Multi Level Marketing ( MLM ) is a special kind of direct selling, defined as trade in goods or services offered directly to a consumer : this means selling door to door, offices, and other places where it can be made a direct sale, excluding stores.
The difference between the traditional direct sales and MLM (Network Marketing) is as follows: while a direct seller is looking to only buyers, a MLM seller tries to find buyers, that can also become merchants, and while the normal seller earns on its sales, the MLM seller has a double revenue, both on what he sells by himself and on what products are sold by the people who believe in working “for the same purpose.”
In this way, you create a “downline”, in other words a network of sellers that you created and acquired over time.
The MLM seller is not hired by the company for which he sells products, but he is an Independent Representative. He is also the consumer who firstly purchased the initial “product”.
When Was Born the Multi-Level Marketing?
According to some experts, Multi Level Marketing was founded in 1934.
This kind of marketing is not absolute “good” or “bad”, “right” or “wrong”, but has always struggled with a negative image due to some aspects:
– the sale of the product, in fact, is not fundamental, but rather the recruitment of new people ready to sell the product (and this suggests that the MLM is comparable to Chain letters);
– people join because they receive fake promises of fast success and sure gain (for istance : “Get rich, with astronomical amount”), but in reality the companies using the MLM declare that the average income per person is somewhere between three and four hundred dollars per month;
– MLM companies uses persuasion technics that are sometimes subtle.
It has been said that 10% of new millionaires in the US over the past ten years have done it by creating businesses through MLM or Network Marketing.
What Happens Very Often in the Web ?
What usually happens to many internet users, or people who attend conferences where everyone can have their say, is what I describe you below.
A person comes to you and talk about easy money, and tells you who has already gained a lot of money (for example one or two thousand dollars per month), while not knowing anything about the internet.
Generally you are also told that you will not lose time to work directly at computerr because you will be able to create an automated job, and all you have to do is :
1 – subscribe to the service or purchase the product (sometimes also is requested to enter your credit card information);
2 – at the beginning is free and then there is have a small monthly fee that generally does not exceed $ 15;
3 – it is true that you will pay $ 15, but you will have the benefits (courses, web space, email or other ones);
4 – for each person you sign up, you will receive money, and then the monthly fee will be erased by these commissions and soon you will just start earning for invite new people signing up;
5 – for every person that you made sign up, and that other people will subscribe, you will earn more money (for istance : I am “A” and I invite you who are “B”, I receive a percentage for having done registering you. But If you do invite another person, who is “C”, I still get an even smaller percentage of “C” and so on, depending on how many levels there are available!).
If we exclude the monthly fee to pay for the system would work anyway because all persons can participate with the aim of involving other people and make money.
Some Thoughts About MLM
1 – from all that has been reported above clearly shows that the gain in MLM should depend on the number of sales generated and the number of sub-affiliates, but often the product is not so important but rather the ability to invite new people to sign up ;
2 – if you were not informed that you can earn for people that sign up from your invite, will you still pay the monthly fee? Probably not, so this is a clear demonstration of how this kind of MLM is not legal (you do not just to sell the product, but to find other people who will make you earn);
3 – do you need to open a VAT number for MLM? From what are the promises : it is not occasional but profits for life, so if you have business with “fixed” income, you should need a VAT number and a personal company !
Some Popular MLM Companies
If you find yourself confortable with all the information given until now, you may be think about become a part of one of the following MLM companies, that are actually very popular and running today :
– Amway : Nutrition & Wellness, Beauty, Bath & Body, For the Home products ;
– Herbalife : Weight loss, Nutrition & Wellness products ;
– Mary Kay : Makeup, skin care, beauty tips, virtual makeover ;
– Pampered Chef : “Discover the chef in you!” ;
– Monavie : From powerful antioxidant support to joint, heart, and immune health, MonaVie’s body-beneficial products provide the nutrition you need for a healthy and active lifestyle ;
– Arbonne : Health and beauty products ;
– Partylite : Candles, candle holders and home accessories ;
– USANA : Nutritionals, skin care, weight-loss and personal care products ;
– Melaleuca : Wellness products ;
– Forever Living : Forever Living products has dedicated itself to seeking out nature’s best sources for health and beauty and sharing them with the world.
But let’s say that I only consider the positive part, in other words I learned from this experience.
Good luck finding your way of success !