Direct to home?

It is crossover time for many brands into the world of direct selling. In an attempt to find more consumers, sales heads of an increasing number of companies are seeking to piggy-back on the strength of 4.5 lakh distributors of Amway in India. Prominent among those players that have tied up with Amway to be a part of its soon-tobe-launched festive catalogue are Arvind Brands with Lee and Arrow, Puma and Cookie Man.

The new catalogue includes brands that are either looking to test-market their products with Amway or those that are simply seeking an additional avenue of distribution in addition to their existing retail presence.

“Amway is known for its sophisticated catalogues in other markets like the US, Australia, Japan and Malaysia. Virtually all the big brands that you can think of such as Sony, Philips, Braun, etc., are all part of it,” says Stephen Beddoe, Director, Sales & Marketing, Amway India Enterprises. The criterion, according to him, is that brands associating with Amway have to usually work out an exclusive deal—both in terms of price and product—and be co-branded with it. The branding sometimes is either part of the label itself, or is part of the packaging at least.

In India, though the company introduced its catalogue about three years ago, it’s only now that it has gained some traction and has roped in bigger brands as part of its collection. “In view of the response, we have decided to now have two catalogues in a year, one in spring and the other during the festival season starting off a little before Diwali,” adds Beddoe.

Amway admits that usually it found purchase from its distributor partners dipping around Diwali. “We found our distributors diverting their spends to other areas and, hence, created a more ‘giftable’ collection involving products that are not our core competence. These are then bundled with our products, or bear the Amway seal,” says Beddoe.

The range today includes many brands that are seeking to gauge consumer reaction to their offerings, even as many of them are in the midst of rolling out their retail presence.

For instance, there’s Naturellement Jam, Trident group (which otherwise is a supplier of Wal-Mart) with a special towel collection, Japanese brand Noritake with its premium range of dinner sets, Illume festive candle collection, Splash brand of bed linen from Hanung, Arcor butter toffees and Leonardo Olive Pomace oil, among others.

In all, the list includes at least 26 brands. “We usually keep shuffling the list every few years and wait for customer pull to kick in,” points out Beddoe.

In fact, many alliances have been afoot: Max New York Life, which sometime ago become a member of Indian Direct Selling Association (IDSA), has a partnership with AmSure Insurance Agency (a separate entity that is a joint venture between Amway India and Hollard Insurance from South Africa). Of the 16 registered members of IDSA, Modicare in India has an understanding with Bajaj Allianz for insurance.

“Direct selling industry is all set to grow, barring three players all the global Top 10 companies are here in India, and Mary Kay (the world’s third-largest direct selling company) has recently announced its entry here,” says P. Shankar, Director, Legal & Corporate Affairs, Amway India. Shankar is also the head of IDSA. The direct selling industry in India registered a 15 per cent growth last year and did business worth Rs 3,100 crore.