MomoTalks Podcast - Episode 05 - Erin Barta of Mannatech

Thank you for having me. It's great to be here.

Yeah, from a background standpoint, I've been with Mannatech since 2006, been the General Counsel since 2013. Prior to that, my practice area was franchise and distribution law, and it was mainly in the restaurant sector. So there are a lot of parallels between franchising and direct selling. So it was a reasonable transition. It took a little time to get up to speed on all things direct selling and multi-level marketing, but I really just enjoy the opportunities that this channel affords people to be entrepreneurial, to build their own business, and I just really enjoy the model.

Yeah, so I oversee the legal department, business ethics which is compliance. We sort of rebranded that to make it sound a little better. People want to be ethical as opposed to just the compliance hammer coming down. I love that. And then I'm also over Regulatory Affairs. So all three of those departments stay pretty busy. We support 25 markets, and we do have counterparts in the other markets that we liaise with from both an RA perspective and a compliance perspective. We also, as General Counsel, we support the board of directors, and so we work with the chairman of the board and the committee chairs on setting the agendas, drafting minutes, making sure that the directors have what they need prior to meetings. And then Mannatech is a publicly traded company, we're a small cap public company traded on NASDAQ, and so I work really closely with our financial reporting team as well.

Yeah, but that makes it exciting, right? Every day is different, so never a dull moment.

You know, I think from a company standpoint, we're looking to make things simpler, right? Simplify the business. And I think from an associate perspective, what digital tools can we leverage and roll out to them that makes it easier for them to reach prospective customers, prospective distributors? We call them Associates at Mannatech, prospective Associates. What can we do to make it easier for them to do the business? Are there things we can do within our customer care team? We have a really great program called the CARE program that when there's downtime in the call center, we have reps that reach out to Associates and say, 'Hey, you've got some folks in your downline that have not ordered in a while, and you may want to contact them to help them see where their business is and provide that value-add service.' Again, helping to make the business easier. And then on the employee side, the same thing. We want to take out the rocks and the roadblocks. Is that maybe simplifying some of our existing processes? Are there steps that we can remove that aren't going to interrupt quality? Are we still going to be able to put out compelling materials, compliant materials in a more streamlined way? So we're always looking at how we can improve processes.

And I think that's a good point. The field is the bread and butter of any direct selling company, and you're exactly right. We've got to make it easy for them. We've got to make it so that they've got the tools they need to do their job. And as fast as technology changes, we need to keep up, especially if we want to target a younger demographic like yourself. We need to be able to leverage the cell phone, the mobile phone. Everything is done on our cell phones these days, and so we've got to ensure that we've got the right tools that are going to reach and teach people where they're at. And where people are at is everything is on my phone. I think that's really key to have digital assets within the app, easier ways for people to sign up and engage with prospective customers or prospective Associates, and make it easier to do the business.

Exactly, exactly.

Yeah, so I think the current state, I think we are still in a... I don't want to say limbo, but we all are waiting to see what happens with Neora. I think that's going to dictate some changes and see what this ruling is. But I think we can still adapt to certain things. We've got agreed orders, we've got ways to read the proverbial tea leaves out there of what the FTC is going to be looking at, especially if you got the nice love letters from them. So we do know what they're looking at. I think the other challenge too, and again this goes into at least for our company, attracting a younger demographic and making ourselves compelling to a younger demographic, is how do we take the advantages that the gig opportunity offers and translate that into direct selling? My boss, Al Bala, he talks about direct selling as the initial gig, the first gig. It's true. So how do we meet people where they are today? There are people who want to make just a few hundred bucks initially a month just to have some supplemental income. Meet them where they're at. Make it easy. Everything from immediate gratification with pay quicker, or paying fast as soon as the sale happens, there's something in your bank account. Also the ease of everything being contained on your cell phone and in your app. You can follow, you monitor your business, you can send out compelling materials to somebody who might be interested in doing the business. So again, to me it's about meeting people where they're at today. I think also the affiliate world is really enticing. There's a lot going on there, and that's been a subject that a lot of direct selling companies have either adapted to within their compensation structure, or recently in June we did a soft launch of another company called Trul Lube, and we view that company as an innovation hub for both products and for how the business model may evolve. So it's somewhat of a hybrid. We're calling it a hybrid affiliate program. There are some elements where you can earn based on someone's sales that happened below you that you've brought into the business, but it's also very simple. You get a link and you can post on social media, whichever platform you prefer, whichever is easy for you. And again, it's for someone to do the business when and where they can. I'm going to say it again, it's about meeting people where they're at today. So we're really excited about the prospects of that. It's really in the early stages, but we think it's going to be an interesting way for us to innovate, whether it's on the product side with new technology that might not be core to what Mannatech is known for, but also for the business opportunity side.

Yeah, and I think to your point with the influencers that are out there, that to me also ties with what direct selling is all about because it is that person-to-person, it's that trusted source. Whether it's your neighbor, a family member, a co-worker, a friend that introduces you to some great products or even the great opportunity that a lot of the companies in our space offer. Typically that influencer, you're following them on Instagram or Facebook or Twitter, whatever it is, you're following them for a reason. It's because perhaps the interests are the same or that person is a trusted resource to you, which to me is analogous. It's just that the internet and the various social media platforms have just opened more doors for us to engage with people. So I think there are some synergies there, there are parallels there.

Yeah, I think we're always going to have to keep trying to adapt to whatever the FTC throws at us. You can read the tea leaves to be proactive, but they're unpredictable. We don't know. I think as we see the proposed new rulemaking, the proposals to change or amend the business opportunity rule, the proposed rule on earnings claims, we can kind of see the direction they're going and adapt to it. But a lot of those things that are being proposed would fundamentally change the business model. So in the back of our minds, you've got to think about, okay, if this happens, then we've got to pivot here, and you just have to be able to pivot to what they're going to throw at you. We're also in the dietary supplement space, so we're also regulated by the FDA, and there are more things to adapt to there. So we've got to be mindful of any new challenges proposed by them, whether it's new dietary ingredients for new products, and just how they're behaving and how they're reacting to what's happening in the marketplace. I think there are opportunities again, like adapting to this gig economy and seeing how the direct selling model can fit within that. But I think the biggest one is really those potential regulatory changes. We've just got to be prepared as they happen. It just is what it is.

Yes, yes. And to engage with the FTC and other regulatory entities where they're at. That includes organizations like TINA, truth in advertising. I periodically go back and check what they're focused on, what's drawing their eye today, and just sort of keeping track of everything. I think my teams try to do that and build a rapport with sales and marketing or R&D or some of the other departments we support, just sort of keeping track of what's happening not only in the direct selling space but in our case the dietary supplement space, keep them apprised of what's happening so from their point of view they can also pivot on how they prepare marketing materials and marketing collateral, how they conduct training. 'Oh boy, this is happening, so maybe we need to focus more on this aspect of our business model.' I think that also builds a great rapport with team members in other departments so that there's collaboration and a more 'hey, we're in this together' attitude. It's us against the government, just kidding. But helping them so that they can adapt training to fit within what the FTC is focused on or what the FDA may be focused on, or whether it's a type of product claim or type of earnings claim. Let's get everybody trained on how to do those properly, compellingly, and compliantly so that they're out there building their business and they can have the confidence that what they're saying isn't going to get them in trouble.

Yeah, it's a great business model, it's a great channel, and it's genius. It just affords people opportunities that they may not otherwise have, so I'm a big proponent of it.

Yeah, so a nonprofit organization, M5M, it stands for Mission Five Million. It started out, we wanted to get nutrition to five million children. We've surpassed that. So it's a great organization. I get really excited talking about it. The organization works with other nonprofits, one of them is Kids Around the World. They put together meal kits, and what we do is we add a phytol blend powder which has vitamins and minerals. We add a little packet of it so that the caregivers at orphanages or feeding programs can dump the phytol blend powder in with the meal kit, and it just bolsters and supports the nutritional content of those meals. It's the heart of Mannatech, wanting to share the great technology that we have and ensuring that some of the most vulnerable people can experience the benefit of that great nutrition. So far this year, we've donated over eight million servings in 2023.

Yeah, it's a softer side, the softer side of Mannatech. You guys are right here first.

Yeah, thank you so much. This was great. I really enjoyed it, and thank you for thinking of me.