The benefit of joining a network marketing business/program is best realized, once you know what network marketing is.
There are a large number of network marketing (MLM) companies online, and new ones are popping out every week.
Although there is no guarantee of whether an MLM company will be able to go long term, or whether it will succumb within its first couple of years, but one thing is for sure … if you are able to identify and join a good company, that can go long term, your job is to simply stick with the company and do some essential work regularly/consistently, as already mentioned in this blog post.
Consistency in doing the essential work in your MLM business will help grow your business, and also increase your income, more than anything else.
So, what is network marketing?
Network marketing, also known as MLM (multi level marketing), is a direct selling method that uses a NETWORK OF PEOPLE, to sell the products of the company.
Although network marketing uses a direct selling concept, but instead of using a few people, as direct sellers, to sell the products, and giving them direct commissions, a network marketing company uses a lot of people, to sell the products of the company. And each of these people can earn from both direct commissions and override commissions.
To say it more clearly, with network marketing, one can directly sell the products, to earn direct commissions, and he/she can also recruit others into their downline, and whenever any of the downline members sell/purchases the products he/she earns a percentage of commissions from these sales (known as overriding commission).
So, with network marketing, you can earn from your own efforts, and also from your downline members effort (leveraged income).
In some ways, network marketing is similar to FRANCHISING. You can become an independent representative of the MLM company, and you can then sign up new representatives under you, to help leverage their efforts. These people you recruit are not your employees, but your business partners, and they are building their own MLM business.
With both franchise and network marketing, you can use the owner’s proven system and business model, to operate your own business.
In Franchise, you use a business owner’s proven system, by paying initial and ongoing franchise fee. In network marketing, you use the network marketing company’s business model to start your own business.
So, where is the difference between franchising and network marketing?
One main difference is, with network marketing, you may also have to give a ongoing fee to the company, but here the cost of operating your own network marketing business is MUCH MUCH LOWER, compared to the franchise system.
This gives network marketing a better choice for many, who want to start their own business, but do not have much capital to invest into.
Network Marketing vs Pyramid Scheme
Some people describe MLM as a pyramid scheme, but this is not true. Network marketing is not a pyramid scheme.
In pyramid scheme, there are no real products. The participants attempt to make money only by recruiting more people into the program. Income is generated only when other people are brought into the system, since there is no actual product to make an income out of it.
With a pyramid scheme, there is no focus on product sales. The only focus is in promoting the program.
As a result, with a pyramid scheme, those who join the program first make the most money.
The MLM business is very similar to a pyramid scheme, but with one BIG DIFFERENCE.
There are REAL PRODUCTS, that other people actually want to purchase.
This gives the participant a chance to also sell the products, in addition to recruiting other people into the MLM program.
Which means, the MLM distributors can earn a living, whether they bring other people into their downline or not. This means anyone, no matter when they join the company, has an equal chance of becoming highly successful, based on their own efforts.
Why You Should Consider Joining a Good MLM Company?
Below are some reasons, why this may be the right time for you, to join a good network marketing company.
(1) MLM is perfect business model for online marketers
If you are going to do online marketing, or if you want to start your own business, or if you love the concept of doing an online business, an MLM business model may be the perfect business model for you. As already mentioned before, with MLM, you can use the company’s proven business structure, to start your own MLM business, at a very low cost.
(2) New online MLM companies will keep coming
As network marketing primarily depends on networking with other people who have similar business mindset, this is the perfect business model for online marketers/business owners. So, there are lots of scope for current and new online MLM companies, to expand their business. As a result, new good MLM companies will keep coming, and there will be lots of income opportunities for those who become good at MLM.
(3) You only have to find a few motivated/serious people at your first level
The MLM business depends on downline building structure. The more active people that are in your downline, the more your income could be. Note that, you can build a lot of people in your downline, by still having only a few active people at your first level. This is the concept many people fail to grasp. Suppose you have 3 good people at your first level, and each of these people recruit 3 active people, then upto 3 levels deep, then you have got (3+9+27) = 39 active people in your downline. Upto 4 levels you have got (3+9+27+81) = 120 active people.
So, this means by recruiting only 3 good people, and giving them proper support and guidance, when they start to duplicate, with passage of time, your income can grow much bigger.
Of course, the real world scenario will not be as smooth as mentioned in the mathematical example above. You can get much less than 39 people in your 3rd level through your 3 active people in your first level. But still the fact remains that, once you have created a few good people in your first level, they can take it from there, and with passage of time, your downline and income can grow quickly, without you have to put in much effort.
And if you promote your MLM company regularly, you are likely to find one or two highly motivated people every now and then, who can take it on their own to grow their downline.
(4) Residual Income
With network marketing, when you are able to build a group of active people in your downline, upto a few below levels, these people will become like an ASSET to you. These people will keep producing ongoing residual income for you, through their own purchases and sales.
(5) You develop the qualities and characteristics of true leaders (business builders)
One of the great benefits of joining and sticking with a good network marketing company, is that your learn the qualities and characteristics of true leaders. You learn the ropes of how to properly communicate with others about your business, how to motivate others, etc. These are necessary skills for any business (including MLM business). Any business requires dealing with a lot of people, and when you learn to do it effectively, your business grows much faster.
(6) You develop your marketing skills
Along with developing your leadership skills, a good network marketing company will also provide you training about how to market it products. This will develop your marketing skills.
(7) You can grow your MLM business as much as you can
With any business (including your MLM business), it is upto you how far you take it.
The day you join your MLM company, you are like the CEO of the company. You decide how much you grow your own organization (your downline).
You can grow downline both by width (your first level), and depth (more levels BELOW your first level).
Most likely, there is no limit to how many people you can have on your first level. And your MLM company’s compensation plan will most likely support at least a few levels deep, which will be enough to create a great income for you.
With passage of time, as you become more skilled, you are definitely going to grow your downline better and faster. This will ultimately help grow your MLM business faster, and produce more income for you.
(7) You can join more MLM companies later
I suggest that aim to join a good MLM company and stick with it for the long term, and work at it. You will definitely develop your leadership skill, communication skill and marketing skill etc.
As you become good with these skills, you can then consider joining some other good MLM companies out there. This will add to your current income streams.
Conclusion
Network marketing is a very important business model in today’s modern world. This business model has been there for many years, and it has lead to better changes in the lives of many people.
Many business people, from all over the world are successfully doing network marketing, and producing great income.
And other great entrepreneurs are recommending it. Robert Kiyosaki has described network marketing, as the business of 21st century, and has even written a book around this topic.
So, before you join any netowrk marketing company, do your research. Check how long they have been around. Study their compensation plan carefully. Study their products. Study whether there are actual products sold by the company or not.
Network Marketing works if you join a good company, and are diligent enough to work hard for a few years, to make it work for you.
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