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5 Tips to Reduce Churn in Direct Selling Companies

by Jonathan Gilliam, Momentum Factor

Momentum Factor’s first client has me deep diving into what it is that keeps a customer happy, and on board, and reduces overall customer churn. It’s a wonderful first project for my little firm and I am eager to deliver for this great direct-selling company. The direct sales business is world-class at adding customers and distributors – we build a base faster and more profitably than most consumer businesses. However, we are just as good at losing them, with an average churn of 75% in 90 days.

There are, however, some things your company can do to reduce both customer and distributor churn:

1. Speak to your audience as though they are a friend, not a prospect (or worse, a child). The voice you use in all your communications should convey excitement and wonder, not hype, which creates skepticism – we have enough of that in this industry.

2. Build trust in your management team, your brand, your field and your company. Do this by telling the truth, being transparent, and doing what you say you will do.

3. Don’t hide. In our connected age, everything you do is analyzed, tracked and shared. Better to own up to problems and address them directly than varnish them over or ignore them.

4. Provide the best, I mean THE BEST, service. Front line customer and field service should be modeled after the greats, like Southwest Airlines and Zappos. I would argue this is even more important to MLM than other consumer businesses, after all, we have a true relationship and exist to provide something more than just a product or service.

5. Embrace social technologies. No other technology has the ability to build relationships like the social web. In my experience, most MLM’s who choose not to integrate social into their businesses are either scared of losing control (you will a little, but it’s ok), not convinced of the ROI (not the best measure of success) or are just comfortable doing it the old-fashioned way (dangerous).

6. Look and act like a real company. Seriously, how many Fortune 500 companies use cheesy websites replete with the word “revolutionary” and videos of their salespeople talking for 30 minutes by a fireplace? Almost never. If all around you is skepticism, think about an overhaul of your messages and media.

Don’t accept a high churn! Every person who drops out is a dream crushed. Show your newbies who you really are and what you really care about … them!

To discuss this topic further or to learn how the Momentum Factor team can be of assistance to help you reduce churn, reach out by clicking here.

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