I’m a proud Lyoness Business Member, and so I will say something to clarify the process used by Lyoness to start a new market, just because Lyoness has 8 years of full activity in only 2 countries in Europe: Austria (the country of origin) and Hungary. All other countries in the world (+32 and counting with Asia starting this year) are in a kind of pre-launch.
That said, no one could state that Lyoness has few this or that, because the internationalization has stared 3-4 years ago.
Lyoness uses a 3-phase launch model.
First stage is for checking compliance with local (country) law.
This could take several months or even a full year. It depends on the country legislation complexity (like USA and others).
Only after full clearance from lawyers Lyoness goes forward with a second step in phase one. That is to start a group of local (country) members that will help to fund the Lyoness in that country. Yes, to fund, because this first group will be like co-founders of the company in that new country, and for that they will have to do a pre-payment for future purchases – it’s not a starter kit neither an investment. And by doing so, they will have additional benefits from the company when it launches, like participate in the media national campaign for getting simple members (let’s say customers). The number of those firstly members is different from country to country and that requires also time. They are called Premium Members.
So, after that accomplished, Lyoness enter in phase two.
In this phase, besides recruiting more business members (not customers yet), the company opens the local (country) office, recruit staff and start partnership with big companies as well with small companies across the country – this takes time, a lot of time. Also in this phase two Lyoness partnership with online stores, because it’s easier to implement that in the community.
Let me ask you something:
- do you think that brands like Microsoft, Apple, BMW, Shell, McDonald’s, Wall Mart, etc. etc. etc. just become Lyoness partners without their lawyers meticulously check everything about Lyoness? And don’t you think that it requires a lot of time (negotiate and checking)?
And then, when there is a strong community of business members and shops (online and physical) across the country, Lyoness enter in phase three.
In this phase the company launches a strong media campaign for the masses to get customers (people who will use the cashback card only, they will not do the business – but they could do it if they want at anytime in the future).
And only after that campaign the company is full launched in that new country.
Then we will have many members using the Lyoness cashback card everyday because there is also a large community of partners for people to go shop with benefits from Lyoness business model, a very simple one in fact:
- Lyoness get a commission from the shoppers for sending them customers;
- Then Lyoness keep one small part for running the business and distribute the rest to the all members;
- Then the members could use the benefits to go shop again, and this is a perpetual cycle.
So, Lyoness uses the size of the community to get more partners, to get more members, to become even bigger.
1.800.000 members in August 2011, and 2.000.000 members in January 2012: that’s 200.000 new members in five months!
Or 40.000 new members per month!!
150.000 points (stores) of acceptance of the Lyoness cashback card and more than 3.500.000 products and services available for all members in 34 not fully open countries!
Consider that Lyoness is in a pre-launch phase worldwide…
Yes, we already made history in the industry, but that is nothing compared with what will be in the next few years.