Network marketing, also called multi-level marketing, is a type of business where you sell products or services through a network of independent salespeople. It can be a great way to start your own business with low risk while enjoying flexible hours and the possibility of creating financial independence.
What is Network Marketing?
In a nutshell, network marketing is a business model where you sell products or services through a network of independent salespeople. You might have heard this type of business referred to as multi-level marketing (MLM), direct sales, consumer direct marketing, social selling, or party plan.
Most people use the term “network marketing” these days, but I use that and Multi-Level Marketing (MLM) interchangeably. Multi-Level Marketing comes from how we earn money. Instead of getting paid just for our own direct sales, the MLM companies pay us based on sales made by us and by members of our team. I’ll talk about that more in a minute.
The idea behind network marketing is that you can start your own business with low risk, little or no money and flexible hours. You don’t need to invest in inventory, you can work from home (or anywhere else) and you can build your business on your own time.
The downside of network marketing is that it can be tough to make money in the beginning. It typically takes a lot of hard work and dedication to build a successful business in this industry. However, if you’re willing to put in the effort, network marketing can be a great way to earn a good income.
How Does Network Marketing Work?
At its core, the network marketing business model is simple. There are three activities that an independent distributor performs to build and grow their business.
Use the products.
The first step on the road to success is to become your own best customer by using the company’s products yourself.
By using the products, you’re able to share your own experience with them and explain why you believe in the company and the products. The stories you’ll be able to tell based on your own results from using the products will be the thing that helps potential customers trust you and want to learn more about what you have to offer.
And the upshot to this is that when you are talking with prospective retail customers or new distributors, you’re simply telling your story. You’ll be genuine, authentic and not feel like you need to persuade or pressure anyone to make sales.
Recommend the products.
When you recommend a product, you’re telling your potential customers that you believe in the product and they might, too.
When you recommend a product to someone, it shows that you have put some thought into what you are selling and that you believe in it. This is important because potential customers want to know that they can trust you.
By listening to people as you engage with them, you’ll sometimes hear them mention a problem they have that your product can solve. At this point you tell them your story and they can decide if your product might be a fit for solving their problem. If it’s a fit, great. If not, that’s great, too.
Over time you’ll gather a lot of retail customers and make a lot of sales without having to be the pushy salesperson many people fear becoming.
Invite people to just “take a look”.
When you invite someone to just take a look at the income opportunity, what you’re really doing is giving them the chance to learn more about the company you represent and what you have to offer.
By inviting someone to just take a look, you’re putting them in a position where they can make an informed decision about what they want to do. You’re not pressuring them into anything, and they can take their time in learning more about what you have to offer.
How Do I Build a Team?
You may have heard stories of people who have teams of hundreds, or thousands or even tens of thousands of people.
How the heck did they find all those people?
Actually, they didn’t.
They found the first four. Or five or six.
I once heard Richard Brooke say, “Geometric progression is to network marketing what compounding (interest) is to wealth building.”
Your job is to find three or four or five (depending on your company’s compensation plan) sales leaders. Different MLM companies structure their pay plans differently, so while one person might need 3 “front line” sales leaders to maximize the comp plan, another might need six.
And what is a sales leader?
A person who is committed to doing the three activities we talked about a moment ago. They use the products, recommend the products and invite people to take a look at the income opportunity.
So the key question you need to answer for yourself to decide if multilevel marketing makes sense to you is, “If I really wanted to, I mean really wanted to, could I, over the next six months, find four or five people somewhere in my entire country who would be interested in doing this?”
If you answer “yes” to that question, you understand everything you need to know about the secret to making money in Network Marketing.
Because if you answer “yes”, you’re going to be looking for people who will ask themselves the same question and answer it with a “yes”.
And when your four new distributors find their four people who go out and find their four people and so on down the line, you will build a tremendous network marketing organization.
What products do you sell?
In most cases, the products you sell in network marketing programs are ones that you can’t find in stores. This might include things like nutritional supplements, skincare products, essential oils, travel services or home decor.
Network marketing companies typically have a wide range of products to choose from, so you should be able to find something that interests you. And, since you’re not investing in inventory, you don’t need to worry about stocking up on products that might not sell.
The most important thing is that you’re passionate about the products you’re selling. If you believe in what you’re selling, recommending those products and making sales will come easily.
What does a typical day look like for an independent salesperson?
There is no one-size-fits-all answer to this question, as individual distributors will have slightly different priorities depending on their goals and schedule. However, there are a few things that many successful network marketers do on a daily basis.
First, they make time for prospecting. This means reaching out to new people and trying to build relationships with them. This can be done through social media, in-person events, or any other type of networking.
Second, they work on building their team. This might involve training new team members, working on team morale, or brainstorming new ideas for marketing and selling products.
Finally, successful network marketers make time for self-care. This is important because it can be easy to burn out when you’re constantly working on your business. Make sure to schedule some time for yourself every day, even if it’s just 30 minutes to relax or exercise.
What are some of the benefits of being a successful network marketer?
There are many benefits that come with being a successful network marketer. Here are just a few:
You get to be your own boss and work flexible hours.
One of the best things about being a successful network marketer is that you work for yourself. This means that you can work flexible hours and make your own schedule. This can be really helpful if you want to balance work with other responsibilities, like parenting or caring for an elderly parent.
You get to make money while you help others do the same.
This means that you can not only achieve your own financial goals, but you can also help others reach theirs. Plus, you’re not just helping people during their working hours – you’re also helping them improve their health and wellbeing.
Not only can your income be residual, it can grow exponentially.
Residual income is getting paid repeatedly for work you did in the past. The same way your internet provider gets a check from you every month or your cell phone company gets monthly income from you based on the sale they made months or years ago, Network Marketing companies pay you month-after-month on the purchases made by your customers.
Not only that, but you’ll get paid commissions on the purchase of customers brought in by people on your team, so the income can grow way beyond what you could generate working on your own.
You get to work from wherever you want.
Home, a coffee shop, or on the road while you’re travelling. You can operate your small business from anywhere you are. If you have a phone and an internet connection, you’re in business.
You get to choose the people you work with.
This means that you can work with like-minded individuals who share your goals and values, and who are supportive and helpful. You’re working on a team of other distributors that you create, so you’re surrounded by positive business partners who will help you reach your goals while you’re helping them reach theirs.
You own the customer.
In many at-home business models, you don’t own the customer you create. If you’re doing affiliate sales for Amazon, for instance, you are creating customers for Amazon. They will be the ones earning money from that person’s future purchases, not you.
The truth is that customer acquisition is the most challenging, the most expensive part of direct marketing. If you are the one doing the work, you should be the one to get the full benefit of it.
Training is available
Training is available for those looking to start a network marketing business. There are a variety of options, both online and in-person, that can help you get started.
When you start a new profession, there will be some skills to acquire and master so that you can perform at high levels.
In a network marketing company, you will have training available from the company and from the people in your team who have gone before you and mastered the game. They will teach you everything you want to know about marketing and direct sales because helping you build success in turn builds their success.
You get to enjoy the satisfaction that comes with knowing you’ve helped others improve their lives.
One of the best things about being a successful network marketer is that you get to help others achieve their goals. Whether it’s helping someone find a new profession they love or providing them with a product that improves their health, you get to enjoy the satisfaction that comes with knowing you’ve helped others improve their lives. This can be really fulfilling, and it can make you feel good every day.
What are the challenges of starting your own business with network marketing?
There are a few cons to starting your own business with network marketing.
It can be difficult to find good leads.
In spite of what some people may claim, not everyone is a prospect for your products or your network marketing opportunity. This means that you may have to put in effort to find people who are interested in what you have to offer. Learning how to generate leads is one of the skills you’ll probably need to develop.
It can be challenging to make sales.
While we use an educational selling process and discourage trying to persuade, convince or “close” people to buy, this is a direct sales business. There are still skills to develop around providing information to people, crafting your story, inviting them to take a look at it and asking them to make a decision.
It can be tough to make a lot of money.
And shouldn’t it be? Earning an extra $500 or $1000 per month doesn’t require a high level of skill, you could do that from just your own sales or building a small distributor network. But if you have visions of earning 6, 7 or even 8 figures per year, as some of the best in the profession do, it will require a lot of work and a lot of tenacity.
It won’t be easy, but it will be worth it.
Network marketing is a great way to become your own boss, work flexible hours and make money. Maybe even a LOT of money. It can be a great fit for those with an entrepreneurial mindset and the willingness to put in the time to learn the skills and build a successful team. While there are some challenges associated with building a successful network marketing business, in my mind the pros definitely outweigh the cons.
So what are you waiting for? Start your Network Marketing journey today!
