What’s the Worst That Could Happen?

This week, Iranian officials shut down the operations of Oriflame, a Swedish direct sales cosmetics company that operates largely in Europe and Asia.  Iran also detained some of its executives, as well as two of its distributors for undisclosed reasons.  The reasons for this shut down are not clear at the moment.  Iran says that Oriflame is running a massive pyramid scheme, and the company believes that Iran has a problem with the fact that it provides opportunity for women, and the direct sales model overall.

Oriflame’s chief financial officer Gabriel Bennet calls the idea that the company is a pyramid scheme “ridiculous.”

“We work the same way in Iran as in the rest of the world, in over 60 countries … A pyramid firm could not run an internationally recognised business for more than 40 years,” he said.

As someone who loves the direct sales model and the opportunity that it provides to women, obviously this is troubling.  However the company has an opportunity to build its case using social media to garner support, and it has not, as yet, taken advantage of these channels.

Hakki Ozmorali, a direct sales corporate consultant and blogger from Turkey, said about the Oriflame situation, “Isn’t it funny (or better-put, tragic) that Oriflame has not yet a move on any of the social media platforms?  Instead, people who know Oriflame (like myself) are trying to spread the word that Oriflame is by no means a pyramid.  When you browse, there are zillions of posts/Tweets made by many, but Oriflame corporate is silent.”

And this is one more reason why all companies need to have a crisis plan, that includes communication through social media channels.  Depending on your evangelists to spread the word is not enough.  I urge all my corporate direct sales clients to create escalation procedures, which include a list of the “worst that could happen” scenarios, who is responsible for responding, and “1-hour responses” that are standard responses to put out within social media channels while the company is examining the situation and preparing its formal response, so that the company looks responsive, and is leveraging its social media channels to communicate with its stakeholders, as well as the general public.

Oriflame is a well-established company that is operating under the same model that you and I love.  One can only hope that the company leverages social media to free its employees and consultants from Tehranian authorities, and can continue its ethical operations.

Your thoughts?

2 Responses to What’s the Worst That Could Happen?
  1. Janette Stoll
    August 25, 2010 | 11:26 am

    I did find few articles on Google addressing the pyramid scheme allegations but it is interesting that not even distributors are mentioning it (perhaps there’s a policy against it??). In any case, during the Arbonne bankruptcy crisis- there were a couple well known distributors on blogs addressing the concerns. I would expect that. It is unfortunate because it’s this type of bad publicity that gives this industry a bad rap. I love direct sales and bugs me when others think it’s a scam.

    Janette

  2. Eileen Marrinan
    August 25, 2010 | 9:49 am

    It’s a pretty sad state of affairs when the consultants are more cluey than corporate. Social media is the 21st century way forward in our industry and corporate need to get on board with the program and if anything -lead the way!!!

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