Written by Crystal Holtzendorff. Crystal is VP of Global Sales at PayQuicker, an innovative financial technology leader in the global payouts market. With 20+ years of industry experience, she is a masterful sales professional with a background in technology, healthcare and marketing. Prior to PayQuicker, Crystal served as a Sales Operations Manager for Global Access and a Sales Manager for Elsevier.
Direct Selling Models Embrace AI in 2024
In the past decade, the direct sales industry has gone through a number of changes. Pre-pandemic, the industry had begun to plateau with the rise of omni-channel options and industry giants like Amazon forcing stiff competition for customers, affiliates and sales representatives. With the quick onset of Covid, stay-at-home mandates created new demand for direct sales platforms, with people looking for additional part-time work that they could do from home, and plenty of people sitting at home looking for opportunities to spend stimulus dollars. The combination helped to drive tremendous growth for the direct sales market, and by 2021, the industry had grown an impressive 14%.
Of course, the pandemic push didn’t last forever. In 2022, growth began to wane—but it did not disappear. That year, the industry grew 8%, accounting for $40 billion in retail sales, and for the next three years, the industry is expected to grow at a compound growth rate of nearly 6%. However, to capture that growth, direct selling companies will need to embrace the digital revolution and adopt advanced technologies like AI to create efficiencies that will help facilitate sales, connect with core customers and attract top affiliates and representatives. Here are the ways that direct sales companies are leveraging technology and AI to stay ahead of the curve as the industry evolves once again.
Innovation Becomes an Industry Requisite
The pandemic did more than generate new demand and workers for direct sales platforms; it also encouraged a digital transformation in the industry. When the pandemic pushed everyone inside, it also pushed everything into the digital space. Companies had to quickly adopt digital marketing tools and platforms that let affiliates manage contactless sales and communication with customers. A lot of companies took the opportunity to innovate, rapidly transforming the direct sales space from an in-person sales experience to one that happens largely in a digital environment. As a whole, the industry is now defined by a more digital, rather than personal, experience.
For the industry to keep pace with growth, digital and technological innovation is now a requisite. In 2022, as industry growth began to slow, companies needed to find new ways to re-engage with customers as well as affiliates and sales representatives, and once again, the industry was looking at ways to innovate even beyond the digital tools that it had adopted just two years ago. To begin, companies have created new affiliate programs and eliminated exclusivity requirements for affiliate programs, opening the door for more affiliates to engage with the platform and customers. In addition, companies have looked for ways to tap into new audiences by expanding into emerging markets or leveraging social selling platforms on social media to tap into influencer audiences and build new customers and brand loyalty. While innovation and evolution are the key to remaining competitive in an increasingly crowded industry, advanced technology tools are still the best way for companies to innovate and succeed.
Direct Sellers Lean Into AI
Automation is quickly becoming the cornerstone of innovation in the direct selling space, and in 2024, the trend will officially take hold. AI technologies not only open a door for direct sales platforms to better engage with customers and improve customer service, but it also helps to create backhouse efficiencies that improve productivity and streamline operations, ultimately supporting field leaders and their downlines. As a result, AI tools are appearing in both the back-office support, customer-facing platforms and even product offerings.
AI tools have truly limitless applications for the industry, and we are still in the very early stages of adoption and uncovering the potential. AI-powered tools, for example, can automate administrative tasks, process invoicing, and manage contracts and schedules, giving affiliates the opportunity to focus on higher value sales tasks and engaging with customers—the tasks that help to close sales and generate revenue. While every industry stands to gain different benefits, Goldman Sachs recently reported that on average AI will take over 25% of labor tasks in advanced economies, like the US. That is a massive benefit to workers, who can dedicate that time to creating corporate and brand value.
On the customer facing side, AI offers another set of benefits. Using tools like Chat GPT, affiliates can create content, blog posts and sales scripts and improve SEO on digital marketing platforms that help to engage with customers. AI-powered bots can also be trained to speak in an individual’s voice, adding a more personalized touch to the experience. Used correctly, AI has the ability to understand the complete sales cycle for an affiliate, providing high level insights that truly help to drive sales.
Payment Tech Advances Growth and Scale
AI technologies are only one part of a complete technology infrastructure. While it is proving to be important to innovation and advancement in the direct sales space, other technologies can equally support growth and scale. Instant payments are quickly becoming another standard in the industry as a way to attract and retain loyal affiliates and representatives. In the post-Covid world, gig work has increased 170%, nearly tripling in size. More gig opportunities have also meant more competition for gig workers, who often have the upper hand in choosing the platforms where they work as well as which work they prioritize. Often, brands aren’t only competing with other brands to attract temporary workers, but they are also competing with other gig work platforms, like rideshare and delivery services. Providing a better work experience is the best way to appeal to gig workers.
Instant payments are the cornerstone of that experience. Many direct sales programs still pay employees once per month with a check or a standard ACH payment. But, employees are more frequently prioritizing work platforms that provide instant payments following a shift. In research from PayQuicker, 83% of survey respondents said that speed of payment was important in choosing a gig. Payment experience has a direct impact on recruiting new talent, and it can ultimately make a big difference in the growth and scale of the company, particularly as companies will have to be savvier and more strategic to achieve growth in the future. Anything that can reduce the amount of time between work and payment will create more stickiness for the company.
Finding a Balance Between Digitalization and Personalization
Historically, the direct sales space has been a personal experience. Think of the Tupperware parties inside suburban living rooms or door-to-door make-ups sales. These were bespoke, in-person sales experiences that met customers where they were most comfortable. Today, customers often live in a digital environment, so it isn’t surprising that the direct sales market has evolved to have a more digital touch. Afterall, that is what is most convenient and familiar to today’s consumers. (It’s just an added benefit that it also helps to attract affiliates.) Still, digitization and AI can’t erode the personal sales experience completely. Despite being online, customers still want that individualized touch, even through a computer screen.
Instant payments are one example of providing personalization through technology. On-demand pay empowers employees to tailor their payment experience to their needs. AI equally has the ability to provide a personal touch. Automated programing and advanced analytics can track customer patterns, behaviors and preferences. Affiliates can use the technology to execute targeted ads, recommend specific products or curate more impactful messaging. AI is often viewed as an impersonal experience, but it actually has the potential to create a hyper-personalized experience for more customers at scale. Companies that can strike this balance between tech and personalization are going to lead the direct sales pack in the future.
In 2024, it is clear that new technologies will be critical to the advancement of direct sales. The industry may be changing, but automation and AI, along with features like instant payments, are helping companies carve a profitable path forward.
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