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Direct Selling; Is it the Next Driver Of Startup Commerce Companies? April 14, 2012

Posted by jeremyliew in Uncategorized.
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I just wrote a guest post on TechCrunch asking. “Is Direct Selling The Next Driver Of Startup Commerce Companies?” We’re seeing lots of exciting startups using this old channel to drive very fast growth.

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1. Brett - April 14, 2012

You missed Beachbody — who is converting fans of P90x and Insanity into one of the fastest growing direct selling companies in country.

2. website - April 15, 2012

website…

Direct Selling; Is it the Next Driver Of Startup Commerce Companies? « Lightspeed Venture Partners Blog…

3. Alvaro - April 15, 2012

Jeremy,

Your article is spot-on. Following are three additional reasons why I think that direct-sales channels will continue growing in Latam:

1. Credit card penetration: Still low among the general population. Moreover, credit card holders still perceive using credit cards online as risky, which is a real hinder for lesser known e-commerce portals. On the other hand, companies that rely on a direct sales force give buyers the option to pay with cash.

2. Weak postal services: forget about USPS`s two to three-day service. Lengthy S&H is one of the main reasons why coupon-sites` service is perceived as poor throughout the region. Again, a direct sales force eliminates the need of S&H, since the prod. is usually delivered by the salesman or the party host.

3. Cheap labor.

Of course there is always the issue of how scalable a business can be when you need to increase head-count in ordert to increase sales…

PS: You would be surprised to learn the case of Rena Wear in Peru, where the company sells high-ticket cookware to middle and low-income buyers throughout direct selling.


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