Network Marketing, also known as Multi-Level Marketing (MLM) is a method of direct selling products using a network of individuals. It’s a popular business opportunity for those who are looking for part-time jobs and flexible working hours.
Network Marketers – also called as a consultant, contractor or distributor – earn money by selling products and by recruiting others to sell products for them. The recruited individuals, in turn, also recruit others to sell products and it goes on and on, hence, it’s why it’s called multi-level marketing.
The first step in network marketing is by signing up to a network marketing company, either by directly approaching one or by getting recruited by someone. Once an individual becomes a member of a network marketing company, they can earn commissions by selling the company’s products.
They can also recruit other people to sell products and every time their recruited individuals (also called as their “downline”) make a sale, they earn a percentage from it.
Network marketers enjoy many incentives if they perform well. For example, they can earn a bonus if they can acquire new distributors or customers or by acquiring repeat business. Bonuses range from extra cash, trips or even other things such as cars or even a house and lot!
MLM vs Pyramid Schemes
For the novice, MLM and Pyramid schemes look like the same thing, but the truth is vastly different. In MLM, an individual can actually make a living, while in Pyramid scheme, members don’t. The latter can be called as a carefully designed mass robbery.
New and aspiring network marketers should know how to spot a legit MLM from not. Here are some indications that a so-called network marketing company is actually a pyramid scheme in disguise:
Requires large upfront “investments”. One of the first things you’d notice from a pyramid scheme is that to be able to join, you’d have to pay a significant amount of upfront investment. You can choose the package you want from legitimate MLM companies, from cheaper ones to slightly expensive ones. It doesn’t need to cost you an arm and a leg.
You are required to buy products you don’t need just to remain in good standing. It’s like forcing you to buy their entire inventory so that you can retain whatever position you are in. Legit MLM companies don’t do that as you have the freedom of choice.
You earn more by recruiting others. This is probably the red alert. When you see this, back away immediately. Why? This means that the so-called legitimate MLM company trying to recruit you doesn’t really care much about selling their products – they just want to recruit as many people as possible just to have them sign up and pay for the ridiculous initial “investment fee” that they require. A legit MLM business’ main goal and focus is to sell their products – not to gain more distributors.
Network marketing is all about selling products. Companies are offering incentives to people who can recruit more distributors just so their products can reach a wider audience, however, if the company becomes too focused on getting more and more distributors, then be wary.
Now that you’ve learned what network marketing is, and what is a real network marketing opportunity looks like, you’re now ready to start seeking network marketing companies that you can join. For more info about seeking for a network marketing company, check this link out.