January 04, 2016
The Social Age
by Andrea Tortora
The Social Age is here. If you’re not taking full advantage of the tools and technologies that social platforms have to offer, you and your company are likely to be left behind as the competition leaps ahead. Now well into its infancy, the Social Age is and will be making a tremendous impact on the sales industry, especially within the world of direct selling. The changes already cannot be ignored.
Technology drives everything—recruitment, retention and revenue—for most companies. Those businesses that realize what they can achieve when all of their internal, back office, social media, field tools and software systems work together are equipped to innovate and leverage essential data that will let them thrive in the future.
Facebook, Twitter, LinkedIn, YouTube, Pinterest and Instagram are potent tools that companies and consultants are learning to use as they build connections with customers and grow sales. Other apps such as Periscope and Google Hangout are gaining traction, too. Yet many executives and companies are slow to embrace these advances. A study from CEO.com and Domo finds that 68 percent of Fortune 500 CEOs have no social media presence. Among the 30 percent who do, they only use one social channel. Here LinkedIn was the chosen platform.
In contrast to that study, it does appear that C-level executives within direct selling are more plugged in to the benefits of these engagement tools. A recent study conducted among members by the U.S. Direct Selling Association (DSA), titled The 2015 Managing Your Company’s Web Presence and Technology Systems Survey, indicates that nearly six in 10 companies surveyed report that one or more of their chief-level executives have company-associated social media accounts that they actively engage in
Additionally, over half of those also indicate that the chief executives create the content for those accounts. At Scentsy, the Idaho-based wickless candle company, it’s common for an executive to personally respond to field achievements or post in conversations on Facebook, the social media platform most used by Scentsy Consultants.
Rick Stambaugh, Chief Information Officer at Utah-based company USANA, refers to the focus of today as “Digital Humanism.” He says, “The consumer-driven Internet of things has many components, but the most prominent one is social.”
As direct sellers work toward more fully embracing the Social Age and everything that comes with it, a few things are clear:
- There is a growing correlation between social media use and deals closed. Consultants who know how to use social media see their sales skyrocket as a result.
- The growth of mobile devices means the salesforce and their customers have constant access to social platforms, no matter where they are.
- Social selling is quickly becoming a dominant sales model across all product categories.
- The use of social technologies is predicted to keep growing at a record pace.
As the Social Age develops, it is mission critical for the direct selling channel to grab the reins, educate itself and either find vendors or hire staff who have a knack for predicting what’s next and how to stay ahead of the competition.
How Small Companies Are Using Technology
Jordan Essentials—Personal Care
Jordan Essentials, which sells family skincare products, uses My Success Rocket to onboard, train and coach its consultants from day one. The interactive technology allows for two-way communication between a coach and a new recruit. The tool collects data that delivers targeted coaching and preserves time for the coach to still sell. At the same time, the gamified training module means new team members are better connected to the company. Nancy Bogart, CEO and Founder of Jordan Essentials, says corporate now receives fewer repetitive questions from first-year sellers. “We are a person-to-person business,” Bogart says. “This is a good interactive system for us.”
Bogart also envisions new methods that are more interactive than what’s available today, such as Go To Meeting or Skype. “I’d love to see something that creates an experience that lets me contact a consultant and her group in California and do a training, and do it with a multichannel coaching platform that keeps the humanness in the business,” Bogart says.
She sees future technology tools “getting warmer and more personal,” so that a video chat on the phone can truly stand in as being a substitute for an in-person meeting.
Simply Said—Home Décor
At Simply Said, which offers home décor based on positive language, Founder and CEO Michelle Leuthold spends lots of energy on getting new designers launched well so that they activate faster and start generating sales. She’s using social media, videos and interactive tools to do it.
“That is where it all gets so interesting,” Leuthold says. “With technology we have to find a way to keep the importance of the relationships. It is an interesting challenge that we are still experimenting with.”
Social media can and should be used to reinforce the closeness and sense of “family” within and outside a company, says John Rochon, CEO of CVSL, a brand holding company of eight direct selling firms.
“It’s important not to make the mistake of getting too slick and losing the human essence of what drives social media,” he says. “It’s not about technology, it’s about relationships and reinforcing a sense of belonging by the salesforce.” The next big leap will be in finding new and interesting ways of combining social media and technology tools with making relationship-based commerce easier, Rochon says.
Traci Lynn Jewelry—Jewelry
Companies like Traci Lynn Jewelry, which leverage people in their own organizations to move things forward, will find success faster. People from the field (who are not sales leaders) are leading a Fragmob implementation at the jewelry firm, as well as leading the social aspect.
“Dr. Traci Lynn is embracing what good organizations have done forever,” says Michael McMillan, Vice President of Customer Experience at Fragmob. “Before you go external, you look internal, and all the field people are members of your sales team.”
Social media strengthens the person-to-person connection at the heart of direct sales. It allows for instructional videos on how to use a product, personal testimonials, and business coaching and training which build relationships between sellers and their sales leaders, sellers and clients, and even consumers and a company’s brand—whether they are in the same location or continents apart.
As the Social Age develops, it is mission critical for the direct selling channel to grab the reins, educate itself and either find vendors or hire in-house staff who know the platforms, can keep pace with their evolution, and have a knack for predicting what’s next while staying ahead of the competition.
Companies are often faced with tough decisions about where to allocate their IT budget. The speed of development within the tech field has produced and continues to produce more options for companies to choose among than they may have dollars to purchase. How does one decide?
Julie Cabinaw, Vice President Marketing Technology and Innovation at Scentsy, says, “It’s important to assess the value of each platform to your audience and choose the ones that will best help you enable conversations that amplify your brand. We view [these technologies] as an opportunity to connect to our Consultants and customers where they live digitally.”
Companies like Younique, It Works!, and Traci Lynn Jewelry recognize the need to integrate their systems in order to revolutionize social selling and meet their customers and potential distributors where they are. They are doing it by maintaining a focus on being flexible and mobile.
It’s also critical to balance dependence on technology tools with the people-centric philosophy that forms the foundation of the channel. Social media, according to Scott Stratten, President of Ontario-based UnMarketing, is not necessarily a lead-generation tool, but rather a conversation tool. Stratten, who delivered a keynote address at the recent DSA Sales and Marketing Conference, describes social media as more of a sales sieve than a sales funnel. He says, “Twitter, Facebook, and LinkedIn can be terrible for sales and marketing. Spam has a better click-through rate, and that’s not an exaggeration. These platforms are best used for the three C’s: community, conversation and customer service.”
When both the company and the salesforce use social media to listen to customers, share stories and share emotions, those efforts can have a positive impact on the brand and thus sales. Cabinaw goes so far as to say the companies who will succeed in this arena are those “that understand their first goal is helping Consultants use social media.”
Many companies use Facebook to start conversations with independent representatives as well as customers. When the company puts dedicated resources toward responding to comments and cultivating those conversations, a true community can develop.
Utah-based wellness company 4Life Research intends to use its Facebook conversations as the foundation for more far-reaching relationships. Calvin Jolley, Vice President, Commununications, says, “In 2016 we’re focusing on campaigns that engage followers with posts that are designed to encourage sharing and commenting. Our intention is to build relationships with those digital brand ambassadors whose social media activity increases our ability to communicate with others.”
Sales generated through social media channels are expected to top $30 billion worldwide for 2015, according to statistics provider Statistica. That’s up from $20 billion in 2014. Direct selling companies are capturing their share of those results. Since its launch in 2012, for example, Texas-based Le-Vel has found 90 percent of its customer growth through connections on Facebook and other social media networks (see “Cloud-Based Company Is Helping Millions Thrive” on Page 36).
As companies boost their social media audiences, they also increase social sales. A study of 500 retail merchants from Internet Retailer found that in 2014, total social commerce sales for this group of businesses was $3.3 billion, up from $2.6 billion in 2013.
Sales generated through social media channels are expected to top $30 billion worldwide for 2015, according to statistics provider Statistica. That’s up from $20 billion in 2014.
Derek Maxfield, Younique Founder and CEO, designed the beauty company around the use of social selling-empowered technology from the onset. Maxfield says, “When you equip social-media savvy Presenters with the right tools, you end up with a social selling model that works. We rely on a seamless digital experience that comes to life through our Presenters.”
Younique’s primary party takes place in the virtual world, and “we’re continually looking for ways to strengthen that approach,” says Maxfield. Younique has added Virtual Hangouts, a video conferencing capability in which Presenters can showcase and sell products as well share tips with customers and even train other Presenters.
The more time companies and consultants spend using social media, the more sales improve, according to the Social Media Marketing Industry Report from Social Media Examiner.
Among all companies using social media for at least five years and who spend 40 hours a week marketing on social platforms, 70 percent say the efforts yield better sales. By comparison, only 38 percent of companies using social media less than five years, or those spending fewer than five hours a week, marketing through social media report increased sales.
An increasing number of companies believe that social media yields measurable returns. For example, 51 percent of business-to-consumer marketers think their Facebook campaigns are effective. They cite these benefits of social media marketing:
- Nine in 10 see increased exposure.
- Three-quarters report increased traffic.
- 51 percent indicate improved sales.
Facebook tends to dominate the playing field. According to Social Media Examiner, 96 percent of marketers say Facebook is their primary social platform, though other platforms work well for many. Fast-growing jewelry company Noonday Collection is among companies that have placed an increasing emphasis on Instagram with positive results (see “An Artisan Revival” on Page 48).
Things are likely to change as businesses ramp up their use of social and technology tools. The Social Media Examiner report says that nearly two-thirds of marketers plan to increase the use of Twitter and YouTube, and 60 percent say they will increase their Instagram presence toward customers.
Successful sales people aren’t just playing around on social media. Their online activities and communications are wrapped up in the sales of their products and services. The most effective ones are those who create genuine communities of people connected by common interests. They may share product tips, answer questions, offer advice and even make people laugh or feel inspired with a funny picture or inspirational quote.
The common denominator among those in the salesforce who use social media to enhance their selling is authenticity. They believe in their product or service, and they believe in the power of social media. The combination creates a highly effective method to build a sales pipeline and nurture leads. At USANA, Stambaugh says the company looks at all social media platforms for insight and understanding of what people like and why they like it. “We may not always deploy a particular platform,” he says, “but we want to understand it.”
Direct sellers and sales leaders know they need to use social media to their advantage, but they sometimes struggle to find ways to understand the data they generate about their sales teams and customers. They want to integrate this information into their systems in ways that allow them to gain new insights and take actions that grow sales.
Though Younique considers itself primarily a virtual party company, Maxfield understands that some Presenters still have in-person sales. As a result, the company is developing an app tied to the company platform that enables Presenters to process and record cash and credit card transactions for customers, as well as manage that customer information for future purchases.
In the next few years, companies can expect to have access to even better tools that build upon the reams of data now being collected. Vendors and direct sellers are working fast and hard to keep pace with technology, and better their analytical tools.
The Move to Mobile
Many of us now access the Internet through a mobile device. In the 2015 study, U.S. Digital Future in Focus, comScore reports that mobile access to the Internet quadrupled in the past four years. At the same time, desktop access is up 37 percent.
What’s the No. 1 activity people engage in when they are online? Social networking. And a third of all traffic to the Top 10 digital properties were mobile-only visits:
- Google is the No. 1 digital property with 238 million unique U.S. visitors.
- Yahoo is No. 2 with 216 million unique visitors.
- Facebook is No. 3 with 207 million visitors.
The amount of time and activity consumers spend on social networking sites makes the case for social selling crystal clear. By the end of 2015, more than half of all social networking will occur on smartphones and tablets, according to research firm eMarketer.
At the end of 2014, Facebook provided 61 percent of all social logins and made up 72 percent of all e-commerce social logins, reports Gigya, a customer data and insight provider. In fact, Facebook’s engagement rate among its users blows Instagram and Pinterest out of the water.
The DSA’s Web Presence study also reports that nearly eight in 10 companies surveyed indicated that their customers can place and complete orders entirely on mobile platforms (78 percent). Younique certainly is in this group, referring to itself as a “mobile first” company, with 76 percent of total traffic coming from mobile devices according to Maxfield.
In their book, A World Gone Social: How Companies Must Adapt to Survive, authors Ted Coiné and Mark Babbitt talk about how social media requires executives to be willing to let go of their control of the corporate message and be active listeners. Social media channels allow companies to crowd source in innovative ways, Coiné says in a video message on the book’s website.
“Average people are connecting to extraordinary thinkers and they are able to become extraordinary themselves through their network,” Coiné says. “Your people, some of them are expert enough to lead you into the social age. You just have to let them.”
The balance between maintaining control of the corporate branding and messaging while at the same time empowering the salesforce to use social media to the fullest extent can be exceedingly difficult. It can be challenging knowing where to draw the line for field leaders with entreprenuerial instincts of their own. Certainly getting their input and including them in the discussion of how to protect the integrity of the corporate message could be a first step.
The Human Element
The companies that will excel in the Social Age are those that find ways to collaborate with the independent representatives in the field as they invest in IT and development to create useful tools. A team approach can strengthen businesses. Listening to the ideas and feedback from those who are selling the products brings competitiveness with new technology and keeps pace with growth, all while tapping into the motivations of what drives people to sell or buy.
The DSA’s Web Presence study reports that roughly 70 percent of those surveyed indicated the primary purpose of their company’s corporate website is information sharing and branding. Only 17 percent reported online selling as the primary purpose, even though two-thirds of those surveyed do award their online sales to a distributor.
This statistic illuminates an opportunity for all companies to align with consumer preferences. More and more attention will need to be given to the development of online and e-commerce strategies that satisfy both the independent representative’s relationship with his or her customer and the desire of customers to shop online.
In today’s Social Age, nothing is just business anymore; everything is personal. In fact, direct selling, as a business channel, is in the perfect position to lead the charge to take technology and turn it into something that resembles and enhances the human element. After all, direct selling is the most relational of all selling methods.