‘The business of America is business’, remarked Calvin Coolidge, and the story of Amway and its founders bears this out. Rich DeVos and Jay Van Andel met in high school and found themselves at one with their views on the American dream. They were sure that it was possible, for anyone who put the energy and work in, to own his or her own business and grow it to the size they preferred. They resolved to work together towards their dream when they finished military service.
Their first venture was a drive-in restaurant, but it was after a break to sail in South America that their first real success came when they became independent distributors of Nutrilite vitamins. Their version of the American dream evolved into the realisation that direct person-to-person marketing could build a business fast.
Real growth, they discovered, would come when they attracted others into the selling side of the business. Using the same person-to-person method they recruited distributors for their new company Amway. The Amway Sales and Marketing Plan told future distributors how to start selling and getting their own distributors. To begin with, the main product that these channels sold was a multi-purpose cleaner.
In its first year of business Amway sold more than half a million dollars worth of product. Growth was rapid in all areas, but it is when you look at the ratio of em-ployees to distributors that you see the potential of pushing out to more and more friends and acquaintances to bring them into the distributing fold. By the end of the 1960s they offered 200 products and had 700 employees. The number of distribu-tors in the USA and Canada who were, in the jargon of the company, building Amway businesses had reached 100,000.
The 1970s was a decade of further huge growth starting from an annual turn-over of $100 million. It was also at this time that the company finally proved to the FTC that Amway offered a genuine business opportunity and was not involved in
‘pyramid selling’.
The product line continued to grow with Nutrilite Dietary Supplements and the Personal Shoppers catalogues allowing further diversification. By the end of the
1970s there were literally millions of distributors, not only in North America but also in Australia, the UK and Hong Kong.
In 1980 the company turnover broke the billion-dollar barrier and more plant was added to keep up with demand. Another new product direction followed with the introduction of the Amway Water Treatment System, distributed in the same way as before.
This is what happens if you would like to become an Amway Water Treatment distributor. You approach, or more likely are approached by, an existing Amway distributor who becomes your ‘sponsor’.
The selling is done by the sponsor talking about the success they are enjoying.
The sponsor also shows the potential distributor a video which, amongst other things, includes a series of endorsements from as eminent people as will agree to do it. At one point in the UK, the video included an MP’s wife with the politician himself in the background. At some point the prospective distributor will be provided with the Amway Business Kit, which contains basic Amway products and literature for use in making sales.
The prospect is then invited to produce his or her first prospect list. The spon-sor then goes through the list and probably keeps a copy in case you drop out. The sponsor also helps you to sort your people into good, medium and poor prospects by discussing their income level, lifestyle and so on.
You then place an order for the products you wish to buy and for some stock.
You are required to pay for your products immediately but have time to pay for the stock as you, it is to be hoped, sell them. You make money out of your sales to customers and so does your sponsor and his in turn.
Don’t forget, this is person-to-person selling and, despite appearances, not pyra-mid selling. You are supposed to be building a business.
In 1997 Amway had a record year with retail sales of $7 billion. The number of employees worldwide reached 14,000.
Introduction
The sobriquet ‘bumper sticker strategy’ comes from the book by Michel Roberts, Strategy Pure and Simple: How Winning CEOs Outthink Their Competition. It gives a title to the concept that every business should be able to summarise, in a few words, its direction, purpose and strategy in a single sentence.
Getting a team to work together towards an agreed common goal is difficult, and the bumper sticker strategy helps with this process. The ones I have picked are at corporate level, but sometimes bumper sticker strategies would be better expressed at lower levels in the business as well.
Here is another use for the bumper sticker strategy. In complex sales campaigns where a lot of people are involved it is helpful for the team leader to express the whole campaign goal and strategy in a single sentence. It helps to brief people and gives them a filter to put their comments through when any member of the team, from technician to managing director, is communicating with the customer.
Suppose an account team is trying to sell a computer facilities management contract to, say, an engineering firm. Further, let us suppose that the bidding sup-plier is the market leader in the customer’s industry in the provision of facilities management. But they are not the existing supplier, this would be a new customer.
The team will include technicians, support managers, finance people, other cus-tomer references, the top management team of the supplier and so on.
All of these people need to be briefed on how to react during their, possibly very short, meetings with the prospect. A bumper sticker campaign strategy such as ‘Come out of the cold’ helps to remind the selling team how they are differentiating their bid from the bid of the sitting tenant.
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The 100 Greatest Business Ideas of All TimeA good bumper sticker strategy holds up well against these questions:
1 Does it show a clear differentiator from the competition?
2 Does it promise something of value to not only the shareholders and employees of the business, but also to existing and potential customers? Can I as a cus-tomer see what is in it for me?
3 Is it a slogan or a strategy? Do the core competencies of the business underpin the strategy?
4 Is the business organised in a distinctive way to give it the best chance of carry-ing out the strategy?
5 Is everyone in the business committed to it?
This last one may be impossible. A bumper strategy that sets the hearts of Board members racing may not work when applied to the storekeeper in a remote location in the western Highlands. This is why many companies have a bumper sticker strategy that they publish to the world, while en-couraging managers to adapt it to a local requirement.
Here are some bumper sticker strategies which are well on the way to meeting all these criteria.