ARTICLE [Direct Selling News - August] Atomy: Breaking the Mold
Atomy: Breaking the Mold
Park subsequently started im-korea.com, an online shopping site, implementing some of the techniques he’d learned in direct sales. Still, the company failed to take off due to inadequate infrastructure and a lack of consumer awareness. In 2009 and on a shoestring, he launched Atomy based on a philosophy of “Absolute Quality and Absolute Price”—selling prestige-quality products at prices the masses could afford. His intent was never to compete with other direct selling companies but rather other distribution channels. He also established several other non-negotiables: a commitment to honesty and integrity, a “one partner per product” philosophy (meaning one manufacturer per product line, which, along with cash payments upon delivery and interest-free financial assistance for operating costs, helps partners grow) and the company’s profitability through an economy of scale.
Proves that work and play aren’t mutually exclusive.
Based in Gongju, South Korea, Atomy provides more than 400 products in various categories including nutritional supplements, beauty, fashion and home décor. Founder and Chairman Han-Gill Park first encountered direct selling during a business trip to Australia. Afterwards, he quit his job and became a distributor for a direct selling company. Park reached the top level of the sales organization but ultimately lost the business he’d built when the company closed.
Atomy’s flagship product, HemoHIM, a health supplement designed to boost immunity, was developed as part of a government project by the Korea Atomic Energy Research Institute in 2004. It was a best-seller in the Korean direct sales industry for six consecutive years (2014-2019). Originally, HemoHIM was offered through another distributor at a price of $770 for 60 packets. Atomy now sells 60 packets of the same product with the same ingredients for $84. HemoHIM and several other Atomy products—including the top-selling Absolute CellActive Skincare System—are sold by a global sales force of 10 million distributors.
“The past ten years have proven that consumer-
centered management is much more effective than
that of the membership-centered.”
—Han-Gil Park, Founder & CEO, Atomy
The company maintains a consumer-centric focus. “Our message is clear: Try only the products you need and only if you’re truly satisfied, recommend them to other consumers,” Park says, adding that a disproportionate focus on distributors isn’t sustainable; “many companies aren’t concerned whether their products are marketable in quality and price but are rather fixated on how much commission to pay out in order to maximize membership. This commonly becomes the reason for the higher prices of direct selling products over others. The direct selling industry shouldn’t forget that it’s just another form of distribution. The past ten years have proven that consumer-centered management is much more effective than that of the membership-centered.” Global sales for the company totaled $1.15 billion in 2019, and it maintains 14 global corporate offices in locations including the United States, Japan, China and Russia.
An Office at Play
It’s hard to argue that Atomy has one of the most unique corporate cultures in the direct selling industry. Take, for example, its “free title system.” Employees are given the latitude to choose their own professional titles, regardless of their respective seniorities. The only stipulation is that they assume responsibility for the duties suggested by their titles.
Adopting a “Chutzpah Mindset,” or being bold, asking tough questions and remaining tenacious in the face of insurmountable challenges, is another core value at Atomy. Employees also enjoy “powers without a yoke of burden,” meaning that “we give our employees the powers they need to carry out tasks without holding them liable for the consequences,” Park says. The objective is to capitalize on employees’ strengths and give them the courage to take risks without fear of retribution should they fail. Managers evaluate employees’ performance based on demonstrated effort to reach above and beyond.
Within a decidedly flat organization, Atomy encourages employees to work through influence, not rank. “An experienced soldier doesn’t mindlessly comply with his commander’s orders. He scans the battlefield himself, understands his allies’ moves, and responds to the enemies’ actions to find the best way to win. He plays the role of a soldier as well as a commander. Atomy employees should also think of themselves as executives and grasp how their actions impact the company’s viability as a whole,” Park says.
Reflective of this unconventional culture are Atomy’s headquarters in South Korea, recognized by the Korean Institute of Architects in 2019 and reminiscent of a Google or hip Silicon Valley IT startup. An August 2019 feature in Forbes Korea describes an open floor plan in which employees work where they choose, are exposed to diverse skillsets and thinking, and enjoy such amenities as an indoor pool, a pool full of rubber balls, swings hanging from the ceiling, a “Thinking Room” with toilet chairs, a “Slam Dunk” room with basketball hoops, a camping space designed to bring the outdoors indoors, massage chairs, a children’s playroom and hair salon. “We didn’t create play spaces in an office but office spaces in a playground,” Chairman Park told reporter Hoon Beom Lee, adding that his intent was to create an environment that tempered a propensity for overworking—something he admitted he used to do—and that burnout was the enemy of creativity.
Research and Development
In October 2019, Atomy celebrated the groundbreaking ceremony of Atomy Orot Factory in Gongju City, a facility that includes a centralized research center and food research lab. It will be the key engine of the research and development of Atomy food products that use natural ingredients without artificial flavors or additives.
Through a strategic partnership with Kolmar Korea, a global original design manufacturer (ODM) in the skincare and health supplements sector, Atomy researches and develops products in line with its philosophies and principles while following consumer trends—for example, the company’s number-one product, the previously mentioned HemoHIM, developed by Atomic Energy Research Institute and manufactured by KolmarBNH.
Atomy also seeks out small or mid-sized companies that offer quality products but have encountered difficulties with sales or product promotion. The company’s aim is to build and nurture long-term, mutually beneficial partnerships by providing these companies with a secure sales route, financing and support of quality improvement efforts.
As is the case for many direct selling companies, Atomy employees and distributors had to respond to changing work conditions quickly. With the onslaught of the coronavirus, what Park refers to as the “no-contact” trend has picked up steam at Atomy; the company canceled all in-person events and replaced them with video streaming through its own channels. Salespeople have opted to meet in smaller groups of two to three prospects at a time, which affords them the opportunity to provide participants with a more in-depth introduction to sponsorship.
The pandemic has inspired increased popularity of products designed to improve immune function—for example, HemoHIM, which recorded sales of 67 billion KRW at the end of April 2020, a 20 percent increase from the year prior. “As the situation with COVID-19 continues, people are taking more of an interest in health and immune systems than ever before,” said Reporter Chan Yu of Money Today Network (MTN) in a recent broadcast. “As a result, the dietary supplement industry is showing a jump in sales which is set to expand not only in Korea but also globally.”
Atomy maintains an active philanthropic presence, from its annual Atomy Run fundraising event, which offers 1:1 matching donation to various causes. Its support of children’s welfare projects, including the donation of 2.7 billion KRW in July, 2020, for the construction of a public children’s rehabilitation hospital, the construction of an academic institute at Siloam Eye Hospital, and a 10 billion KRW (approximately $8.7 million) donation to the Community Chest of Korea, the country’s largest welfare institution, to help single parents, underaged or young mothers become economically independent. The Community Chest donation, made through Atomy’s “Life Cherishing Mom” fund, is the largest among those made by mid-sized companies in Korea.
Despite the pandemic, Atomy opened the Chinese market this July and is scheduled to launch three new markets before the end of 2020: India, Colombia and Turkey; and in the next five years, it plans to begin operations in Europe (UK, Germany, France) and Africa (South Africa, Ethiopia). By 2030, Atomy will be available in more than 30 countries worldwide.
The next phase of Atomy’s business, Park says, is a platform that blends business and entertainment to engage distributors in a new way. Launched in 2019, Atomy Entertainment & Multimedia, or Atomy ENM, is an “entertainment-centric distribution company” led by renowned drummer Lino Park. It’s designed to encourage and inspire Atomy distributors and provide accessible and entertaining content they can use as a tool to grow their businesses. ENM creates both online and offline content and presents shows using technologies like augmented, mixed and extended reality. Its inaugural show, Atomy Dream Hub Festival, took place in 2019 and entertained distributors and residents of Gongju where the company is based. “We expect Atomy ENM to play a key role in attracting the next generation with fun content through the latest technology and media,” Park says.