Multi-level marketing

Multi-level marketing (MLM) is a marketing strategy in which the sales force is compensated not only for sales they personally generate, but also for the sales of others they recruit, creating a downline of distributors and a hierarchy of multiple levels of compensation. Some people use "direct selling" as a name for MLM, although MLM is only one type of direct selling, which started centuries ago with peddling.

MLM companies

MLM companies have been a frequent subject of criticism as well as the target of lawsuits. Criticism has focused on their similarity to illegal pyramid schemes, price-fixing of products, high initial start-up costs, emphasis on recruitment of lower-tiered salespeople over actual sales, encouraging if not requiring salespeople to purchase and use the company's products, potential exploitation of personal relationships which are used as new sales and recruiting targets, complex and sometimes exaggerated compensation schemes, and cult-like techniques which some groups use to enhance their members' enthusiasm and devotion.

MLM compensation plans

Compensation plans in network marketing / MLM vary from one company to the next. It is up to you to ask questions when evaluating any company’s pay plan. Some are front end loaded or they maybe back end loaded.

Making Money with MLM

In every MLM program, there are inevitably those who profit more than others. These elite few are also those most often identified to such programs. They drive fancy cars, live in large mansions, and cash in massive commission checks every month. They are also the ones most often called upon to speak at the MLM gatherings. In contrast, there are also those who never seem to get anywhere with their programs.

The Benefits of Multilevel Marketing

Multilevel marketing is picking up a lot of steam. This is due to the large amount of people online that are hyping multilevel marketing and all of the profits that go along with it. And if you are interested in this business, you should not have any problem finding information online to help you get started. The bottom line is that multilevel marketing makes you money too. As soon as a decent amount of people started to cash in on it, the number of interested parties began to increase.

Showing posts with label MLM Tips. Show all posts
Showing posts with label MLM Tips. Show all posts

Sunday, January 8, 2012

The Misconception of Multi-Level Marketing

Have you ever wondered why people are so turned off at the mention of Multi-Level Marketing? Is it legal? Is it a pyramid? Where does the money flow? In this article we will examine basic differences between Multi-Level Marketing and a Corporate Structure.

Let's take the corporate structure first. Almost all of us work in this type of hierarchy everyday. A CEO heads the corporation or company. Below him/her are upper management people i.e. Vice President, Controller, Senior Sales Exec...etc. Below them are middle management people i.e. Department Heads, Retail Directors, Consultants and various Supervisors.

Finally we reach the Sales Representatives, Customer Service Representatives, Stockers, Cashiers, Cleaners, Drivers, etc.

So who makes the most money in this type of structure?

If you were to draw a flowchart this, it would look like a “Pyramid” The CEO makes the most money as he/she sits at the top. It is the person at the “top” of this “pyramid” that makes the most money, because in this type of structure, you are paid based on “where you are” in the structure. The only ways you can truly increase your earnings are if someone in the structure is promoted, gets fired, dies, or quits. As a result, everyone in the structure can move up. Let's take a look at a Network Marketing Structure and then compare. On the surface, both structures are mirror images of each other. BOTH look like a “Pyramid” structure. Flowchart it out again. An affiliate will sponsor someone, they sponsor more, they sponsor more...etc. But...who makes the money here? The worker at the top? Wouldn't it seem fair that if you do more work, you should get paid more money? This structure is simply a structure of business owners. Pay is based ONLY on what you do, not your position within the network. This is what differs Network Marketing from a typical “Corporate Structure Job”.

In the MLM structure YOU are in control of your income. In the corporate world, someone else will always be in control of your income. Always!