Herbalife Marketing

This post is reviewing some of the difficulties of Herbalife Marketing online. Solutions are lined out in our Series of posts called Marketing Herbalife on Twitter, Facebook and Google.

1. Herbalife Corporate Image Online

The first issue is the Herbalife online image. Herbalife has not really developed a professional online image as a Corporation. Not that there are no websites and informative content. It seems however, that their web development is more focused on support sites for Herbalife Distributors than on creating a strong Brand image.

Herbalife Marketing has to do with Herbalife and when a distributor promotes the business opportunity Herbalife is offering, then any online prospect is likely to look up Herbalife on Google. Unlike offline prospects, online prospects have an easy and quick access to information.

Herbalife’s low-tech goodwill campaigns and sponsoring are not used efficiently online to support distributors and distributors are restricted to use visual supports online to perpetrate a popular brand image.

2. Herbalife Products

Herbalife Products can easily be found online, namely at distributors’ shops.

However, Yahoo Shops, Amazon and eBay are popular and trusted platforms where customers can get their products from, often at way below retail price.

Also, Yahoo, Amazon and eBay offer affiliate programs, allowing anyone to monetize on Herbalife products without being a Herbalife Independent Distributor.

A Herbalife Distributor selling at retail price is not competitive online. Also, potential customers are searching the web for best prices and best buys, coupons and discounts.

Here is what Google returns on Coupons:

“G.S…..com wants to make Herbalife affordable for everybody and offers great savings. With our shipping promotion combined with our sales, you SAVE 25% on your TOTAL cost of purchase!

First of all, take advantage of my special extra 5% discount by putting your email address in the box on the TOP LEFT hand side corner of this web page, then click on “Send Coupon Discount Now”. You will immediately receive a coupon code via email!

Then, if you decide to become a G.S…..com regular customer, we will reward you emailing you another secret coupon code that will entitle you to enjoy an additional PERMANENT 5% Discount OFF any product (no minimum order required) on top of the 25% discount that everybody already gets!

Get an Additional 5% OFF with any $300 Order!”

That’s a whooping 35% down, which makes any distributor’s efforts look like Impossible Mission unless he is a supervisor buying at a discount of 50% from Herbalife.

But even in that case, the supervisor is looking at a margin of 20% instead of the promised 50% by the pay plan. 20% before cost for marketing and other overheads.

Why should anyone pay to become a distributor of a product expecting earnings from a margin which in reality is just added to prevailing market conditions?

But there is more: some of the most popular shops online belonging to Herbalife Distributors offer 5% discount coupons just for opting-in to a  list (Lead generation – think about the cost per lead) and then they offer 30 or more for orders with free shipping.

Diet444.com is a typical example for such practices whereas even the label on top makes you think it’s Herbalife and not a Distributor (watch the Herbalife logo and the very small microscopic “Independent Distributor”.)

Herbalife Independent Distributor

Click to see original size.

Conclusion: there is strong competition amongst Herbalife Independent Distributors, whereas Distributors offering big discounts and who use the name of Herbalife all over their site and meta tags do better which can be considered as an unfair advantage.

In spite of Herbalife Internet Rules and Ethics, Herbalife seems to have no control over the price of it’s products in the market, nor over the way people use brand elements and trademarks. In other terms: Herbalife cannot protect the small distributor who tries to make some money from his Distributor’s license at recommended price levels.

Herbalife, unlike Apple or other brands, does not seem to be able to get some level of price control imposed on eBay. The best deals are therefore to be found on the eBay platform such as this one:

Herbalife Products on eBay

The Herbalife Distributor License, allows consumers to get a 25% discount for an annual fee, are no longer attractive for consumers. The retail price war indicates that profitable business results from networking and building the MLM system.

3. Herbalife Business Opportunity

MLM is not an online Business model and in fact I think that the internet will kill MLM sooner or later.

The reason is transparency. If people can see that in the product price there is a 72% margin paid to the distributors, then they feel that thy are overpaying the product. The above examples show, that prices cannot be controlled and competing with each other Distributors are willing to give up a big part of their margins, gaining thus an advantage in the market over other Herbalife Distributors.

We will end up with a list price and a real market price, which is probably at about 50% discount.

Also, typical successful online business models do not foresee that anyone has to pay to promote a merchant’s products. On the other hand, looking at the pay plan, you see that royalties and overrides can build great earnings. The real money is made from these 5% here , 3% there and 2% elsewhere multiplied by the number of concerned downline distributors. It’s an ideal opportunity for offline networkers dealing with offline prospects.

Online expansion of Herbalife will mean a total change of the Herbalife business model. If Mark Hughes was to create the company today, he probably would come up with a modern, fast, competitive and expansive online business model. Changes in Herbalife are not likely to occur quickly as the financial interest of upline leaders would need to be compromised.

4. Success with Herbalife

Herbalife related business is traditionally built on personal relations. This is why marketing Herbalife Products and Business makes so much sense in the context of Social Networks. Meeting people, building relations, discussing life and business and attracting contacts to the conversion funnel, makes a lot of sense. Prospecting in Social Networks and then meeting people offline makes even more sense. Twitter and Facebook are ideal pools of prospects, the more that geo-search allows for better targeting than Google.

Success is when people buy a product from you they could buy elsewhere for 50% less. The question remains: for how long will people value your relationship at 50% of what’s in their wallet?

5. Trust and Confidence

An individual Herbalife distributor enjoys not much trust and confidence at the beginning of his online career. Competing with other Herbalifers with the support of upline leaders makes life easier. However, competing with Distributors who enjoy the notoriety of Yahoo Shops, Amazon and eBay is a completely different story:

On eBay there are sellers with thousands of sales on record and official shops.

Herbalife Powerseller on eBay

Herbalife Shop on eBay

This seller on eBay has over 1400 positive ratings over the last 12 month, selling over 3 products or items per day. How many Herbalife Distributors using conventional e-commerce tools and respecting Herbalife rules have such a score?

The eBay record of the seller with 99,9% positive feedback on over 8000 sales is like a quality seal: you can trust this seller! The seller has built a solid reputation over time with visible transparent results.

Selling online is about trust and confidence, namely if you sell cross boarder.

Note

The above are just some of the obvious difficulties which emerge from online transparency. Our task is therefore to overcome these weaknesses and to compensate for them by building an online business which inspires trust and confidence and which targets to build these personal relationships so dearly needed to close deals.

Respecting Herbalife ethics and rules, you are exposed to unfair competition. Think about the means the Internet offers to fight unfair competitors and implement an offensive strategy.

Trends show that the Internet is used as a global platform to build proximity business, meaning that you profit from your location to do local business online profiting from the fair advantage of proximity. People are ready to pay more buying from someone who lives in the same town rather than taking the risk of buying from a seller from another state or country.

Think about it when you target

Read also:

• Working from Home
• Marketing Herbalife on Twitter, Facebook and Google Part 4
• Marketing Herbalife on Twitter, Facebook and Google Part 2
• Marketing Herbalife on Twitter, Facebook and Google Part 1
• Marketing Herbalife on Twitter, Facebook and Google Part 6

Tags: Make Money online, Online Marketing, Online Media, Online Publishing, Yorgo Nestoridis

This entry was posted on Wednesday, August 5th, 2009 at 7:10 am and is filed under Herbalife, Herbalife Business Opportunity, Herbalife Marketing, Herbalife Products, Herbalife on Amazon, Herbalife on Yahoo Shopping, Herbalife on ebay, Marketing. You can follow any responses to this entry through the RSS 2.0 feed.