Network Marketing/
Multi-Level Marketing Explained
Multi-level or network marketing is nothing more than a way of doing business. It is a distribution process where a company chooses to sell and distribute its product through independent sales representatives (distributors) instead of spending mega dollars on traditional marketing costs - mainstream advertising, marketing and distribution.
The advertising is primarily done by the independent distributors. The distributors benefit because they are paid the money that would have gone to traditional advertising, marketing and distribution. The company will typically provide advertising and marketing guidelines as well as materials that can be used for promotion. Most companies will have an extensive website which the distributors use to promote their products and to bring new people into the business.
This method is much more effective in getting a product into the hands of customers in a timely manner because it works at the grassroots level. People are much more likely to make purchases when the products are introduced and recommended by someone they know or have a relationship with. Potential customers also like the fact that they can contact the person who sold them the products if there are any problems.
Network Marketing companies do not allow their products to be sold "over the counter" in retail stores. They would be shooting themselves in the foot if they did – they would be sabotaging their sales force (distributors)/advertising department. And, it takes much longer to get a product on the market, recognized by shoppers and marketed in retail stores (many years) than to print promotional material and build a distribution team. Not only that, the products would be competing on the retail shelf with other products, with no one to explain the special benefits as a distributor would, and the perceived value of the product would be lost.
With some companies, health and beauty aid products can be sold in medical offices or beauty salons as long as it is done on an appointment basis and the professional is a distributor with the company.
So there are many advantages for a company to choose this model over the wholesale distribution method. In fact, the wholesale distribution step is virtually eliminated because the product goes directly from the manufacturer to the purchaser via an independent distributor. Many times the purchaser will place their order online and the product will be shipped to them directly making the process seamless.
Is it a good thing? It can be very good if the company is legitimate and stable and the product actually does what the company says it does. One important aspect - the company must have a product in order to be legal.
If all the right "ingredients" are in place, it can be a godsend for mothers who want to stay home with their children instead of paying for daycare find multi-level marketing a good solution. In a lot of cases, after paying for good daycare for their children, what's left in their paycheck is pretty small. Additionally, people who have lost their jobs because of economic conditions or because of changes in the viability of the industry they are in are perfect candidates.
People who are unhappy with their curent job often would love to do something else. Network marketing fits in well in this situation because traditional career change usually involves additional training of one sort or another and could be very costly.
Finally, there are people who just want MORE MONEY!
This can be a great vehicle to supplement your income, but you must be able to commit the time and energy needed.
Anyone thinking about creating an additional income stream through network marketing or multi-level marketing needs to do the necessary homework before becoming involved with any company. Ensure your success by doing your homework!
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