June 01, 2013
Growth Award: Extraordinary Growth for a Brand-new Company
by Barbara Seale
Nerium International accepts the Bravo Growth Award at the DSN Global 100 Celebration held in April.
IN THIS ISSUE:
Nerium International is breaking records. But then, that’s what it was created to do.
Nerium was blossoming from the moment it launched in the fall of 2011. In that startup year alone it attained $2.5 million in revenue. By the end of 2012 it achieved 3,900 percent growth and generated $100 million in revenue. For that amazing achievement it was awarded the Bravo Growth Award for achieving the highest percentage of growth over the prior year. That phenomenal blastoff placed the company at No. 86 on the Direct Selling News Global 100 list.
By the end of 2012 Nerium International achieved 3,900 percent growth and generated $100 million in revenue.
“I think this is the first time a company has gone from startup to $100 million in its first year, as well as into the top 100 global companies,” Nerium International Founder and CEO Jeff Olson says proudly. Then he quickly shifts to looking toward the future. “That says a lot about the company. You can only imagine, with those early results, where we will be and what we will do by the year 2020! The average company in the Global 100 is 15 to 18 years old and does business in 10 to 15 countries. We ranked on the list with one product and one country.”
Nerium’s single product is NeriumAD Age-Defying Treatment night cream that is clinically proven to reduce the appearance of fine lines, wrinkles, discoloration, uneven texture, enlarged pores and aging skin. Nerium encourages customers to take before-and-after pictures so they can have visible, objective proof that the product works.
Nerium International was actually created to market NeriumAD. Scientists at Nerium Biotechnology Inc., an international research and development company, which now functions as Nerium International’s business partner, accidentally discovered the Nerium oleander plant while doing other research. As they sought the potential uses of the plant, they discovered that its extract delivered remarkable age-defying results when applied to the skin. They then developed a proprietary process to extract the plant’s beneficial ingredients so they could be used in products.
From Source to Sell, Slowly
Managers there spent two years searching for the best way to market their discovery. They expected to sell the resulting products through traditional retail stores and direct marketing channels such as infomercials. Eventually, they explored direct selling. That was when they met Olson, an industry veteran, and asked him to lead the new company.
|Jeff Olson, Founder and CEO of Nerium International, addresses the crowd after his company accepts the Bravo Growth Award.
First, he wanted assurance that the product worked. The Nerium Biotech team presented him with a stack of peer-reviewed studies on the extract’s effects on the skin. Olson was impressed but not yet convinced. Knowing how critical it is for direct selling companies to defend their claims about product performance, he asked for third-party clinical trials.
So Nerium enlisted the services of highly respected ST&T Research International to perform rigorous clinical trials. ST&T selected participants for the trial, randomly assigning them to test the effects of NeriumAD. ST&T’s technology includes the most advanced facial scanning equipment available to see what’s happening on the skin’s surface, and also what is developing underneath. The scanners produce objective results based on computer analysis of changes in the skin. ST&T scanned the skin of study subjects each week for 30 days. ST&T researchers consider a 5 percent improvement in 30 days to be a very good result. They found far greater results from NeriumAD. Finally, Olson was on board.
The company holds globally exclusive dermal and oral application rights to NeriumAD’s proprietary ingredient, and it protects the integrity of raw materials by growing them at Nerium Biotechnology’s exclusive commercial farming operation—the only one in the world dedicated to the cultivation of the Nerium oleander plant. With strict biomedical field protocols—the highest standards for commercial farming—the farm provides a dedicated and renewable resource reserved exclusively for research and production. The facility provides Nerium with plant-to-product integrity and almost unlimited capacity.
|2013 Bravo Growth Award: Nerium
All those elements were essential to Olson because he was beginning to see the opportunity to achieve a personal goal: to build what he thought to be the perfect direct selling company. To achieve that goal Olson wanted his company to be built with the best of everything. Having a great product was only the beginning.
“When we launched, we were a mature company, whether you looked at our management or our systems. Nerium International may have been one day old, but it was actually 20 years old.”
—Jeff Olson, Founder and CEO
The next step was building a great management team. He combed the industry for available, seasoned, smart, professional executives. The senior staff members were in place for almost a year before the company took its first application from a prospective Brand Partner. Olson says the Nerium International team has 150 years of collective direct selling experience.
“We took our time to get it right,” he recalls. “We have 10 core values, but the one we follow the most is ‘slow down to go fast.’ If you’re going to do it, do it right the first time.”
The team developed industry-leading tools, training and back office applications that made the company look well-established on Day One. And the compensation plan was designed to create distributor success. It includes a generous offer to provide Brand Partners with free products for their own personal use or to help them further build their business. For example, when three customers sign up for a monthly auto-delivery, the Brand Partner receives a free shipment of their own monthly supply. Brand Partners also receive free bottles of the product for every auto-delivery order that they sell.
“When we launched, we were a mature company, whether you looked at our management or our systems,” Olson says. “Nerium International may have been one day old, but it was actually 20 years old.”
Such meticulous, top-quality planning let the young company grow organically, but at fast-forward speed.
“I think this is what I love the most,” he says. “Because we did everything with such high quality, everything is world class. Because of that, we have attracted the most amazing people who do things first class, and with integrity.”
Meticulous, top-quality planning let the young company grow organically, but at fast-forward speed.
With all of these elements in place, Brand Partners can also take full advantage of one of Nerium’s strong suits—its customer acquisition strategy. “If you win at customer acquisition, you’re a winner,” Olson says. “Our whole goal from Day One was to create a reason for a person to become a customer—someone not involved with the compensation plan at all. If you win at the customer level, everything else is easy. If you don’t, everything else is hard.”
He says that Nerium has an expansive customer acquisition model that is Priority One, Two and Three. It begins with a desirable product squarely focused on a society obsessed with looking youthful. Then it offers that product at a discounted price when the customer becomes a Preferred Customer and signs up for auto-ship. Customers even get their own website and can earn free products when they refer friends and meet other criteria. The whole system is a giant customer acquisition magnet.
When acquiring customers is that easy, Brand Partners benefit, and they stick around.
“We have unprecedented retention,” Olson reports. “When the customer proposition works, it all works. When you’re constantly churning, then that’s when this business is difficult.”
Personal Development Culture
Culture was key to everything. Olson explains that Nerium International is built around three words: Make People Better. Yes, products must be excellent, and yes, a compensation plan has to deliver premier results to distributors and the company. And certainly a customer acquisition strategy must be in place. But culture? Olson says a great culture is what causes companies to thrive.
“For us it’s all about personal development,” Olson says. “When we created our distributor kit, we made half the kit about our brand partners and their personal journey. It’s about helping people become a better version of themselves.”
One of the kit’s key elements is Olson’s book, The Slight Edge: Turning Simple Disciplines into Massive Success. In the book, Olson outlines a way of thinking and a way of processing information that he believes are critical to making the daily choices that lead to success in life and in business. Working through the kit and the book helps new Brand Partners get off to a fast start and maintain their momentum.
Personal development for Nerium International Brand Partners may begin with the welcome kit, but it doesn’t stop there. It is the single largest part of every event. The company has hired Shawn Achor, author of The Happiness Advantage, to present a three-hour workshop at every event on increasing their success by being happy.
“It’s where we shine the light,” Olson says. “We do personal development because we believe in it.”
Setting Records, Changing the Game
In its second full year, growth is continuing at a fast rate. Just as the company was quick to reach $100 million in revenue, Olson wants to continue that growth. He says that Nerium International is on track to reach another significant level next year.
How will they do it? By continuing to execute with excellence and to constantly improve. The status quo isn’t good enough, he states flatly. As great as the current tools and systems are, Nerium will work to upgrade them.
“By expanding our salesforce and product line, we’ll naturally grow,” he says.
Those plans are in the works. Customer research shows that some people want products that are specific to their concern. So Nerium has other products under development, and it’s just the beginning, Olson says. The company has already identified more than 20 products to market in years to come.
The groundwork is also laid for geographic growth. Nerium International now operates in every state, as well as the U.S. territories of Guam and Puerto Rico. To build their global presence, the company has hired a senior vice president of global operations, who has experience working in 30 different countries. At least six countries are slotted to open their doors to Nerium International in the near future.
But traditional growth methods are only part of the story. Olson offers a hint about future plans. Early in 2014, Nerium International plans to launch something that leaves him very enthusiastic about what’s to come. Nerium innovators are sweating every detail of the initiative, and the company will launch only when every facet of it is polished.
Olson says, “I am more excited about what we’ll look like a year from now than even where we are now. What I’m most proud of is that I feel like we’ve done things right. Our goal is to be a shining star of the industry.”