March 01, 2017
Millennials and Direct Sales: An Ideal Collaboration
by Heather Martin
If America’s millennials were a country, they would be bigger than Great Britain. And France. And Canada.
The U.S. Census Bureau reports that 83 million people were born between the late 1970s and the late 1990s, making them one of the largest, most influential generations in history. They came of age during a time of major technological, economic, social and political changes. They saw the rise of personal computers and the fall of the Berlin Wall. They watched an implosion in conventional corporate America because of companies like Enron and an expansion of access to information and people because of companies like Google.
As a result of these experiences, millennials may be more wired, more community conscious, and more skeptical of traditional business and life practices than Generation Xers and baby boomers. They also get married later, are less likely to own a home or a car, and are less interested in working a 9-to-5 job until they retire. Millennials also value social connection but demand personal freedom. They crave collaboration but have a strong need to express their individuality.
This combination of traits and experiences makes millennials sound like ideal candidates for direct selling, which might explain why nearly one in three people involved in direct sales is between the ages of 18 and 34, according to the U.S. Direct Selling Association (DSA)—that’s 5.9 million of the 20.2 million people associated with direct sales.
Recent studies by Amway and SUCCESS magazine also reveal a strong desire among young adults to pursue entrepreneurial opportunities. Amway’s 2016 Global Entrepreneurship Report indicates that 52 percent of millennials younger than 35 can imagine starting a business. The 2016 SUCCESS magazine survey, conducted online by Harris Poll, showed that in the 12 months leading up to being surveyed, 5 percent of millennials earned income through direct sales. In general, according to the SUCCESS magazine research, millennials are more likely than adults age 45 and older to earn income from what’s called the “YouEconomy”—that market segment covering such self-driven enterprises as Airbnb, Uber, eBay, Etsy, and direct selling. (YouEconomy is defined as a market segment in which individuals work as an independent contractor, an independent representative through direct selling, renting out assets, selling items through an online platform, self-employment or managing a small business, or ride-sharing driver.)
As DSN celebrates its first Direct Selling Forces Under 40 class, we want to examine the impact and success these millions of young people are having in this channel of distribution—not just as entrepreneurs but as corporate employees and consumers.
Millennials in the Field
Of all the direct selling companies on the map, perhaps none knows the millennial age group—at least the youngest members of it—as well as Nashville-based Southwestern, whose Southwestern Advantage division recruits an independent salesforce of college students to sell educational products.
In any given summer, between 1,500 and 2,000 18- to 23-year-old Southwestern representatives spend up to 80 hours a week selling study guides and other K-12 curriculum supplements door to door.
Southwestern Advantage Global Director of Campus Relations Dr. Ralph Brigham says this segment of the demographic is perfect for this work. “They are very used to talking about and being comfortable with books and studying because that’s what they’re doing in college. They’re very familiar with these topics.”
Brigham and other direct selling executives with a significant number of millennials selling their products and services say millennials are generally successful in this channel because they like flexibility and are independently minded, eager to learn, and motivated by recognition. “They really love that whole recognition part,” Brigham says, noting that in every Southwestern sales territory the field representatives gather on Sundays for training and the chance to be acknowledged for their successes.
Utah-based Jamberry is another company whose field representatives are almost exclusively millennials, comprising about 80 percent of the consultants who sell Jamberry nail wraps. “From the very beginning, we immediately recognized that our product and business model appealed to millennials,” says Chief Growth Officer Brick Bergeson. “We were seeing that the majority of new consultants were in the age range of early 20s to mid-30s.”
Aside from giving consultants and customers a tangible, colorful way to show their individual style, Jamberry resonates with millennials because, like more and more direct selling companies, it has built its selling strategies around technology. Millennials are the first truly digital natives, and they are comfortable working and interacting digitally. “Social sharing and selling comes naturally to this age group,” Bergeson says. “We recognized that early on and built strategies around that very aspect.”
One of Jamberry’s most successful social media campaigns didn’t even start in the corporate office, Bergeson says—#becauseofjamberry emerged organically from consultants on Instagram posting about opportunities their Jamberry incomes were giving them. One woman said it allowed her to pay for her child to join a chess club, says Senior Content Marketing Manager Caitlyn Brooksby. Another was able to take her husband to dinner at a restaurant they’d never been able to afford. “Our product is about more than just nail wraps,” she says. “We’re able to help those we care about the most.”
Working for a larger purpose is a strong value among millennials. According to DSA’s 2016 U.S. Consumer Trends report, 90 percent of millennials say being able to “give back” is an essential factor in choosing a job.
So Jamberry has given its consultants opportunities to contribute to such causes as cancer and heart disease prevention, Brooksby says. In the past two years, Dallas-based nutritional supplement company Le-Vel has donated $500,000 to charity, from the sales of limited edition products it created for breast cancer awareness and an organization that supports people with disabilities.
Le-Vel Co-CEO and Co-Founder Jason Camper says the company understands that having a higher purpose—whether it’s backing a cause or achieving personal growth—is important to their field representatives, whom they call Promoters.
“We really try to get in emotionally with Promoters; we want them to succeed not only in Le-Vel but in life,” Camper says. “We’re always asking our Promoters, ‘Why are you with Le-Vel? What do you want out of life? Where are you going?’ ”
Of course, not every millennial is right for every direct sales opportunity.
Older millennials, those in their mid-30s, are better fits for Le-Vel because the company targets people who are “a little bit more grounded in life,” Camper says. So about one-third of Le-Vel promoters are millennials, says Camper—who, in his late 30s, either just makes or just misses the millennial cut, depending on which decade range you choose.
Le-Vel also is capitalizing on the value millennials place on wellness, which Goldman Sachs’ macroeconomic research suggests is more of a lifestyle for millennials than something to focus on only when they’re sick. So it’s not surprising that 600,000 Promoters have signed on to sell Le-Vel supplements and other wellness products.
Millennials in the Office
While the majority of people in direct sales usually are in the field, companies do need corporate staff to lead and support their sales representatives. As Camper says, “I couldn’t run this company just by myself.”
Creating a home office that attracts millennials seems like more of a focus for some of the companies we talked to than for others. Many of Southwestern Advantage’s executives and support staff do work remotely, Brigham says, but they’re not just millennials. There’s a pretty even mix of generations. But at Jamberry, 60 percent of the corporate employees are millennials. Brooksby, who’s 28, joined Jamberry in mid-2016 and says she was excited to move from an older, more traditional company to an entrepreneurial environment. “Millennials are drawn to startups,” she says.
Brooksby also appreciates the Jamberry culture: Its open-concept office promotes collaboration—“which you know millennials like,” she says; leadership invests in employees’ professional development; and perks such as an on-site gym and a stipend for food boost millennials’ overall engagement.
Le-Vel’s highly virtual operational structure appeals to the tech-savvy younger employee, Camper says. There are about 100 corporate staff, more than half of whom telecommute, which satisfies a millennial’s desire to work on his or her own terms. “We’re not requiring someone to uproot their family and move to Dallas,” Camper says.
Millennials in the Buyer’s Seat
As the largest segment of the population, millennials also have the most spending power—about $200 billion annually, according to a recent report in Forbes magazine. And according to the SUCCESS magazine research, millennials are almost as likely to be YouEconomy entrepreneurs as they are to be YouEconomy consumers, with 54 percent of millennials purchasing YouEconomy goods and services in the 12 months leading up to the survey, compared to 42 percent who earned income through the YouEconomy during that time.
This economic influence, and the fact that they are “very brand loyal,” makes millennials a prime audience for direct sellers, says Brooksby, who was a Jamberry customer for four years before she joined the company.
Camper says that about one-third of Le-Vel’s consumers are older millennials, who are drawn to the product for the same reason Promoters are: because they see it as part of a commitment to a healthy lifestyle. “They are people on the go. They take care of their bodies,” he says.
While Southwestern considers its book dealers its consumers, it does offer anecdotal evidence that the end users, families who buy the educational materials, fall into a younger demographic. “The millennial generation has younger children, so they are into early learning and education in general,” says Director of Communications Trey Campbell. “They also value hard work and like to help people. Once they understand what the student is selling and how it can help their family, they are much more open to making the purchase.”
DSA data does support the idea that millennials who are parents have younger children. According to the 2016 U.S. Salesforce survey, millennials “are the most likely to have two or three children under 18 in their household.”
A Good Match
On many levels, direct selling seems to align with how millennials think and operate. It does not require them to fit into a conventional career box. It is often technology-driven, allows them to have a large degree of personal freedom and, especially if it’s a second source of income (as many direct selling opportunities are), gives them the opportunity to engage in more than one professional pursuit at once.
“We’re in a ‘gig’ economy,” Brigham says. “Staying with the same company for 40 or 50 years and getting your gold watch isn’t happening.”
Millennials are reshaping the way business is done. Directly.
Success Magazine Survey Methodology
This survey was conducted online within the United States by Harris Poll on behalf of Success Partners Holding Co. from May 17 to 19, 2016, among 2,026 U.S. adults ages 18 and older, among whom 426 are millennials (ages 18-34). This online survey is not based on a probability sample and therefore no estimate of theoretical sampling error can be calculated. For complete survey methodology, including weighting variables, please contact Charlee Russell at email@example.com.