There are basically two methods of distributing physical consumer products.  When the buyers go to the shop to make a purchase, this is Retailing. However, when the products are presented to the customer without the customers going to the shop, this is Direct Sales Marketing.

Direct sales distribution to the customer is differentiated by how the customer is being acquired. When a person acquires the customer, this is known as Direct Selling. Direct Marketing is when the customer is acquired through a media such as TV, Internet or mail order. A customer acquired by Direct Selling may then be sold to directly from the main company where the customer purchases online or through telephone ordering.

Direct Selling is divided into two sections; Single Level Marketing [SLM] and Multi-Level Marketing [MLM]. In both forms of marketing, the customer is ‘sold to’ by a person who is a ‘direct sellers’. Depending on the company rules and regulations, these direct sellers will sometimes be known with terms such as consultant, representative, associate, executive, partner, agent. A general term in MLM is Retailer – the person will basically employ the skill of retailing to sell to the customers where the income opportunity shall be purely based on commission earned through customer sales.

The difference between the two methods is based on how the sales force or prospect is recruited, trained and supported. In MLM, it is often referred to the ‘Leadership Programme’. This programme determines the growth of an organisation.

SLM is the traditional form of Direct Sales where the Leadership Programme is managed and controlled by the Direct Sales company. The direct sellers are known as “Directors” or “Managers” who are given some form of basic salary and are tasked to manage or handle certain regions, areas or sections.

In MLM, the responsibility to promote the products or expanding the sales development of the sales network is being offered to Network Marketers in the form of a Business Opportunity. The Network Marketer promoting the products earn a commission on the purchases made by other Networkers “hired” by them and everyone under the organization. The fact that the expansion opportunity is larger, Network Marketers are able to significantly earn larger incomes than in SLM. This is the reason as to why MLM is now the dominant form of Direct Sales in the world.

As such, a Network Marketing company generally offers two opportunities to a would-be business owner or the direct seller; a Retail income opportunity [Retailer] and a Network business opportunity [Networker].

Nowadays, you heard of many other marketing terms use such as referral marketing, group marketing, etc. These terms are used to the fact that the company actually want to distance themselves from the bad publicity of Network Marketing. However, whatever terms they used, if a company uses a commission based programme to earn from multiple levels of business owners, then the programme is still a Network Marketing business.

As far as many network marketing leaders are concerned, Network Marketing is the best term.

Talk soon,

Jailani

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Yesterday, I met a prospect who wanted to know more about MLM business. At the end of the meeting, even though he did not make any decision to join me, it was a fruitful meeting after all. The fact that he personally admitted that he now understand how it works, was good news to me.

Network marketing is actually easy to execute if you understand how it works. That is the reason why any person regardless of their experience and background can do it. What it takes is the willingness to be taught and guided to duplicate the know-how to do it. You need to built relationship with your prospect and be truthful to them. Refrain from having a hidden agenda. Just tell them the truth, built the trust, and you could be heading towards a positive result in expanding your organization.

During the meeting, I managed to address all his concerns about the business. One of the questions was whether a person needs to maintain a minimum personal volumes (pv) every month in order to use the products. These are my replies to him.

Depending on the company’s policy, most of the direct selling companies will require you to join as a member first before you can buy any products from them. You need to be sponsored by the company’s independent distributor. The membership varies from one company to another. Some even will offer you a one-time membership fees. However, some company do not require you to be a member to purchase their products, but instead of getting a cheaper price, you will be charged at a higher price which is sometimes referred to as retail price.

Even if you are a member, that doesn’t mean you will have to buy the products every month or maintain a certain pv set by the company. The only benefit that you will not enjoy is that you will be charged at a higher price. However, if you feel that the products are good and effective, you may wish to sign-up for the monthly autoship program where you will enjoy the cheapest price. The monthly autoship item(s) should be equaled or more than the pv set by the company in order to get the best price. Those who have to maintain the minimum monthly pv are those who loved and believed in the products, those on monthly autoship program and business builders.

If you want to earn money from using the products, then you may wish to maintain a monthly pv or sign-up for the autoship program. But, if you want to earn “big” money, then you have no choice but to be prepared to maintain the minimum pv; as you are not only a distributor, but a business builder as well. In other words, network marketing is your business. The question that you have to ask yourself is “What is the definition of the monthly pv maintenance to you as a business builder?”. Do you define it as a business investment, or just for the sake of maintenance for the purpose of earning money?

As a business builder, you must be clear of your position in the network marketing industry. You must use all products first before you want to share with others. In fact, your monthly maintenance can never be equaled to the number of products you used or consumed every month, unless you only have a single product to market. Your monthly expenses will initially be high because you need to love the products first. It will be easier to share when the products work.

If you want to start a business, you have to invest lots of money and time. Generally, there is no big different between setting up a traditional or network marketing business; you still need money and time – either big or small. Can you find any other business that needs a low investment than network marketing business? You decide.

Network marketing is a ‘people’ business. Whether you are a consumer, a distributor or a business builder, you can still earn income by sharing or recommending the products or business opportunity to others. Even if you earn 10 cents or 10 dollars, it still money.

What is your status in the industry? Are you just a consumer who benefited from using the products; or a distributor who share the products to earn extra income, or a business builder who build a career and empire in the industry? Be clear of your position, be clear of what you want, be clear of yourself.

Talk soon,

Jailani

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