33 minute read
FEATURE
In this article, I am going to discuss how Le-Vel approaches and views regulatory compliance and why it is vital for companies and leaders in our space to proactively move their companies and the industry forward in this critical area. However, this piece is not intended to proclaim that Le-Vel is perfect with regards to regulatory compliance—we are not—or that every company should do exactly as we do. Each company has its own way of dealing with this subject, and there is no one “right way.”
As the President and Chief Legal Officer of Le-Vel, I am laser-focused on growth, on morale in the field, on excitement, and on generating continued forward motion from a business perspective. Therefore, know that all of the actions discussed in this piece are done with those non-negotiable business fundamentals in mind, as well as, legal and regulatory considerations.
AT LE-VEL, THE significance of regulatory compliance is ingrained throughout our entire culture. Beginning with our coCEOs Jason Camper and Paul Gravette, myself, our Chief Compliance Officer Christopher Schmidt and including the entire corporate team and our leaders in the field, we pride ourselves on the amount of time and resources we put into regulatory compliance. These efforts are employed, in conjunction with the outstanding guidance provided by our primary regulatory counsel at Covington & Burling, in an effort to continually stay ahead of the curve and anticipate the many twists and turns in an ever-evolving regulatory landscape.
THE FTC AND OUR INDUSTRY
Our industry has been the subject of increasing regulatory scrutiny for years. And now, with Operation Income Illusion announced in December, coupled with other recent actions taken and statements made by the FTC (such as “Seller Beware”, the Keynote by Commissioner Noah Joshua Phillips at the DSA Legal & Regulatory Summit on October 15, 2020), the glare of regulatory oversight is only getting brighter. It is incumbent upon all of us who serve and lead in this industry to set the right tone and send the proper messages throughout our organizations. When we do this, it not only helps our individual companies, it also helps the industry at large.
FOUNDATIONAL ELEMENTS OF LE-VEL’S REGULATORY COMPLIANCE PROGRAM
Le-Vel, from day one, has operated with an eye towards regulatory compliance. There has never been a signup fee, website fee, or fee of any kind to join or remain with Le-Vel as a Promoter or a customer. There have never been sales minimums or quotas required in order for Promoters to earn commissions. We have never paid commissions for recruiting. Our product has always shipped directly to the end consumer rather than being purchased and resold by Promoters.
In addition to the above elements that have been part of the company since inception, there are many other compliancerelated practices, tools, and policies we use and have implemented that have served us well. Some examples include: maintaining a strict policy prohibiting the sharing of income or commissions earned; our marketing focusing primarily on the products as opposed to the opportunity, leading to less risk of improper lifestyle or income claims and a very robust customer to promoter ratio; using an automated system, as well as a manual auditing system, to scour social media and the web for any non-compliant posts, and using noncompliant posts as an opportunity to reach out to Promoters to provide 1-on-1 training; utilizing an abundance of targeted training videos; sending continuous and timely compliance communications to the field.
We have incorporated these practices for many reasons, both business-oriented and for legal/regulatory considerations. For the purposes of this article, there are two primary regulatory risks that we are attempting to mitigate through the use and implementation of the above practices.
First, our conservative policies, training and proactive compliance program help to minimize the likelihood of illusory income claims and improper lavish lifestyle claims, which are a major focus of the FTC. It is imperative that individuals not be misled by marketing, requiring transparency and clarity regarding the opportunities available and the likelihood of success.
Second, because there are no fees, quotas or required reselling, any potential harm to individuals is substantially minimized. If, after joining Le-Vel, a person decides the company is not for him/her, the individual can leave without any dollars spent outside of their personal product purchases. From the standpoint of a regulator, this inquiry—what harm do individuals incur—is very important in determining whether action should be initiated.
Aligning your business fundamentals and regulatory program with those two aspects in mind: 1. Minimizing improper claims and ensuring transparency regarding the opportunity 2. Minimizing any potential harm to participants —not only mitigates regulatory and legal risk, it is also an excellent business practice, encouraging business sustainability and long-term growth.
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THREE NEW COMPLIANCE PRACTICES
Given my view that regulatory scrutiny will increase in the future, we decided that the aforementioned steps, policies, and practices should not be the end of the equation and greater safeguards were required. As a result, we have taken many steps to mitigate regulatory and legal risk over the past 18 months. Three such substantial steps are detailed below.
SOCIAL MEDIA DISCLOSURES
Stemming from a comprehensive internal review, we implemented a new policy mandating that Promoters include a simple and conspicuous disclosure when posting about the rewards available to Promoters.
This social media disclosure contains a link to our Income Disclosure Statement (“IDS”). The IDS sets forth average income, likelihood of hitting certain ranks, time it takes on average to hit certain ranks, likelihood of achieving certain rewards, and more for two sets of Promoters: 1. Any Promoter who orders product 2. Team building Promoters
In short, when an individual sees a post showing the success of a Promoter in achieving a certain reward, the accompanying disclosure clearly and accurately provides such an individual with the information necessary to understand the likelihood of achieving that reward, as well as a simple and accurate understanding of the overall opportunity.
We were unsure if the field would take to this policy right away. However, adoption has been incredible, in large part because we explained the purpose of the policy and showed them how this not only protects their businesses but will also help them further connect with consumers through greater transparency. We found that being open and transparent with our field, rather than simply setting the policy without explanation, was unequivocally the right choice.
Although this policy was a bold step, after countless hours of discussion, we knew it was the right path forward. Individuals must know the chances of achieving success and qualifying for specific rewards so that they can make an educated decision whether or not to participate. This policy ensures
such transparency and openness. Consequently, I believe industry-wide adoption of such a policy is in the best interest of individual companies, as well as the industry as a whole.
IDS REVIEW ADDED TO SIGN UP PROCESS
The second step involved a change to our sign-up process. When an individual comes to Le-Vel.com to enroll as a Promoter, they must first view our IDS and affirm that they reviewed it. As a result, individuals will see black and white data regarding average earnings and the likelihood of receiving certain rewards before deciding whether or not to join Le-Vel. Further, it allows us to show, if necessary, that individuals were not only given access to such information but did review this information prior to joining Le-Vel.
This is a simple and easily implemented practice that adds meaningful value from the standpoint of transparency.
Regulatory compliance is good business.
PROMOTER CERTIFICATION PROGRAM
The most effective compliance programs are ones in which the field buys into the program and understands the details, the purpose, and the benefit of the program and specific policies. With that in mind, Co-CEO Jason Camper envisioned the use of an engaging and interactive Compliance Promoter Certification Program, which we recently kicked off. This Program, which utilizes quizzes and other interactive tools, reinforces our policies and moves our Promoters from passively reading policies and passively viewing compliance videos to proactively thinking through important compliance issues and their solutions.
The field has embraced the Program, proudly posting about being certified and showing off their certified “badges.” Given that compliance is generally not considered the most exciting of topics, it has been great to see both our executive leadership and the field view this important area as a valuable and essential piece of the company.
WHAT NOW?
There is no exact formula or perfect compliance and legal program. A successful program emerges from a combination of factors, including thoughtful decisions based upon facts available, the assistance of experts on the subject, and company-wide acceptance that a proactive compliance program is critical to the long-term success and sustainability of the business.
Low cost. High ROI.
This is NetSuite:
While there is no perfect formula, there are two pieces that must be present. It is imperative that companies seek to: 1. Manage and minimize lavish lifestyle/income claims and provide transparency to potential and current participants 2. Ensure the business is not operating in a manner that causes harm to participants in the business.
Consequently, companies must implement solution-based policies, tools, and practices with an eye towards these two fundamental issues.
FINAL THOUGHTS
Regulatory compliance is good business. It is right for both customers and potential customers, for individuals participating in the business, for companies, and for the industry as a whole. I know others see it the same way, and I appreciate companies that look to lead in this area.
I suggest that, as leaders of this industry, we continue to be focused, continue to listen, and continue to be willing to make changes when necessary. A company should not make wholesale changes simply for the sake of making them, but, rather, we should all be prepared to wholeheartedly embrace change when major shifts occur and the writing is on the wall. In other words, proactivity is key and putting one’s head in the sand is not the proper course of action.
If we lock arms and focus on moving forward together, the world and regulators alike will see what we already know— lives are being enhanced on a daily basis and our industry and the companies operating the right way serve as the vehicle for such incredible transformations. DSN
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AUDIT · TAX · ADVISORY
RE DEFINED
WHY INDUSTRY LANGUAGE AND THE BEHAVIORS THAT SHAPE IT NEED TO CHANGE .
BY SARAH PAULK
sees us matters. D—RYAN NAPIERSKI, Nu Skin President and Chairman of the Advocacy Committee for the World Federation of Direct Selling Associations IRECT SELLING has had a record year. In spite of all the challenges 2020 dealt, approximately 80 percent of direct selling companies grew their revenue as compared to 2019, with 30 growing by more than $100 million and at least ten more than doubling their annual revenue. Three private companies, including MONAT and Scentsy, grew by more than $400 million, and two public companies, eXp World Holdings and Herbalife appear to be on the same track. It’s a pattern that continues, as the category shows consistent, month-over-month growth during the ongoing pandemic. Relationship marketing obviously has staying power, and even companies who shy away from using the “direct selling” label know it. This year, big-name brands are turning to the social selling template to fashion upgrades to their business models, like L’Oréal, who in the last month of 2020 purchased a minority stake in Replika Software, a platform that empowers brands to “activate at scale social sellers to inspire their networks and generate e-commerce sales.” E-commerce already represents a quarter of L’Oréal’s sales revenues, and this next step will leverage what the company’s Chief Digital Officer Lubomira Rochet describes as
Speaking the Future:
Who are we? Where are we going? What should we be called?
an “ecosystem of social sellers for the beauty category” in an attempt to “crack this new channel” of social commerce.
For brands like L’Oréal and others, “social commerce” means allowing customers to shop on social platforms with the guidance of middle men and women who are experts, influencers and brand representatives—or, rather, a leaner take on the commission-based social selling model direct selling is known for.
A LANDMARK BAN
Imitation may be the sincerest form of flattery, but it’s not all good news. There’s a reason why brands are lifting the healthiest layers from the business model while downplaying its ties to the actual industry.
In December of 2020, TikTok became the first major social platform to ban multi-level marketing, lumping it in with Ponzi schemes and fraudulent activity under their community guidelines. In pop culture now, the terms “mlm” and “pyramid scheme” are officially synonymous. TikTok will certainly not be the last, as anti-mlm movements build traction. The Subreddit r/antiMLM, which now has 675,000 followers, is a landing page for posts from people who receive spammy emails from friends they haven’t spoken to in decades, spouting fraudulent claims about income potential and unrealistic product results. anguage will catch up to behavior, as industry leaders have explained, but in a field in which innovation is essential to stay competitive, is there time to wait?
Buzzwords like social selling, social retail, social commerce and social sharing are already taking the main stage with more frequency while more historic terms like network marketing and multilevel marketing are being emphasized less. But there is more linguistic room to run for companies who are ready to grow their influence outside of the industry and continue building their legacies within it.
For the direct-to-consumer model, for instance, the language is still remarkably seller-focused. Fresh titles may appear more relevant, but most point inward toward the company itself through combinations of words that describe the distributor. If the industry is going to become as customercentric as it is aspiring to be, it will need language to lead it there. That may mean setting the tone through words that point outward toward the customers they long to serve.
In a personalized customer-centric future, the focus will be less about brand evangelizing and recruitment, and more about the interpersonal interactions between industry micro-influencers and consumers that build product loyalty and a renewed reputation.
“Clearly the industry is looking for where it will go in the redefining,” says Stuart Johnson, CEO of Direct Selling News, NOW Technologies and Transformation Capital. “This is more than semantics. It warrants our attention and I’m looking forward to the discussion.”
—JOHN PARKER, Amway Chief Sales Officer and Regional President West
On the legal side of the issue, the Federal Trade Commission is ramping up efforts to crack down on network marketing companies participating in fraudulent activities. Its Operation Income Illusion, announced in December of 2020, is focused on work-from-home scams, pyramid schemes and companies who make promises about income opportunities that in actuality cost consumers more than they earn.
The distrust of the multi-level marketing label is pervasive, particularly with the youngest generations, as evidenced by their favorite social platform’s landmark ban. And yet the model is performing at peak levels, with external industries urgently innovating their digital approach in order to copy the social selling playbook. So how does the direct selling industry redefine its mission, approach or methods to keep its most valuable puzzle pieces while eschewing the elements it knows cannot fit into a credible and successful future?
DISRUPTION FROM THE INSIDE OUT
“For companies to succeed in this new economy, we must continue to be disruptors while we evolve ourselves to be even better stewards of the empowerment opportunity we represent,” Nu Skin President and Chairman of the Advocacy Committee for the World Federation of Direct Selling Associations Ryan Napierski told participants at the SUCCESS Partners University (SPU) 2020 event. “In this world where rumor travels at light speed, who we are and what we do matters. How the broader world sees us matters.”
In his presentation, Napierski did not refute the existence of bad apples within the model, saying, “In my 25 years in this industry, I’ve had the privilege of knowing some of the most amazing and reputable business leaders on the planet. I’ve also had the unfortunate experience of associating with some individuals who saw themselves as far less than the potential that they and their businesses hold. If they would think more about building a sustainable enterprise over time, not a flash in the pan, they would, in fact, contribute to building a better industry, economy and world.”
Being healthy requires recognizing illness and addressing symptoms and root causes. Negative experiences are the ones that gain publicity from onlookers. Still, if industry leaders would acknowledge the damage inflicted by toxic companies as unacceptable, it would provide more credibility to the category’s heritage of ethical, legal opportunities. Napierski’s refusal to sweep under the rug the flaws of the industry to which he’s devoted his life serves only to strengthen the opportunity. The world is telling the industry— through bans and sanctions—that trust has been broken. Leaders who are willing to follow Napierski’s example will help mend it.
CHANGING THE LANGUAGE
How industry insiders talk about their companies, compensation plans and representatives affects how the world views the opportunities they represent. Language changes over time, and so has the direct selling industry. Amway, for instance, originally referred to its representatives as distributors—because they did, in fact, purchase products, sell and distribute them to customers. Today, they refer to their organization leaders as Independent Business Owners, which the company believes is a better reflection of the role of its entrepreneurial representatives, who manage sales, customer satisfaction and team support. In contrast, the company handles distribution and delivery.
This connection between the words used to describe the industry and its real-world impact is inextricably linked. However, the words themselves have less influence than the behaviors they derive from. “The distinction and understanding that the words represent about how our business truly operates, that is really important,” says John Parker, Amway Chief Sales Officer and Regional President West. “In the end, what matters more than the words we put on top of our business are the experiences we’re providing customers. Whether we describe ourselves as being in direct selling or social commerce or network marketing, I think that’s much less important than the experience customers are having, and the experience what we call Independent Business Owners are having.”
BUILDING CUSTOMERS, NOT TEAMS
Franchise owners, food delivery workers, and even the #sponsored content from influencers have become natural bridges between customers and products. Overall, society doesn’t begrudge the association these people have to a brand, even though they profit off of the relationship and resulting purchases. In the same vein, today’s direct seller is a connector between consumers and products. Like a franchisee, they make an investment in owning their own business and then reap the profits of building it.
There is a difference, however, in that direct sellers are also building organizations through recruitment. At SPU 2020, a number of executives highlighted the importance of building customers rather than teams as a key element of not only compliance but future growth. Direct Selling News has also announced a Customer-Centric Recognition (CCR)
Program that celebrates companies creating a sustainable, customer-centric future for the industry and that boast high customer-to-distributor ratios. Team-building is still a central ingredient in the direct selling model, but the shift away from recruitment is undeniable and timely.
This switch, while a momentary upheaval for some companies, is another in a long line of changes the industry has adjusted to, especially in the wake of a pandemic. Pure Romance Chief Executive Officer and President Chris Cicchinelli describes what it was like to shepherd his company through the drastic transformation from being an in-person “party-based” company to an all-virtual company basically overnight.
“At Pure Romance, our motto is: Change is inevitable; growth is an option,” Cicchinelli says. “We need to change, and we’re going to grow from this. We’re going to come out of this a stronger organization, but we have to get uncomfortable for just a little amount of time.”
The pandemic has proven to direct selling leaders that they know how to change direction on a dime and successfully bring their organizations along with them. A course correction as significant as reexamining the recruitment model and the ways it is implemented would be well outside of the industry’s comfort zone, but, as the sudden and unexpected all-virtual approach to direct selling has shown, that’s often where the most powerful innovation resides.
—CHRIS CICCHINELLI, Pure Romance Chief Executive Officer and President
JOINING THE GIG ECONOMY
Category giants like L’Oréal are just the beginning in what will surely be a full bandwagon of brands arriving on the social commerce scene in a disruptive rush. As opinions skew negative in the marketplace concerning direct selling, relationship marketers would be wise to embrace their natural fit within the gig economy rather than insist on the #bossbabe and #buildingmyempire mentality that has attracted scorn. By embracing the “gig” title and leaving behind non-compliant promises, companies can disrupt themselves before the world around them does it for them.
“We are all really more conscious about disruption now,” Cicchinelli says. “As a 2021 project, I’m starting the conversation inside of our organization, asking how we would put ourselves out of business. If an innovative startup wants to put us out of business, we want to think like them.”
REDEFINING THE INDUSTRY
In 2021, leaders can expect to see a continued adoption of “social selling,” “social retail” or “social commerce” as key replacements for the labels that have garnered the industry distrust. Still, it will be critical to remember that the reputation of the industry is not dependent on finding just the right campaign or words that will change consumers’ minds. Instead, acknowledging that a lack of compliance by others has caused harm, and then committing to behaviors the industry is already skilled at, like philanthropy and life-improving (rather than life-changing) income, is the way forward in stomping out the reputation-tarnishing pyramid schemes and succeeding for generations to come. Ethics matter, reining in hyperbole matters and, yes, reputation matters. Redefining direct selling through behaviors that organically inspire positive language from those on the outside looking in should be priority number one.
“I don’t think it’s about picking words and then trying to build a business to support that,” Parker says. “I think it’s innovating our businesses and then the language and the words we use to describe it will become very apparent.”
Based upon the research conducted for this article, the future will be about building brands that serve their customers efficiently and personally by the independent contractors who facilitate the relationship. DSN
CONTACTSALES
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RYAN NAPIERSKI
REMEMBER WHEN it was easy to network with your peers during impromptu hallway or dinner conversations at industry events and the resulting insights that came out of those conversations?
DSN’s new Executive Insights series is the next best thing to those priceless exchanges.
The debut interview brings together Wayne
Moorehead, Chief Marketing Officer at Young
Living and Ryan Napierski, President at Nu Skin, in a one-on-one discussion about disruption, the
New Normal, what keeps Ryan up at night, and so much more. Here is a brief look at parts of their conversation. To watch the entire interview, visit
DirectSellingNews.com.
WAYNE MOOREHEAD: Thank you, Ryan, for being here today. When Stuart and Direct Selling News reached out to me with this opportunity to be the kickoff episode where one Direct Selling insider gets to interview another—you were the first name that came to my mind. I’ve always seen you as someone who’s able to understand and embrace the dynamics of change, identify those that are going to have the greatest impact and create the greatest change. We’re all wrestling with this new normal because of the seismic changes that we experienced. We have closed out what was probably one of the most dynamic and challenging years. Trends and changes that were predicted to be decades out accelerated rapidly and are now staring us in the face. So this concept of new normal is something that we’re all still processing.
How much is this concept of the new normal present in your mind, on an individual basis and at Nu Skin?
RYAN NAPIERSKI: Great question, Wayne. Funny that you use the term new normal. I just gave a speech last week and used that exact phrase. That this is a perpetually new state of normal, that the change and disruption are prevalent and exciting.
For our leadership team and me, we absolutely have learned to love the disruption. Our industry happens to have been through multiple cycles of disruption. We’re in one now—that is more exciting and transformational in a favorable way than any of the preceding disruptive periods.
This new one, social commerce, is the most exciting transition or disruption that we’re seeing for our industry, largely because of macro trends. When you talk about value creation in any industry, the macro trends that are driving that now with the gig economy, with social commerce, influencer and affiliate marketing—those all feed so nicely together with the traditional or the analog direct sales model. As companies lean into those macro trends, with the right strategy, there’s enormous potential.
There isn’t a day that goes by that we’re not talking about a disruptive force and how Nu Skin is leaning into that disruptive force.
WAYNE: Over the last several years, you and the leadership team there have made a big push from a technology standpoint. Obviously, technology was vital to us even being able to stay in business the past 10 or 12 months, to be able to interact and connect with our distributors and members.
Can you talk a little bit about how the focus on technology changed for you?
RYAN: Technology is the scalability element of the whole future-looking model. We initiated a pretty heavy technology transformation. Knowing that we didn’t have the capabilities in-house, I had to partner with some external firms to bring the right technology leadership in. We overhauled our technology. And we’ve been overhauling and going cloud, security, customer-first. We’re rebuilding all our processes internally. It was pretty disruptive, pretty transformational work. 2020 catapulted us forward to the future that we thought was coming, but we projected that to be 2023 to 2025. And so it accelerated the pace of change.
Everyone has talked about the return to normal. For our leadership team, we said, “Absolutely not. This is the new normal. We will continue to lean into this.” And largely, Wayne, because it’s so favorable to our industry, and to the companies that are leaning into the change. It was both— the last 10 months catapulting us in, but then burning the bridges behind us and saying, “We’re here.” Now we’ve got to learn how to win in this new market.
For us, there really is no going back. We have transformed the way we see the world and our own leadership capability as well.
WAYNE: I think we’re going to be adopting a fairly similar model. I agree with that approach from kind of the collaboration and a culture standpoint, there needs to be some type of cadence of in-person meetings. There may be more flexibility in a hybrid model where it’s not the 9:00 to 5:00. Or where people are spending two hours of every day in the car, but we’re seeing a lot more efficiency. I think employees are happier with the flexibility. As time goes on, everyone’s getting a little anxious to get back and kind of interact and a little more face to face interaction.
How do you see kind of in-person events? I think a lot of us experimented this year with virtual events and found some success and advantages there and some obvious disadvantages.
RYAN: It is a blended approach. Culture is such a critical part of not only a company, but the entire organism, including our affiliates, members or consultants. I do believe that we will have a blended approach moving forward continuously. What I love about the digital first events are that we can connect much more frequently, and they’re very effective in conveying information. The motivation and aspiration elements of our business that are inherent in the channel growth I think do require some more direct in-person interchanges.
We’ll be experimenting throughout 2021 and beyond with more of a blended hybrid approach.
WAYNE: From a work-from-home standpoint, as you look at the employees, the ability that technology lets us connect wherever—as far as talent acquisition or retention, geography isn’t a limiting factor anymore.
How are you and Nu Skin thinking about work-fromhome going forward?
—Ryan Napierski
RYAN: My assessment of the work remote model is that there have been significantly more pros than cons. If I were to score the various characteristics of the work environment, most have improved. The only con that I’m really worried about, that is collaboration. I think not having that ability to sit in the same room and whiteboard and collaborate on something is one area that we’re struggling with. It’s critical to the strategic work.
When I look to the future, I think absolutely Nu Skin has and will continue to adopt a work remote model for all the good reasons. As we’re scaling that and accessing new capabilities, it is critical and allows us to work much more effectively.
I would anticipate that we will be opening our offices back up for a more shared remote to on-premises work environment. I would imagine it’s going to be a blend moving forward, but I do anticipate a return to the office in partial form, particularly for our collaboration work around the strategy and the mapping side of things.
WAYNE: I agree with that approach from a collaboration and a cultural standpoint. There needs to be some type of cadence of in-person meetings. There may be more flexibility and employee satisfaction in a hybrid model. As time goes on, everyone seems to want a little more face-to-face interaction.
I want to talk a little bit about momentum. I remember being at the SUCCESS Partners University event two years ago…interacting and talking to a lot of companies that were down from a revenue and growth standpoint. At that time, there seemed to be an ominous change that was happening, where I think everyone was looking around going, “Whoa, what does this mean?”
And with 2020, we saw increased awareness and demand for a many of our products, which created this tailwind or momentum.
What changes did you see at Nu Skin from a momentum standpoint?
RYAN: The advantages that our model presents of being able to shop online, work remotely with products that help people played the industry’s advantage in our favor. And what I like to say more than anything is we were able to provide solutions to a world that was really true in need— from work, products, opportunity, culture and community.
When people were stuck at home, working remotely, they have an opportunity to connect with a team and be a part of something bigger than the problems they were facing. I think we provided solutions for what people needed.
Now, as far as looking forward to the momentum, citing your specific question. I believe that people have gotten a taste for what life can be. People are realizing human connection, relationships and flexibility matters. We provide all of that. We provide the opportunity for people to interact one-on-one. We provide the opportunity for people to have more flexibility in the way we work, anywhere, anytime. We provide solutions for their actual consumption needs.
The momentum that we started to build in 2020 will continue as we lean in and transform ourselves.
WAYNE: When you’re thinking about 2021 and the business landscape, more than anything, are there one or two things that are really keeping you up at night?
RYAN: Internally what keeps me up at night is—are we walking the walk or just talking to talk? Because we’re all getting more proficient technologically and digitally, and we can talk about what we’re doing. A great example, I was on a call this morning with 240 of our top leaders here in the U.S. We’re not meeting the customer need yet. We still have a whole bunch of problems. So, when I look at that, I say, “Well, we can sit around and pat ourselves on the back. The scaling of the business is causing breaks all over the place and the cracks become wider. So, are we as a team, are we patting ourselves on the back and just talking the talk, or are we really walking the walk and making certain that we’re driving the action, everyone throughout the company?
At an industry level, what keeps me up at night is the misunderstanding and misinterpretation of our industry at a regulatory level, at a commercial level and at a human level. I think we have to be very candid with ourselves in that regard—that we have not historically done a great job always. I’m saying collectively as a direct sales unit, we have not done a good job of being truly customer-obsessed.
If we’re serious about being customer-obsessed and about capturing the market opportunities ahead of us, it’s on us to talk the talk, walk the walk, act the way we want to be seen. We need to rebuild or reposition ourselves, not just with a narrative or a storyline, but to truly get into the grassroots behaviors of our channel, of our Salesforce and help them to learn that there’s so much more success when we actually represent ourselves for what we have—amazing products in an easily accessible manner, a trusted person to person relationship, word of mouth and becoming a part of a community or a brand that actually values you instead of seeing you as a transaction.
My worry is that we as a collective industry don’t acknowledge that, or maybe more that we’re going for the short-term gain and win, rather than looking at this long-term and saying, we really have an opportunity as an industry to grow from a $200 billion global industry to a $2 trillion global industry, to a 20 trillion. There’s no reason why we shouldn’t be ten times the size we are today with what we have to offer.
WAYNE: I agree we need to work to change the perception and positioning of the entire channel. Not just at our own individual company level, but at that industry level. I think we all need to come together, but I believe that we can have real impact and real change on that.
—Ryan Napierski
Final question. What gets you out of bed in the morning? What are you most excited about for 2021 from a business perspective?
RYAN: Scalable empowerment. What I love most about this industry is that we are an industry of empowerment, right? We provide people with the opportunity to really direct their own future with effort, with work, with a commitment. It’s hard work, but we are an empowerment engine as an industry. What excites me the most is the scalability that a digital-first industry actually provides. So, what I’m really excited about, what wakes me up prematurely, because I need my sleep, is that just, are we moving fast enough? Are we taking advantage of this unique opportunity that’s in front of us? DSN
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