web DeskA fierce marketer has revealed the secret behind the business model of The Icon Group, whose product is ‘people.’ The Thai Direct Selling Association invites people to observe the direct selling business.
Ajarn Thanawat Chaitrakulchai, a fierce marketer, has come out to reveal the secret of the business model of The Icon Group. In summary, is it a direct marketing business or a direct selling business? If we look at it as a direct selling business, in the past, it was a single-level direct selling, which means selling and getting a commission, and a multi-level direct selling, which means selling products and having to find people to join the team.
We will go into detail about Multi-Level Marketing or MLM. There are 2 types of products:
1. Products that are physical objects, such as household items, toothpaste, and dietary supplements
. 2. Products that are people. People are also products. For example, if we are a distributor and want to reach a higher position, we have to invite people to become our dow
nline. When our downline sells a lot, we will rise to a higher position. The higher the position, the higher the compensation.
Ajarn Thanawat, a fierce marketer, said that multi-level direct selling, like the famous companies from abroad do, requires a product that is a champion product, meaning the product must sell itself. It is not like when it is used, it cannot be sold. When we go up to the top level, we have to stock up on products. When we cannot sell, our capital is tied up and we have to borrow money. Therefore, the company must also have ethics.
But The Icon boomed during the Covid period. The company was closed, people stayed home, and everything was online. So, it was an incentive to learn online sales during that time, from expensive courses that cost thousands.
Another person who is familiar with the Thai direct selling industry, Mr. Phongsaphon Unaprom, representative of the Vice President of Government Relations, Thai Direct Selling Association, further explained how we can say, “Huh?”
Leg
al definition: Direct selling is the presentation of products through distributors to consumers at the consumer’s location. Direct marketing is the communication of product stories through various platforms such as TV and online.
First, see if the person who invites you to buy something is natural or unnatural.
Second, if they invite you to do business, invite you to sell something, do you have to invest a lot? In correct direct sales, the company will invest on behalf of the members. The company will open branches all over the country and act as a stock manager on behalf of the business. In correct direct sales, the businessman will sell by word of mouth, get orders, and then buy products from the company. Therefore, there is no risk of sinking capital or sinking stock. However, if it is not a correct business, they will focus on selling by shifting the burden to the distributors to be responsible for stock, not investing in opening branches, not investing in stock. This is called selling to agents, not se
lling through agents.
But which agency will give the best answer as to whether The Icon is a direct marketing or direct selling business? The answer given by the Consumer Protection Board is very clear.
Mr. Jitipat Boonsom, Director of the Consumer Protection Division, Direct Sales and Direct Marketing, revealed that The Icon Company was registered in 2019, which was in the news because it has a retail sales process and creates a sales network that sells products through individuals who are members to consumers, and distributes revenue from product sales, reflecting the total back to the main network.
Previously, in 2018, the company asked if it could register as an MLM, but found out that it was not a direct sales business because there was no appropriate compensation plan. Instead, it was a retail format, selling the products and then looking for a difference from the profit.
After considering, it did not meet the criteria, so it was not accepted for registration. In 2019, it was registered as an ‘onlin
e direct sales market’, which was approved, meaning that there were products that were sold and purchased through his website.
However, the Consumer Protection Board found that since the inquiry in 2018 until now, there have been sales in a form that is different from what was registered. Therefore, a letter was sent to inform the relevant agencies, including the Police and the Fiscal Policy Office, to help supervise.
It was reported that ‘Boss Paul’ will travel to give a statement to the Consumer Protection Board on October 16th and has ordered celebrities to travel to meet with the Consumer Protection Board as well. There have been approximately 20 complaints filed with the Consumer Protection Board since 2019-2020.
Source: Thai News Agency
