Network Marketing is a term that describes how a company decides to market their products or services. The companies decide that to build their business, they want to make use of a distributor network.

In simple terms it is having independent agents serve as distributors of their products or service, and are encouraged to build and manage their own sales force by recruiting and training other independent agents. Usually such businesses are multilevel marketing in nature in that payouts occur at more than one level.

It is a method employed by large firms such as Amway, Avon, Tupperware, Mary Kay Cosmetics. And now even entrepreneurs like Donald Trump, Robert Kiyosaki and Warren Buffett have endorsed Network Marketing either by buying out a Network Marketing company, or investing in one, or even building their own using Network Marketing as the business model; as they have realized the potential of this multi-billion dollar worldwide industry that distributes practically any portable item.

The Structure in Simple Terms

Independent distributors:
 are encouraged to sell the company’s products or services,
 are encouraged to build and manage their own sales force team by recruiting and training other independent distributors (known as a downline),
 are awarded a commission based upon the volume of product sold through their own sales efforts as well as on the sales revenue of the sales-force recruited by the distributor and his/her recruits (called downline),
 develop their organizations by either building an active customer base, who buy directly from the company, or by recruiting a downline of independent distributors who also build a customer base – thereby expanding the overall organization,
 also earn a profit by retailing products they purchased from the company at wholesale price.

Commissions are paid to multi-level marketing distributors according to the company’s compensation plan. There can be individuals at multiple levels of the structure receiving royalties from a single person’s sales.

This arrangement of distributors earning a commission based on the sales of their independent efforts as well as the leverage sales efforts of their downline is what makes the business model so lucrative, and which would eventually create residual wealth.

Multi-level Marketing, Direct Selling or Referral Marketing?

Network Marketing also goes by the following terms…

 Multi-level Marketing – The structure is designed to create a marketing and sales force by compensating promoters of company products not only for sales they personally generate, but also for the sales of other promoters they introduce to the company, creating a downline of distributors and a hierarchy of multiple levels of compensation.
Note: If not abused, this method of marketing has the potential to create residual wealth. In addition, one has to learn effective and modern marketing strategies that work in this internet age.
 Direct Selling Method – Independent Distributors market directly to consumers and potential business partners.
Note: If done in a professional way, this method encourages customizing a product plan or a service plan according to the customers’ individual needs.
 Referral Marketing – Products or services and the business opportunity is marketed by means of a relationship of referrals and word-of-mouth marketing.
Note: Traditionally, your warm market was your friends, family and other personal contacts. Now imagine the scale of using modern marketing strategies (the internet) to build your list of fans.
 Network Marketing – What you are building is a marketing network that will advertise your services and products.
Note: Network Marketing has always been a great way to get the word out about any business, and in today’s day and age, it is more effective than ever before – with social networking sites.

Some Controversial Issues

 Why is it called a pyramid scheme?
Not all multilevel plans are legitimate. Some are pyramid schemes – where the money you make is based primarily on the number of distributors you recruit and your sales to them, rather than on your sales to people outside the plan who intend to use the products.

This is illegal, because plans that pay commissions for recruiting new distributors inevitably collapse, when no new distributors can be recruited. And when a plan collapses, most people (except perhaps those at the very top of the pyramid) end up empty-handed.

So, you need to research the company’s compensation plan, among other diligent research about the company and the products.

 Why are MLM companies a frequent subject of controversy and lawsuits?
Some of the criticisms regarding MLM companies have been…
o that they are similar to illegal pyramid schemes,
o high initial start-up costs,
o price-fixing of products,
o encouraging if not requiring distributors to purchase and use the company’s products,
o emphasis on recruitment of lower-tiered distributors over actual sales,
o misleading information, especially with regards to income potential,
o potential exploitation of personal relationships which are used as new sales and recruiting targets,
o complex and sometimes exaggerated compensation plans,
o cult-like techniques which some groups use to enhance their members enthusiasm and devotion.

However, not all MLM companies operate in the same way. So once again, you need to do your research properly.

 Why is there such a high failure (drop-out) rate?
We often hear the term that 97% fail in MLM. Research also comes up with statistics such as: “just 10% of Amway’s agents in Britain make any profit, with less than one in ten selling a single item of the group’s products” (Times Nov 27, 2007), or “while earning potential varies by company and sales ability, DSA says the median annual income for those in direct sales is $2,400.” (USA Today Sept 14, 2009). Why is this so?!!!!

Before deciding to quit or not to join at all, let me tell you of some of the reasons why most fail:-
1. not taught how to market effectively. Just talking to family and friends and strangers will only lead to frustration.
2. given the wrong impression – that there is no sales involved. Hence people find it difficult if they are not prepared to learn sales techniques,
3. given the wrong impression – that it is easy to duplicate. So people enter with the impression that this is going to be an easy ride.
4. given the wrong impression – that you are going to get rich. With the right training and determination and commitment and hard work, you will become rich. But it takes time, as this is exactly the same like someone builds his / her own business.

Hence, with the right frame of mind and the right marketing training, you will succeed like the 10%. If you use the internet to leverage your business, then you are light ways ahead of your competition who is prospecting strangers in the mall. In addition, although you need network marketing if you want to create residual wealth; leveraging your internet attraction marketing skills, will allow you to additionally create multiple streams of income. And it is this combination that will allow you to retire from ‘corporate America’, quit your 9-5 job, and live a life of financial freedom.

If You Would Like To Retire From Your 9-5 Job, If You Would Like Financial Freedom, And Are Willing To Work Hard To Achieve Your Dream Life, Lessons Are Being Given At BrandingYOU&Co.

To Your Success

Related posts:

1. How to Succeed in Network Marketing
2. What Do You Do If Your MLM Company Closed Its Doors On You?

The other day I received an email from a person who asked me if I have been long with my current MLM company and how I am doing, as he was researching business opportunities in the Network Marketing industry. So, if you are in the same shoes of this person and are looking for a good home-based business, then this article will help you to know what you need to look out for.

Are MLMs An Honest Business Opportunity?

The downside of the internet is that it seems to have generated more scams than legitimate business opportunities; and this is partly due to the fact that the internet has opened a whole new opportunity to the individual person to have easy access to all information. However, if you are equipped with the right knowledge, it is easy to spot a legitimate business from an illegitimate one almost instantly.

In addition, it doesn’t seem to help that the most common scams seem to involve an MLM company. However, as has been the case for centuries, even long before the internet era, the few individuals who try to scam people, manage to taint the whole industry. The same goes with regards to the Network Marketing Industry, where the few scams manage to smother the many success stories of those MLM companies that offer a legitimate way to work from home.

How Do I Spot A Scam?

 Check why you are paid. If you are paid just for recruiting – getting more people to join the organization, and the whole business runs purely on this principle, then it is a scam and also illegal. All MLMs are based on both recruiting and retailing.
 Do your homework. There are organizations such as the Federal Trade Commission whose purpose is to prevent unfair methods of competition, to protect the consumer and small businesses. Through their database of frauds, you can research any company before joining. This organization is mainly for the American population, however most countries would definitely have something to this – it might be listed under a different name, such as Fair Trading.
 Your initial investment. Be wary of those companies that ask you for a large investment. Usually you would be asked to pay thousands of dollars, in return for a huge stock of products, which is extremely difficult to move especially if you are new to the market. The ideal company would only need you to buy a distributor kit or a kit with demonstration goods for you to sample out for yourself. This would only require a minimal investment, and normally you would be paying the equivalent of a ‘wholesale’ price for the kit, with no ridiculous mark up.
 The retail price of the product. Check at what price you will be retailing the product, and how it compares with other products in price and quality. Most scams work on the principle of over charging for the service or product. So, it is advisable to research the products of any competitors, both other MLM companies and also the products that you would buy in stores and shops. One thing to take into consideration though is, that research has proved that most often the products (including nutritional products) retailed by an MLM company are of an extremely high quality, especially when compared with some cheaper products that you can buy off the shelf from a retail store. (Will write a future article on this concept and the research.)
 Training provided. If the company won’t provide any training, then it is most likely a scam; and anyway you don’t want to be involved in a company that doesn’t invest in training their members, and to give them an equal opportunity to succeed.
Click Here If You Would Like To Learn More About My Company

More Information That You Need To Know

 There are some websites which are dedicated solely to the home based business. You can check what they are saying about the company you are researching, and other companies in general. MLM Watchdog, NPROS and MLM Rankings.

 Choosing your mentor. This is a very important step, which sometimes tends to be overlooked. Once you join a business, it is essential to learn how to market effectively yourself and your business. The majority of people who fail do so, because they realize that succeeding in the home business arena is not as easy as is painted, or because they find it hard to generate leads, or because they don’t seem to breakthrough to achieve the success that they have envisioned.

Unfortunately, through my experience, most members are still using strategies that at this-day-and-age do not make the most of technology. I have learnt to work mainly smart and not hard, and have embraced the power of the internet, together with attraction marketing strategies that brand me as an expert, where I get leads chasing me, instead of me chasing cold leads. Hence, I am able to train my team in the latest strategies that are effective, ensuring them success along the way and benefiting from the lucrative home based business.

Choose Wisely

The home based business is an extremely rewarding career, especially for those who want to work from home, and in the process enjoy their families, their freedom and their career success. However, this same career can be very frustrating if you don’t do your research properly, and end up with a company and/or a mentor who leads you to a dead wall.

P.S. Click Here If You Want To Look At The Company I Work With.

P.S. To Learn How To Market Online And Promote You (And Not Your Company), Irrelevant Of The Company You Are Involved In, Lessons Are Being Given At mlm.BrandingYouandCo.com

To Your Success

Related posts:

1. How to Succeed in Network Marketing

This week a friend of ours received a phone call. This phone call could have either saw his six figure income snatched away, or like a pro, he would come out better off. Let me explain in more detail, and why it is important to brand you and not your company.

Basically what happened to this friend is – a person who was in charge of the network marketing side of the MLM company that our friend supported, called our friend to inform him that unfortunately they have decided to ‘stop’ the network marketing side of the company!!!

Imagine, you believed so much in an MLM company and you have built a six figure income around it, and in a couple of minutes you learn that this income could ‘vanish in thin air’. Unfortunately, this happened to our friend, and it happens to a lot of people whose Network Marketing Company decide to shut down.

What Next?

So, if this ever happened to you, you could do either of 2 things:
1. either whine and complain about the unfortunate situation,
2. or keep your (downline) team together and move on.

The first option is the easy way out, but I am sure your dream would be to continue with your momentum and continue earning your six figure income.

Let me explain what my friend did, which saw him earn $6000 in less than 8 hours, by taking charge of his ‘unfortunate’ situation.

 He acted fast. He chose another company which resonated with his philosophy, and within an hour he became a network marketer for this MLM company.
 He communicated with his team. He sent out Emergency Emails to his team, explaining the situation, and invited them to Urgent Webinars. He actually held about 5 webinars the same day he learnt the unfortunate news. In the webinars, he could communicate with hundreds of people in his ‘downline’, explaining the situation, telling them about this new company that he joined and inviting them to join his team in the new company.

How Did He Do It?

Well, the answers are simple:
 He learnt how to brand himself, and not his company
 He built a strong relationship with his team
 He learnt how to market online

Because of all this he manage to turn an unfortunate experience, into an amazing journey where within 2 days he had 80% of his team join him in his new company. So, he came out better off in the end.

What Can YOU Do?

 First you need to start branding yourself as an expert. You are not working for your MLM company (remember, you are not employed), but you are building a name for yourself while supporting a particular Network Marketing Company that you believe in. So promote you and not the company.
 Once you brand yourself, you start building a relationship of trust with your ‘followers’. This you would do through an autoresponder (email marketing service) and by giving value to your readers. Our friend, could easily send out an email to all his followers, because he had them on his list.
 Learn how to use the power of the internet to brand you. The internet is huge, and marketing online gives you the advantage of reaching to a lot of people. There are different marketing strategies that you can choose from, to ultimately conquer the internet.

My Advice

It is true that you have to choose a company that you resonate with and a company with a good compensation plan, but all this means nothing if you don’t have a mentor who can teach you how to brand you.

Your mentor should inspire, motivate and educate you. You should be taught how to market effectively to promote you. You should feel part of a team, which together is so strong that it enables you to reach new heights. Your mentor should give you the skills necessary to be able to achieve massive success in the industry (and in a way you are ‘unbreakable’).

What happened to my friend, was shocking. However, I have learnt a valuable lesson. The most devastating events in the world, won’t even make you miss a beat, if you learn how to market YOU instead of just your company.

P.S. Click Here If You Are In Need Of A Mentor Who Can Teach You How To Promote You.

P.S. To Learn How To Market Online And Promote You (And Not Your Company), Lessons Are Being Given At www.BrandingYouandCo.com

To Your Success

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Whether you are involved in a Network Marketing Company (MLM) or you are a service professional or you are a small business owner, internet marketing can help you explode your business. However, one has to have a strategy in place for the marketing to be effective.

Branding YOU as the Expert

The NUMBER ONE rule of thumb is that you have to Brand You and Your Company as a leading thought in your industry, to succeed on the internet. You have to respect the ‘law’ that first you help people before asking for their business. It is human nature that when people start viewing you as an expert in your field, they automatically do what you tell them to do – as they have come to respect your opinion and trust you that you are advising them for their own benefit. You have become a source of authority in their life – so they buy from you, they ‘hire’ you as their service professional, they follow your guidance, …

To become known as an expert in your niche, you mainly start by helping people. You have to earn their trust, by showing them that you are a leader in your industry and you know what you are talking about. But first they have to experience first hand that you know what you are talking about and that they can trust you. Hence, a complete no-no is pitching your sales talk at first sight. Rather at the first meeting offer some tips on how they can better their situation.

Let me give you an example for all this to be clear. Let’s say you are a florist by profession and have a store (can be online or offline). You are in an online forum when someone complains that they bought these flowers and after just 1 day they died. So you would write in the forum about tips how to make your flowers survive longer than 1 day – you would go into how to choose flowers when buying, if to cut the stem or not, how often to change the water, what room temperature should the flowers be and so on. At the end of your comment, you would write your name and your website address. This would position you as an expert, and people would come to visit your website and then your store. Compare the above to instead leaving a comment and writing something like this: ‘Buy your flowers from www.FxLxOxWxExRxS.com – guaranteed to last you for 10 days.’ I am sure you realize which comment will generate more traffic.

Who can Market Online?

Anyone who is alive and breathing can use the power of the internet to market and brand oneself and one’s company.

If you are a Service Professional or a Solo Entrepreneur, you can use the internet to brand yourself as an expert in your field. Set up a blog and market yourself as a thought leader in your niche, by writing articles and giving free knowledge to your readers. For example if you are an accountant you can write articles on how to calculate your yearly income tax, how to save on your taxes, simple tips for business owners, and so on.

Same goes if you are a Small Business Owner – use the internet to brand your business as the leading company in your niche. If you are an owner of a hairdressing salon – write articles on how to have a hair cut that suits your features, the latest trends, 5 easy tips on how to ensure healthy hair, and more.

Let’s now look at someone who is involved in an MLM company. You were given a generic company website, you were not taught how to market effectively, and hence you are suffering from a lack of leads. So you turn to the internet to brand yourself as an expert in your niche, and hence start generating endless leads. Let us say that you are involved in a company selling vitamins. So you create a blog where you market yourself as an expert in vitamins – you write articles on why vitamins are important, how many vitamins a day is needed, what vitamins to avoid if you are breast feeding, and on and on. This will brand you as an expert in vitamins, and people would automatically follow your advice and buy vitamins from you. Now in Network Marketing, one makes a living from selling but also from recruiting. So it is also important to brand yourself as an expert in recruiting. You can do this by targeting those individuals who are aspiring entrepreneurs. (Note: not your friends and family, nor the strangers at the mall, nor the leads that you call off a list, but aspiring entrepreneurs who have always dreamt of being their own boss). You would write articles to teach them on how to start their own business, how to market online, how you recruit people, and so on.

One thing I have to emphasize is that the information that you supply to people has to be the truth – as otherwise if someone finds out that you have been tricking them, then your reputation and business takes a quick downhill turn.

How to Market Online

Your next question must be how do I market online and brand myself as an expert?! You have to use marketing strategies to generate traffic to your website – some of them are free and others are paid strategies. An easy-to-understand example, which many of you are familiar with, is offline marketing – stores and other businesses use different mediums, such as newspapers, magazines, press releases, postcards, radio, TV to advertise and generate traffic to their store or business. Exactly the same goes on in the internet. There are different marketing strategies that you can make use of to advertise you and your business, to generate traffic to your online store (your website) and / or your offline business.

One of my favourite marketing strategy is blogging, and hence article marketing. I am sure that you have realized that having an online presence is a must nowadays for any business. If you don’t have an online presence, you are invisible to the world, and generating business would be harder. Some businesses choose to have a static website, however I strongly prefer a self-hosted blog where you are constantly updating information and constantly communicating with your clients. (Note: creating a self-hosted blog is easy to setup – no knowledge of HTML needed, and you can set up your own self-hosted blog with one 90 minute training webinar. You can Click Here for the free training) With blogging comes article writing, where you can even submit your articles to different directories – this marketing strategy will help to continue branding yourself as the person-to-go-to in your niche, and will help to promote your blog as a platform to your business.

Other marketing strategies include using social media such as Facebook, Twitter, YouTube, LinkedIn to brand you as an expert, and direct people to your blog, and hence to your business (can be online store or offline business). Using paid strategies such as Pay Per Click ads and Paid Press Releases is another form of generating traffic to your business. Leaving comments on other blogs, participating in forums and interacting on the internet is also effective, especially in the beginning. Advertising for free on Craigslist and Backpage is another option. E-mail marketing is another effective way to keep a correspondence with your list of readers and clients.

As you can see, there are many ways one can ‘advertise’ on the internet. But MY ADVICE TO YOU is to choose one marketing strategy, or maximum two, and stick with it till you start seeing results. Keep tweaking and testing till you become an expert in that marketing strategy, and your conversions start pouring in. Always follow the mantra ‘expect to give before expecting anything in return’ – give out free valuable information (not spam and not pitching your sales story) that will brand you as a leader in your niche, and eventually this will earn you big bucks. And also keep in mind that using the internet as a medium to brand yourself as an expert takes time – so be patient but consistent – your determination will eventually pay off big time.

I personally use MLSP as my marketing system – it is my educational platform where I constantly learn effective marketing strategies that brand me as an expert in my niche, strengthens my reputation, and consequently gives me great leverage and power to explode my business. If you would like to test drive the same system, then visit www.BrandingYouandCo.com for more information.

To Your Success

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If you are involved in an MLM company (also known as network marketing companies) or are interested in joining one, then you must be familiar with the phrase… ‘make a list of friends and family’. If you are anything like me, you must be really frustrated with this phrase, as you are aware that most often than not this strategy simply doesn’t work.

Another frustrating phrase is …‘talk to as many people as you can’. This in other words means pitching your sales-story to strangers, assuming that all their life they were waiting for this moment, and they will jump in the boat too and will make you rich! However, an interesting analogy is, that if you become an accountant you don’t ‘pester’ others to become an accountant too and work for your firm?!

After trying a couple of these strategies, one becomes to realize how frustrating this is and most often than not will lead you nowhere or with just a couple of dollars, which is not much compared to the hard work you put in, or worse off spending more than you are earning.

Why do most people fail?

A lot of people are shown a different view of the business model. A lot of people are told that there is no selling involved, and that the products are so good that they sell for themselves. ‘Once people try, they will buy for themselves and their family…’, the pitch goes. This myth is misleading, and brings a false relief to people who don’t like selling. However, people, with no experience of sales and no proper training in marketing and business, struggle desperately, often quitting within a few months. Some people might even join another MLM company, thinking that the problem is the company – but they are wrong.

THE MAIN PROBLEM is that most often than not, people are not taught how to market properly. What you want is people being ‘attracted’ to you and calling you to join your business. And this is done through learning how to market correctly, and through learning how to brand you as the expert. If you haven’t read Mike Dillard’s Magnetic Sponsoring, then grab a copy now, as it will change your outlook in how business is done.

In addition, people are given false beliefs that by joining an MLM one is going to become rich instantly. You can make money in network marketing, but it takes determination, hard work and patience, plus the PROPER TRAINING. Unfortunately, most of the training of most MLM companies is ‘outdated, offline-only, old-school techniques’, which although might work for a few, there are other cutting-edge marketing strategies (based on science) that can actually guarantee you results if implemented persistently.

Another frustrating problem within an MLM company is the attrition rate. The ratio at which people join your team and the amount of people who quit is horrendous. You find yourself training someone to leave you for another company. This can easily be resolved by giving your team proper ‘modern’ marketing strategies which actually work. Once they see that it’s working, they view you as an expert, and would want to continue being in your team.

So How do People Earn The Big Money in Network Marketing?

From research of different MLM’s brochures and website, in the success stories page, one always finds in small print that the typical annual gross income is much much less than otherwise advertised. A lot of articles state that 97% fail in the network marketing industry with only less than 3% actually live the life that is often the bait to many to enter the network marketing industry. While I won’t go into the exact percentage, it’s a fact that only a few succeed to earn a substantial income from their MLM business. MLM is often compared to a pyramid scheme where the bottom people ‘slave’, so that the few at the top become richer and richer at their expense.

However, it is important to note that those who have made it to the top, have done so through a lot of hard work, maybe luck too. For sure they didn’t do it just through talking to family and friends. A probable answer is that they might have already had a large network of people, which made their list of family and friends much longer than yours. It could also be that they previously came from a sales background. An interesting fact is that if someone sticks to the same company for 10 years, they are in the running of becoming part of the top few – but could this also mean that they were persistent, worked hard towards their goal, had a vision and did not give up easily?

Is There A Future For Me in Network Marketing?

Nowadays, there are different strategies of how to go about your MLM business, and achieve success – dare I say it… guaranteed success. But this is done through proper training, and being determined to put in hard work. The get-rich-quick-and-easy mentality does not work. My favourite strategies that I personally use are:

1. an attraction-marketing based system that teaches me how to market successfully to the target people that I want and who are interested in what I have to say. I don’t waste my time giving meetings to people who are not interested, and only end up buying because they pity me. You can check out the system here.

2. the second strategy is providing free valuable information first, and building a relationship with my readers, while branding myself as an expert and positioning myself as the-person-to-go-to in my industry. And this I do through my own self-hosted blog. Subscribe to Claire Morawski’s free training on how to create a successful blog.

To Your Success

Related posts:

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