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Why 97% of Network Marketers Fail To Break Even

Oct 12, 2007
One of the biggest and best-kept secrets in network marketing and MLM companies is that 97% of affiliates end up losing money instead of making it.

That's a shocking statistic, isn't it?

Every day, spurred on by the promise of financial freedom, thousands of people join the network marketing industry. Several months later and in some cases several thousand dollars or pounds worse off, they give up, disillusioned.

Which is a crying shame since armed with the correct knowledge and a plan of action, network marketing or multi-level marketing as it is also known, is the single best way for ordinary people to make extraordinary incomes.

So why do so few people make it? Surely they can't all be so lazy and incompetent that they can't make the grade?

Of course not!

The problem is that in no other business are there so many people with so little idea about sales and marketing trying to teach other people who are equally clueless about sales and marketing. Nowhere is the phrase "the blind leading the blind" more apt than in this industry.

Not only are the usual methods employed in the MLM industry ineffective, they have also tarnished its reputation almost beyond repair, giving network marketers the reputation of door-to-door snake oil salesmen or fake Rolex peddlers.

A mass of hot air, hype and even downright lies are passed down from one sponsor to the next.

Lies such as "everyone is your prospect", for example. Contrary to popular myth, many people are perfectly content with their current job, income and way of life. Others hate the idea of network marketing and would sooner cut off their own arm than be involved in it. Some people believe that making lots of money is a bad thing. Some people are frightened to death of anything that involves the slightest element of risk. There are a hundred other reasons but the bottom line is that everyone is not a prospect and it's a waste of your time, energy and not to mention your self-respect trying to recruit people who have not shown the slightest interest in what you have to offer.

As a business owner it's not your job to try to convert people. You're not a member of a religious sect! And think about it, what kind of first impression are you giving to a prospect? By forcing your business opportunity down their throat unasked, you've just shown them how you do business yourself.

The reason MLM uplines love to propagate the myth that "everyone is your prospect" is because they want recruits to think that a networking marketing business doesn't require any money to get off the ground and is thus ideal for the average person who doesn't have a lot of spare cash and would be put off by the concept of a marketing budget or the idea of having to spend money to make money.

What they fail to disclose is that poor advertising methods lead to poor results. And worse still, by using the much-hyped "speak to everyone you meet about your business" rule, you are showing your prospect that you are the kind of business person who isn't professional or successful enough to invest in proper marketing. Which immediately gives a cheap, "hustler" impression.

Who wants to work with someone who advertises their business this way? Do dentists or doctors hit the streets peddling for custom? Hey there, got any aches and pains I can take care of for you?

Of course, if you speak to everyone you ever meet in your day-to-day life the chances are high that eventually you'll hit on someone who is interested in making a secondary income. But even then they are not likely to take you seriously because you've already shown them how you do business and unless they like the idea of pestering every person they know, they're not going to want to get involved because they'll figure if that's how you prospect for recruits, that's how they'll have to do it, too.

So what's the answer?

The simple yet devastatingly effective answer is the same method as is used in any normal, brick and mortar business the world over:

Get the customer to come to you first

using an effective system of lead generation and marketing. A customer who is actively seeking what you have to offer is the only kind of customer worth spending time on. This is the way every other type of business the world over functions and once network marketers stop believing that "everyone is their prospect" and start using proper, systemic marketing methods they discover that network marketing can be simple, fun and extremely profitable!
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