What is Network Marketing?

Bigun28

There are many issues with Network Marketing (also known as Pyramid Selling) that you need to be aware of. There are many different schemes and people try to mask them in all sorts of guises, but they all follow the same ideology.

Imagine a pyramid where all the blocks below are supporting the ones above. The ones at the top have the most below them. Now compare that to Network Marketing where the idea is to get other people working/selling a/the product for you. Hence, the people at the top will theoretically make the most because they have the most people below them working for them.

Where it starts failing is for those people low down in the pyramid, because some of their 'profit' goes towards paying for those people above them in the pyramid. So the further down the 'pecking order' you are, the less you will make. The basic idea is to make the pyramid as big as possible, so the people above want the people below to build below them. That's why everyone on the site mentioned is trying to recruit. That way, more profit is generated making the people above 'richer'. Also remember that all of the products for you to sell are 'bought' from the people above, each generating their own bit of profit.

The other area which many people initially fail to see is your market. Many will get into pyramid or network marketing because they will believe the hype about how much money you will make – normally hype generated by people at the top of the pyramid who do/can make the money at everyone else's expense.

Yes, you've got loads of friends and family, so you believe you can sell to them and possibly get some of them working for you so that you can build up your own little area of the pyramid. Your friends will probably buy the first few times as a goodwill gesture to help you along. But there are only so many cloths, cleaning products, water softeners, whatever etc that they will/can buy. So you quickly exhaust your market and need to look further afield. If you've recruited friends to work for you, the chances are that you will both be trying to sell to the same circles/groups of people, so the market is exhausted quicker.

To look further afield for new clients you either need to get out (difficult if you're a housewife at home) and introduce yourself to strangers ormake new friends in order to sell, or advertise (at your own expense – they always forget to mention that bit). So after a while, you start to realise that you are not generating as much profit as you thought you would and things are becoming too time consuming for little return. Hence, many people then leave.

Interestingly, if you listen to much of the hype, rarely do people tell you exactly what they sell. Often they just tell you about the apparently 'vast' sums of money that they've made. The only way you can find out about the product is to attend a seminar etc where you get the 'hard sell' pitch and where they try and sucker you in. They'll deny that it is Pyramid selling and call it every other name but. They may tell you that you are near the top of the pyramid, making you believe that you will make a big profit, but often you will be nowhere near. Your probably towards the top of their little pyramid, but not near the top in the grand scheme of things.

I tend to move around a lot with my job and I've had a lot of experience of people trying to push me into these schemes and I've done loads of research with them and about the ideolgy behind them (which all originated from the USA by the way). I've had numerous calls from people at all times of the day and night trying to recruit me. The best advice I can give it to stay clear.

grapefruit

Randal, you do have some valid points but I think you are being a little harsh about network marketing. Yes it does have its faults but like with most things there's good and bad. I think most people in network marketing don't like the term "pyramid selling" because it has connotations of being a scam. Yes, of course there have been dodgy companies and probably still are but if you work for a reputable company you really don't want to be tarred with the same brush. People should be aware of the pitfalls as you've said but I wouldn't say don't do it because at the end of the day there are many thousands of people who are successful.

Yes the people at the top do make more money but they have invariably worked hard for it. What you're forgetting is there's room at the top for everyone if you're prepared to work for it, most people aren't. Yes maybe some people make it sound easier than it really is to make large amounts of money but it is possible. You do need to recruit people but its how you go about and also how you look after people once you have recruited them.

Yes, you're right it can be difficult finding new customers once you've exhausted your family and friends. That's where the support of your company and the "successful" people in the business comes in. If its a good company they will help you.

Network marketing is not for everyone but for anyone who has ever thought about it, do your research before you commit and find a company whose products you would enjoy selling. A good place to look is the DSA (Direct Selling Association).

Bigun28

grapefruit wrote: »

Randal, you do have some valid points but I think you are being a little harsh about network marketing. Yes it does have its faults but like with most things there's good and bad. I think most people in network marketing don't like the term "pyramid selling" because it has connotations of being a scam. Yes, of course there have been dodgy companies and probably still are but if you work for a reputable company you really don't want to be tarred with the same brush. People should be aware of the pitfalls as you've said but I wouldn't say don't do it because at the end of the day there are many thousands of people who are successful.

Yes the people at the top do make more money but they have invariably worked hard for it. What you're forgetting is there's room at the top for everyone if you're prepared to work for it, most people aren't. Yes maybe some people make it sound easier than it really is to make large amounts of money but it is possible. You do need to recruit people but its how you go about and also how you look after people once you have recruited them.

Yes, you're right it can be difficult finding new customers once you've exhausted your family and friends. That's where the support of your company and the "successful" people in the business comes in. If its a good company they will help you.

Network marketing is not for everyone but for anyone who has ever thought about it, do your research before you commit and find a company whose products you would enjoy selling. A good place to look is the DSA (Direct Selling Association).

I agree with some aspects of what you are saying. There are some schemes that are traditional – Avon, Ann Summers etc, and there are those people that can be successful at it. The papers today had the story of one woman who has made a fortune from Avon.

However, my experience (and also the experiences of friends) has revealed that there are also many more bad ones out there.

Network Marketing was always seen as a 'Get Rich Quick' scheme – work from home, only a few hours a day and soon you'll be raking it in. That tends to be the angle that most of the advertising works on. Everyone wants to make a load of money for little work. So many people get suckered in to it.

If people want to get involved with these schemes then fine, it's their choice. But please go in with your eyes open and understand what you are getting yourself into. If you are prepared to work all the hours God sends, then it may be for you. Unfortunately, many people like to have some time to their selves and aren’t that committed.

In my line of work, we move around a lot and we tend to get approached by many of these schemes for a variety of reasons. I have seen countless friends and associates get taken in and then preach to everyone about this 'new fantastic idea' that they've discovered and how they will soon be 'running their own company' and how they will make 'loads of money and be able to retire at 40'. Then when you see them again a year or so later, the realisation has sunk in and they have realised that the 'fantastic scheme' wouldn't work, and they are left with a bitter experience and minus a large sum of money for their troubles.

Money_maker

Beware spamming - pickles 1

ColinAllCars

pickles1 wrote: »

Have you tried selling ebooks, or signing up to some of these money making schemes. I have tried loads, most don't work but I have found a couple that have worked for me. I now make quite a nice little earner on the side.

If you do want to make some extra money in a legitimate way let me know and I will point you in the right direction, just send me a private message.

If you don't chat to me good luck.:money:

Multiple SPAMMER !!! Touting !!!

ColinAllCars

Randal wrote: »

There are many issues with Network Marketing (also known as Pyramid Selling)

They are not the same.

One is legal the other is not.:D

Money_maker

Pickles1 re-registering as pcmoney to defend spam post.

Hauritz

It is the most profitable to do the network marketing online. Internet allows you to build a larger marketing network that you will be able to use more effectively. The network marketing strategy still needs to be created for the online marketing network.