Network marketing also known as Multilevel Marketing (MLM), is a type of business opportunity that is very popular with people looking for part-time, flexible business. Network marketing is also known as Pyramid selling and referral marketing. It’s a kind of mouth publishing where the product sell depends on people recommendation.
Network marketing network compensates participants primarily for recruiting others rather than for selling the company’s product or services. A network marketing system in which most of the revenue comes from recruitment may be considered an illegal pyramid scheme.
Network marketing programs aren’t defined as franchises under state and federal franchise laws, you’ll need to do your own investigation before investing any money. It is restricted or banned in several countries due to its history as a vehicle for consumer fraud.
Let’s take an example for network marketing:
An ABC Company with XYZ product planning to sell its product via network marketing, the customers or the persons which we normally call are business partners in case of Network marketing. As the concept is, the one with whom they are dealing are going to deal with others for their product, so with that concept they become business partners and get reward according to the sell done by them. And it becomes a network of one to many. Where one person is connected to many persons and it becomes pyramid of the company.
How to succeed in Network Marketing
As the profession appeals to many people because they can be their own boss, set their own hours, and work towards their own success. It is a big commitment, but network marketing can be a very lucrative career.
There are three parts of network marketing:
- Finding the Right Company
- Starting at a Company
- Building Your Business
- Finding the Right Company
The things which you have to keep in mind while finding the Right Company are:
- Investigate companies
- Look up CEO’s and other company leaders
- Investigate the products or service the company sells
- Question your recruiter
- Read your contract carefully
- Watch for red flags
- Draw up a business plan
- Starting of a Company
If you are planning to start a company then you have to consider many things because it is ultimately going to affect your financial condition.
- Choose the right mentor
- Study your products and know them well
- Attend company meetings and training cells
- Build new leads
- Follow up with all leads
- Building Your Business
I you are going to build up your network then there are many things which you have to keep in mind.
- Recruit new members
- Mentor your recruits effectively
- Give your team members good commissions
- Consult professionals about your business
Some key points in above methods:
Red Flag:
- The company makes more money by selling products to distributors then to the public.
- The company’s recruiter makes more money if you sign on.
- The company promises you that you’ll make a lot of money.
- The company’s products are not backed by scientist research.
Responsibility of a mentor:
- To funnel new leads for you.
- To meet with you face to face at least once a year.
- To coach you through the early stages of your career.
- To sign your paychecks.
Key Suggestion:
Just like you were recruited to a network marketing company, you’ll need to recruit new members to your team if you want to be successful. Look for people who are personable and team oriented, as they will make valuable addition to your team.
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Aayushi's Thought 