I’ve been contemplating shutting off all the social media stuff for about a month now, and I’m finally going to pull the trigger. I also, never thought that I was going to do this, but I’m also going to shut down my consulting business for a while, and likely for ever. So no more blogs, or blogging for me, no more Facebook, Youtube, Twitter (except to check Team_1), or any of that. Just GMail, AG, DLB, and DIMDIM.

I’ve been sort of in a professional daze the last couple of days; It’s nothing particularly good or bad, it’s just been rather unexpected. It’s just a question of where I am spending a lot of my time lately, and whether it’s bringing me a day closer to the life I have to live, or the life I want to live. I like things that stay done, and Interactive Commerce is the only thing out there that I know can do that for me.

I look at the status messages on my news feed on Thursday and Sunday and they genuinely depress me. Cheering on the weekend, and booing the work week, but no one does anything to change it. Here’s the one teaching nugget for this whole post, “That which you tolerate, you will not change.” Todd Clark taught me that.

I’m going to find the few who actually want to do something about that and turn their week into a Sunday followed by 6 Saturdays, and are willing to do the work to get there. I don’t care if I have to talk to every single person in Los Angeles and Orange County, but I’m going to find them, and help them do it.

If you need to get a hold of me, use the contact form and make sure that you leave a phone number and email for me to get back to you at.

All right. I know what you’re thinking. I totally prepared for it with an awesome video of exactly what you thought the industry was. I hope you got a great laugh out of it. I certainly did.

Here’s the thing, those stereotypical ideas about direct selling being a door to door business do have some truth to them. This is entirely reflective of an American culture 60 years ago. Most direct sales companies at the time basically marketed housewares and home care products, so the target market were housewives. In those days where were the housewives typically found? At home. The idea of a 2 income household is so common now, that people forget that back in the 50′s it was looked on as borderline scandalous and embarrassing for the man of the house. It was a major blow for a man’s ego for his wife to have to get a job. It’s not like our egos have gotten any less fragile, but that is besides the point.

The other typical image that comes to mind when people hear direct sales is the traveling salesman. The man that would load up the car with stuff, disappear into the country weeks at a time, and come back with loads of sales, only to have to repeat the process again.

So let’s take a second and broadly define what the direct sales industry is all about. Essentially a manufacturer makes a product, and has an salesman directly retail it to the consumer. Because the product goes directly to the consumer, the manufacturer gets a better price for the product, and the salesman scores himself a nice commission. These commissions were fairly high folks. It had to be. The job had to pay so good that people would be willing to pick up and leave their family weeks or even months at a time to go earn those commissions.

This same basic pattern continued up all the way into the 90′s. The only exception was that the deregulation of the air line industry made airplane travel more affordable, and people were able to expand their territories farther.

Then came the internet. The internet and e-commerce have completely changed everything about this industry. No more door to door. With a referral code, any customer could shop directly from the manufacturer and have their product delivered to them. No more  writing checks to the sales man, or handing them cash in hopes of getting a product delivered to them.

So the internet changed the face of the industry. Then came social networking. Social networking, in general, has totally changed the face of business period. It has disrupted normal advertising and distribution channels. And it has revolutionized the direct sales industry, particularly the companies that use a network marketing model. Personally, I think that this and other affiliate type programs are the future of all direct selling, and e-commerce. It just meshes so well with popular culture today.

When I say that it revolutionized it, I don’t mean that it suddenly gave distributors a vast audience to pitch their deal to. The sad thing is that people do that, but online it’s so much easier to ignore those pitches or just hit the report abuse, flag, or report spam buttons. Amateurs who have no idea how the industry works, will fail regardless of the medium or technological breakthroughs. This is still fundamentally a people industry. The reason social networking has revolutionized the industry, is because Facebook, MySpace and YouTube have made the idea of social networking common place in todays networked culture. Networking is no longer something fringy, it’s the way most business is done now.

Where does the majority of the revenue for Facebook, MySpace, and YouTube come from? Advertising. Okay, lets review a simplified version of their business model. They basically allow people to build their user base by creating an environment where they can share information with one another. The community is grown through the existing user base. The site targets advertising to them and banks the ad revenue. YouTube is a bit of an exception. They do allow some of their users to advertise on their videos and share in some of the ad revenue with their users. To be honest, I would not be surprised if there’s more than a few people that have built a big enough community of viewers that are making 6 figures through YouTube right now.

Network marketing does the exact same thing, except through commerce, not information sharing. Distributers can grow a community of people that drive volume to an e-commerce website. They are paid sales commissions back on the products they retail, then a compensation plan pays back the people in the community a portion of the company’s sales revenue for that week or month. People just need to realize that the networking component just gives the individual distributors extra leverage, and commission and compensation structures have adjusted to equalize the older model with the new networking model.

This entire blog is dedicated to building up people’s entrepreneurial genius, so let’s see what this means to the average person wanting to start a business of some sort. Through the internet, this has become the one of the most accessible ways for people to create a secondary income through building a direct sales business. It can be done completely outside of whatever your main income source is, and most likely any direct sales company is going to have somewhat of a decent training program to help you build up your skill set. There’s a ton of free information online that you can find about marketing, sales, and all kinds of other things. I’ve personally found blogs of people in the industry to be the most helpful. With direct sales companies that use network marketing you have the added bonus that whoever sponsors you, has a vested interest in you building a successful and profitable business.

The one thing that I have found extremely helpful about the marketing and sales world, is that the skills that you learn translate to practically every aspect of one’s life. I’ve had to develop loads of people skills in order to expand my business, as a side effect my personal relationships have become significantly stronger. Basically, I am more pleasant to be around. The sales and marketing skills have helped me develop my client base, and more than anything they have improved my ability to market myself in this economy and build brand equity.

Direct sales is not for everyone, but it does have an extremely low cost of entry, and all parties involved (your company, your sponsor, or both) have a vested interest in your success and would be willing to work with you if you need and want the help.

Here is the roadmap that has been traditionally handed down to all of us, myself included, about how to get ahead and have a successful career and build a beautiful life. It goes something like this:

“Go to school, study hard, get good grades, so you can go to college. Get a degree then go out and find a good, safe, and secure job. Work your way up the corporate ladder, and retire with a nice pension.” I think everyone has basically been told some variation of that by their parents, a guidance counselor, or a teacher. Some even add the corny, “the move to the beach, do some fishing and take up golf.”

Okay, so let’s stop take a deep breath and think about where that idea comes from. I don’t think that we have to go too far back, or that we even have to pinpoint exactly what year or generation it comes from. Let’s just take a look at why it likely became the typical roadmap for success in America.

It just makes sense that if that advice is so prominent it means that it had to have worked at some point. So let’s look at it in the most basic of senses. It means that at some point in time if you went to college and got a job where you wore a shirt and tie, you made more money, accrued a bigger pension, and were able to have a better lifestyle, in general, than someone who did not. This entire idea has basically persisted up until today. There were some spots where manufacturing was huge in the United States, and there were some alternatives, but the microprocessor changed all of that. Let’s look at what this means for people today.

I’ve heard and read one statistic over and over again in the past 2 years, and it has everything to do with the endgame of people’s careers- retirement. Only 2% of the people who retire at age 65 are self sustaining in retirement. I’ve read them and seen them in loads of places, but the numbers come from the Social Security Advisory Board. This means that 98% of people are not making it on their own in retirement.

The big question is why is this happening?

The answers to these questions are something that you put into books not a blog post. But here are some of the main reasons why:

• There’s no such thing as a safe, secure job anymore. Companies, in general, are no longer loyal to their employees; they’re loyal to their stockholders. 
• There is no such thing as,  ”I am worth X dollars a year.” The reality is that the position, not you, is worth some dollar amount per year. If some department can be replaced by a computer program, website, or a machine, it will be done.
• Retirement is based on you living on a fixed income. Inflation makes everything the cost of living go up, while you’re income, remains generally fixed.
• Employer based pensions are mostly gone in the US. These have been replaced by 401k contributions, which are market dependent and require a massive savings balance for them to work. Think of all the people who were ready to retire this year, and had large portions of their retirement nest eggs wiped out.
• Income, adjusted for inflation, has decreased over the last 30 years. In other words, people are working harder, and longer, for less pay than they would have made 30 years ago.
• Debt. Too many people are too overburdened with debt. There’s tons of college students that are graduating with 20K+ in college loans. Depending on the rate, that’s like having a car payment without the car.
• Lifestyle is different. 10 years ago, the thought of paying $3 for a cup of coffee every morning was absolutely insane, but now it’s normal.
• We live in a global economy now. It’s cheaper to make something in another country, and have it shipped here than it is to have it made here.
• Technology. The internet + computer programs have replaced lots of people in the work force.

I’m going to stay on this topic of redefining old ideas all week, but here is a thought for today: 98% of anything is an overwhelming majority, so whatever 98% of people are doing, no matter how right or wrong, is considered normal. That’s huge! So if 98% of people are following a roadmap to success, that leads to them not being self sustainable in retirement there is something horribly wrong with whatever they are doing, and whatever that 2% is doing is considered abnormal.  No one ever starts a career thinking, “I’m going to work for the next 40 years of my life, save some money, only to retire and not be able to make it. That’s what I m going to do!” It sounds stupid, but that is what happens. Normal thinking leads to normal results, which is something that no one ever wanted in the first place.

Migrated. Originally posted June 8, 2009

To say that the internet, and the Information Age have forever changed the landscape of business is the most obvious statement on the planet. The real question though, is not how companies transition to new Information Age models, but what does this information revolution mean to the entrepreneur?

There is this commonly held belief that the most important skill of an entrepreneur is his or her ability to raise capital. In the Information Age, this is absolutely dead wrong. The internet has seriously changed that. There are so many sites out there that will allow you to put up and host a website for free. They come with easy to use tools and pre-configured designs and layouts. Are they the greatest in the world? Not really, but they are absolutely the right price– free. Add a domain, that’s a whopping 15 bucks a year. Would capital help, absolutely, but it is not necessary. 

With the internet, massive amounts of capital can be replaced by massive amounts of sweat equity.

This leads to what lots of people think may be the other most important skill on an entrepreneur; reading the market, and predicting where trends are going and how to capitalize on them.

The internet, and the massive amounts of information available, make it easier for individuals to do proper research, analyze a situation, and make a significantly more informed decision than before. What I am getting at is that what used to take a team of people doing research in a particular niche, or a market, can now be done by someone who knows how to beat on Google hard enough to get the information, and is willing to put in the time to do the analysis. Surveys, focus groups, and all that other stuff companies used have to do in order to figure out customer to their products can all be done through Google’s blog search and search.twitter.com.

The really big question then arises, which is not what the internet and Information Age has changed  for entrepreneurs, but how can it empower ordinary people to do extraordinary things?

I had dinner last night with my friend, Sean last night and we were talking about how people are making large amounts of money off eBooks. The fairly ironic thing, is that many of the people profiting from those sales, were not at all involved in writing them– they are just affiliates acting like a regular book distributor/store, but they have next to no overhead. The really crazy thing is that no one involved in that sale made a physical product.

I’m not even going to get into all of the other things that individuals are doing to make extra money. The reality is this, there is absolutely no reason why someone who is reading this post should be slaving their lives away at a job if they don’t want to. Just as the internet can destroy businesses that don’t adapt, it can absolutely empower people to do something great with their lives.

Migrated. Originally posted on June 11, 2009

I read an blog post the other night on what a lot of people think the future of employee compensation is, and it rang a bit close to home. I’ve been talking to some more people online about it and it looks like some companies have started implementing it, and with very mixed reactions from their employees.

The change is from the standard annual salary broken down into an hourly rate, to a base salary with monthly and/or annual performance bonuses. Basically, companies are starting to move more towards a situation where you have to perform to make good money. Personally, I have absolutely no problem with that. That’s the way it should be.

I think that this economy has revealed that loads of companies have tons of dead weight dragging them down. I remember when they first started admitting that we were in a recession, employee productivity jumped. People facing the reality that if they did not perform, they would get the axe started doing what they were being paid to do- work! It makes total sense for companies to move to this model, and I personally think that over the next decade the vast majority of institutions will start doing this. Just think about it, if you perform, you bonus. If you don’t perform, you’ll probably end up getting sacked, but at least the company does not have to pay you the bonuses, which under the old structure they would. Can the system be abused by the employer? Absolutely, but so could the other one. There are plenty of people out there that were underpaid before the recession hit, so don’t compare apples to oranges.

The company I used to work for was in the midst of implementing it as I was cut. Your base salary would be determined by title, not necessarily skill level. Some companies claim that skill level and title match. Bullshit. Then there would be monthly and/or annual performance bonuses. The idea is that they would make up the salary gap between market or whatever. Im not going to get into it, because I think that whatever a company does as far as salaries, if it continues to work for them, more power to them- figuratively and literally.

What does this mean for the Tom Smykowski’s (Office Space) of the work place? With technology, you job may be completely done by a computer that is more friendly than you, works all the time, rarely calls in sick, and does not need your benefits package. 

What does this mean for people that are top performers? Now that the scope of your compensation structure is based around your performance, the ceiling to your income will be clearly visible and defined. Personally, I think people like this will make a transition to the business world as entrepreneurs, and develop internet businesses. In the business world, if you have the chops and you hustle, you get paid. The reality is that in the business world, there is potentially no lid whatsoever to your income.