DIRECT SELLING …IS A METHOD OF DISTRIBUTION OF CONSUMER GOODS AND SERVICES THROUGH PERSONAL FACE-TO-FACE (SALESPERSON-TO-CUSTOMER) SALES AWAY FROM FIXED BUSINESS LOCATIONS

Direct selling PROBLEMS Lack of awareness Negative image Lower availability of consumer at home Recruitment of good salespeople often difficult High perceived risk Vulnerable to economic cycles PROSPECTS Untapped market Homemaker lifestyle or busy lifestyle Changes in traditional channels Relationship marketing Low investment; rapid expansion potential Uses traditional friendship networks (word-of-mouth)

Direct Selling Why and When? (from Co. viewpoint) When the consumer has less time; is asking for more information; is seeking more convenience Product: when communicating quality is important When the company seeks a high degree of control over the distribution channel When middlemen are not easily available, costly, or don’t offer the right services When there is a recession When you have excellent people management skills

Appropriate products …used by most households (brushes) can be demonstrated at home (vacuum cleaners) involve all members of the family unit in the decision making process (encyclopedias) are differentiated from equivalent store products or cannot be purchased in stores (Tupperware) Do not represent high risk purchases to a consumer who feels knowledgeable about them (cosmetics)

Direct Selling: Advantages (Consumer Perspective) Convenience in ordering and obtaining products Demonstration in the environment where product will be used Personal consultation with salesperson in an environment --the home--where the consumer is in control

Direct Selling:Concerns (Consumer Perspective) Anxiety about manipulation: social pressure Invasion of privacy Previous unsatisfactory experience with direct selling Post-purchase service support (e.g., vacuum cleaners) Lack of relevance for much of a person’s buying