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What is a Multi-Level Marketing Program?

Apr 25, 2008
Multi-Level Marketing (MLM) also known as Network Marketing, is a system of marketing that allows a parent company to market their products or services by selling them directly through referrals and direct selling of their affiliated companies. This distribution model emphasizes more on recruiting their direct sellers than marketing their product or service itself. In return for the referrals and direct selling, the independent representatives receive commissions on the sales they make.

MLM goes beyond that. The independent representatives will also have to recruit sub-representatives thus creating a multi-level structure of marketing representatives (downline). As the sponsor of the sub-representatives, you, too, will get a share of their commission as well as the commission of your own.

Do not get MLM wrong, it is not a pyramid scheme. An MLM program is legitimate. While a pyramid scheme and the MLM program both involve the earning of commissions, the MLM program involves the sale of products and services with a value proportionate to the amount invested. It is more than a transfer of wealth (which makes pyramids illegal); the program has an exchanging value for the money you are earning.

Advantages of Using the MLM Program

Low Barriers to Entry

You do not need to become a marketing guru to enter and MLM program. Although marketing mastery is a big plus, you can do well just by having the right connections and good public relations skills. As for the cost to start up your own program, it is basically a low-cost investment compared to start-up franchises or small businesses.

Pre-Existing Business to Work With

You do not need to worry about manufacturing a product or doing a service; you will have a company that will do that for you. No more stressing on business plans and systems. You do not even need to worry about shipments and returns. The multi-level marketing program will only require you to concentrate on making sales for your parent company.

Work Can be Done Home-Based

You do not need a corporate office to run your program. You can run it in your own home. All you need is a list of contacts and a computer to communicate with your sub-representatives and clients.

Flexible Hours

Since a network marketing program does not require a whole lot of time, you can run your program full-time or part-time. Your hours are flexible, just as long as you meet your requirements and maintain a well-motivated downline.

Continuing Income

Last, but definitely not the least, your MLM program can get you a leveraged income from your recruiting efforts. As have been said, you also earn commissions from the sales of your downline, apart from the commissions you make from your own marketing. If you have a hard-working and a driven downline, chances are, you will have a strong source of income as a sponsor.

As you can see, employing the multi-level marketing program has its rewards. Forget about the bad publicity it has as it is linked with the pyramid scheme. Remember, these are two different things. The right network marketing program can be a profitable business to run, especially with the advancements in communications technology. Just as long as you build a good and motivated downline and do your part as an independent representative, you are on your way in making big bucks.
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