It can be demoralizing to have compliance constantly reaching out to correct claims that a seller assumed were just fine. Yes, monitoring is essential as you do not want your field to be easy target for regulators to put your company at risk. So how do you monitor, keep the field happy and prevent future infractions at the same time?
The answer is education through compliance training.
Unauthorized sellers battle with companies for consumer dollars, and customers look for the quickest, cheapest way to get the product on their doorstep. This severely impacts a direct seller's bottom line and, most importantly, hurts the field, as they often cannot compete with the cut-rate prices found online.
With the proliferation and popularity of video apps like TikTok and the rise of influencer marketing, social selling is everywhere. Even so, despite the convenience and ingenuity of this brand of marketing, it’s still unclear whether your product will stand out in the endless sea of advertisements that is the current social media scape. Even so, there are new platforms on the horizon that look a little different and seem to beckon the next frontier of social selling.
You may have thought to yourself, “it seems like just about anyone can be an influencer these days,” and you’d be correct. Young people are finding it easier than ever to monetize the now-marketable skill of content creation. The transition from long-form to short-form content created a higher demand for more content, and thus more digital content creators.
Adding to this increased regulation are measures being taken by the U.S. Food & Drug Administration (FDA). Like other regulators, such as the Federal Trade Commission (FTC), the FDA is making a point of upping its game. While the FDA has always been an ardent protector of public health through its enforcement policies, they are adapting to new sales techniques by increasing their scrutiny of social media promotion.
As social media has become more and more a part of our daily lives, direct sellers have applied their relationship-building skills to these channels in order to expand their customer connections and pivot towards a new e-commerce strategy: social selling.
In the past weeks we’ve all been flooded with emails and scary news, much of it causing angst and confusion. Yes, this is pretty awful. But we will get through it. We will be temporarily banged up, but we will definitely get through it, together.
Momentum Factor CEO Jonathan Gilliam recently interviewed Peter Marinello, Executive Director of the Direct Selling Self-Regulatory Council (DSSRC) to learn how the program will impact the compliance function of direct sellers.
One of the most challenging issues facing direct sellers today is the advent of the unauthorized Amazon seller. From former distributors who post their products for sale to larger aggregators who deliberately buy up product and offer them at a discount in their own “Amazon stores”, many direct selling companies struggle daily with this competitive menace.