Virtually all MLM sales are made by ‘direct selling’. This is defined by the Direct Selling Association as follows:
The selling of consumer goods direct to private individuals, in their homes and places of work, through transactions initiated and concluded by the salesperson.
It is obviously different from the way most consumer goods are sold, through shops, catalogues and direct mail.
Direct selling is, of course, not exclusive to MLM products, and anyone will be aware of the many types of goods sold ‘direct’ by party-plan, person-to-person and door-to door.
Direct selling has certain advantages over shop retailing, for the customer, the salesperson and the manufacturer. The customer does not have to leave home and the products are delivered. This has great appeal to old or frail people, and it also appeals to busy people who would rather avoid battling through the town-centre shops.
Many goods sold through MLM and other direct selling methods are unique in some way, and would be hard to find in a retail shop. The customer is likely to receive a great deal more personal attention from the salesperson than he can expect at a shop.
With person-person sales, the seller has the opportunity of developing a friendly relationship with the customer, if the latter is not already a friend.
This relationship is vital for repeat sales to the customer, and also allows new products to be introduced and demonstrated on a regular basis.
This distributor/customer relationship is also important to the company: it takes the place of national advertising which a conventional company would need to attract its customers to the retail outlets.
Reference: Peter Clothier: 2nd Edition