA has also added a new interactive component when you hover the arrow or cursor over various content on the page.

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Direct Selling News Honors Channel’s Top Companies in 10th Annual DSN Global 100 https://www.directsellingnews.com/2019/04/25/direct-selling-news-honors-channels-top-companies-in-10th-annual-dsn-global-100/?utm_source=rss&utm_medium=rss&utm_campaign=direct-selling-news-honors-channels-top-companies-in-10th-annual-dsn-global-100 https://www.directsellingnews.com/2019/04/25/direct-selling-news-honors-channels-top-companies-in-10th-annual-dsn-global-100/#respond Thu, 25 Apr 2019 16:05:58 +0000 https://dsnnewprd.wpengine.com/direct-selling-news-honors-channels-top-companies-in-10th-annual-dsn-global-100/ In recognition of those companies offering unparalleled opportunity for individuals to start their own businesses, Direct Selling News today unveiled its 10th annual 2019 DSN Global 100, an exclusive ranking of the world’s leading direct selling companies (based on 2018 revenue). The DSN Global 100 is a collective effort to show the impact and potential of the $189 billion direct […]

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In recognition of those companies offering unparalleled opportunity for individuals to start their own businesses, Direct Selling News today unveiled its 10th annual 2019 DSN Global 100, an exclusive ranking of the world’s leading direct selling companies (based on 2018 revenue).

The DSN Global 100 is a collective effort to show the impact and potential of the $189 billion direct selling channel. Unveiled online at DirectSellingNews.com and soon to be featured in the June issue of Direct Selling News magazine, this year’s Global 100 companies hail from 20 countries and represent aggregate revenue of over $75 billion.

“Each year, the DSN Global 100 event allows us to recognize the leading companies in direct selling today,” said Todd Eliason, Direct Selling News’s new Publisher and Editor in Chief. “The companies on the list represent a wide range of products and services, but they share a passion for developing a community of independent business owners who share those products and services with customers in their personal networks. It is a unique and powerful distribution channel.”

A number of takeaways from this year’s Global 100 list.

  • 21 companies achieved more than $1 billion in net sales in 2018. That’s over one-fifth of the ranking. Collectively, these 21 companies generated $55 billion for the year.
  • Mid-market companies—those between $300 million and $1 billion—are represented by 23 companies in this year’s ranking. Five companies are above $700 million, and another five above the half-billion-dollar mark.
  • 15 companies are making their first appearance on the Global 100 list, including companies from Brazil, Korea, Taiwan, Germany, Malaysia, and Sweden.

For the seventh consecutive year, Ada, Michigan-based Amway claimed the No. 1 rank, with $8.8 billion in revenue, up 2.32 percent over last year. Avon Products, Inc., Herbalife Nutrition, Infinitus and Vorwerk rounded out the top five on this year’s list.

Bravo Award Winners Front and Center

The annual event celebrating the Global 100 took place on April 24, 2018, at the Renaissance Dallas at Plano Legacy West Hotel in Plano, Texas. During the dinner and awards ceremony, DSN also presented its Bravo Awards for excellence. MyDailyChoice/HempWorx was the first of two winners of the Bravo Growth Award for their extraordinary annual sales growth of 900 percent from 2017 to 2018. Color Street took home the second Bravo Growth Award for annual sales growth 881 percent from 2017 to 2018.

Color Street was inspired by New York’s “City That Never Sleeps” nonstop energy and wildly colorful fusion of cultures. The New York City-based company offers a vast array of colors and nail art design. Las Vegas-based MyDailyChoice/HempWorx has achieved astounding growth in just two years in business. Using cloud technology to cut overhead costs and taking advantage of the ever-growing consumer interest in hemp-derived products.

Jessica Herrin, founder, CEO of Stella & Dot’s Family of Brands received the Bravo Leadership Award for her exceptional leadership qualities that have propelled her company to extraordinary new heights. Naming her company after her beloved grandmothers, Jessica had the goal of revolutionizing entrepreneurial opportunities for women by creating a modern home-based opportunity. She envisioned a new kind of company that would allow today’s busy women to achieve unparalleled success and balance through a career they were passionate about.

Expanding beyond the flagship Stella & Dot line of accessories, the Family of Brands gives women greater opportunity to create a flexible social selling business opportunity that more precisely fits their goals as an Independent Business Owner. To date, the company has paid out more than $500 million in commissions to 50,000 independent business owners in six countries.

The Bravo Lifetime Achievement Award honors an individual who not only has made on a lifetime commitment to advocating the direct selling business model, but has been shining beacon in the professional contributions they have made to the direct selling community. Taking home the award is J. Stanley Fredrick, or “Stan” to his friends. He has been actively involved in the Direct Selling Association for more than 40 years. He has served on the Mannatech Board of directors since 2001 and was elected chairman in 2009. He also serves on the Board of Directors of Wineshop at Home, a part plan company.

In recognition of his lifetime of contribution to the industry, Stan has been inducted into the Direct Selling Association’s highest honor, the Hall of Fame. He is also in the Direct Selling Education Foundation Circle of Honor.

 

DSN created the Global 100 list to acknowledge the successes of individual direct selling companies and provide a clear picture of the magnitude of the industry. In its 10th year of undertaking this project, DSN continues its commitment to create a fair ranking that will showcase a transparent channel, thus providing credibility and consumer confidence as well as research support for those seeking information on direct selling companies.

All photos by: Debi Podvalova

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Bob Hipple Named ByDesign Technologies VP of Sales https://www.directsellingnews.com/2019/04/09/bydesign-sales-vp-bob-hipple/?utm_source=rss&utm_medium=rss&utm_campaign=bydesign-sales-vp-bob-hipple https://www.directsellingnews.com/2019/04/09/bydesign-sales-vp-bob-hipple/#respond Tue, 09 Apr 2019 15:48:57 +0000 https://dsnnewprd.wpengine.com/bydesign-sales-vp-bob-hipple/ ByDesign Technologies, a leading provider of software for the direct selling industry, recently announced that Bob Hipple has joined the company as vice president of Sales. Hipple brings more than 20 years of sales and leadership experience to ByDesign, including executive positions with direct selling companies. Since 2005, he has been a keynote speaker, author […]

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ByDesign Technologies, a leading provider of software for the direct selling industry, recently announced that Bob Hipple has joined the company as vice president of Sales.

Hipple brings more than 20 years of sales and leadership experience to ByDesign, including executive positions with direct selling companies. Since 2005, he has been a keynote speaker, author and owner of the direct sales consulting firm Direct Selling Today, where he and his team provided clients with strategic marketing, training, development, sales leadership, compensation plan creation and business management services.

“Having recently completed a full-time, 18-month church mission, I am delighted to be back serving in the direct sales industry,” said Hipple. “I have always been impressed with ByDesign’s rich culture of innovation, exceptional talent and outstanding client support. I am very excited to join ByDesign in their role of leading our industry into a new era of technology for direct selling companies.”

In his new role, Hipple will focus on expanding the adoption of ByDesign’s Freedom Solution in North America. Jerry York will focus on accelerating ByDesign’s international opportunities.

“We’ve been very busy this past year with record sales and the interest in our products has grown exponentially,” said Daryl Wurzbacher, CEO of ByDesign Technologies. “ByDesign is dedicated to meeting these challenges by delivering the platform, the technology, the innovation, the expertise and the support needed to fuel long-term growth for direct selling, MLM and party plan businesses of all sizes.”

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Amway Reports 2018 Sales of $8.8 Billion https://www.directsellingnews.com/2019/02/11/amway-reports-2018-sales-of-8-8-billion/?utm_source=rss&utm_medium=rss&utm_campaign=amway-reports-2018-sales-of-8-8-billion https://www.directsellingnews.com/2019/02/11/amway-reports-2018-sales-of-8-8-billion/#respond Mon, 11 Feb 2019 21:54:29 +0000 https://dsnnewprd.wpengine.com/amway-reports-2018-sales-of-8-8-billion/ Amway announced sales of $8.8 billion for the year ending December 31, 2018, a 2 percent increase over 2017 sales numbers. The company said growth was broad-based across many of its top markets including China, the U.S., Thailand and India. “Amway’s growth in sales is a result of our sharp focus on the experience Amway […]

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Amway announced sales of $8.8 billion for the year ending December 31, 2018, a 2 percent increase over 2017 sales numbers.

The company said growth was broad-based across many of its top markets including China, the U.S., Thailand and India.

“Amway’s growth in sales is a result of our sharp focus on the experience Amway Business Owners and their customers have buying, selling and using Amway products,” said Amway Co-Chairman Steve Van Andel. “We’ll continue to make investments that enable every possible opportunity for ABO success.”

Amway attributes sales growth to significant investments in digital tools and mobile experiences as well as product innovations that have helped ABOs attract and retain more customers. This includes enabling more e-commerce and social selling, connecting additional products with digital experiences, and personalizing more nutrition and beauty products. The results of investments in e-commerce are most evident in China, Amway’s largest market and a leader in the business’ digital innovations. In 2018, 70 percent of Amway China sales were made through mobile orders.

“Amway is capitalizing on the world’s growing appetite for e-commerce,” said Amway Co-Chairman Doug DeVos. “Momentum is building, investments in digital and innovative products are increasing, and healthy, steady growth is anticipated to continue for the foreseeable future.”

According to the company, sales in nutrition and wellness were 52 percent of Amway’s market sales, up 3 percent from 2017. Beauty and personal care were 26 percent, up 1 percent.

Amway is celebrating its 60th year of business in 2019.

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Avon CEO Rings Closing Bell at NYSE https://www.directsellingnews.com/2019/02/08/avon-ceo-rings-closing-bell-nyse/?utm_source=rss&utm_medium=rss&utm_campaign=avon-ceo-rings-closing-bell-nyse https://www.directsellingnews.com/2019/02/08/avon-ceo-rings-closing-bell-nyse/#respond Fri, 08 Feb 2019 16:54:27 +0000 https://dsnnewprd.wpengine.com/avon-ceo-rings-closing-bell-nyse/ The New York Stock Exchange recently welcomed Avon Products Inc. (NYSE: AVP) to celebrate more than 130 years of championing economic empowerment for women around the world. Avon CEO Jan Zijderveld was invited to ring the closing bell. He was joined by several Avon executives and guests. The 133-year-old Avon was founded in 1886 by […]

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The New York Stock Exchange recently welcomed Avon Products Inc. (NYSE: AVP) to celebrate more than 130 years of championing economic empowerment for women around the world.

Avon CEO Jan Zijderveld was invited to ring the closing bell. He was joined by several Avon executives and guests.

The 133-year-old Avon was founded in 1886 by book salesman David H. McConnell as the California Perfume Company. Upon noticing women taking more interest in the sample perfume bottles he gave away with purchases, McConnell realized he could offer women the opportunity to become entrepreneurs by selling perfumes to one another.

McConnell manufactured his own line of perfumes and then recruited a team of women to be Sales Representatives. The very first saleswoman was the iconic Avon lady, Mrs. P.F.E. Albee.

The California Perfume Company was incorporated in New York in 1912. In 1939, the company was renamed Avon.

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Tupperware Brands Announces 2019 Global Links Scholar https://www.directsellingnews.com/2019/02/07/tupperware-brands-announces-2019-global-links-scholar/?utm_source=rss&utm_medium=rss&utm_campaign=tupperware-brands-announces-2019-global-links-scholar https://www.directsellingnews.com/2019/02/07/tupperware-brands-announces-2019-global-links-scholar/#respond Thu, 07 Feb 2019 17:28:31 +0000 https://dsnnewprd.wpengine.com/tupperware-brands-announces-2019-global-links-scholar/ Tupperware Brands Corporation recently announced that Dr. Denise Poiani Delboni of Brazil is the next scholar to be selected to its cross-cultural exchange program Global Links. The program, co-founded with the Crummer Graduate School of Business at Rollins College and supported by U.S. Department of State’s Office of Global Women’s Issues, is designed to build capacity for women’s social […]

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Tupperware Brands Corporation recently announced that Dr. Denise Poiani Delboni of Brazil is the next scholar to be selected to its cross-cultural exchange program Global Links.

The program, co-founded with the Crummer Graduate School of Business at Rollins College and supported by U.S. Department of State’s Office of Global Women’s Issues, is designed to build capacity for women’s social entrepreneurship and engage established female business or economics professors working at universities in the chosen country.

Dr. Delboni was chosen following a competitive selection process. A professor of Labor Law, Compliance, and Labor and Employment Relations at Fundação Getúlio Vargas (FGV) and Escola Superior de Propaganda e Marketing (ESPM) in Brazil, she has focused her career on advancing entrepreneurial opportunities for women in her home country.

“I am honored to be selected by the Global Links program and to be given the opportunity to expose the next generation of leaders to learnings from a leading academic institution and a global corporation,” said Dr. Delboni.

The first phase of the Global Links program starts with Dr. Delboni joining Crummer Graduate School of Business at Rollins College to participate in training and classes focused on entrepreneurship and sustainable business practices. At the latter part of the phase, Dr. Delboni will complete a hands-on externship focused on business fundamentals at Tupperware Brands global headquarters in Orlando. Following her immersion in the United States, Dr. Delboni will return to Brazil for the second phase of the program where she will work with her students to partner with local non-profits or social enterprises to implement economic empowerment projects with women who are small business owners on the ground. The third and final phase of the program will see the scholar selecting a group of students to return to the United States and provide insight to the program’s stakeholders about their experience, the measurable impact of the program and its multiplier effect.

The 2019 program follows three successful programs with participants from Iraq and India, addressing societal and educational barriers to labor force entry and economic empowerment.

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