Made to Measure: J.Hilburn Gives Direct Selling Some Style
Not Your Mother's MLM
Avon. Mary Kay. Tupperware. Very large companies have been built around multilevel marketing, thanks to its ability to achieve massive scale quickly and cheaply. But MLM is also notorious for underdelivering on product quality and price and churning through salespeople. A few key tweaks to the model allow J.Hilburn to avoid those pitfalls.
Limit recruiting
In most MLM companies, the emphasis for salespeople is on recruiting as many other reps as possible to earn commissions from their sales. At J.Hilburn, reps can recruit only five people. If they hit sales targets with that small team, they unlock the ability to recruit more people. The result is an emphasis on building the most productive team possible rather than the largest.
Eliminate market saturation
Another common problem with the traditional MLM model is that, in a rush to recruit large down lines, reps end up cannibalizing their own sales, because naturally they recruit people in their own social networks and geographic areas. J.Hilburn combats this problem by setting a cap on the number of reps in any given market, based on the size and maturity of the market.
Don't make reps pay up front
Studies show that more than 99 percent of MLM reps end up losing money (hence the common comparison to illegal pyramid schemes), and the biggest reason is that many companies force reps to buy products up front at wholesale prices. Because J.Hilburn makes its products on demand, customers buy directly from the company, and reps act more like traditional salespeople.
Control the customer experience
The company keeps an invisible hand in sales wherever possible. Slick look-books reinforce the luxury branding. A new iPad app for salespeople feeds them smart recommendations and flags potential measurement errors. And targeted e-mail marketing and e-commerce can take the salespeople out of the reorder process entirely (while still paying them commissions).
