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Commercial Times Interview David Fan, CEO VIVA Life Science New Positioning for Creating Positive Advantages

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Today, MLM companies are focusing on specialized nutritional supplements, exceeding that of household and skincare products. In this competitive world of MLM, more and more companies are launching new supplement products to get a piece of this growing market share. David Fan, CEO of VIVA Life Science, which is famous for its nutraceutical supplements, thinks the key to survive in this versatile market is to establish brand value and develop unique selling points.

Brand Value Directly Influences Sales Volume David Fan said that VIVA recognized the importance of establishing unique selling points from the very beginning of the company and long before the Taiwan government set up an enforcement law to regulate the quality of supplements in 1999. Many health supplement manufacturers were shocked at that time because they were unable to comply with the law on such short notice. In the same month, VIVA submitted an application for Certification and was the first company to receive government acknowledgement for the quality of a health product.

According to David Fan, to reach such a high nutraceutical level for supplements it is important to value the products’ efficacy and safety. In order to increase product and brand credibility, the company sends out their clinical studies to famous U.S. and international medical research journals for review and publication. So far the company has 9 published articles and is one of the few companies to have medical support for their products.

Mr. Fan also states that brand value directly influences sales volume. The stable and continuous increase of sales volume is the key to success in MLM. He says that, nowadays, it is hard to play games with compensation plans to increase organization size. It is much better to work with the marketing plan and increase the ratio of loyal consumers, which will ensure stable profits for the distributor and the company.

In order to create loyal customers, this year David Fan is planning to position the VIVA brand as the Top Nutraceutical Supplements on the planet. The target market will be the 40 to 60 year olds and a new advertising campaign will be launched with the intention to plant the brand value in the consumer’s mind. David Fan explained that previous MLM strategies involved business builders as a large part of the distribution channel where they were able to profit from their efforts. But now, we must plan an advertising budget and use public advertising as a major tool to establish the brand value and respond to the current changes in consumer habits, trends and behavior.

Big Shakeup Coming to MLM in the Next 18 Months Besides the uniqueness of the company, David Fan stated that the financial stability of the company is an essential element for success. In the situation of a shrinking market, one faulty decision can lead to serious adverse outcomes or disaster. For example, the company that sets up a branch office everywhere with a long term lease may find they cannot support the expense of daily operations when there is a sudden cash shortage, a change in the economy, or the fall of financial institutions or governments. He also emphasized that the environment and market conditions influence the consumer’s buying power, especially when the economy goes down and people lose jobs. This situation can also have a big impact on the MLM business, similar to the “domino effect”. If one domino falls, all the dominoes fall. It is a chain reaction. We must be very careful.

David Fan says, for example, that because of the changes in the whole economic system last year in Taiwan, almost all MLM companies experienced negative growth. Inflation directly influenced people’s consumption power and even business builders had a hard time making money just to survive. This makes the distributor think that they are even farther away from their dream. When you are poor, you can’t have a big dream and think about financial freedom because you are too worried about surviving. Distributors experience pressures from all sides. In fact, in this environment, achieving your dream is more difficult.

David Fan thinks that the rising Chinese dollar is the main reason for inflation and contributes to price increases in materials. Expensive raw materials are a burden to the MLM companies who do not manufacture their own products because they need to adjust their pricing from 12% to 15% or more, or they decrease their bonus output to respond to the higher costs. David predicts that these major changes will cause a big shakeup in the MLM market in Taiwan within the next 18 months, which will lead to the wash-out of many MLM companies.

Fan Recommends Direct Selling Part Time How will VIVA react to the coming shakeup? David Fan frankly says it is not a period to be drawing on big dreams. Many MLM companies paint a picture of the big dream but he would rather give a more realistic promise. He suggests that most people should do MLM business part time to obtain an extra income outside of the income of their regular job. Once a high rank is achieved in MLM, then it would be more beneficial to enter the business full time. Don’t just give up your full time job and risk your financial stability. Moreover, he says that VIVA will help the business builder increase their communication skills and attention to details, which will help them respond positively to change and create the VIVA Advantage.

Many MLM companies have ventured into the China market, but David Fan casually sits back and says that when he sees people going like blind bees in the same direction he stops and thinks whether this is an opportunity to get a piece of the pie or is it just a mirage? He thinks Chinese people have the character of painting a big picture of a dream yet giving a vague promise for its fulfillment. So, he decided not to go into China with everyone else. Now, as he has observed, of all the MLM companies that entered the China market, very few are making money. Truthfully, most of the time it is the company making money, but not the distributors.

David Fan thinks that the changing society will influence the business world. He noticed the younger generation of Taiwanese do not have a strong family value and so families fall apart as well as their ideals. Young people have no brand loyalty and the strong current of information that is readily available on the internet and other media deepens the situation where they can quickly change their loyalties. This is a crisis for business and establishing a brand value in this kind of atmosphere is very difficult.

However, David Fan emphasized that this crisis could actually be a turning point, an opportunity. In the near future, he is going to develop a strategy to increase distributor commissions and bonuses and increase the brand value to create VIVA’s advantage in the MLM marketplace.

How to Win in MLM Many Multi Level Marketing Companies (MLM) have given independent distributors big dreams without revealing the true nature of the business. It takes time and work. He advised that one should approach multi level marketing on a part time basis before jumping in too deep, too quickly. Use it first as a tool to gain extra income. Once certain targets and a secure position are achieved in the business, then it is more advantageous to consider engaging in the business full time. Do not add risk and stress to your life by giving up your existing career too soon.