Comparisons of Salespeople in ML vs. SL Direct Selling Organizations

Comparisons of Salespeople in ML vs. SL Direct Selling Organizations Mia Yan Jake Raynard

Background of Study • Purpose: • Determine whether ML and SL salespeople differ on behavioral, motivational, or descriptive characteristics • Implications for managers and organizations

Sample & Data Collection • Sample: 22 member companies of the Direct Selling Association in the UK • Questionnaire - salespeople in 1st month with the company • 4050 questionnaires sent - 673 usable responses (response rate of 18%)

Multilevel: • Amway • Cabouchon • Dorling Kindersley • Herbalife • Kleeneze • Mary Kay Cosmetics • Nature’s Sunshine • NSA • NuSkin • NutriMetics • Oriflame • Studio Dee • World Book Learning Journey Single Level: • Ann Summers • Betterware • Encyclopedia Britannica • Kirby • Pippa Dee • Princess House • Tupperware • Vorwerk • World Book Childcraft

Research Methodologies Variables: • Job characteristics • Proving oneself to others; personal feelings of success; work rewards and career growth; being in control • Job satisfaction • Organizational commitment • Involvement and loyalty; propensity to leave • Met expectations • Personal growth and well-being; achieving and accomplishing results; job and its image and rewards; undesirable job characteristics • Image of direct selling • Hard sell, misleading, illegal; advantages to buyers and sellers; better salespeople than retail stores

Characteristics of Respondents

Comparison of Salespeople

Single Level Salespeople median age 33.3 median income – 15,351 education – 11.5% college or post graduate work experience – 63.5% (5+ years) primary job – 65.5% Prior selling experience – 51.7% Median hours a week for DS – 9.4 Mean intention to quit – 2.07 Multilevel Salespeople median age 37.3 median income – 21,229 education – 26.3% college or post graduate work experience – 73.8% (5+ years) Primary job – 35.7% Prior selling experience – 42.6% Median hours a week for DS – 6.7 Mean intention to quit – 1.75 Comparison of Salespeople

Discussion: SL Salespeople • importance of proving themselves • desire to increase self-confidence (younger, less educated, less experienced, lower income) • importance of selling a highly competitive product (boost their confidence) • independent contractor – simply sells the product/ service • do not assemble a cadre of salespeople/ downlines • Consider DS as their primary work activity (more hrs) • Equates success with personal sales levels

Discussion: ML Salespeople • personal selling is not the only focus • build and maintain one’s organization, a network of downlines. • attains success through intrinsic feelings of personal satisfaction (recruiting, training, and motivating others) • MLs move beyond a tactical focus on completing tasks (SLs) • strategic focus on facilitating the completion of plans through others

Implications for Managers • Single Level DS companies: • Focus on recruiting younger, less highly educated, less experienced people who view direct selling as their primary work activity • Multilevel DS companies: • Recruit older, more highly educated people with greater full-time experience who wish to maintain another job in addition to DS work

Single Level Organizations • Training focus: • sales skills • product knowledge • Competitive advantage • Self-motivation • Confidence building activities • Shorter-term sales goals – build their confidence incrementally

Recognition programs highlighting achievements Compensation payments should be given frequently Stress individual performance rather than competition with a whole group Single Level (cont’d)

Multilevel Organizations • Training focus: • Activities building organizational commitment • Communications or newsletters to highlight group achievements • Group meetings for those within a person’s downline • Any type of social activities

Amway team activity (Germany) Amway Team (Taiwan)

Comparisons of Salespeople in ML vs. SL Direct Selling Organizations