What is Network Marketing / Multi-Level Marketing?
Network Marketing and Multi-Level Marketing (MLM) are
schemes for selling products and services, while recruiting, motivating and
supporting salespeople. Common legitimate MLM companies are Amway, Herbalife and
Mary Kay. Many smaller companies risk being legally classified as pyramid
schemes, as happened to Omnitrition, Equinox International and Heritage
International.
Network Marketing & MLM companies offer high incomes for those
people who can:
- appreciate the opportunity
- follow the guidelines and procedures for success
- avoid costly mistakes
- ignore a lot of advice to forget it
Network Marketing and MLM Basics
There is no quick or easy way to create a stable income in a network marketing or MLM
business. The following steps are required for success.
- Get Started
- Sell product or services
- Recruit distributors
- Support distributors
- Help distributors sell
- Help distributors recruit
- Duplicate success
- Follow the program
Get Started
Most multi-level and network marketing companies reward you
for selling products or services; and
further reward you for recruiting effective distributors. Usually such
companies will pay you a percentage of
the sales volume of the people that you recruit, and a percentage of the
sales volume of the people that THEY recruit.
Caution: Don't try to promote a multi-level company AND explain the
opportunity AND sell a product simultaneously. Instead, find people who
are interested in the product or in the MLM opportunity, and then provide
product information or distributor information.
The marketing plan looks very simple - and it is. The
first challenge is that most of your family and friends have probably already seen
many multi-level marketing schemes. They may criticize or even insult
your motivation and your intentions.
Caution: Tell your family but don't try to recruit
them, and be cautious about deceiving your friends in any way - assuming
of course that you enjoy your friends and want to keep them. Many multi-level companies
advise you to evade straight talk. Any deviousness may result in alienating
people.
Recruit Distributors
We coach MLM leaders to create leads by
finding previously unknown potential distributors - either through advertisements or through
casual meetings. Give company literature, success guidelines and product information only to people who show interest.
Caution: People join MLM companies to make money.
Yet, for legal reasons, most MLM companies emphasize and support their
products and services - not their distributor programs. Don't expect much
backup from the company concerning recruiting distributors.
Advertising is usually expensive and often a waste of
money unless it is carefully written and well targeted. National campaigns
are REALLY expensive - and I know of none that even paid for themselves. We
coach MLM and network marketing leaders to assess local conditions and write
advertising copy specifically for local people.
Caution: Avoid overwhelming potential distributors
with complex concepts and terms. They can get confused with jargon such as
Network, Downline, Upline, Organization, Levels, Legs, etc. The result of
confusion?
Nothing!
A golden key is to use targeted metaphors. We coach
leaders to build distributor organizations using simple terms, concepts and
metaphors suited to the region.
Caution: Some people may have never heard of the company.
Others have heard of it in disparaging terms. Is it a pyramid scheme? Is it
legal? Few people will not believe the size of incomes that you discuss. The
result? They don't sign up!
Don't try to sell a distributor program to everyone.
Instead, contact people who you think might be interested in a business
opportunity. Then explain the program as simply as possible, saying that you
will provide details only as details are requested.
We Support Distributors
New recruits joining a multi-level sales program need support, guidance and
information. If their sponsor provides little or no support - most people
will quit.
Existing distributors can support new recruits by telephone or
in regular meetings. Otherwise most recruits will quit.
Caution: Many MLM schemes sell books,
tapes, seminars and other "tools" to people who are not selling
anything. Anybody can understand direct sales: you
can teach the concept in a few minutes. Yet upline distributors often
participate in motivational "pyramid clubs".
Although some MLM recruits succeed with minimal help from
a sponsor, most recruits need help from their upline - and often "upline help" is
inadequate, ineffective - or even counter-productive. We coach leaders to
carefully target who to sponsor and who to help.
Caution: Beware of "hype" - of inflated claims that
very few people can realize. Building a MLM business, if extensive
long-distance calls and drives are considered, can be far more expensive
than a relatively trivial "cost of joining". Your distributors will quickly
resent you - and quit.
New distributors desperately need leadership and guidance.
We provide leadership talks, seminars and demonstrations to coach and
support distributor networks.
Caution: Many MLM companies teach that jobs are for
stupid people and that most businesses fail.
Yet MLM distributors can expect a 95% failure rate. Without targeting, MLM
can be a high risk "numbers game".
We Help Distributors Sell
People build a business to satisfy many
different needs, and not all relate to money or material benefit. Some
people become MLM distributors to learn the basics of owning and operating a company.
Others enjoy the social scene of associating with apparently successful
people.
Caution: Only invest time with people who want to
build a business. Otherwise you risk pouring endless time and effort into
helping people who really don't want to be helped.
The most common reason why most people fail in MLM is
failure at selling. We coach distributors in MLM sales
techniques AND systemic success skills. We coach recruits how to speak at
small and large sales meetings. We coach leaders to be leaders - and to
recruit and coach their own downline.
Caution: Measure your success in money! Many MLM
distributors measure their success in
the number of meetings attended, the distance driven to meetings, the number
of marketing plans shown, and the number of tapes and books bought.
We coach sellers of MLM products to improve sales in many ways - either to friends and family, through advertisements or
sales meetings. High quality product information is verbally and visually
presented to interested people. We also find new markets and applications
for MLM products and services.
Caution: There is nothing wrong with wanting more or better
things. However MLM distributors often try to instill greed
in new recruits, with a "win at all costs" mentality. This
can quickly damage a recruit's friendships and family harmony. Many new
recruits reject principles that have guided them through life, not wanting to become self-centered
marionettes for their upline.
Help Distributors Recruit
Caution: The next most common reason that people fail in MLM, after
poor sales skills, is inability to recruit. Unless a sponsor provides adequate
support, new distributors will likely fail and quit!
We coach leaders how to teach new distributors how to
"share" MLM products, network service or concept with friends, neighbors
and relatives, and we recognize that many new distributors are more
comfortable presenting the opportunity to strangers.
Caution: MLM companies survive due to an enormous
"I quit" rate, with 95% of distributors leaving within a few years. This bubble
does not burst as quitting recruits are replaced by new recruits. This is
the realistic background of any MLM business. We coach leaders to prepare
for and use this reality.
We coach recruits to explain the MLM program to a few
friends, and propose a business venture that involves local advertising. We
coach people to sign up a few friends and generate a lot of fast leads.
Caution: Some people can only build a MLM business with
their family's or partner's support,
while others work best alone. Quickly identify the working preference
of a new recruit - and support the recruit in the way they prefer. Many
distributors will find that their intimate partners
do not wish to be involved in a MLM business.
Duplicate Success
We coach leaders to follow up with their first level of people by mail, email,
telephone and in short meetings. If
you have signed up people who are not active, find new
(hopefully better) distributors. Keep all your first level people alive and active
by setting an example of success and showing them how to duplicate you.
Caution: Learn to handle the "Is this a pyramid?" question
effectively. Product quality and guarantees
are irrelevant. A pyramid scheme can have the best products and still be a pyramid scheme.
That method of distribution is illegal, not the products.
We coach leaders about when they should do their distributors' work, if they
are not performing as expected. However, only build ONE "leg" for inactive downline. Look for new winners "below" each first-line
distributor.
Caution: Leaders use and learn to like their
products - it's hard to sell what is not liked. Leaders also emphasize business potential over
any product line.
We coach leaders to generate leads for their downlines. If
a downline doesn't
follow through on leads that you give them, don't waste more time! We coach leaders
to build and
support both an active first level of
distributors - and then to find new leaders in depth.
Follow the program
Caution: Your upline may tell you that there is a defined path
to success and that
each step takes you closer to it. In reality, you may be
pressured to purchase "required" motivational tools, rallies,
meetings, books etc. Such a path can drain you.
Regardless of how hard you work - if you cannot build a
stable organization - your time and effort are wasted.
Building an organization takes time. Study the program
carefully, read the literature critically, devise promotional
campaigns, recruit downline and earn product income! It will
be some time before you
can expect much to happen. And this time can be much shorter with
professional guidance.
Caution: How long should you work a business without success? What
length of time is enough before you accept that you will never have the
lifestyle that excited you to join. Many MLM distributors struggle for years
before they realize that they were wasting time and money.
If you believe in the potential of a MLM program,
commit to build it for at least a year. During this year, earn money from
sales, recruit and train people and generate leads to help them. Then evaluate
it - and if you don't like it you have built something you can sell.
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