MLM's 101...MLM's Explained...What We Have All Forgotten About MLM'sSurprise…MLM’s Work..!! First, let me go down on the record as saying that Multi-level-marketing, also called simply by its initials MLM, in its purest form WORKS..!! Yes it’s true, they do work every time. You see, MLM is just a fancy way of describing the oldest form of advertising, word-of-mouth advertising. So simply put, MLM’s work through the power of personal advertising. For example, let’s say you visit a local fruit stand and after buying their produce, you realize that this vendor has some of the best fruits and vegetables you have ever tasted. Well you can’t keep something like that to yourself, right? So you tell your family and friends that they simply have to buy at this particular fruit stand. Well the owner, either by your own admission or that of your friends and family, finds out that you are referring people to his place. Needless to say, the owner is very happy and in an attempt to thank you and further fuel your activity of sending others to his stand, decided to give you a small reward in the form of payment or a bonus discount. In the old days, this could have been a credit from the store for future purchases, or an increase in the amount of an item sold at a discounted price. Or, the one we are all used to hearing about which is an incentive we commonly call profit sharing. Profit sharing is simply the sharing of a small percentage of the over all sales from all the people who you have sent to a store. Obviously, there are different forms of profit sharing, but that gives you the basic idea. This process continues to grow with the creation of a down line. So back to our example…the initial person who started all this hype is loving all the extra discounts that he is getting for just doing what comes naturally to him, which is just as simple as telling others about this great product. He soon realizes that if he can spread the news even more, his bonus can get so big that he may even be able to get his own produce for free. So… he talks some of his friends into helping him spread the word. In return, he passes on a very small amount of the bonus that he is already getting from the store owner to his new recruits. This in turn motivates his new recruits and the cycle starts over again. Over time this pattern continues to grow, creating a graphical pyramid-style structure of sales, with the top of the pyramid being the one guy who started the whole thing. And presto, a new MLM is born. As you can see this process can quickly grow, and if the product that is being sold is good, eventually everyone in the pyramid structure receives some type of benefit. But make no mistake, as well as everyone may be doing with the added bonuses and discounts for the product they are buying, the ultimate winner in this whole thing is the store owner. Remember him? After all, it’s his product that is now flying off the store shelves and his profits are soaring, no matter how much of a discount or profit sharing he may give away. That’s it in a nut shell. It’s a win, win situation…the owner dramatically increases his sales and because he is sharing a bit of the profits with his top customers, they in turn sing the praises of his establishment. The customers are happy because they are making a few dollars in the process and still get to use the great product that started the whole thing. That is MLM in its purest form…and yes, it works. The problem comes when people, namely the owners, try to tweak this simple, timeless, almost perfect system, in an attempt to squeeze out a larger profit. Which is why 97% of MLM's and there members...Fail.
So here are the keys to a Properly working MLM. For an MLM to properly work you need two things. The first is a product, and a good one at that. It has to be in demand and it has to offer superior quality to that of its competition. The second is it has to create a following, after all that is where the excitement of the word of mouth will come from. As time and technology progresses, the simple act of “word of mouth” takes on many forms, and with the advent of the internet and e-mail, people who believe in an item have an easier way of getting the word out. This is why we have seen a sudden resurgence in the use of MLM’s. Owners of small industrial and household products, as well consumable products, now have an inexpensive way of getting their product out to the public without spending hundreds of thousands of dollars in initial advertising. With MLM’s, as long as the product is good, the advertising is built in.
The Time Factor
Another important thing to remember about MLM’s, and I can’t stress this enough, is time. A good MLM will take time to build. And as such, should be considered when looking for an MLM to join. Good questions to keep in mind are: How long has this company been in business? What is the time frame that they use in their profit sharing model? Do they promise a quick commissions’ payout? Remember, the shorter the profit payout cycle, the more you should be questioning the program and that should raise a red flag for you. In other words, there is no such thing as “get rich quick…” there just isn’t. A good MLM will have at least a couple of years under its belt, and the commissions program should be easy to understand. The accounting for the program should also be very transparent. In other words you should be able to see the volume of your up-line to be able to better review your cut of the profits.
A side thought Like with anything positive in the world there is the negative side that ironically seeks to balance things out. And so it goes that from the very beginning of marketing, even in its purest form, there have been people who work to exploit any potential flaws in the system. So along with the legitimacy of the MLM model, the Scam was born and it has been playing havoc with people ever since. So the question becomes…Are you tired of all the Multi-level-marketing Scams out there..?? Well you’re not alone, most of us are. Over the years I have wasted so much time and money on MLM’s just to find out that all I’ve done is make my sponsors or the company owner richer and richer. Well, I’m tired of it. And since I don’t seem to learn my lesson and somehow keep falling for their wonderful sales pitches, I have decided to try to find a way to work the system to my benefit. And after doing some research and asking many questions, I think I’ve found a clear-cut method that has not only helped me, but that I think may help any of you out there with the same problem. But wait…we are jumping ahead of ourselves. To fully understand the problem and therefore realize the solution, we must first investigate the HOW. How do these’s MLM owners get us to fall for their sales pitch every time? Visit our MLM's 201 page for more insight on the pychology of an MLM.
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