Foreign firms show way in direct selling

Featuring anti-aging products, the company is selling more than 200 categories of anti-aging and nutrition products, including its flagship brand ageLOC, with ageLOC Transformation System, ageLOC Galvanic Spa and Body Spa, and nutrition product portfolio, Pharmanex, priced at 200 yuan to 600 yuan.

"We are planning to triple our distribution networks in the next five years and add the independent promoters, who can promote and sell products in their own business places, into the current marketing model," Fan said.

Although more competitors are joining in the battle, Fan said Nu Skin will stick to focusing on the niche anti-aging sector, as the proportion of aging people will jump to 25.4 percent by 2033, and one-third by 2050, according to the Ministry of Human Resources and Social Security.

"We are not competing with other direct-selling companies in this field, and we have advantages over technology and marketing," Fan said.

Different from Nu Skin, Amway is diversifying its products, while the 50-year-old Mary Kay Inc is planning to march into male skincare products and the healthcare sector.

"China is Mary Kay's only manufacturing plant outside of the US, and China is the company's biggest overseas market right now," said Paul Mak, president of Mary Kay in China.

Mak refused to reveal the sales figures in China as it is not a listed company, but he said the company has developed about 190,000 salespeople, and its year-on-year growth is remaining above a three-digit number in China.

"We are improving our brand and service in matured markets in big cities to compete with numerous retailing cosmetics brands. At the same time, we are speeding up digging out smaller cities, as we have established seven distribution centers around the country to assure an immediate delivery," he said.

Amway has also witnessed Chinese consumers' path of increasing understanding about direct selling in the past 18 years.

"Amway China reached a total turnover of 27.1 billion yuan in 2012, which accounted for one-third of the company's global revenue," said Yu Fang, vice-president of Public Affairs, Amway (China) Co Ltd.

The player invested 600 million yuan in building its first global planting research and development center in Wuxi, focusing on organic planting technology, herbal medicine healthcare products and cosmetics, as well as the second phase of its factory in Guangzhou, which will mainly expand the manufacture of its flagship brand, Nutrilite.

Although Yu is confident with its consulting marketing strategy in the way of face-to-face, one-to-one tailored service, she is worried about hurdles in managing and leading its sales team as they are scattered and floating.

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