Network Marketing Business Success – A Nuts and Bolts Guide

If you have an entrepreneurial spirit and you’ve ever considered starting your own business, you’ve no doubt explored the idea of network marketing. Also known as multi-level marketing (MLM) or direct sales, network marketing is one of those businesses that seems to attract schemers and con artists, giving the entire category a bad reputation. Try telling someone that you’re involved in network marketing and they’ll most likely think, if not say it outright, “pyramid scheme”. This unfortunate association is not entirely unjustified, as there have been many highly publicized cases of fraud and abuse in the network marketing business. But let’s think about what this business is all about and how it should be viewed when operated legitimately.

Network marketing, MLM, direct sales or whatever term we want to use, is nothing more than an organization of independent sales reps selling a product or service, while also recruiting others to sell the same merchandise. These recruits then provide an additional income stream for the person who introduced them to the business. This is known as a “frontline” plan and involves an up- and downstream commission structure. In and of itself, this type of plan is not inherently bad and can be an inexpensive way to build a small business. If the product or service being offered is in high demand and the structure of the company is equitable and legitimate, it can be a lucrative endeavor for a motivated entrepreneur. In fact, one of the primary complaints about most MLM ventures, that the new recruits don’t make any money for themselves, but more for their “upline” – simply isn’t true. Any new entry to a network marketing company can be a success, if enough effort is put into recruiting and grooming their downstream.

So, let’s talk about what to look for in a company that you may be interested in. First let’s realize that network marketing, MLM or direct sales companies are legal in all 50 states, as well as more than 100 other countries. Also, the Federal Trade Commission (FTC) has ruled this type of business structure as legitimate and has issued a set of guidelines for Direct Selling Associations. With that being said, here are some things to look for when researching which of these businesses may be best for you:

  1. Look for a company that sells a product or service that you personally believe in. This is a crucial element to success, as you will be selling not only the item, but the system. A product or service you are passionate about helps to build that same passion in your downstream recruits. And remember, your downstream is your future.
  2. You also need to consider the stability and integrity of the company you are joining. How long have they been in business? How many tiers are above you? What is their reputation in the industry? These are all important factors in your success selling the product, as well as your downstream.
  3. Let’s not forget the pay plan. How fair is the commission structure? What percentage of each dollar sold goes to you, your upline and to the management levels? This may be the most crucial element to explore when choosing the right company for you. Can YOU actually make a good living on this pay structure?
  4. Training is also an essential component of the equation. How long and in what form is the training? Does their style of training suit your personality? Is it easily transferred? Remember, you will need to train others in your downstream and the robustness of the training provided, directly impacts your success.
  5. Finally, ask yourself “does it feel right?” This is a key question and one that often goes overlooked. After the presentation and as you’re browsing through all of the literature about this company, stop and check in with yourself. If you feel uneasy about any aspect, explore that. Did they ask for a large initial purchase of their products as “samples”? Did they offer little in the way of future support? Were they truly interested in your success? How did it feel?

For any entrepreneur interested in network marketing, MLM or direct sales ventures, I recommend researching the business extensively. The better educated you are, the greater your likelihood of success. Realize that there is a huge initial investment of time and effort, before you ever see any real money. But also know, if you’ve done your homework and chosen the right company, with the right line of products and a fair compensation plan, you’re on your way. Stay focused and work your plan. You are limited only by your commitment and belief in yourself.

Be a Marketer

Have you ever spent money on advertising but then didn’t get the results you felt you should have? I know I have. Any of us who have ran a business has had this happen to us.

According to the ad rep, you just didn’t do it often enough, or for a long enough period of time. In other words, you didn’t spend enough money with him.

Well maybe you’ve heard this definition of insanity: Doing the same thing and expecting different results. So who’s insane, the rep, or the person who keeps giving him money for the same thing expecting different results?

You’re told that what you need is “exposure”, when you know what you need is sales.

Unless you have endless funding to create a brand name, you probably don’t have the budget to buy ‘impressions’ and hope for the numbers to eventually tilt in your favor.

You want return on investment NOW, you want RESULTS!. When you spend $1 in marketing you’d better get $2 back in sales – better yet, $3 or $4 or more, depending on the Life-Time Value of your clients.

Let me show you what I mean.

Recently, I decided to sell my pickup. Who was my target market? Someone looking for a pickup. Where would I find that market? Places where pickups are advertised – because that’s where someone looking for a pickup is likely to be looking.

I could have just put a sign on my truck and waited. Or put a sign in my yard. After all, thousands of people see my truck every day. And hundreds of people drive by my house every day. But what percentage of those people are looking to buy a pickup? One percent? Probably less.

But of the thousands of people looking at the truck ads in the paper, or on the internet, how many are interested in buying a truck? A lot more than one percent.

What’s the difference in these two approaches? The sign was way cheaper – or was it?

What was the ROI? Zero.

The internet ad I placed was $40.00. My truck sold for $20,000. What was the ROI? I got results because I employed the principles of Direct Response Marketing.

I wasn’t interested in building name awareness in the general public’s mind so that one day down the road, when someone out there became interested in buying a pickup truck, he’d call me. No, I needed results NOW.

I determined who my target market was, used the right medium, and delivered an effective, “matching”, message.

Now it’s true that if you offer a product or service that many will want eventually, such as window washing, but not all of them want it now (so we’re not talking groceries here), you should design an ongoing marketing strategy that will move the ‘not now’ folks to come to you first when they are ready.

But it’s wasteful to spend your marketing dollars on those that will never use your service or product. (e.g. Renters don’t usually pay to have their windows washed)

That’s where target marketing comes in. Unless you sell groceries, the general public is too big a target. Kinda like blowing up the whole barn to get rid of the hornets’ nest under one of the eaves.

Direct Response marketing is the answer for the small business owner with a limited advertising budget. And an essential strategy for a large business with a large advertising budget. In either case, an effective message to a targeted audience will get you the results you desire.

The Principles of Small Business Online Marketing

Many people view online business as being something totally different than the old style small business that existed in the pre-internet days. This can be a serious mistake. The truth is that the general principles of business have not changed. They remain the same regardless of the vast amount of technology that is now available to us. It has always been important to generate traffic, for example. The need for advertising and the necessity of making it easy for your customers to spend their money with you are just as vital to the online business as to the little country store of 50 years ago.

Professional web designers are aware of this important fact. It is their job to adapt these time honored business principles to the technology that has opened up a new and global market place. In the old days, one of the important principles of small business was expressed as location, location, location! On the internet, location is expressed as search engine ranking.

The problem with the internet is its vast size. The number of websites is mind boggling, and if your company is providing a specific service in a specific location, its site will be lost in that immensity unless you can direct customers to it. For example, if you are running a mortgage company in Utah, a Utah web design will be necessary. It will not help you much to have people in China viewing your website. The idea of proper Utah internet marketing and mortgage website marketing will be to direct customers to your site that are both in and near Utah and interested in mortgages.

The search engine is the device that provides this direction. It is a process known as SEO, or search engine optimization that allows the major search engines to find and rank your companies site. SEO is the advertising mode of the online business. The method is different and new, but the principle has remained constant.

The need to ease the customers’ way to spend their money is a function of proper web design also. This idea is known as being “user friendly.” The website becomes your sales force. It must act as a salesman would act by answering questions, directing customers to the right products, and closing the sale. The well trained salesman could increase sales in the old style business and it the same way a properly designed website can do the same thing. Once again, the principle has remained the same. It is only the method of applying the principles that has changed.