This falls within the direct selling marketing model structured in a more simplified way in which products are moved directly from the manufacturer or distribution company to a hostess who in most cases is a volunteer ambassador. The host is approached by the company representative who persuades the home owner to the companys products and in turn receive gifts such as products and sometimes cash benefits.
The party host uses his or her reputation and knowledge of the product to promote it sales among invited guests thereby stimulating impulse buying.
The party plan sales allow for a variety of products to be displayed, demonstrated and promoted by word-of-mouth. This also gives room for questions and personal testimonial by the hostess and the companys sales representatives present at the party. This plan combines party fun in-home parties, togetherness and bonding. Existing users are given a discount on purchases and are motivated to invite other guests to the next party or sponsor a home party or new sales representatives.
If effectively done the party plan can give birth to a party plan group (PPG) from which hostesses can be recruited from and the sales party taken to various homes and location with the intention of driving more sales and recruiting more end-users of the products. Today, party plan parties are conducted virtually with varieties of products.
THE ADVANTAGES OF PARTY PLAN SELLING MODEL
1. Easy to start as it relies on people lifestyle and to a large extent fun driven
2. Host or hostess are motivated by gift, cash or credit for future purchases
3. Success stories recorded by leading companies known for using party plan and these will include Discovery Toys, Tupperware, Home Interiors, JAFRA Cosmetics and others
4. It encourages mentoring and coaching for new recruits, consultants, and sales representatives
5. It is a business type that can be done without many headaches considering that fact that social events are common in our society and such events usually draw huge attendance.
DISADVANTAGES OF THE PARTY PLAN MODEL
1. Impulsive buying and pressuring guests to buy the demonstrated products is sometimes considered inappropriate
2. Quality of the merchandisers are sometimes suspects
Like every other business, a thorough investigation is required and a good relationship must be established with the company beyond the purse party host and the consultants.
HYBRID DIRECT SALES AND MARKETING MODEL
Direct sales companies are constantly adopting methods and technology at ensuring that all classes of people are dragged in by their nets. The use of technology is structured to effectively manage the compensation plans, support auto-shipment, reward individuals effort and at the same time promotes networking in such a way that both party plan and multilevel systems are combined.
The hybrid system takes care of those who are interested in products and as well those who wanted both the products and the business opportunity that it offers through networking. In the words of Belinda Ellsworth, the hybrid direct sales model is a combination, in both pay structure and business practices, of network marketing and party plan,
The hybrid direct sales model offers a more acceptable business plan that cut across demography and allays their fears of many. It brings the best of SLM, Party Plan, and MLM. This is the trend now and should be embraced by direct selling companies.
The need to expand coverage, reduce cost and provide an opportunity for the new generation of young people who are better with technology and the telemarketing systems are some of the major reasons why a hybrid system should be taken more seriously. For example, trading in forex, gold and digital currency follows the hybrid marketing system and it is gaining much ground in formally traditional societies and accepted by a vast majority of the people that still want their privacy to be maintained while trading online.
ADVANTAGES OF THE HYBRID MARKETING SYSTEM
1. It uses multi-channel or a hybrid distribution system. Modern day direct sales organizations are determined to compete effectively and that win more customers using different distribution channels that were hitherto the reserves of the conventional marketing organization. Unlike traditional direct sales organizations which sell and compensates distributors using the single system, the hybrid organization now adopt matrix payment and a combination of binary and hybrid system.
2. It enables organizations in the direct sales business reach a wider market. Beyond word-of-mouth, door€“to-door, purse party plan etc multilevel marketing companies now use online facilities, Telemarketing, low-cost communication system. Today, network marketers can recruitment downlines in far away countries and get paid in their local currencies i.e., OrganoGold Nigeria was built by ambassadors in Jamaica, Alliance In Motion Global Nigeria was develop by Alliance In Motion Global Philippines, Syntek Global USA pioneered Syntek Global Nigeria.
3. It widens the demography and dragnets for more people to be brought into the direct sales business. Today, people open a business account, children account and sometimes an entire family are engaged in network marketing because of the hybrid system that is both convenient for the older generations as well as the new generation.
DISADVANTAGES OF THE HYBRID MODEL
1. Channel Conflict. Adopting multiple channels can sometimes be problematic if not well coordinated; we have instances of delay delivery of products and breakdown in the system thereby making auto-shipment of order product impossible.
2. Lack of Control. The hybrid direct sales models is a combination of both party plan and multilevel marketing system, hence the likelihood of slackness in control may be prevalent since members are given some level of freedom in their operation.
3. Likely compromise in product quality. Although modern direct sales companies are constantly refining their production system, still, the tendency for laxity is to be considered since product are delivered from multiple distribution centers.
4. System failure. Because the hybrid model relies so much on technology the likelihood of system failure is a probability especially when it comes to compensation which is so diverse and tempting.
Sharing is caring!