Comparisons of Salespeople in ML vs SL Direct

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 ØImplications for managers and organizations

Sample & Data Collection • Sample: 22 member companies of the Direct Selling Association in the UK • Questionnaire - salespeople in 1 st 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 Nu. Skin Nutri. Metics 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 Characteristic ML SL Total Significance of Difference Percent full-time or self-employed prior to start of direct selling activity 50. 9 24. 0 42. 7 0. 0001 Percent with previous selling experience 42. 6 51. 7 45. 4 0. 034 Percent with five years or more work experience prior to direct selling activity 73. 8 63. 5 70. 7 0. 035 Percent with other job in addition to direct selling 64. 3 34. 5 55. 2 0. 0001 Percent for whom direct selling is primary work activity 32. 4 62. 4 41. 4 0. 0001 Percent who would seek another work activity if no longer involved in direct selling 20. 6 9. 0 17. 0 0. 001 Percent who work with more than one direct selling company 15. 2 10. 9 13. 9 0. 092 Percent female 71. 2 73. 5 71. 9 0. 297 Percent with college or post graduate degree 26. 3 11. 5 21. 8 0. 0001 Percent married or living as married 69. 5 67. 1 68. 8 0. 207 Median hours per week devoted to direct selling 6. 7 9. 4 7. 6 0. 0001 Mean intention to quit (where 1=never thought about quitting; 6=no longer active) 1. 8 2. 1 1. 9 0. 011 37. 3 33. 3 36. 0 0. 013 £ 21, 229 £ 15, 351 £ 19, 212 0. 0001 Median age Median income

Comparison of Salespeople

Comparison of Salespeople

Comparison of Salespeople

Comparison of Salespeople

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

Discussion: SL Salespeople • importance of proving themselves – desire to increase selfconfidence (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

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

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)