Review – Network Marketing Booming Again

  • May 2, 2009

Last week I joined a business mastermind group and I asked them of their opinion on network marketing and direct sales as a business model. I received a very mixed bag response. See below for my response.

Thank you for you wonderful responses.

I threw this question out there because over the last 50 years this business model has created negativity and as a result in my opinion it is not socially accepted. However, I relate this to franchising back in the early 70’s when this business model was emerging nobody trusted it and nobody would buy goods and services from a franchised business. Now over 80% of all goods in the USA and Australia are bought through a franchise model. I believe direct sales is the New Age franchise and is a business model many companies are turning to in this economic climate to move their products. Plus with new technology and the emergence of the Internet you can now extend far and wide to meet new people.

A few weeks ago the BBC did a story on the emergence of Network Marketing in the US and last week there was a similar story in New Zealand. In a recession people turn to low cost/high return businesses to create some extra income. Everyone is looking and this is a simple business that anyone can do. It’s not easy, but it is simple.

Here is an article of Networking Booming In a Recession

Paul Zane Pilzer created an audio and book called The Next Millionaires and he states that he believes “That between 2006 and 2016 – 10 million new Millionaires will be made – especially if you are in direct sales, the Internet, product distribution, or in an emerging trillion dollar industry such as wellness”. It is the transfer of wealth.

More millionaires are made in a recession than any other time in history. It is the time for the “average Joe” to make his/her mark and become one of the new rich. Your income is related to your philosophy, not the economy.

I have been in business for the last 10 years including buying, building and selling 3 gyms and still currently own 2 gyms. I have also studied the Internet intensely and spent over $200,000 on mentors, seminars, workshops and products to be at the top of the knowledge base when it comes to Internet marketing.

Lately I have been studying the Network Marketing model in depth. From their compensation plans, products, distribution, systems, teaching practices, success, failure, human psychology, timing, growth, expansion etc.

I want to share a few key points for anyone considering this business model.

1. Product. You need total belief in the product, it needs to be unique, consumable and not something you can buy in a supermarket.

2. A great company that is debt free with great leaders and track record. Alarm bells with start ups because you do not want to build a great business that falls over because the company has gone under.

3. Compensation is key. You need to be able to make good income. I originally thought that most companies pay the same. But you need to research this in detail because some comp plans pay significantly more than others. As a general rule the company should pay over 50% back to distributors and should pay as deep as 10 levels. If they don’t, do not go there. 4. Timing, Timing, Timing. Start ups are risky, 50 year old companies are saturated. Pick a company with security but yet is expanding Internationally and is bringing out new products.
5. People. Who are you getting involved with directly? Are they good leaders? Who is behind the company? Do they come from a place of passion and Integrity or are they in it for the money with a micky mouse product?

6. Systems. Is your company teaching old school methods of phoning your friends and family or are they up in the 21st century with cutting edge online systems?

If you do not tick these 6 boxes do not consider.

What is critical is the people you will be involved with. If your direct upline is not successful. Find someone who is successful. Because you need great support and mentoring in the early days.

Here are a couple of great resources

1. Brilliant Compensation This is to help with understanding of the model.

2. Your First Year in Network Marketing Book. This takes you on the journey of the business. It is priceless.

3. Next Millionaires Book or Audio. All about timing.

Here are a few tips.

Setting people up the right way. You have to train them and give them all your intellectual property so they are unbreakable. If they are set up right, they will set everyone who joins the business up right.

Interview people to make sure they are the right type of person you want to work with. If they have 50 ways it wont work then they are right and need to be sent off to do some personal development to get their mindset right. The negativity with this business has been created from everyone in the past saying “All you need to do is join up and you will make all this money”. You are better off saying, “I am going to provide you with some information that you can take away and if you want to be involved come back and we will work together.” If this happens you are at least working with the willing. “Those forced beyond their will, are of the same opinion still.”

It needs to be an e-commerce business that has an auto-shipment system. If there is no auto-shipment do not even waste your time.

Thanks for your help and best of luck in 2009


Leave a Comment: