Are you a Direct Selling company, or an ecommerce company?
“Are you a direct selling company, or an ecommerce company?”
It’s an interesting question that has a rather obvious answer: “both”. And while many of us may nod our heads in agreement at the idea of this answer to the question, very few of us actually live up to it.
Not so long ago, direct sales companies clearly thought of themselves as, well, a “direct sales company,” and simply looked for ways to add on ecommerce functionality without allowing it to actually impact how they do business. While it certainly helped our model to adapt some of these capabilities, it typically created a customer experience that left one wanting (at best). Long is the list of companies who have touted streamline ecommerce functionality only to create online shopping that can fall well short of expectations.
But the trepidation in identifying as an ecommerce brand wasn’t completely unwarranted. Many an “outsider” made their way in and out of the corporate ranks in direct selling, bringing a wide range of needed experience and expertise, only to watch it fall flat as its implementation overlooked the nuances of the field and their unique needs and approach.
For a while, it felt like you could be a great direct sales company, or a great ecommerce brand, but you couldn’t be both.
Direct sales companies ARE ecommerce companies
Of course, that’s now changed. Or at least it has for successful direct sales companies. For one, the ecommerce marketplace has incorporated approaches and techniques that feel very much like direct sales, but aren’t. Affiliate programs, influencer marketing and the like are proving just how enamored the world outside of direct selling is with sales and marketing models that are driven by individuals. As the accommodation of these capabilities becomes more commonplace, the access to those accommodations for direct sales companies has only grown exponentially in recent years. Most direct sales companies now are not only launching with ecommerce in mind, but are typically launching with an ecommerce-first mentality. And they’re taking into account these unique shades of social selling and creating truly hybrid approaches that sometimes stray from what we would consider “traditional” direct selling.
Likewise, many existing ecommerce brands who already incorporate these types of programs find it very easy to eventually incorporate a true direct sales model into their existing business. More are starting to see that direct sales can be a continuation of that strategy, rather than a completely different path, bringing with them fresh perspectives about how the model can be leveraged best moving forward without the dogma and baggage of some industry vets.
In both instances, both companies have no problems thinking of themselves as both a direct sales company and an ecommerce brand. The need to differentiate is not only no longer necessary; it’s actually prohibitive.
Direct selling’s ecommerce needs are unique
Yes, today’s direct selling company must think of itself as an ecommerce brand. But make no mistake: direct selling technology needs are still quite distinct from those of an “ecommerce only” approach. Commissions generation, selling tools, backoffice experience, reporting and options for customization are integral to the success of a direct selling strategy.
Given the amount of plugins, apps, APIs and integrations available today, it’s easy, and quite tempting, to essentially piecemeal an ecommerce strategy to fit the needs of your direct selling model. However, the “simplicity” can sometimes be quite the allusion when your system doesn’t truly integrate these components together end-to-end, for both your home office team and your Distributors. What seems like an easy add-on today can actually cause months of added headache, errors and unnecessary work as those “seamless integrations” inevitably become not so seamless. Whatever you may be saving in budget, time or planning upfront can easily be forgotten when compared to the disconnected chaos and frustration that so often ensues.
This “bolt on” approach seems like an obvious and appropriate choice at first, but it breaks down quickly. When you start with a platform focused on ecommerce only that doesn’t account for those other unique components of direct selling, and ‘bolt-on’ commission and seller tools from other third parties, things can start to break down quickly. There can be gaps between the systems, causing incorrect or delayed commissions. While the very simplest form of commissions may not be an issue (think 25% paid on all retail sales), areas like incentives, promotional experiments, and even couponing or discounts in a way that syncs with the structure of your plan can be a real issue and become highly manual. You may see similar issues with a robust subscription functionality that trigger other commission rules. Simply put, there are things that direct selling does that no one else does, so it’s hard to find that out of the box solution.
Ultimately, you’re stuck in the middle, dealing with multiple platforms and third parties. Some may be customizable; some might not. Some may need updates once a week; others once a quarter. Some may be invested in the direct selling industry; some not. You see where this is going.
Invest in tomorrow’s simplicity (not just today’s)
Do you find yourself tempted to take on the “bolt-on” approach to launching your direct selling platform? Does the idea of using a popular ecommerce platform with a few add-on features specific to direct selling sound like an option that’s too good to pass up? Our experience tells us it probably is, and there’s more to your ecommerce strategy that needs to be accounted for. Too many young companies take the path of least resistance in the beginning, only to be forced to wade through years of resistance thereafter. Make a decision you’ll be glad you made a year from now and find a solution that provides an end-to-end experience that serves as the foundation for growth for years to come.
Interested in seeing how Paragon provides affordable end-to-end solutions that can be customized specifically for your direct selling company? Learn more at paragoncommerce.com, and let’s schedule time for a demo when you’re ready.
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