Multi Level Marketing – What Is It?
There seem to be a lot of people searching each month for, “What is multi level marketing”? According to Wikipedia, Multi-Level Marketing is a marketing strategy in which the sales force is compensated not only for sales they generate, but also for the sales of the other salespeople that they recruit. This recruited sales force is referred to as the participant’s “downline”, and can provide multiple levels of compensation. The reality is multi level marketing or MLM as it is usually referred to is the same as network marketing.
Multi level marketing is a people helping people business. As Zig Ziglar said, “You can have everything in life you want if you will just help enough other people gat what they want.”
Many people do business with multi level marketing companies without realizing it. Many of the companies you are already familiar with, and perhaps buy products from, are multi level marketing companies . Of who hasn’t heard of Amway one of the biggest and oldest companies but did you know that companies such as Tupperware, Mary Kay, Avon, The Pampered Chef, and Pre Paid legal services, to name a few, are multi level marketing companies?
[mlsp-cta campaign=”bizbuildermasterynet” layout=”standard” align=”left”]When someone asks me, “What is multi level Marketing” I tell them to imagine a new pizza shop opened in town and you go try it. You think it’s great pizza so you tell your friends about it and some of them go try it. That’s networking. Now add a compensation component. Let’s say for every one of your friends who tries the pizza, you get a small commission. Now that explains what is multi level marketing.
Network marketing or multi level marketing companies are highly regulated to insure they comply with many laws. One such regulation is there has to be a product, not just paper. Many people have heard the term “Ponzi scheme” in conjunction with illegal investment strategies. Wikipedia defines a Ponzi scheme as “A fraudulent investment operation that pays returns to its investors from their own money or the money paid by subsequent investors, rather than from profit earned by the individual or organization running the operation. Notice the words “rather than from profits…”
So if you ask, “What is needed for a multi level marketing” company to be legal one requirement is there must be products that bring revenue into the company from customers, not just from the investors.
Let’s face it, we start a business – regardless of whether it’s a multi level marketing business, a franchise, or a business you start at your kitchen table, we’d like to make some money. You may have many reasons WHY you want more money and the freedom of owning your own business (to be with your family more, fight traffic less, quit your J-O-B, retire early, watch your children grow, live in a better area, work completely from home, fund your kid’s education, be your own boss, etc.) but the point is, why would you want to work hard for less then you’re worth?
Not only does multi level marketing offer the potential that YOU could make more money, faster than you would with some other business opportunity (if at all), but it also means that the people in your downline could make money faster, as well. (And in MLM, their success means your success.) Notice I emphasize the word “could” because success is not guaranteed and does require work. There are no free rides. Many people fail in multi level marketing because they under estimate the amount of work and time involved to be succesful.
It also implies those of you working part time could make enough money to stay interested and working the business. There is a statistic that shows people who make at least $300 a month in their MLM business will stay with that business and make it work. If you’re getting paid on the first several levels, you can make that $300 pretty quickly (and potentially a whole lot more!)
Here are a couple of things to remember: just because an MLM has been around for many years, or has branded their name, does not mean they have a superior pay plan (unfortunately).
So what are some elements of a good multi level marketing company
Do you believe in the product or service being offered?
First, the product is paramount. You will have to hold your head up high and proudly proclaim you have the best mousetrap ever invented so you better believe it yourself. In other words is the company selling a product you believe in and use yourself.
So one good test is to ask yourself if you would use the product normally and would you recommend it to others? If the answer is, “no” then this company is probably not a good fit for you.
If you honestly believe in the product yourself and use it in your life, then things get a lot easier. You don’t have to sell anything, just share your experience with your friends and family. Remember there is a very well worn out saying that, “Features or benefits tell, but stories sell”. So best to have your very own personal story of success.
What about support?
One of the beauties of multi level marketing is, if done properly, your upline will provide support for you. They are there to help you. In a traditional employee/ employer relationship, if the employee does not perform, he or she is easily replaced.
In a multi level marketing company, there are no employees. If you are struggling, your upline should jump in to help because their success depends on your success.
How long has the company been around?
With a start-up company like most traditional business, many will fail in the first year. So while it may sound good to get in on the “ground floor”, most of the time it’s better to position yourself with a more established business. My personal opinion is a company that has been here 3 to 5 years has a good chance of survival and is still in many cases a growing, vibrant opportunity.
So there you have it. Find a network marketing company with a great product that you believe in and can endorse. Make sure the company has some history and stability. Insure yourself the upline is active and available to help you. Then jump in amd plan to work hard for 3 to 5 years to build a residual income stream for yourself. Good luck!
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