What MLM Software Do I Need for Every Direct Sales Growth Stage?
MLM software decisions are tough. As a result, one of the most common mistakes direct sales companies make is not choosing the right technology at the right time. We get it, you want to serve your customers well. So you choose to invest in technology. The problem is if you spend too much on your technology at the wrong stage of growth, you’ll strain your resources.
The truth is: there is a way to right-size your MLM software and it is dependent on your stage of growth.
Therefore, we’ve divided the stages of growth for an MLM or direct sales company into three stages:
- First – Stage 1: Maximize Personal Touch & Leadership
- Second – Stage 2: Maximize growth
- Third – Stage 3: Maximize profits
When we speak to direct sales or network marketing companies, one of our first questions is about their stage of growth. If we demonstrate what our technology can do that doesn’t fit their stage of growth, the “bells and whistles” can cause them to over-purchase. And that would be a mistake. It’s more important that your MLM or Network Marketing software works for you.
As industry expert Terrel Transtrum often instructs clients, “we don’t let our technology dictate our strategy to serve our customers.”
He’s right. Yet, we see companies overspend on MLM or Network Marketing software they just don’t need. The results are a strain on cash flow, and it can prohibit growth—instead of igniting it.
We don’t want that for your company. Use this article as a checklist of what you really need dependent on your stage of growth.
If you’re in Stage 1, allow Stages 2 and 3 to excite you for what will be necessary for your company when you reach those milestones.
Goal: Maximize personal touch and leadership
How many distributors or members? 50-250
The fastest path to cash flow for a startup is when you hit your first 50 distributors. Consequently, your first big technology milestone is as you kick start your first 50 distributors. This technology will fuel your growth to 250 distributors.
Email is one of the first points of contact for your company. That’s why we recommend using Google Workspace for your Email Management System. It’s easy to use, versatile and can grow with you.
Onboarding new customers and distributors requires your automation to grow. It’s the doorway to your company. That’s why you must ensure your technology is up for making a solid first impression with new customers and distributors. Including:
- Starter Kit (Recommended Price Starting at $49)
- Compensation Plan
- Product Brochures
- Company Mission Statement
You may also include (Recommended Price Starting at $99)
- Sample Products
- Branded Materials
- Items that support selling or recruiting
Keep in mind: you can manage growth by offering more expensive registration packs to begin.
Your website is the home base for your company. However, unlike traditional e-commerce websites, you need your site to function from the beginning for payments to your sales force that includes:
These are unique sites that your sales force can promote for their audience to use to place their order.
Affiliate links on a corporate E-commerce site:
In addition, you’ll need unique affiliate links so every salesperson is compensated appropriately.
The merchant account is where the payment is processed for the order. While Authorize.net or Stripe will get you started selling immediately, you will ultimately need to switch to a direct sales-appropriate provider as quickly as possible. Direct sales appropriate providers offer the capability to scale with your company and provide dedicated client services. Don’t worry, we can help you find the provider that is right for you.
- Order Fulfillment: Purchase a monthly plan from the following to get best shipping rates and done-for-you fulfillment flow. This will process the orders from your website to your fulfillment warehouse for a seamless shipment process.
How you communicate with your customers and distributors sets the stage with your entire relationship with them—and their success!
In the beginning, we recommend communicating regularly with both:
- Text Messaging
Payouts & Financials:
Choose a simple solution for fast payouts. The more consistent the payouts, the greater the trust you earn with distributors. Schedule to send money to representatives at a minimum, monthly. You’ll need:
- Payout System, choose one
- Tax Engine
Representative Back Office Software:
Our Control Pad Software allows distributors real-time insight on their sales and connections.
Social Media Presence:
Social Media is an important trust and authority builder for your company. As soon as you’ve decided on the name for your company (Not sure about your name? Use this tool to help you decide.), open accounts with:
“Distributors” is a little limiting. There are various types of mlm and network marketing companies, a large portion of which has members rather than distributors. should we consider making it broader in reach by listing it as something like distributors/members?
Some companies will never have 5000 distributors, but will still be pretty large by having a significant membership base.
Goal: Maximize growth
How many distributors or members? 250-5000
Sophisticated Compensation Plan Engine:
Streamline transparency into sales reports and payouts with direct selling software. In other words, this stage of growth is recognized as hyper-growth. And in order to manage growth well, you need a solid compensation plan engine to ignite growth. Therefore, your MLM software should perform the way the software is designed. You will need:
- Dashboard for Distributor Management
- Administration System
In Stage 1, it is critical to have a starter kit that includes products for every new distributor. We also recommend the Perfect Welcome formula to increase retention. Now is also time for your software to calculate added incentives to the distributor dashboard to drive sales. For example:
- Gift Card Prizes
- Product Credit or Free Products
At this stage, you’ll need to upgrade your merchant account to an MLM or Network Marketing merchant account. This is where some of the best MLM software needs to be used to accept online payments, track distributors’ efforts, and compensate accordingly. At this stage, you’ll need a merchant account that understands the complexity of network marketing. We recommend Nexio as the best merchant account option for our clients.
While you may have started with a simple order fulfillment process, you’re at the stage where automation is key. The more seamless your MLM software is with your order process, the greater the opportunity for growth. Also, consider:
- Warehouse Management Solution
Setup Learning Management System with minimal gamification. This will allow you to organize your content for your distributors in one place. Compliance training, compensation plan explanation, leadership training, and real-time communication to the field are all important content pieces your distributors will need to refer to often. This will also free up your customer service team from answering the same questions repeatedly.
Help Desk Software:
In an effort to stay accessible to customers and distributors, help desk software for your business model is a must. There’s nothing more frustrating to customers or distributors than not getting help when they need it. Consider both email and chat functionality so that your customers get the support they need when they need it!
At this stage, weekly payouts are expected by distributors and will keep them engaged. You will need support in the following areas:
- Payout Type
- ACH: This will require the software has the ability to accept and store banking information.
- On-Demand Payouts: Some strategic partners will give you the option to offer on-demand payments.
- Accounting: An accounting software, like Quickbooks, should be installed as part of your accounting practices. You’ll also need a way to automate the collection of information for 1099s before the first payout.
Most distributors work on the go making a mobile application crucial for their success. When you reach the second stage of your growth, now’s the time to start developing a mobile app.
When you reach more than 250 distributors, you’ll have better data to understand buying patterns, recruitment data, and retention goals. With this information, you can determine what Network Marketing Software will support an increase in these areas.
Shopping online is the most common way to purchase and with the introduction of Metaverse, the increase will continue at an alarming rate. Make online shopping available as a more robust part of your strategy.
Having a crisis management tool before you need it will allow you to prepare for the inevitable. We often recommend MLM software to support your team when a crisis occurs.
Communicating through email with customers and nurturing long-term relationships is a critical part of your marketing strategy. Look for a broadcast email software that will grow with you and give you the insight you need on your customer base.
Facebook Group for Active Members:
The majority of your customers and distributors are active on Facebook. Why not engage with them where they’re already consuming content? Setup your Facebook Group and arrange for a member of your customer service team to manage the relationships there.
Goal: Maximize profits
How many distributors or members? 5000+
Comp Plan Scenario Testing & Forecasting:
Now that you have 5,000 distributors, it’s time to make sure you’re scenario testing and forecasting for your compensation plan. For example, your MLM software should allow you to prepare a dashboard with these numbers. Take a look at your dashboard to help you make decisions to maximize your profits.
The level of support for more than 5,000 distributors needs to feel personal. For example, each distributor should feel like you’re only serving them. That’s where an MLM-specific help desk software can help. At this stage, your distributors will require phone support (chat and email won’t be enough).
The more distributors, the faster payouts are expected. In our instant, gig-economy world, distributors believe payouts should be almost instant. You’ll need the MLM software to support:
- On-Demand Payouts
- Instant Payouts
- Personalized Debit Cards
Setup a Learning Management System that integrates with rewards and more complex gamification.
At this stage, integrate with ERP or Enterprise Resource Planning system. This will streamline your systems for your team in order to scale.
Keeping a pulse on KPIs will allow you to make better decisions for your organization. At this stage, your data tells the full story. That means you and your team can adjust and set goals accordingly. Also, consider:
- RFM (Recency Frequency Monetary Analysis)
- Customer segmentation
- Automated offers
Open International Markets:
Many companies make the mistake of expanding internationally too soon. This is the ideal stage to begin to think of expanding into new countries. If you are expanding internationally, go back to Stage II. As a result, you’ll make sure your technology solutions support multiple languages, currencies, and prepare you for growth in your new markets.
Comp Plan Considerations:
A well-written compensation plan will grow with your company at every stage (especially if it’s written by the team at Dan Jensen Consulting). Your technology should accommodate a more robust organization as the leaders within your organization grow. During Stage III, start to consider based on your experience:
- Building Managers
- Building Leaders
- Types of Bonuses (Simple)
- Affiliate Bonus
- Retail Profits
- Fast Start Bonus
- Team/Level Bonus
- Preferred Customer Profit
- Rank Advancement Bonus
- Party bonus
- Leadership Pool Bonus
- Ranks should be easier to achieve in the beginning and become increasingly harder to achieve.
- Rule of thumb: build your achievements so that high achievers can reach the highest rank within 1-2 years of starting.