Glossary Terms

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Direct Sales

Direct sales is a method of selling products or services directly to customers, without the involvement of intermediaries such as wholesalers, retailers, or middlemen. This method is also known as network marketing, multilevel marketing, or door-to-door selling.

What is direct sales?

Direct sales refer to the process of selling products or services to customers directly, without the use of intermediary channels such as wholesalers or retailers. In direct sales, a company's sales representatives interact with potential customers one-on-one, whether through face-to-face meetings, phone calls, or online communication.

Direct sales can take various forms, including door-to-door selling, person-to-person selling, and online selling. This sales method allows companies to have greater control over the management of their sales processes, including pricing, inventory, and customer relationships.

What is outsourced direct sales and marketing?

Outsourced direct sales and marketing is when a company hires an external agency or team to handle sales and promotional activities.

These outsourced teams engage directly with customers to sell products or services, often bringing specialized expertise and reducing internal overhead.

What are some advantages of doing direct sales to customers?

Direct sales offer several key benefits:

  • Stronger customer relationships: Build trust through personal interaction.
  • Higher profit margins: Eliminate middlemen and retain more revenue.
  • Immediate feedback: Gain real-time insights into customer needs.
  • Better brand control: Deliver consistent messaging and experience.

What is an example of a direct sale?

An example of a direct sale is a skincare consultant selling products door-to-door or through a personal network. The transaction occurs directly between the consultant and the customer without involving retailers or third-party sellers.

What are the five direct sales strategies?

The five direct sales strategies are as follows:

  • Personal selling: In-person pitches tailored to buyer needs.
  • Telemarketing: Phone-based outreach with clear messaging.
  • Direct mail: Physical promotions to engage customers.
  • Email marketing: Personalized emails that drive conversions.
  • Events & trade shows: In-person demos that build trust.

What is the direct sales process?

The direct sales process typically includes:

  • Prospecting: Identify potential buyers.
  • Approach: Initiate contact and spark interest.
  • Presentation: Showcase the product or service.
  • Handling objections: Address concerns confidently.
  • Closing the sale: Secure the purchase.
  • Follow-up: Maintain the relationship post-sale

Is sales commission a direct cost?

Yes, sales commission is considered a direct cost. It directly correlates to sales activity and varies based on the number of units sold, making it a variable expense tied to revenue generation.

When are product costs matched directly with sales revenue?

Product costs are matched directly with sales revenue when a product is sold.

This aligns with the matching principle in accounting, ensuring expenses are recorded in the same period as the related revenue, giving a more accurate picture of profitability.

Based on the responses, employees can be placed in three different categories:

  • Promoters
    Employees who have responded positively or agreed.
  • Detractors
    Employees who have reacted negatively or disagreed.
  • Passives
    Employees who have stayed neutral with their responses.

How to do direct sales?

Direct sales means selling directly to consumers without intermediaries. Key steps include:

  • Know your product: Understand its features, benefits, and unique value.
  • Prospect smartly: Target customers likely to benefit from your offering.
  • Build rapport: Connect through trust and active listening.
  • Pitch effectively: Focus on how your product solves their problem.
  • Close the sale: Guide them confidently without being pushy.
  • Follow up: Offer support and maintain the relationship post-sale.

How to build a direct sales team?

To build a strong direct sales team:

  • Define the role: Identify key skills and sales goals.
  • Attract talent: Use job boards, referrals, and events.
  • Train thoroughly: Provide product knowledge and sales tools.
  • Set goals: Track KPIs and offer performance feedback.
  • Promote culture: Encourage collaboration and reward success.

How to increase direct sales?

Boost direct sales with these strategies:

  • SEO your website: Use keywords and optimize content.
  • Create valuable content: Solve customer pain points.
  • Use email marketing: Nurture leads with personalized offers.
  • Streamline checkout: Reduce friction and build trust.
  • Deliver great service: Be responsive, helpful, and reliable.

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