In simple terms, network marketing is a
network of people
who have access to a range of products
and services that are
distributed through that network.
Rather than operating via a shop front,
people can buy these
products and services for personal use or
to sell to others.
Further to this, people can assist in
expanding the network
by inviting others to join the network,
thus extending the
concept to their sphere. Over time, and
with more people
Introduced, the volume of products and
services being distributed
Increases. Along the way, a portion of
the profits on
those products and services are paid to
you and people in your
‘Down-line’ (we’ll explain some of this
terminology later). In
time, the opportunity to create a regular
income from a team
of people using and selling products
becomes a reality.
Over the years, network marketing has
attracted some
less than favorable perceptions. The
industry’s image was
tarnished in its early days of
development, when there
were no systems in place to educate those
involved to go
about their business in an ethical and
professional manner.
Additionally, there were many
disreputable companies around
who took the attitude of selling products
at any cost, to
anyone, with no long-term strategy; there
were also some
illegal pyramid schemes that entered the
market disguised as
network marketing companies.
Today there are well over 20
million people around the
globe involved in network
marketing, also known as multi-level
marketing (MLM) or direct
selling, and this figure is growing.
Manufacturers, many of them
Fortune 500 companies, now
see it as a viable and
credible alternative for distributing their
products and services.
Reaching consumers directly through
traditional retailing methods
and/or outlets is not only difficult,
it is extremely costly.
Today, almost everything—
including health supplements,
cosmetics, cleaning products,
training materials, clothes,
cars and travel—can be and is being
sold through network
marketing. Some of the most famous
names in the network
marketing industry include Avon,
Usana, Melaleuca, Mary Kay,
Quixtar, Herbalife, Amway,
Tupperware, Juice Plus, Nu
Skin and AIM.
Technology, especially the
Internet, has had a dramatic
impact on the industry, and
more and more it is seen to be
moving into the marketing
mainstream. The industry is
rapidly maturing and those
becoming involved in network
marketing are now more often
than not coming from professional
backgrounds.
Network marketing has
certainly come of age. It is an
excellent way to get into
business, it has a lot of appealing
aspects that cannot be found
in mainstream businesses (we
discuss this throughout the
book), and many of the 20 million
people involved are making a
lot of money, for not a lot of
work. They did the hard yards
when they started but now they
enjoy the fruits of their
labour with a solid passive income
stream and residual income.
Previously, many people saw
network marketing as something
you did on the side to make a
little extra cash. This option
is still available today, but
for most people now involved in it,
network marketing is an
opportunity to establish a business that
is, and will continue to be,
their main source of income.
One of the biggest mistakes
made by people becoming
involved with network
marketing is failing to treat it as a real
business right from the
start. Because there is normally a
relatively low start-up cost,
and a high degree of flexibility,
some people treat it more as
a hobby. That said, this concept
does work for some people.
They manage to set up a great little
business which supplements
their income and helps them to
acquire the things they want
out of life. But for many others,
their lack of conviction
ultimately results in the business slowly
fading into the background—materials,
books and products are
left to gather dust on a
shelf and the words ‘network marketing
simply isn’t for me’ are
uttered whenever the concept is raised.
The main purpose of this book
is to make you, the reader,
aware of the similarities
between building a network marketing
business and building a
traditional business. Even though the
way each one works, and the
end results, are different, many of
the principles, fundamentals
and attitudes behind making each
business a success remain the
same. If you can see your network
marketing business as just
that, a business, right from the start
and give it the respect and
focus required, and at the same time
recognise that many of the
principles and challenges are no
different to starting up a
pet shop, for example, then you are a
long way towards achieving
success.
Numerous network marketing
companies are now established
around the world. The way
they do business, their
structure and the terminology
used varies from company to
company. While our discussion
has been kept as generic as
possible, to encompass the
industry overall, most observations
are based on experiences with
a particular network marketing
company. If the references
and examples we use don’t always
seem relevant to the
particular network marketing company
you are involved in, you can
bet that the principle of treating
it like a real business still applies.
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