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: The Rs 3,500-crore Indian direct selling industry, which employs over 1.5 million entrepreneurs, is unfazed by the global slowdown. The effect of the downturn has prompted many industries to revamp their marketing activities. However, it has opened up a room of opportunities for direct marketing companies to grow even at this juncture.
The industry is currently growing and the annual revenues are expected to reach Rs 5,000 crore by 2012, according to the estimates of the Indian Direct Selling Association (IDSA), a self-regulatory and promoting body for the direct selling industry in India.
This target seems to be achievable especially when the industry is adding entrepreneurs every day and more and more American and European companies are finding India as their favourite destination to expand their businesses. The main reason: India and China are relatively less affected by the slowdown. India is also better placed as the industry is still in its infancy, offering a bigger scope for business, say industry experts.
Direct selling started in India only 15 years ago. Global direct selling market is at least six decades old and a $110-billion business with 58 million direct salespersons in 165 countries. Presently, the US is the world leader followed by Japan and Mexico. Even Brazil, Russia and China have higher turnover than India.
Interesting examples substantiate the growth model. For instance, Tupperware, one of the leading direct selling companies with the largest women’s network, markets premium food storage, preparation and serving items. The company forayed into the Indian market in 1996 and is today a household name.
Oriflame, another direct selling company, which offers a wide range of high-quality beauty products in the personal care and skin care segment, forayed into the market in 1995. Amway India commenced commercial operations in 1998 with just six products. But today it is a household name and offers over 100 products covering personal care category including cosmetics, home care category, nutrition, wellness category, commercial products etc.
*Impact of slowdown
According to experts who follow the industry closely, during a downturn phase which is plagued by job cuts and salary roll back, the number of entrepreneurs joining the direct selling market as agents and people who take up this profession on a whole-time basis is increasing in the country. They attribute it to the slowdown and job cuts, which has suddenly made a growing pool of educated manpower available to...
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