Multi-Level Marketing... aka.. Network Marketing... aka... (alot of names laa...)
Hey there.. have you heard of this multi-level marketing (MLM) before?? or other might call it Network Marketing... hm... Well.. I've heard of it before... though not until a few today i really take a closer look on the definition of this field of marketing...
This is a quote from wikipedia on MLM... (http://en.wikipedia.org/wiki/Network_marketing)
Multi-level marketing (MLM), is a form of Network Marketing (however the terms are often used interchangeably). It is a marketing strategy that compensates promoters of direct selling companies not only for product sales they personally generate, but also for the sales of others they introduced to the company. The products and company are usually marketed directly to consumers and potential business partners by means of relationship referrals and word of mouth marketing.
Independent, unsalaried salespeople of multi-level marketing, referred to as distributors (or associates, independent business owners, dealers, franchise owners, sales consultants, consultants, independent agents, etc.), represent the parent company and are awarded a commission based upon the volume of product sold through each of their independent businesses (organizations)
Independent distributors develop their organizations by either building an active customer base, who buy direct from the parent company, or by recruiting a downline of independent distributors who also build a customer base, thereby expanding the overall organization. Additionally, distributors can also earn a profit by retailing products they purchased from the parent company at wholesale price.
Distributors earn a commission based on the sales efforts of their organization, which includes their independent sale efforts as well as the leveraged sales efforts of their downline. This arrangement is similar to franchise arrangements where royalties are paid from the sales of individual franchise operations to the franchisor as well as to an area or region manager. Commissions are paid to multi-level marketing distributors according to the company’s compensation plan. There can be multiple levels of people receiving royalties from one person's sales.
Well.. the rest you can read in the link i gave you.
So what i want to stress about this topic is that... of how its nature of MLM...
As you can look the part of the Legitimacy in todays status quo.... of how close it is related to pyramid schemes and etc.... (To know further about this pyramid schemes... here's the link... http://en.wikipedia.org/wiki/Pyramid_scheme)
Alright... i hope you read the link's i gave you... because.. what the things i'm about to say next.. may or may not be easy for you to understand... Because this is my opinion on what i've read, and have personally seen this concept into play...
Hmmm... imagine.. in order to earn money... you have to either recruit new person in the group (that means... the new guy.. have to INVEST-meaning pay some amount to enter the group) or selling the product (if they do sell quality product)... though most of these MLM companies.. network... they more focus on the first part... using the Pyramid concept... which if you read... its DOOMED to collapes... and 88% of the participant in the group... don't even earn anything.. furthermore... LOSS EVERYTHING... So how is this a WIN-WIN situation??? Where most of these MLM who concentrate on these Pyramid concept... or just networking marketing for that matter.. promote these concept... that its a WIN-WIN scenario??? while from what you read.. only 18% only benifits from it...
Second part of it... When talking about the legitimacy of these MLM.. its a bit GREY (unclear) when trying to diffentiate the different between MLM or Pryamid Concept... the only sole that thing that i believe can separate (though can be argue.. which i will move on later) is the product which these MLM sell.... Now... what is there to be argue???
Well... it all depends on how actually the company runs these thing... wheather they focus more on the PRODUCT or.. like wise.. the PYRAMID... (recruiting others into their company)... some.. like "Cosway"... "Neway"... or even "Avon"... they product is quite renown.. and they are more focus in the PRODUCT quality rather then recruting... I mean... honeslty... if the product is known... its internationally recognize... and yet its fair to all parties (which MLM in nature does not).. then... i might consider going into these MLM thing...
Because... as a wise man once say.. "In success... There is no SHORTCUT into it... Its thru hardwork...determination... and honest work (meaning not take other people money for your own benifits) will bring you to where success is".. So yea... i suppose these are just part and parcel of my point of veiw..
Though subject to further investigation... I will keep you posted.. Bacause... what i want to discuss next is on.. the TRAPS on MLM on YOUNG ADULTS... how manipulative these MLM can be...
Last note... here's the link for the LEGAL MLM company that i found in WIKI... (http://en.wikipedia.org/wiki/List_of_multi-level_marketing_companies)
Till... then... see ya...