The Multi Level Marketing Dream
Freedom, travel, exotic places and living the good life. Glossy photos of flash cars, well dressed people wearing lots of jewelry, meetings at the corporate offices.
This has to be the “next big thing”. Figures on the accounting page already show millions in sales, and if you get in now you will be near the top. (Not sure how that works).
The concept for many products sold by Multi Level Marketing is probably pure, initially at least. Idea for a product, develop the product, how to sell it?
Multi Level Marketing is very common in the health and well being sector.
ie: Someone discovered a tree or vine somewhere in the Amazon and took a sample to someone else who had it researched and found it to be a cure for something that 90% of the population suffers from.
Many of these companies crash and burn leaving people who invested time and money in them with nothing but worthless promises and financial hardship.
In saying that, after the demise of many MLM schemes, some of the products they were promoting have found there way into the mainstream consumer realm.
Goji berries is one, Aloe Vera was a disaster, but it is now found in many health food stores and also medicinal products.
The whole concept of MLM is simple enough, you sign up, you buy a bulk order and try to get others to buy a bulk order. Hard !.
Most people will buy one for personal use but are not interested in selling it.
The flash car, boat, private school for the kids, overseas holiday’s is not on their radar, meeting the mortgage, paying utility bills, putting food on the table, is where they are at, and forking out a substantial amount from their savings isn’t going to happen.
Reality of a Multi Level Marketing Business.
Often described as the ideal home based business.
No contrary thoughts allowed. You have been sold on the benefits of the product, (everyone needs this), been to meetings chaired by a couple of the “creators”, who have flown from the other side of the world especially to meet you.
Watched videos of the product and saw the workers leaving the factory in the latest model hot rod.
Then listened to a motivational talk by one who has reached prettiest rock status, who’s previous employment was working in a rice field somewhere in Asia. You also have the glossy booklet.
Everyone leaves the meeting full of excitement, some with their credit card balance back to near zero, some are still undecided, some already on the phone trying to drum up sales to move stock which will be arriving by courier in a few day’s time. ( hubby or the wife need room to park the car in the garage).
The hard sell begins, phone calls, arranging house parties, contacting family, friends, neighbours, and any other social contact listed in your diary.
Logging in to a web page they have included as part of the deal, getting your details onto business cards.
Your day begins at 6 and finishes at 10, plus weekly meetings with your sponsor.
Often many people have no problems selling the product, but to make money you need the ones who can take it off you in bulk and then set up their own sales team, so you receive kickbacks from them and their downline.
Otherwise you are just selling product, and any profit is going back into buying more product.
No holiday or new 4WD this year.
As with anything there is an ebb and flow, you’ve ordered, some people don’t want any more, you have to play catch up, as well as still trying to find X number of people who are able to establish their own downlines.
To give an analogy.
In a town of say 100,000 people, 80% probably have a pet, but the 3 or 4 pet stores in the town is enough to satisfy demand. There will be a couple of supermarkets in the mix as well.
You need at least 10 or 12 other people to set up a down line of consistent sales to get yourself in front of the game. So if even 100% of people “Need” what you are selling, you are still oversupplying.
There are some old school MLM business models still working well, some have 50 or more years of operation.
Some people live quite comfortably off them, others are quite happy to plod along with little more than a sign visible from the street, from which they make sales.
The biggest problem of MLM business’s is the hype. What was promoted in times before the internet is much the same as what they promote on the internet.
The hype always seems to be “People Need This’, and if you can convince them they need this thing, then you will become rich.
The internet is a different media, It is more like, people will use what they need, not be told what they need.
All the cliches in the world will make no difference if someone is doing something they have been told they need to do Vs, doing something they want to do.
This has led to companies moving towards Affiliate marketing methods.
The different models available vary from just promoting a link or banner or landing pages for basic affiliate sites such as Rakuten, Clickbank, a few others, to companies that have shifted the MLM business to just having affiliates who have downlines of memberships, not products.
These do not go to infinity as in pyramid schemes. No genuine MLM business goes to infinity. (that I am aware of).
Another way is for companies to make their sites “sticky”.
They work on the idea of giving people what they want and include shopping, lists as big as, if not bigger than Amazon, auctions, games, awarding points to count towards something else.
Linking with e-commerce stores, and promoting business’s in your local area.
Usually for an affiliate of these sites the choices can be overwhelming. A where do you start and where do you finish (if there is a finish).
All have tutorials, some are free for affiliates who sign up, others you pay then get tutorials to “guide you along the path to riches”.
These sites need a capacity to build a large following because there are competing against Amazon, E-Bay etc, and by adding local business in as many cities and towns of the world as they can, they are working up from a grass roots level.
It is not a bad concept, it promotes local brick and mortar business, and it gives an avenue for others with an e-commerce site or a game developer to promote their wares away from the noise of Microsoft and Goggle.
And that noise from Google and Microsoft is being heard along the corridors of power in the USA, China the EU and many other countries.
You may have noticed that if you looked at some item on E-bay or some e-commerce site, the next time you go to your home page there are 3 or 4 items similar or the same as the one you were looking at, but being promoted by Google. (if you have Google as a your default browser).
For me I see nothing wrong with these sites, the more variety the better. People get sick of seeing the same old, same old.
These “MLM” sites are for the most part, providing an alternate avenue away from the mainstream, and giving people what they want.
If your mum is making dresses and selling them online and an affiliate in the same town is marketing them then it is a win / win situation.
Like E-Bay or Amazon you have to sign up. The sign up is always free and there is usually some incentive to sign up, a small discount on your first item or something.
So whether your an affiliate or just a member you still get rewards, plus if there is a restaurant or hardware store listed in your local area, then you will probably receive a discount there.
This is the internet working to provide good all round I think.