Earthly Clean

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MLM Cleaning Products Business Plan

Market Analysis Summary

Earthly Clean has identified two distinct type of customers. The first customer type is the end user of the cleaning products. These are people with an environmental consciousness in need of appropriate cleaning supplies.

The second customer group is comprised of a select number of people from the first group with an interest in becoming distributors of the cleaning products. The following sections will provide more detailed information regarding these two groups.

4.1 Market Segmentation

Earthly Clean has identified two groups of customers who are the most attractive marketing prospects.

  1. Consumers of environmentally friendly cleaning products.
  2. Members of the consumer group who are interested in being product distributors.

Individual consumers
These are people who are looking for products that will reduce their individual impact on the environment. Cleaning products are an excellent product category to concentrate on since they can be particularly abrasive to the environment. Some demographic information for this group is as follows:

  • Ages 23-48
  • Median household income of $41,000
  • 22% of the people commute by bicycle or use mass transportation
  • 97% of the people are active recyclers
  • The majority routinely consider what consequences their choices or actions will have on the environment.
  • 41% are vegetarian
  • 93% are registered Democrats

A distributor is an individual consumer who is interested in also selling the products. In the world of MLM, the sellers are called distributors because they are essentially doing the activities that a distributor would do in a more traditional distribution channel. These individuals have a passion for the product and the time to sell the product to their friends.

  • 89% of the people will take on the role of distributor in addition to their already existing part or full time employment.
  • They see the chance of selling Earthly Clean as an opportunity to do something that they are passionate about (positive environmental actions) as well as a means of making supplemental income.
  • 87% of the distributors will have the goal of signing up more distributors and establish an additional source of revenue.
Market Analysis
Year 1 Year 2 Year 3 Year 4 Year 5
Potential Customers Growth CAGR
Individuals 6% 2,455 2,602 2,758 2,923 3,098 5.99%
Distributors 5% 2,455 2,578 2,707 2,842 2,984 5.00%
Total 5.50% 4,910 5,180 5,465 5,765 6,082 5.50%

4.2 Target Market Segment Strategy

The two enumerated customer segments are particularly attractive because they represent people who are most likely to be consumers of environmentally friendly cleaning supplies. The individual consumers have a sensitive perspective toward the environment and are looking for a way that they can have a positive impact on the environment. Recognizing that so many traditional cleaning agents are toxic for the environment, it then becomes relatively easy for the individuals to make a positive contribution. This attitude follows the slogan "think globally, act locally." Buying these products allows them to do their part.

The distributors are individual consumers who have an even stronger conviction and belief in the products as well as the time to sell the products and find potential people to recruit into the distribution effort. To be a distributor does not require a huge sacrifice of time, the majority of distributors will have full-time jobs in addition to marketing Earthly Clean. This makes the job of distributor all that more attractive, the person is able to balance their already existing job with another source of revenue and personal satisfaction. 

4.3 Industry Analysis

Earthly Clean arguably participates in two industries, the product industry of environmentally friendly cleaning supplies and the business model industry of MLM. The environmentally friendly cleaning supply industry is small but just now beginning to develop momentum. These supplies are typically sold in health food type stores. These stores generally sell a smaller variety than what Earthly Clean sells, they have just the basics. Some larger retailers such as Safeway and Alberston's are beginning to carry one or two products, typically an all purpose cleaner and a washing machine liquid. As the market demands more outlets for these products it is likely that more retailers will begin to sell environmentally friendly cleaning products.

Earthly Clean also participates within the multi-level marketing industry. However Earthly Clean does not, per se, compete within this industry. Currently, market research has yet to find an MLM company that sells environmentally friendly cleaning products. The largest and most well known MLM company is Amway which sells a wide range of products. Amway is different from Earthly Clean in the sense that the majority of products that they sell are branded rather than private label products. While that is beneficial for Amway in that they are able to use the manufacturer's marketing efforts to assist in sales, Amway is often not that cost competitive.

4.3.1 Competition and Buying Patterns

Earthly Clean faces competition from several sources:

  1. Local and national health food stores: These stores typically have a small selection of cleaning products. National competitors include:
    • Whole Foods
    • Wild Oats
  2. Large supermarkets: These competitors have a very limited selection
  3. Mail order/Internet sales: These are remote retail companies that sell a range of products. More often than not these companies sell national brands as opposed to private label goods. Competitors include: