Company Spotlight
January 2010
Living the Dream
Oriflame pioneered natural beauty products not tested on animals back in the 1960s and is today one of the world’s fastest growing direct selling companies. Here, Direct Selling News Europe’s Madeline Clark looks at the company’s very latest developments within Europe and finds out more about its exciting new strategies for attracting budding entrepreneurs.
WHEN Swedish brothers, Jonas and Robert af Jochnick and their friend, Bengt Hellsten, launched Oriflame in 1967, their dream was to ‘conquer the world’ with pioneering natural beauty products that would never be tested on animals.
Today, that conquering spirit lives on, as Oriflame continues to grow with that same bold vision of becoming the world’s number one direct selling company in the skin care and cosmetics industry.
Michael Cervell, Senior Vice President of Direct Sales, explained, “We have this vision, not necessarily because we find it important to be better than our colleagues in the industry, but because we want everyone in the company to come to work every day with an attitude of winning.
No one who ever won an Olympic gold medal did it by practising for a silver medal!” As part of this grand plan, the company has just completed a groundbreaking re-organisation of its European business by merging the company’s western Europe and North African region with the central and eastern Europe region.
The new region is now being run from offices in Warsaw, with the key benefits of pooling resources and sharing best practices across the board. Oriflame is confident these major changes will lead to increased business and greater expansion within these markets. The company currently operates in 22 countries across Europe and has a total of 700,000 Consultants in those countries.
“The western European market and the central European market are becoming very similar in their demands for products,” said Michael. “With this in mind, we felt this was the right time for them to operate as one region. We are confident these changes will open up even more business and help us to continue to grow.”
Michael, who joined the company in 1991, added, “In these challenging economic times, the interest in the business opportunity is increasing, and recruiting is going well. We have a large proportion of sales in central and eastern Europe, and these economies were affected by the current world recession six months behind other European countries. This was beneficial, as it enabled us to adjust our plans and prepare. Our strategy has been to keep our salesforce as active as possible by ensuring we have goodvalue offers for the end customers in addition to manynew products.”
Meanwhile, the company continues to work hard to make its business opportunity concept stronger than ever. In 2008, Oriflame made its compensation plan even more attractive by launching 10 new titles, with the highest cash bonus now amounting to $1 million. Last summer, the very first cheque for this sum was presented. The company has also moved with the times by working hard to improve its sales and recruitment processes by making the earnings per hour equation more attractive.
Most recently, the company has also focused on attracting younger people into the industry. Michael explained how fantastic new opportunities to achieve this have been created by both the Internet as well as the current recession.
“There is great potential to reach out to young people on social media sites such as ‘Facebook’ he said. “Meanwhile, the current recession means many young people leaving university are finding it more difficult to find jobs. A career in direct selling may now be an option they might not have considered in the past. We offer good training and information tools on the Internet, which young people are so familiar with. People today know there is no such thing as job security, and self-employment is becoming a much more attractive option.”
Oriflame is passionate about offering people the opportunity to fulfil their dreams in the same way that its founders fulfilled their dream when they set up the company in the 1960s. Michael pointed out, “While other cosmetic companies focused on the retail environment and stores to reach consumers, Oriflame’s founders chose to take an alternative route.
“They realised that many people have dreams of running their own businesses, so they adopted a direct sales model that gave people the opportunity to do this by selling Oriflame products and by inviting others to do the same. Our founders were young and had big dreams. They were going to conquer the world, but they could only do this by offering other people the same opportunity.”
He added, “Their dream was to provide people with great, quality skin care and cosmetic products inspired by the natural and distinctive beauty of Sweden,” said Michael. “Their focus of making products that contain natural ingredients and were never tested on animals was a new concept at that time.”
Attendees enjoying the evening
Today, the company continues to go from strength to strength, producing 400 new products each year with numerous special offers and providing opportunities, without any financial investment or risk, for people to set up their own businesses by simply showing a catalogue and building a sales team. The company has branded this concept ‘Make Money Today and Fulfil Your Dreams tomorrow™.’
Michael points out, “Oriflame only charges a small fee to join the company, and most training is free. Even if people leave, they will always leave with the feeling that working with Oriflame has been a valuable experience.”
The company attracts new Consultants through one-to-one meetings with an existing Consultant or through inviting prospective Consultants to attend opportunity meetings held by one of the company’s independent Leaders.
Oriflame uses a standardised Opportunity Presentation around the world, with each Consultant or Leader adding his own touch, based on personal experience.
Like most successful companies, Oriflame has embraced modern technology wholeheartedly in order to keep up with the times. Michael believes the Internet has provided great opportunities for providing information as well as for making that first contact with potential clients.
“In the last 10 years the Internet has become a key channel for communicating with the sales force as well as for providing business support,” he said. “We are investing a lot in this area, which provides a global platform. We are also taking the first steps into e-learning as a complement to face-to-face training, which is always to be preferred but not always possible. We aim, through online applications, to give our Leaders the tools they need to administer their
networks in an efficient way, giving them more time to spend face-to-face with their teams and new prospects.”
Every year brings new challenges, and Michael points out that one of the ongoing challenges at Oriflame is to maintain and nurture the entrepreneurial spirit passed down by the company’s founders through a framework of policies, guidelines and forums.
“Another challenge within a company that has been operating for more than four decades is continuing to make the company attractive to both older and younger Leaders and Consultants,” he added. “Nothing makes us more proud than when a Leader who has been with us from the early days passes their business on to their child, and the Leaders who have been with us since the early days are the most loyal ambassadors we can imagine. Still, it is a challenge to continue to make them feel important and at home at Oriflame, while at the same time making future Leaders 40 years younger feel they have joined a progressive company.
This challenge comes across in everything, from how we communicate and train to what kind of incentives and events we organise.
“At the same time, we also have all the challenges of traditional retail companies in terms of product development and customer offers, together with the challenges of motivating an independent workforce continuously in situations where the emotions and atmosphere you create can be the difference between a market that grows and one that does not. This places very high demands on the management team in each market and we are always searching for people who, we believe, fit our values and ambitions.”
Michael firmly believes direct selling regulations are crucial for protecting the industry from scams and unethical practices which can sometimes get confused, in the public perception, with legitimate business. “In this area, the recently adopted Code of Ethics by the WFDSA is very important, and we are educating our salesforce in this,” he said.
Michael believes the ongoing Orifl ame success story is based on the core values – togetherness, spirit and passion – originally adopted by its founders. “Togetherness is about working as a team, the spirit is about anything being possible and the spirit of never giving up, while the passion is about being passionate about your work and what you do,” Michael explained. “We have continued to nurture this culture, as well as having fantastic products, great catalogues and a dynamic compensation plan, and I believe these are the keys to our success.”
He added, “You cannot copy a genuine culture that has developed over 40 years. Our CEO, Magnus Brännström, has personally trained over 1,000 people in one-day seminars around the world on our values and principles, and I think
that this is quite unique. He has had a personal hand in the training of all these people, in small groups, from receptionists to managers.
“The current recession means many young people leaving university are fi nding it more difficult to find jobs. A career in direct selling may now be an option they might not have considered in the past.”—Michael Cervell
“We also have a Global Leadership Council which consists of the 15 top Leaders out of our three-million-strong salesforce. We meet for three days every year in Stockholm in the very same hotel where Orifl ame was founded and discuss strategies. This has been very helpful in developing our success and working in close partnership with our top Leaders from all over the world. Meanwhile, we have our annual conference, which took place in Rome last summer and was attended by 4,800 people from all over the world.
“We have a product philosophy of offering the wisdom of nature and the best of science and a company philosophy which is best described as offering people an opportunity to fulfi l their dream, big or small, in a natural, progressive and ethical way based on our Swedish heritage.”
NEW PRODUCTS
FACT FILE
Oriflame recently launched two pioneering new products in its wellness range which focus on weight loss and beauty from within.
The groundbreaking new weight-loss product comes in the form of a nutritional ‘Natural Balance Shake’ designed to work hand-inhand with lifestyle changes.
Michael Cervell explained, “This product is designed to work as a whole package which also involves a change of lifestyle. We go out and talk to people about this, with the emphasis on exercise and diet, including eating more fruit and vegetables.
“This is quite a pioneering product for men and women, and there is also lots of research behind it. We are also running a clinical study. You don’t stop taking your regular meal but have just half a portion of your regular meals and also take the shake. It is not just about the product. It is about a whole lifestyle package and is a much healthier way to lose weight.”
Meanwhile, Oriflame’s new ‘Beauty from Within’ products are in the form of nutritional capsules which work to reduce wrinkles from the inside.
Oriflame is also celebrating the New Year with the launch of its latest Swedish Spa range collection which offers all the luxury of a spa within your own home. Also new for 2010 is the sensuous, Giordani Gold Shine range of colour cosmetics, created for women wanting a more dazzling, radiant look. Other exciting products include the Orifl ame Perfect Body range with its leading edge AntiCellulite segment.
