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Wednesday, July 11, 2001

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An interview with Samir Modi, Managing Director, MODICARE.

Why did you decide to adopt direct marketing techniques for Modicare products?

If our products were available off the shelf we would have been like any other company retailing its products. Instead of adopting the regular route we wanted to make a difference in the lives of the people. Therefore we adopted the channel of Network Marketing for our products. We go far beyond providing people with our product range, we provide them with the opportunity to make money and thereby become financially and socially independent and self-reliant.

In addition we are able to avoid the huge expenses on advertising and promotions that one normally associates with retail outlets. These in turn are passed on to the distributors as benefits and margins.

A consumer is given the chance to see a product demonstration before a purchase and then allowed the option of whether to buy or not. The Modicare system is based on product plus knowledge, which is unique to the Network Marketing concept unlike any other retail system.

How did you spread awareness about Modicare products in the market initially?

During its inception on March 30, 1996 we had a mere 12 products available at one location in one city. Armed with 300 distributors we chiefly used word of mouth to create and spread awareness about our company and products. These distributors represented the face of the company and in turn acted as ambassadors and promoters of the brand. We also used some below the line methods of communication like posters, leaflets, and an in-house magazine called Contact etc.

All our communication efforts are mainly channelised towards our distributor base because it is finally they who need to be updated on the products and systems because it is they who are the spokespersons of the company.

Can you explain how your product distribution networks function?

We cut out the middlemen so there are no wholesalers or retailers and the commissions or profits are passed directly to the consumer. In fact when you get involved in the Modicare system you become an independent business owner and you purchase your products at a wholesale price. The savings (from buying from us) could vary from 20% to 35% depending on the product. Additionally you can earn commissions up to 30%.

If a person wants to become a Modicare distributor or a direct sales executive, how does he go about it?

There are two ways to do so: One can find an existing Modicare consultant and sign up with his network, wherein he becomes a consultant and gets the mark up discount on all the Modicare products.

The other method is to contact the Modicare office and the customer relations team refers him to an existing Modicare consultant in his vicinity and he can choose to join their network. Once you become a distributor you will get a Starter Kit, which is a comprehensive business tool containing literature, products, sponsoring material, consultant forms etc.

What is the initial investment that is required to become a Modicare distributor and how soon can one expect returns?

The total amount required is Rs. 1950, and the rate of return is correlated to the amount of time that you devote to the business. On an average, by putting in about 6 to 8 hours a day one can earn anywhere between Rs. 30,000 to Rs. 50,000 per month. Our top distributors earn up to 7 lakhs per month, but to reach this level it can take you anywhere from two to five years depending on your perseverance.

As you are competing with international brands like Amway, how do you train your direct sales team?

We are committed to training and a substantial part of the revenue is invested in developing product and opportunity related material. Seminars and meetings are held on a regular basis where an existing distributor can get prospective customers. A "Private Business Reception" is a business preview on how to use the products, sponsoring and follow up. Product seminars are also held on a daily basis. These are conducted to provide product training and product selling skills to the distributors so that they have adequate information about the products. Demonstrations are conducted to create a visual impact. This allows the distributor to see, touch and feel the product so that he is convinced about its effectiveness. Information on product features, benefits, USPs, list applications, cost per use, uniqueness, multi-benefits etc are shared with the distributors during these sessions. We also hold orientation programs for all the new entrants, and leadership training exercises.

Apart from profits what kind of incentives and support systems do you offer your team?

As motivation we sent 200 of our top performers aboard on cruises. In May this year we took 60 of our top consultants to Australia. To mark its annual distribution ceremony, we organised an entertaining evening program in December 2000 at Delhi, Calcutta, Bangalore, and Pune to celebrate the achievements of its top consultants. We also have various schemes on a monthly basis whereby our consultants can win a number of consumer durable goods.

What are your future plans for Modicare?

Modicare will focus on increasing its product portfolio and specialising in personal care with emphasis on cosmetics. The company is also working towards completely reworking its image of the brand and upgrading the network to make it online. Our aim is to give financial freedom to the men and women in this country.


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