Multi level marketing What is MLM business - the terrible truth

MLM (MLM)- This is a type of business, the essence of which is the sale of goods or services, through a network or multi-level.

Features of MLM (MLM) business.

A characteristic feature of this business is the distribution structure of independent sellers who represent the parent company and receive their commission based on the volume of services or goods sold by them. The sellers themselves in MLM companies are called distributors, consultants, dealers or partners.

Many products sold through network marketing are in one way or another related to medicine or body care. Distributors can make money through MLM in one of two ways: by selling products they have purchased at wholesale prices, or by hiring other distributors who are building a customer base to expand the entire organization.

What you need to know about MLM in order not to fall into the pyramid.

In most legitimate MLM companies, commissions are not paid simply for referring new distributors. While the level of structure has a significant impact on revenue, a salesperson should still have personal selling. This stimulation of sellers to make real transactions, and earn money on this, distinguishes MLM from ordinary pyramids. In simple words, the network business earns by selling real goods or services, and not by regular cash replenishment through new participants.

Hello! Today we will talk about network marketing. We will just talk about it, but this does not mean that we urge to deal with it. This article is just a review of the tool, nothing more.

It is difficult to say what network marketing is in a nutshell. Someone calls this scheme of earning a real “scam”, someone talks about the only opportunity to open your own business without investing tens of thousands in its development. This article will collect the most detailed information, after considering which you will come to certain conclusions and decide for yourself whether it is worth looking for a job in network marketing or is it better to leave this area to others.

What is network marketing and what is its essence

Network marketing- a way to promote a certain product using a network of people who, in turn, receive a percentage of the sale of the product and rewards for attracting new people to the network. A person tells his friends about him, they, in turn, tell their friends, and as a result, a kind of network is obtained, in which it is very easy to distribute the goods.

For each invited person receives a percentage of his profits. Of course, various psychological techniques are used to attract people to network marketing. Not everyone will find this work profitable, so before explaining to a person the essence of the technology for distributing goods, they work with him for a very long time and explain the benefits that he will lose if he does not agree to this work.

Network Marketing - Pyramid

Some compare network marketing to pyramid schemes. Yes, the scheme is a bit similar, but in the case of network marketing, no one forces a person to invest a lot of money and just sit, waiting for a miracle. If you work, constantly increasing the base, you can first go to zero, and then to a plus. Unfortunately, in large networks you will already be too far from the top, so you should not expect sky-high fees and life in the Maldives, but a couple of tens of thousands of salary increases are quite real.

Network marketing system and principles of its functioning

• Any network system must somehow serve the distribution of a product, product, or a particular service that a company or group of people provides;
• If the flow of goods or services stops even for a few days, the money stops flowing and the system collapses;
• There must be many representatives of the lowest level in the system, because otherwise the scheme does not make sense at all.

If you decide to get into network marketing

It all starts with a banal interview, where specially trained managers talk to potential buyers, describing all the prospects in bright colors. There may be an exaggeration (for example, about the highest income in the first couple of months - even if you are super active and all your friends immediately connect to the network, you will not receive a large amount in the first month).

If you have agreed to register, some companies may require you to pay an entry fee to the network business. Of course, they will not provide you with any documents, or they will give you something that has no legal force. True, only young and unscrupulous network companies sin with this - masters who have been on the market for several decades will never do this, reputation is too important for them.

After that, the actual work begins. That is, a constant search for new sellers who can be connected to the network after themselves and make a profit from them. The money is received after the sale of the goods, but some companies additionally set a certain payment day, before which it is impossible to receive the full amount. In the latter case, you should strain yourself - often these are scammers who work for a couple of months, after which they disappear along with the money they earn, leaving behind an empty office and a manager girl in a pre-infarction state.

How to make money with network marketing

In total, there are three ways to make money in a similar company:

• Resale of products. To do this, a certain product is bought at a wholesale price and sold from friends at a market price. The percentage markup varies from 15 to 30%. This method even has a name: margin;
• Receiving bonuses for some actions performed within the framework of work in the company. Usually bonuses are based on the number of sales, although there are certain exceptions. Such earnings are highly dependent on the company in which the person works - some do not offer anything at all for overfulfilling the plan, and someone is very generous with gifts for every important figure;
• Receive funds from interest that drips from workers who were directly invited by you and your friends. The more such people you have under your control, the greater the amount. If you stand at the beginning of a large grid, you may not work at all - but it takes a lot of time and effort to build it, in addition, if some distributors get disappointed and leave, you will have to return again to expand the grid to an acceptable level of earnings for you.

All these methods require one thing from you: you must work. Work hard, constantly disseminate information, look for new customers. Be prepared for misunderstanding, for the fact that you will simply be banned on social networks, for the fact that you will be trolled and sent in personal correspondence - unfortunately, not all network users adequately respond to network marketing on the Internet.

Network marketing on the Internet

If possible, it is possible to sell goods. Or a site to attract people. True, this will require certain resources, and it will take a lot of time to promote it (unless, of course, you are an expert in).

Among other things, in order to succeed in network marketing, the employee is required to have certain character traits. First of all, he must be very persistent, not accept refusals, try to prove his point of view - and, at the same time, be able to retreat if he understands that the situation is taking an unfavorable turn for him. Confidence in this list, perhaps, should be in the first place: if people feel that you know what you are doing and have no doubts, then they will follow you and work in the same company, generating income - well, or just buy some is the quantity of goods.

Are modern people interested in network marketing?

Despite the large number of standard “scams” ​​and a small percentage of truly successful people, everyone who is on the Internet has thought at least once about this way of earning. Modern leaders in network marketing, such as Oriflame, Avon, Faberlic, Vision, Amway, LR, Tian De and Siberian Health, still get into the top queries, according to a special service that determines which words and in what quantities and combinations users usually google.

Before moving on to the specifics, I would like to consider the main advantages and disadvantages of network marketing.

Advantages of network marketing

• You can make big money if you really try. To achieve the goal, it is enough to create a close-knit team that will gradually help you make a profit.
• Financial independence from the company and other people. In other words, you yourself decide when to sell the goods and receive your own proceeds, the employer does not track this moment at all. Well, a bonus is financial independence from loved ones, for example, from a husband or parents. It’s just that full financial independence cannot be achieved - all the risks associated with force majeure will remain.
• Having your own business. This is not really a business, at least at the very beginning of the development of your particular network. In a year or two it will get better, and you can be called a small businessman. Investments, by the way, will also be required, so all those who tell you about the complete absence of investments are either lying or do not fully understand the principle of operation of such systems.
• Close-knit team. There will not even be any nasty “buts” - in network marketing they pay special attention to this. People there are quite friendly, but not everyone is ready to go beyond communication, limited to work. There were cases when very interesting people turned into workers who were no longer interested in anything but profit. It's not worth bringing this up.

Cons of network marketing

• Earnings are completely unstable. No one guarantees you that the woman over there who bought all the purchased goods from you this month will do the same next month. If you suddenly fell ill, missed a meeting with a client, or simply didn’t like someone, you lost money, and now you won’t get it back. In general, a rather inconvenient scheme that requires constant work and saving in an emergency reserve.
• The moral burden associated with constant communication with customers. Even if you are extremely sociable and friendly, people will not always be happy with you. Not all potential customers with whom you will communicate will behave adequately, and if you are going to meet in person, you can get injured or damaged equipment with the goods.
• Material investments at all stages. They may be insignificant, but this is not so important - the main thing is that you still have to spend money. And it is not a fact that the purchased product will pay off, so at first distributors try to buy what they themselves can later use. A few thousand rubles is a normal price to start a career in network marketing. If at the moment they are not available, we suggest that you familiarize yourself with the information.
• Responsibility for the people you have invited to work under the same scheme. In principle, if a person's moral principles are not the highest, he may not pay attention to this point. So, train a couple of people and forget about them until they leave and his income drops a little.

Myths and fictions about network marketing

This paragraph contains the most common myths about network marketing and a brief description of the facts that debunk them. Read carefully, and if after that you are not disappointed and are ready to start working, proceed to reading the next paragraph.

Myth: The network is the best way to open your business quickly and with virtually no initial capital, having stopped working for your uncle.

Reality: Since you will be at the very end of the network, you will have to work hard. Constantly look for people who are interested, monitor bonus programs and discounts, in general, for the first six months, at least, life will not seem like sugar. Then you will either completely get tired, or you will reach a more or less normal level of earnings. Golden mountains, at the same time, you still will not earn.

Myth: Buyers on the Internet love it when the goods are offered to them by representatives of online retailers, and not official stores.

Reality: Not everyone is comfortable buying such products from online sellers. If you are going to sell such products to your friends and relatives, you risk ruining your relationship with them. No one will like it if someone decides for him that now he needs just such a shower gel, and no other.

Myth: The whole world will soon refuse to trade through ordinary stores and switch to network trading.

Reality: Brad of pure water. Companies of this kind appeared in the United States in the early 1960s, and until now even a percentage of all sales are not sales in networks. Thus, in the near future you don't have to worry about regular trading.

Myth: With the help of network marketing, you will free up a lot of time, you can change your lifestyle and just be happy.

Reality: Never believe motivational posters and commercials, because often they tell lies. In addition, energetic and constantly developing people are unlikely to enjoy sitting at a computer all day and selling a useless product to strangers.

Myth: Trading online allows you to maintain peace of mind.

Reality: There is absolutely no connection. Moreover, if you are a rather irritable person and cannot calmly respond to rudeness and remarks, any calls to customers will more likely bring you out of a state of peace of mind.

Myth: You do not even need to look for a permanent network of clients, because you have your friends and acquaintances - they will provide a constant income.

Reality: And now let's imagine ourselves in the place of such a person: he lived a conscious life, choosing means and things that were convenient for him, and then bam - a seller comes who offers to throw the years of selection into the trash and start buying completely different, untested products.

Myth: You practically do not work, taking up sales for only an hour or two a day.

Reality: No no and one more time no. Selling at the initial stages will require you a mountain of time, which many most likely do not have. At the same time, you still have to look, since combining network marketing with your main job is simply unrealistic - if you want to get at least something.

Myth: Employees who are already online are interested in your successful work and development. Working in network marketing allows you to strengthen the spirit, to understand that you can run your business and not depend on anyone.

Reality: Many people play on this, saying “why work for someone if you can open a business right now”. Remember, business and network marketing are different concepts, and such a scheme is unlikely to have anything to do with personal freedom.

What to do if you are still interested in network marketing

Criteria for choosing a network company

Before you go to an interview and buy a product, it is recommended to look at the following characteristics of a network company:

• The product they offer. It should be safe and moderately affordable so that people can buy it without going broke. Of course, there is a possibility that you will want to sell the same product as very expensive and high-quality, but it will be on your conscience.
• Company age. If it was organized a week ago, then the likelihood that this is another fraud, after which the organizers will disappear into the sunset with your money, is very high. The most reliable are companies operating on the market for at least 5 years. This criterion makes it possible to weed out financial pyramids: a financial pyramid, even the most organized one, will not last five years. Unscrupulous network companies in the first five years squeeze all the juice out of users and also stop working, in the rest you can try to make money (although the competition will be much more serious).
• Marketing plan. It is better to compare it with the plans of other companies that you decide to consider. Compensation payments through the network - the most important thing, you should find out about the conditions for accumulation and payment first of all.
• Training in the basics of distribution work. A very important point: if you are required to pay, then most likely you will not be able to work with them. The same if the imposed courses do not help in any way, but simply take time. Just stop going to them, and if suddenly they refuse to pay you without courses, leave there - no one guarantees that after training you will be paid what you earn.
• Fame matters too. If a company is known in at least three countries, then it is more reliable than a company with the same characteristics, but without representative offices in other countries.
• Legality of the company. If you cannot find a full-fledged representative office (not an office for a day with a bad repair) or an official website, then feel free to break all ties with the company, because there will be nothing good from such cooperation. Be sure to check the site for performance and content content: if it was created a long time ago and is updated periodically, then everything is in order.
• Good team. If you see that these people are really on fire with the idea, and they themselves are actively involved in sales, and not just pretending to interest you, if their pages on social networks look more like real ones than advertising ones, then you may well trust them. Remember: you should not evaluate the team during the first meeting, it is advisable to at least learn a little about them before the interview and take a closer look later.

Independent rating of network marketing companies

Also, when choosing, you can focus on the rating of companies, which was compiled on the basis of sales volume in recent years:

• Amway;
• Avon Products;
• Herbalife Ltd;
• Mary Kay Inc.;
• Vorwerk & Co. KG;
• Natura Cosmetics SA

And now more about each company.

Amway

An international company that offers customers more than five hundred items of goods that allow you to maintain beauty and health at the appropriate level. At the same time, the quality of each unit of goods is strictly controlled, which is a rarity among network companies in principle.

Features of work

• If a person personally buys a large amount of the company's products, he receives an additional reward;
• Products are purchased at wholesale prices from the company, and the distributor must sell them at a markup of 30%. It is these percentages that are the main income of a person at the initial stage of work in a network company;
• Additional earnings begin if a person invites his friends to the team. The more distributors and consumers he leads, the more profitable it becomes for him to purchase goods specifically, and the greater the amount he will receive from one transaction.

This company is a real example of how people can earn money without actually leaving their homes. Of course, you won’t be able to achieve the same in a couple of weeks, but if you advertise yourself properly and find regular customers, you will get a good increase in your main income.

Avon

One of the network marketing companies in Russia, which has been known on the market since the 2000s. Representation in more than a hundred countries around the world, so there will be no problems with reliability, unless, of course, you are contacting a real representative, and not a charlatan hiding behind a well-known brand.

The company is famous for offering not just cosmetics: in the catalogs you can find costume jewelry, perfumes, small nice accessories for women, etc.

Features of work

Cooperation with the company can be carried out on two grounds:

• As a regular customer with VIP status. Registration is free, each such client gets the opportunity to purchase goods with a standard 30% discount. Every time a customer places an order (starting from the first time), he receives gifts from the company;
• as a coordinator. In this case, there is MLM (multi-level marketing): the main task of the coordinator is to attract new representatives to the company. The coordinator also has a fixed 30% discount, but in addition to it, he receives an additional 12% on all sales made by his referred friends. It is worth remembering that for each coordinator there are peculiar incentives and additional discounts. The only thing is that such actions must be constantly monitored.

Herbalife

The company is relatively young, it is not yet forty years old, but it already has representatives in almost a hundred countries around the world. If you want to cleanse your body, improve your health and earn some extra money, then distributorship in this company is the best option. Natural cosmetics are also available.

Features of work

• To get started, you need to purchase a special set. It will not work to collect cosmetics in separate packs, at least for the first time;
• The percentage difference is only 25%, unlike previous companies;
• Above each distributor is a person who receives a commission once a month.

Mary Kay

A company that has been presenting products for skin care and make-up application on the market for fifty years. Fame in other countries is not so great, representatives in less than forty countries, but this does not prevent the company from stubbornly holding on to the first places in the tops of network marketing in Russia.

Features of work

• Only women over eighteen can get a job;
• The consultant is obliged to purchase a starter kit, without which he will not be able to make further purchases. Income is made up of money earned from the sale of products and interest that drips for each invited new employee;
• If you plan to use this cosmetics for a long time, you can become a direct client with all the ensuing bonuses. Discounts can reach forty percent, and the company also provides all customers with gifts and a monthly magazine. Those who wish absolutely free of charge take several courses, in particular, training in makeup techniques and the basics of doing business.

Vorwerk

This company, unlike the above, has nothing to do with cosmetics and body care. The catalogs contain appliances, kitchen equipment, etc. There are representative offices in more than 60 countries of the world, and specifically in Russia, such goods can be bought for more than ten years, so the reliability of the company is at the level.

Features of work

• If a person has just started working in a similar direction and does not quite understand what they want from him, the company provides the opportunity to take good free courses, thanks to which even beginners understand the scheme very quickly;
• No one monitors the implementation of the plan, the consultant himself decides when and how much he should work. Of course, only a percentage of sales is paid.

Natura

A Brazilian company that has been successfully selling cosmetics and perfumes for almost fifty years, including in Russia.

Features of work

• Both consultants and advisors receive only a percentage of sales. There is no additional income for attracting new employees;
• The Consultant can receive preliminary free training in the basics;
• The company constantly runs some promotions aimed at encouraging good employees.

Unsuccessful examples of network companies

You must understand that there are different types of network marketing, and not all systems work as they should. This list contains several examples that show that not all areas are suitable for network marketing, and not all organizers can organize the proper level of work.

• Madzherik. Initially, the money was invested in some kind of scientific development, but then the company began to offer very strange projects, which, for obvious reasons, did not pay off. At the moment, the company has not been rehabilitated in any way, the reviews are purely negative, the network has practically collapsed.
• A company that was engaged in fuel additives for cars. The manufacturer itself did not inspire confidence, plus, among men there are less people who are ready to work according to such a system, in general, the idea did not take root at all.
• Internet market Inmarket. The same market, but with the return of a certain commission to the owners. Prices naturally rose, as a result of which the site fell into disrepair.

How not to break loose and work

A few final tips:

• Always find out the full information about the product that you are going to offer to customers.
• Don't advertise all at once, let the buyer get used to you, explain what you do, learn about your preferences, and only then start the presentation.
• Watch your appearance and manners. People who look bad tend to sell much less.
• Train. Read books, attend trainings, do everything to become more confident and calm.
• Analyze mistakes and don't be afraid to ask more experienced friends for advice.
• Don't neglect the Internet. There is a great opportunity to advertise yourself and your product.
• Find your sales method, and in no case do not bring aggression into it. If the seller starts to push, people feel it and almost immediately “merge”.
• In no case do not spoil relations with relatives, friends and colleagues. You can stop getting involved in network marketing, and then your whole team will forget about you - but the people who were with you before all this will no longer be able to treat you the same way.
• If possible, use the product yourself. Make additional advertising in this way - believe me, it will be interesting for potential customers.

Results

So, let's summarize briefly. For starters, be extremely careful. Never get involved in an initiative if you do not like it, in no case do not pay money if you are not sure of the integrity of the company, etc.

If possible, google reviews about network marketing, in particular, about the company you are interested in, check every word spoken by representatives, look for people they talk about on social networks - sometimes you can find a lot of interesting things in photos or in groups. Such a short investigation may well save you nerves, time and money.

If you suddenly fail to earn the expected money, try to think: yes, you can make money in network marketing, but for this you need to have a special mindset and attitude. Maybe it's just not for you? There are people who can't bring themselves to do math, and this kind of work just doesn't suit you.

This means that no one is forcing you to run to the next network company, in the hope that mountains of gold will begin to roll in right now - just return to your old job and try to console yourself with the fact that many people besides you also cannot withstand such a race and refuse from "easy" earnings.

MLM ("Multi-Level Marketing") is multi-level marketing, but the better known name for this business is network marketing.

The concept of such marketing is that a multi-level organization is created in which a product or service is promoted from producer to consumer in a direct way from person to person. Each level of the organization has its own income. In the traditional trade, the store employs several salespeople all day long, earning very low wages. In mlm, a very large number of people are aimed at distributing the product. Each person does much less work promoting a product or service. With the help of the network, a complex of advertising, promotion and sale of products is organized.

There are several basic actions that must be performed by each person in mlm:

• to promote information about goods and services;
• promote the idea of ​​business opportunities;
• teach others to promote this information.

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How to choose your mlm company?

Choosing a company starts with the product or service offered by the network company. In most cases, the products of network companies are of high quality. If you have already tried it, and your impression of it remains positive, then it will not be difficult for you to recommend it to another. And the more you like the product, the easier it is for you to offer it to other people.

Imagine that you recently watched a movie that you really liked. Surely you will immediately want to recommend it to your friends. Your enthusiasm and confidence in the quality of the product will push away all doubts and embarrassments, and you will easily be able to offer a product that you yourself liked, even to strangers, thereby benefiting yourself.

Depending on which company you ended up with, spending the same amount of effort, you can get completely different profits. There are several criteria that you need to follow when choosing your MLM company. They are published by Down-Line News magazine. According to these criteria, you can determine:

1. What can you earn in this company?
2. What awaits you personally in your business, which you organize in this company?

Let's look at a few key criteria:

1. Product uniqueness. The products offered by the company must be unique. You can not start working in a company whose products, although good, but such products are produced by a large number of different companies. If the product is not unique, then a huge number of competitors can produce an analogue at lower prices. Also, the company should have a wide range of products. don't go with a company that has only one miracle product.
2. Product relevance. Demographic research in the market is carried out to clarify unsatisfied demand. Actual products must fill this demand and be maintained at a high level.
3. Production of products. The company must promote its own production and have high productivity in order to maintain a competitive price and pay its distributors. It is not recommended to work with an mlm company that sells other people's products under its own brand. Such a company is considered an intermediary, which will affect the price and payment.

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MLM business goes online

Already a huge number of networkers, realizing that the future lies with the Internet, began to work on the Internet. The only problem is that few of them know how to properly handle this modern and powerful tool. Moreover, not every MLM organization provides the conditions to build your business there.

Working in mlm is getting more and more difficult every day. Annoying calls, constant distribution of leaflets, personal meetings already practically do not give any results, and a person who decides to work in MLM in this way receives constant refusals, after which he simply leaves this business without having time to achieve something. Having understood this problem, many networkers began to master the World Wide Web in order to find a wider target audience.

They began to understand the importance of working on the Internet. But here the old methods no longer work. Most networkers have no idea how to build an mlm business using the Internet. Back to index

Why do you need to build a business on the Internet?

1. You can build your business from anywhere in the world, the main thing is to have access to the Internet. you are not tied to a specific office where you had to bring potential partners.
2. On the Internet, people with disabilities who are not able to attend various presentations, travel around different cities can do it.
3. You can build your team from people from different cities and even countries. It doesn't matter where your potential partner is, as long as they have Internet access.
4. Organizing webinars allows you to communicate with your partners without leaving your home, at a convenient time for you and for them.
5. With the help of online stores, it will not be difficult for you to sell your products without problems with delivery and payment.
6. The most effective advertising at the moment is advertising on the Internet, which can be used with minimal financial costs, or completely reduce them to zero.
7. The convenient way of online learning will give you the opportunity to learn from the most successful leaders in the world.
8. The Internet will help you with many types of work that you previously spent a lot of time on, and even partially automate it.
9. Your sites will tell people about your business 24 hours a day!

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Stages of work of a novice networker on the Internet

1. Attracting potential partners. To begin with, as you might guess, you need to create your own website on the Internet. It can be a paid site that can be ordered on a freelance exchange. Or create your own website for free. To get started, a one-page site on a free hosting is suitable. If you already have a site for the selection of candidates, then this is very good, but if no one knows about it, then it will not bring any benefit. You need to develop your site. This can be done for free, but you will have to spend your precious time, or you can turn to paid website advertising services on the Internet, but for this you will have to fork out. Both methods of advertising are quite effective, so it is recommended to resort to both.
2. A selection of people looking for new earning opportunities. This stage is considered the most important in working through the Internet. It is advisable to automate the initial selection of partners, since it is at this stage that the largest number of people, the vast majority of whom will not build a business with you in the future. With the help of the site, this is easy to do. The main thing you don't need to do here is advertise your company as well as your products, because people don't like it at all. On the Internet, through your website, you must look for people who are looking for opportunities to achieve their goals, and provide them with this opportunity. There are a large number of design options. you must understand what you need to give to your partners - to help make the same site with the same function. After all, the main principle of mlm is duplication, that is, the repetition of the actions of your sponsor. It is best to provide your partner with a ready-made website builder so as not to waste time on it.
3. Selection of people who are interested in the possibility of achieving goals with the help of mlm. This is easy to do. Give the person the tools to do the job for you. It can be films or books about mlm, or an invitation to a webinar. Such materials can be posted on your website, but it is better not to make them publicly available, the subscription form will help with this. A person who wants to study the materials fills out a form, after which everything necessary is sent to him by mail. This is a huge plus of the Internet: you don't have to wait for the CD or book to be returned to you, and you don't waste time on it, because there are automated subscription forms.
4. Webinar (conference). This event provides a potential partner with information that will help him make a final decision. A candidate from anywhere in the world can, after receiving a link, enter the webinar room and listen to information about your proposal, ask questions of interest to him, and hear the opinions of other people. In almost all mlm companies, there are leaders who hold daily webinars, to which you simply invite your candidates. Over time, it is better to learn how to hold your own conferences, in which partners will see you personally as their sponsor. You can also record your conferences and then send them by mail.
5. Registration and getting started. At the end of attracting and motivating potential partners, they are registered in the business and work with them begins. Before the attracted partner starts working, he must fully study all the information about the principles and system of work in your team, understand how he will repeat your actions to achieve the goal.

MLM business, or network marketing, began to conquer the Russian market back in the 90s of the last century, and still remains in trend, attracting new entrepreneurs to its ranks. Thanks to this form of sales, we distribute all kinds of additives, cosmetics, detergents, dishes, etc. According to the Direct Selling Association, 43.5% of the market is occupied by personal care products, 29%- products that promote a healthy lifestyle. 11.2%- clothing and accessories, 9.5%- household chemicals, 5% - household goods and others. But, despite the rather high demand for goods, and the growing turnover of companies involved in the network business, our attitude towards MLM is very ambiguous.

• What is attractive MLM business
• Why people do not like MLM: 3 reasons for distrust of business
• How to start a business from scratch in MLM
• How to choose the right company to work and start earning
• 3 tips to make money with network marketing
• Internet network marketing: the second wind of business?
• MLM business trends 2018
• How to develop a business mindset with MLM

On the one hand, hundreds of thousands of people come to the MLM business who want to earn money and build a career: at the end of 2017, 3.8 million people were engaged in network marketing. With another- Network Marketing is often avoided and often not seen as an opportunity to earn money, preferring a stable job with a stable monthly pay. The thing is that often people have no idea about the true face of network marketing. Let's try to figure out what MLM business is today, what positions it occupies in Russia, whether it has prospects and what awaits it in the future.

What is attractive MLM business

The name MLM comes from the English multilevel marketing, that is, multi-level sales, sales. Network marketing is a certain type of marketing of goods and services by independent distributors. Each of them can not only engage in sales, but also attract new partners, and they, in turn,- their own. Thanks to this approach, a “network” is formed, each member of which can receive interest both from their own sales and from the sales of people attracted by them. The bigger the distributor network- the higher his income.

Let's say you have a store that sells cosmetics.. You will be able to make a profit only when buyers come to you. opened - earnings will also depend on its attendance by customers. Network marketing will provide completely different opportunities. People themselves will order the necessary goods, buy them and distribute them among friends. It is for this reason that it is so attractive to companies that produce certain products. "Dinosaurs" of the market, such as Avon, Mary Kay, Oriflame, Amway do not have worthy competitors for the simple reason that their goods are often sold out almost immediately, even at prices that are many times higher than the "store" ones. Sales through stores are fraught with competition and unnecessary problems that can be solved through network marketing. The manufacturer does not need to spend money on advertising, rent of retail space and incur other expenses. But for networkers, a big plus is that companies not only earn money themselves, but also give everyone the opportunity to earn- those who love their products.

In network marketing, you can:

- have a free work schedule;

- get by with minimal financial investment;

make a career;

- create passive income;

- transfer the contract by inheritance or sell.

But despite all the advantages, not everyone manages to achieve success in MLM.

Millions on MLM: how American multi-level marketing differs from Russian

American MLM marketing differs from Russian only in the attitude of representatives of two nationalities towards it. Americans most often think of network marketing as a side job or second job. They are ready to devote some time to it, but not all their lives. If things are going well, and there is not enough time to manage a multi-level company, a few leave their jobs and are engaged only in MLM business. Some people can actually become millionaires through MLM. But this is only the top of the pyramid, at the bottom of which are thousands of less successful entrepreneurs.

In Russia, newcomers often try to put all their efforts and resources into a new business and constantly run around familiar and unfamiliar people, offering goods and trying to sell it at any cost. To build their own network, many lack the skill or desire. Beginners basically see only a system of bonuses and bonuses in front of them, plus the opportunity to buy goods cheaply.

Network marketing today, like any other business, requires a reasonable approach and a clear plan of action. And one more thing: if abroad the times of lawsuits against network companies are a thing of the past, and business has become completely legal and profitable, then in Russia the opportunity to encounter fraud still exists.

Probably, most of our readers at least once in their lives had to look for additional income, or even a place of their main job. Moreover, this happens not only with young specialists who have just left the walls of an educational institution. Everyone is looking for a job or part-time job, from schoolchildren to pensioners. The reasons are different - someone does not have enough money to meet basic daily needs, someone wants to save up for an expensive car or apartment, young people living with their parents strive to gain at least minimal financial independence.

The search for options, as a rule, begins with the study of the media and sites that post job ads. Experience shows that there are almost no valuable offers there. And some we simply do not pay attention to, believing that they are not worth it. Network marketing ads often fall into this category. The attitude to this occupation in our society is very ambiguous and mostly negative. Epithets like "scam" and "divorce" are not the toughest in relation to MLM (an abbreviation of the English term MultiLevel Marketing, which "in our opinion" means "multi-level marketing"). But is it really so sad?

We are all adults and we understand that it is possible to draw some conclusions only after studying the issue. And at the same time, many of us sin with unreasonable assessments of this or that phenomenon, inspired by other people's impressions or other people's experience (it doesn't matter, negative or positive, but someone else's). It seems that network marketing has fallen victim to just such an assessment, although many do not even really understand its essence.

In a nutshell, this is just one of the ways to promote and sell a product, which, like any other, has its advantages and disadvantages, which we will deal with today. This whole scheme is carried out with the help of a large number of people forming a network. Information about a product is spread from person to person, there are no intermediaries who buy goods in bulk and resell them at an inflated price, and there is no expensive advertising. The significance of these factors will be explained with an example.

All of you know Orbit chewing gum and have at least an approximate idea of ​​how much it costs in our stores. So compare - the cost of producing one package (10 pillows) is equal to a maximum of 50 kopecks, and we buy it hundreds of times more expensive. And all because before it hits the counter, it passes through the hands of several wholesalers, each of which makes its own margin (the manufacturer, of course, also lays his own). Add here a lot of money for advertising in the print media, on the streets, TV advertising, and you get a figure from the store price tag.

MLM is a direct sales system, devoid of all these heaps, so the goods in such networks are often cheaper than in retail outlets. And not because they are fakes or low-quality goods, as some people think.

The earnings of network members consist of a percentage of the cost of goods sold and a reward for attracting new people. That is, it is profitable to involve newcomers in the network, but the process is not simple. Here you need to be a bit of a psychologist and be able to unobtrusively convince, conveying to the person the meaning of this sales technology and its inherent advantages.

By the way, it is with such an unpopular phenomenon as financial pyramids that many people compare MLM networks. All this comes from a misunderstanding of the sales mechanism. But the mere fact that network marketing does not require large investments and does not promise fabulous profits in return for nothing should suggest that this is not a “scam”.

Here, in order to achieve something, you need to work hard to create your own clientele. And profit does not always come immediately, for some time, you may have to work in vain. But in any case, your efforts will bear fruit, and after a certain period of time you will begin to receive income. If you connect to a large network, then you should not count on a huge income, but you can definitely earn an additional 20-30 thousand rubles a month.

True, in order not to get burned, you need to be able to distinguish a real network company from a pyramid that disguises itself as one. Therefore, we advise you to take into account a number of points before becoming a member of such an enterprise and attracting friends and acquaintances to it:

1. First, a real MLM company will offer you to sell a certain product (product or service) from the manufacturer's catalog. You will not be forced to buy goods for the future, you will only work with products already ordered by your customers and pay for them on the day they are received from the warehouse.
2. Secondly, you should be alerted by the requirement to pay membership fees or buy some "securities" that actually have no value outside of this structure. You will also not be paid for the volume of products sold. You will be rewarded solely for the number of attracted members who have already paid the same membership fees. If everything is as we have described, then you have landed on a financial pyramid and you should not linger there.
3. And finally, thirdly. There are companies that offer to sell some hardware or software, but require you to pay a certain amount in advance for a certain package of services, without which you will not be able to work, as well as attract a couple of new participants. The mini-network that the participant creates in this way becomes the source of his income. To be honest, such schemes look doubtful, although, in fairness, it should be noted that such companies still have a product for implementation. But climbing the career ladder here is almost impossible, even with the skills of a psychologist, having leadership qualities and oratorical talent.

That is, the conclusion from all of the above is obvious - you can engage in network marketing and achieve success in this business only if the conditions for cooperation are clear and transparent, and there are no points of doubt.

1. Let's start with the fact that the MLM system makes the cost of goods (services) much lower for the buyer, since the price does not include advertising costs and intermediary margins.
2. The goods are delivered to the consumer in a short time due to the fact that the logistics are well thought out and the company has a network of warehouses in different regions (cities, countries).
3. Counterfeits and product substitutions are excluded, which is possible in the process of numerous resales. Grid companies go directly to the end consumer and falsifications are almost excluded here.
4. Employees involved in multi-level marketing are highly motivated, both in terms of the possibility of high earnings, and in terms of building their own business.

Sellers' income consists of a percentage of sales, but not only. They can also recruit new people and be rewarded for contributing to network expansion (hence the name network marketing). Each member of the network can eventually, having created a fairly wide client base, establish their own small network business. The MLM system is beneficial to all parties - the manufacturer, the consumer, and the sellers (distributors).

For the manufacturer, this is a real opportunity to save on advertising without compromising the popularity of the product. The consumer is satisfied with the fast delivery, guaranteed quality, relatively low prices, the availability of samples and catalogs, as well as the opportunity to sometimes purchase those goods that are not on store shelves.

As for distributors, they have the opportunity to build their own business without having a large start-up capital, on an already prepared market (after all, the main network companies are widely known to the population) with a built-in sales system. In addition, they have the opportunity to get the necessary knowledge for free, as MLM companies pay a lot of attention to training and mentoring.

So, it would seem, everything is simple. But then why do many people who have tried themselves in this business fail and consider it nothing more than a scam? Most likely, they either did not show the necessary perseverance, or they simply lack the qualities without which there is nothing to do in network marketing.

It must be admitted that networking is not for everyone. And not because someone is bad, but someone is good. It's just that this job, like any other, requires a certain set of qualities, without which success will be very difficult, if not impossible.

As a rule, people who do not accept the rigid framework of work "from call to call", who are creative, sociable, persistent and striving to build their financial independence with their own hands and on their own mind, can advance to the highest levels. If you want your life and your income depended solely on you, if you know how to set goals and persistently go towards their achievement, know how to communicate freely with people, have the gift of persuasion and the inclinations of a psychologist, and also strive to constantly improve the level of your education, then MLM is exactly what you need.

And separately I would like to say about patience and perseverance. The fact is that most of those who did not achieve results in this field, gave up at the initial stage of work. After all, this is not a job where, no matter how successful you are, you will still be paid your due salary. You need to be ready to work for some time on future results (even without making a profit), create a client base, and master the intricacies of the profession. But over time, your perseverance and your patience will certainly bear fruit, which will definitely please you.

Of course, you should start with choosing a network company. There are different options here - you can connect to a company with a name that is well known to people, where there is already an established and developed distribution network. The product of such a manufacturer is easier to sell, because people know it and trust its quality. But there is also a downside here. It consists in the fact that in such a network you will find yourself very far from the top, it will be difficult to move forward, and your income will not be very high.

Another option is to join a newly established company. Difficulties in this case will lie in wait for you from the very beginning, because you will have to convince people to purchase an unfamiliar product from a little-known manufacturer, and buyers are usually reluctant to take such a step. But over time, when the company creates a name for itself, you will find yourself on the top steps of the pyramid, and you will have a corresponding profit.

However, no matter which option you choose, first of all pay attention to the payment system and the bonus program. The scheme for making a profit should be clear and transparent, there should be no penalties, and the employer's requirements for sales volumes should be realistically achievable.

Having decided on the choice of a company, think about how to generate income. It can be direct sales, or it can be passive income from attracting new members to the network.

Most often, beginners start with the sale of goods and this, in principle, is justified. Being engaged in sales, they get the opportunity to get comfortable in a new niche for themselves, study the market and create a customer base.

But professionals advise both to engage in direct sales and attract new people to the network. After all, it is not at all difficult, when telling a client about a product, to tell about the prospects that your work opens up. Most likely, some people will also want to try their hand at this business in order to get additional funds and the opportunity to purchase products at purchase price.

When a certain amount of time has passed and you have done a good job of building your chain of distributors, it will be possible to refuse sales altogether or do them much less. After all, you will receive the main income from the work of your subordinates.

Any occupation has its pros and cons, and network marketing is no exception:

1. From a positive point of view, it is worth noting the opportunity to buy high-quality products for yourself cheaper by a third, or even more than their “sales” value, that is, the price that you announce to your customers.
2. The second plus is the absence of the need to invest your own money in the business as an initial contribution (membership fees), of course, if it is a legal network company, and not a disguised pyramid.
3. Not to mention the possibility of free education. As a rule, companies, taking care of increasing sales and expanding their network, spare no time and money to familiarize distributors with their products, effective sales techniques and rules, ways to build their own business for passive profit, etc.
4. And, finally, with the advent of the opportunity to conduct such a business through online services, distributors no longer need to stop people on the streets in search of customers, come to their homes, offices, etc. Now you can work remotely.

Among the shortcomings, perhaps, it is worth noting the fact that the expansion of the network leads to a decrease in income, and new partners receive much less than those who came before.

There is a lot more to be said about network marketing, but we set ourselves the task of explaining the essence of this phenomenon as simply as possible and giving you the opportunity to navigate how such work meets your needs and characteristics of your character.

Hopefully, you will now be able to make your decision to participate (or not participate) in MLM based on your own conclusions, and not be guided by the feedback of former unsuccessful distributors. Good luck.