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Sherri Richards, Published January 12 2013

Direct sale evolution: Recession, social media play role in more women starting at-home businesses

FARGO - When Cathy Zastoupil first started selling Pampered Chef products 10 years ago, she filled out a paper form for every customer who ordered at a home party. Now, she brings along a laptop to place the orders.

The world of direct selling has changed substantially since the days of “Ding Dong, Avon Calling.” Now it’s more likely to be the ping of a text, tweet or Facebook alert.

“We called. We always talked on the phone with customers,” Zastoupil says. “Then we went to emailing and now it’s like texting and Facebooking. That’s how we stay in touch with our customers.”

More products are being sold via direct-sale companies, too, like clothing, customized jewelry and even erotic items.

“Every other month I’m hearing of a new home-based business that I hadn’t heard of before,” Zastoupil says.

Direct-sale companies weathered the recession better than other retailers, says Odile Streed, assistant professor of marketing at Concordia College’s Offutt School of Business in Moorhead. She notes an increase in direct selling worldwide.

Direct selling eliminates some intermediaries, so start-up companies may choose to distribute that way because they can sell their products for less, Streed says.

Also, during the recession, people who were laid off or looking to supplement their income may have turned to direct sales.

“Some do well, make a career out of it,” Streed says. “People say they don’t have anything to lose.”

Direct selling appears to be more prolific in rural areas instead of urban, Streed says, which may be another reason Fargo-Moorhead feels flush with these sorts of businesses.

Compared with a city like New York, people here have larger homes to host parties, are more likely to know their neighbors, and have access to fewer stores, she says.

And while online shopping is an option, people want to be able to see and touch the product they’re buying. Direct sales combines the two, Streed says.

Plus, social media has made it easier to market and promote direct-sale products, and organize the home parties.

When Kristin Moeller of West Fargo asks hostesses if they want postcard invitations to mail, they decline, saying they’ll just create an event on Facebook.

Moeller is a designer representative for Origami Owl, a custom jewelry company started in 2010 by a teenage girl. At first, the company had a kiosk in a mall, but found a direct sale method would be a more cost-effective way to expand, Moeller says.

Even established companies have harnessed the online evolution of direct selling, including Avon, which started in 1886 and used the iconic “Ding Dong, Avon Calling” campaign from 1954 to 1967.

DeAnna Hennebry, of Fargo, started selling Avon 13 years ago. “When I first started … it was so much more where I had to go out and hand people the brochure. Now I can send them an e-mail and say check out the brochure, here it is online,” Hennebry says.

She’s able to access more training online, and receives daily emails with new information.

Jamie Steffes, of Fargo, an independent consultant with Norwex and Pink Papaya, notes that besides connecting with customers, social media allows her to connect with other consultants. Her companies also do training online.

Steffes says she sees a downswing in home party attendance, but says once someone is connected with a consultant, her websites and Facebook pages allow for repeat business.

As someone who works full-time in addition to being a direct sale representative, social media gives her the flexibility to do both.

She also sees the growth locally in women starting these sorts of in-home businesses. She points to the numerous vendor shows held around town, especially leading up to Christmas. She’s taking part in a “Diva Expo” Feb. 10 at the Doublewood Inn in Fargo, which will feature 40 to 50 vendors.

The internet has made marketing much easier for representatives than it was years ago, Moeller agrees. But she says word-of-mouth and home parties are still key in the industry.

Zastoupil says that home parties are still the heart of her Pampered Chef business. And despite our busy lives and online social networks, women like to get together.

“We like to eat, we like to shop, and we like to socialize and you get that all at the in-home party,” she says.

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Top Direct Selling Companies Worldwide

1. Avon Products, Inc.

2. Amway

3. Herbalife Ltd.

4. Natura Cosmeticos SA (Brazil)

5. Vorwex & Co. KG (Germany)

6. Mary Kay Inc.

7. Tupperware Brands Corp.

8. Oriflame Cosmetics SA (Luxembourg)

9. Nu Skin Enterprises, Inc.

10. Belcorp (Peru)

Source: directsellingnews.com