Direct Marketing in India

Direct marketing constitutes about Rs.2000 crore of the total Rs 1, 90,000 crore annual Indian retail market, spread over 2600 towns and 50 major cities in India. The huge profit margins of companies involved in direct marketing, while many of the major retailers are experiencing an all time low has completely changed the paradigm of the Indian retail market.

Direct marketing in India has created a new breed of distributors, earning millions especially in direct selling and multilevel marketing (MLM) segments pertaining to health and wellness, beauty products, household appliances etc. In a typical direct marketing network in India, individuals become independent contractors, agents or franchisees of the parent company and they are rewarded according to the sales of the products/services and the persons they bring into the network. Door-to-door selling, group meetings and networking are some of the most commonly adopted methods in direct selling.

The direct selling sector is poised for tremendous growth(more than 25 % annually, at present), estimated to touch the Rs. 10,000 crore ceiling by 2012 with a number of exciting new sectors like education and insurance coming on board. Currently some of the fastest growing sectors in direct marketing are nutrition, kitchen and household appliances, and insurance. The categories of products and services involved in direct marketing have gradually expanded from the traditional wellness, nutrition, education, weight management and kitchenware categories to more sophisticated, new-age segments, like software/hardware products, online/offline jobs, banking, luxury retail in India and other allied services.