What Exactly is Network Marketing? by Jason Oickle
To begin with, the concept behind network marketing is simple. Sharing -
through product or business philosophy - is the basis of network marketing.
Network marketing is a multi-billion dollar industry involving millions of
independent business people around the globe. Large companies like Gillette,
Colgate-Palmolive, Kleeneze Europe, AT&T and others, have all turned to
network marketing because of the very real edge it gives them in both domestic
and international marketing.
Network marketing is a 'BIG' small business, which offers everyone, with or
without business experience, the opportunity to start and run a home-based
business that works. It is the last frontier where 'the little guy', (people
like you and me) can make it BIG.
NETWORK MARKETING Vs. TRADITIONAL MARKETING
The traditional way of marketing products is to move them from a manufacturer
through a network of middlemen. National Wholesalers, regional wholesalers,
Cash & Carry warehouses, retailers, - the 'middlemen' - all add their
'valueless' percentage to the price of the product.
By the time the product or service reaches you, the end user, you're not only
paying for the product, but a percentage of the price for each and every
middleman in the network.
In network marketing there are no middlemen. Instead of paying them, a network
marketing company will pay you for whatever amount of product you cause to be
'moved'.
As a sole individual operating alone, the amount of product or service
provision you could 'move' from your own efforts, would be relatively small. In
network marketing however, the amount you 'caused' to be moved indirectly could
be huge.
Here then is the essence of a network marketing compensation plan. For not only
will you be compensated for the product or service provision you personally
cause to be moved from your own direct efforts, you will also receive indirect
compensation for the product or service provision that your 'organisation'
'causes' to be moved.
YOUR 'ORGANISATION'
To be successful in network marketing you will need to build an 'organisation'.
That is to say you will need to 'share' the benefits of both the
products/service provision and the business opportunity with others. In network
marketing this is referred to as your 'downline'.
The 'serious' money to be had in network marketing is to be had from what is
termed as 'over-ride' commissions from the 'movement' of product or service
provision from the 'downline' your 'sponsor' will help you to build.(In network
marketing it is the responsibility of your introducing 'sponsor' to help you
build your 'downline'.)
All you need to do initially to build a 'downline' is to 'share' with others
the information about the products or service provision and the business
opportunity on offer.
Theoretically, if after 'sharing' the information with others and you
subsequently attracted just five SERIOUS individuals who decided to join you in
your network marketing business - for illustration purposes only - your
'downline' could equate to the following after five levels of geometric growth:
You
You sponsor just 5 SERIOUS people into your business.
Your level 1/ 5
They duplicate your efforts and each sponsor 5 SERIOUS people.
Your level 2/ 25
These 16 duplicate your efforts and each sponsor 5 SERIOUS people.
Your level 3/ 125
These 125 duplicate your efforts and each sponsor 5 SERIOUS people.
A little arithmetic will tell you that's theoretically a total of 3,905 people
on your fifth level.
AN UNLIMITED INCOME POTENTIAL
Imagine the power of a business-building plan that would pay you an agreed
'over-ride' commission on each product or service provision 'moved' by each and
every one of those 3,905 potential distributors in your downline. Network
marketing then is about a LOT of people 'moving' a little product. The more
people you introduce, the greater your income potential. Notice that I said
SERIOUS people. You may find that you have to introduce 20, 30 or even 50 new
distributors before you find a person who Gets SERIOUS about the business.
If you want to toss aside the potential earnings on offer as being ridiculous
or impossible - DON'T. I personally have met people who are earning $5,000 to
$50,000 per month (yes per month) from network marketing for part-time effort.
Though the majority of networkers earn hundreds rather than many thousands per
month, (most working part-time) it must be understood then that if you are to
make serious income, you must put in serious effort. No free lunches here! The
professionals in Network Marketing (those that earn HUGE incomes) recognise
that to become successful you must "go through the numbers". That is, sort
through lots and lots of people until you find those people who get SERIOUS
about the business.
There are two prongs to earning in Network marketing. First, is, of course,
building a down line. But remember, a large organization of people who do
NOTHING other than sponsoring others, earns NOTHING!
Second is, BALANCE and CONSISTENCY. Spend some time building your organization
yes, but also spend time PROMOTING your products/services to others and use the
products/services yourself!
SO HOW DO YOU CONVINCE PEOPLE TO JOIN YOUR BUSINESS?
The simple answer is you don't. You want those who convince themselves. If they
are truly looking for a way to become successful, then they'll come to you to
go after it. The key to achieving success in network marketing is not to be had
by convincing people, but by helping those (SERIOUS) people who want to become
successful themselves.
WHERE DO I FIND PEOPLE TO JOIN ME IN MY BUSINESS
As it has been estimated that 20% of the UK working population - that's
approximately 6 million people - would be interested in starting their own
business, the marketplace in the UK alone is truly enormous. With a recent MORI
poll indicating that 50% of 16 - 25 year olds were interested in starting their
own business, the marketplace is actually growing.
One of the most important things to recognise is that the most precious
resource available to you is in the new blood - the millions of business
opportunity seekers who are not presently involved in networking. For it is
there that you will find the success stories of tomorrow for your downline
organisation.
The impact of the Internet on network marketing will be absolutely HUGE.
CHOOSE THE RIGHT COMPANY
In any successful business it is the quality of the product or service that is
being offered that is the single most important aspect for its success.
The most lucrative compensation plan in the world will NOT provide you with an
on-going residual income if the product or service doesn't provide tangible
value and benefits for yourself and your customers.
Provide a product or service that people need, want, coupled with a business
opportunity they are willing to tell their friends about and you can build
yourself a business empire in network marketing!
TIPS FOR THE TOP?
Tip# 1/ If you're already involved in a network marketing programe and you're
being 'sold' primarily on the benefits of the compensation plan with the
product or service being offered as a secondary consideration, then read the
above paragraph again and MOVE to a company whose products or services 'move'.
Tip# 2/ Ask yourself this important question: Is the network marketing
programme I'm considering joining one that I'm willing to share with my friends
and family? The comment "I don't want my friends and family to know what I'm
doing, l want to become successful first - then I'll introduce them!!" is
almost legendary in network marketing. (A comment oftimes made by failed
networkers who had no real belief in the company or the products they were
promoting in the first place!) If you immediately feel comfortable with the
prospect of letting your neighbours, your friends and your family know about
the network programme you're considering joining, have belief in the company
and its products/service provision, have confidence in your introducing
sponsor, then you have probably chosen the right company to work with.
Tip# 3/ Don't be impatient by expecting things to happen overnight! Building a
moderately productive downline in any network marketing programme takes TIME -
many months not many weeks.
Tip# 4/ Read tip 3 again and avoid like the plague any company which suggests
otherwise or does not require you to invest in the development of a distributor
base. If your prospective sponsor in the network marketing programme you're
being invited to join doesn't stipulate that it takes TIME to build a
significantly productive downline then it's not a business your being invited
to join but a game - and one you're bound to lose!
Tip# 5/ If you want to dine with the classes - deal in products or services
wanted by the masses!
If you have tried Network Marketing before and failed, you probably chose the
wrong company, the wrong sponsor, or the wrong product.
IS NETWORK MARKETING FOR YOU?
A message from the Prime Minister the Rt. Hon. Tony Blair MP to the Direct
Selling Association.
" I'm delighted to offer my support to the Direct Selling Association and point
out to you how big a part direct selling is of our domestic market in the sale
of goods and services. We've got something like 13% of the entire home shopping
market done by direct selling, almost half a million people are involved in
direct selling and 40,000 of those are doing it full time...It also shows how,
in a changing economy and changing labour market, there are great new
opportunities out there.
I want to say to you that this is a good thing to be involved in and that we,
as a Government recognise the tremendous contribution that people who are
taking up direct selling opportunities can make to the overall prosperity of
the economy. So it is well worth doing, well worth being involved in and I wish
those of you who are engaged in it, the very best for the future."
The above is the text of a video message given to members of the Direct Selling
Association on the occasion of the DSA's Annual Conference held at Hinckley
Leicestershire on 5-6 May 1999.
TO SUM UP
Network marketing isn't for everybody. While some people swear by network
marketing, others simply swear! (Read tip No. 3 again to find out why). To
succeed in network marketing you will need determination, commitment,
enthusiasm and most importantly - a burning desire for success. If you believe
you have those qualities get back to the person who provided you with this
information TODAY.
About the Author
Jason Oickle enjoys teaching people how to be successful online
Professional Internet Marketing Course
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