Herbalife

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.

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.

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.

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.

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?

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.

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

• herbal­ife
• herbal­ife logo
• Herbal­ife Products
• sell­ing herbal­ife on ebay
• mar­ket­ing herbalife
• can you sell herbal­ife on ebay
• herbal­ife ebay
• www dogalk­ilo­kon­trol com
• herbal­ife marketing
• Herbal­ife Inde­pen­dent Distributor

Related posts:

1. Mar­ket­ing Herbal­ife on Twit­ter, Face­book and Google Part 1
2. Mar­ket­ing Herbal­ife on Twit­ter, Face­book and Google Part 2
3. Herbal­ife kills Face­book or the Other Way Around?
4. Mar­ket­ing Herbal­ife on Twit­ter, Face­book and Google Part 3
5. Mar­ket­ing Herbal­ife on Twit­ter, Face­book and Google Part 5

Tags: Herbalife, Herbalife Business Opportunity, Herbalife Marketing, Herbalife on Amazon, Herbalife on ebay, Herbalife on Yahoo Shopping, Herbalife Products

This entry was posted on August 5, 2009 at 3:10 pm and is filed under Herbalife, Marketing. You can follow any responses to this entry through the RSS 2.0 feed.