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By Rainer Paul

The direct selling industry has the potential to experience significant business growth due to the emerging proliferation of social media. The core of social media is a vast digital network marketplace, offering a sizeable opportunity to attract and grow Consultant and customer levels in a low-budget environment.

What Is Social Media?

Social media is a collective group of internet tools, such as social networks, blogs, forums and video-sharing sites, whose content is primarily published by users of an online community (such as MySpace, Facebook, Skyrock, LinkedIn, StudiVZ, Tuenti and YouTube). These social-media platforms are places where community members have a high level of involvement and interaction. These individuals seek to socialise with one another, interacting to express themselves, find solutions to problems and search for information, career opportunities, etc. This has led to blinding growth in the number of community members and the amount of shared, accessible information.

How Can Social Networking Help Direct Selling Companies?

Social media is quickly becoming a vital component to marketers and is extremely applicable to the direct selling industry, where revenue growth is closely tied to effectively recruiting customers and Consultants. It is in this online environment where many people spend their time, and engagement/interaction continues to grow exponentially. Social networks provide an ideal forum for Consultants and customers to communicate about the company they work for, the products they use and the impact both have on their lives.

The implication for direct selling companies is far-reaching, as these networks present an efficient platform to identify and make contact with a large number of potential recruits. It stands to reason, then, that direct selling companies quick to employ technology-enabled solutions to engage these audiences will undoubtedly be positioned competitively for growth.

With more than 600 million members on social networks worldwide, these massive online communities are growing by approximately 500,000 new users each day. Worthy of mention are the millions of blogs and forums catering to every imaginable genre.

hina has the largest blogging community in the world, with 42 million bloggers, more than the United States and Western Europe combined. As these numbers continue to grow, businesses can begin to see the opportunity social media offers.

Consultant and Customer Information Hosting or engaging in a social network provides direct selling companies access to low-cost market research/data. Developed social communities are places where consumers share information about products and services they use. Embedded in this information are user tastes and preferences. Access to this information offers companies the opportunity to get immediate customer feedback on new product launches or services.

The sheer volume of online conversations is staggering: Essentially, if you are not marketing in the social networks, you are not getting in front of your current Consultants and customers. Companies marketing in this space can gain a competitive edge in market share and revenue growth, as well as benefit from costs lower than those typically associated with traditional marketing and customer service.

Accessible consultant and customer information will have a profound impact on product development and marketing. In a client-centric world, being able to identify what customers value in products and services, as well as trends in the marketplace, separates success from failure. As businesses continue to utilise social media and its benefits, a significant shift to closer customer/company relationships will occur.

 

A Place to Advertise

Traditionally, online network marketing efforts have been limited to hosting a static, replicated website with the challenge of somehow driving traffic through purchasing leads and advertising cooperatives, both high-cost endeavors. The evolutionary next step is to provide innovative and effective tools to deliver a company’s corporate message into social audiences where there is an opportunity to share. This environment is rich with Consultant and customer leads, as these communities are bound by common interests and success stories. With the potential for such far-reaching exposure, companies need to embrace social networking and establish best practices for compliance to preserve their brand integrity and ensure that their Associates are portraying their vision and values.

A comprehensive social media strategy must include tools to broadcast promotional media, such as video, directly and effectively to the target audience in the social environment, which then compels action and captures prospects’ information.

Benefits

Short term

1. Increase lead generation for Consultants and customers
   
2. Create greater customer and product promotional reach
   
3. Improve customer service in accuracy and speed
   
4. Achieve higher cost-effective branding

Long term

1. Promote employee insight, collaboration and learning
2. Create a closer relationship with Consultants and customers, allowing a faster and more accurate understanding of what they value
3. Test new markets or products without the inherent costs of traditional marketing approaches
4. Recruiting Consultants and customers, driving product development and marketing direction
5. Generate stronger consultant/customer loyalty and a higher level of growth and profitability

Negative Aspects

Risks do exist for marketers who use social media tools. Social networks are open forums for customers and noncustomers alike to freely discuss and post information/opinions; companies must be vigilant in reviewing broadcasted material. Social network mediators must be quick to deal with network users who spread inaccurate, damaging information that can have a negative influence on other members. Any information posted or distributed through social media, whether it originates from the corporation or customers/Consultants, must be scrutinized for consistency and validity. Any errors in message or content can have a detrimental effect on a corporation’s image.

Social network managers have to work hard to keep users engaged as well as entertained. Once a site is up and running, the users usually carry network direction, but a company’s involvement must not be underestimated. Managers need to be involved in order to keep the site’s content and platform exciting and fresh. This will drive an increase in traffic and user time spent on the site.

Final Thoughts

Social media offers direct sellers new and creative ways to market and grow their business. During an economic period where low-cost solutions provide opportunities for businesses, social media offers direct selling companies effective marketing tools of low cost and fast entry. Leveraging these tools’ capabilities and minimizing inherent risks require a defined goal and the appropriate management of content, platform and members. Like any business project, management and execution of the process
often decides the effectiveness and resulting success of any social media strategy.

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Rainer Paul is President and CEO of IMS.