Oriflame plans mechanism to track its products sold on e-commerce sites

Meenakshi Verma Ambwani New Delhi | Updated on March 12, 2018


Direct sellers hopenew guidelines will boost industry

Fresh guidelines issued by the government for the direct selling industry do not allow e-commerce firms to sell products of these companies without their approval.

However, lead players in the direct selling space, such as cosmetics brand Oriflame, have decided not to wait for the implementation of the guidelines to track their products.

Juan Carlos Posada, Senior Director, Regional Marketing, South Asia, Oriflame, told BusinessLine that the company had been trying to fight this challenge for some time.

Joining fee

“We have had conversations with key e-commerce companies to check on this. We are mulling putting in a mechanism under which there will be unique codes on our products so we can track them to see how they end up on an e-commerce site,” he said.

The guidelines also bar direct selling companies from charging any entry fee or joining fee from consultants or agents.

Asked if this would impact the company’s business, Posada said Oriflame charges a nominal amount as joining fee, which is not a big source of revenue.

As part of its promotional schemes, the company has already been waiving off the joining fee for certain periods, he added.

The direct selling industry believes the guidelines, when implemented, will boost the industry, which is fairly small compared with other mature markets.

Growth potential

For Oriflame, India is currently its third-largest market globally.

“We believe there is a huge potential with growing disposable incomes and urbanisation,” Posada said.

“India is among the fastest-growing markets for us and we believe it has the potential to become the largest market for the company in the next three to four years, depending on growth of other markets like China,” he added.

Wellness products

The company, which sells skincare and cosmetics products, introduced its wellness products in the country last year.

Posada said that only 20 per cent of the wellness product portfolio was currently available in India and the company would look at expanding this portfolio aggressively.

Digital channel

The company has a research & development centre and two manufacturing units in the country.

“We are investing significantly on strengthening the digital channel. Currently, nearly 60 per cent of the orders from our consultants come through the digital channel. We believe that in the next 3-4 years, this could become 100 per cent,” he added.

Published on October 02, 2016

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