Network Marketing

Network Marketing

Let’s be honest. The network marketing industry (also known as multi-level marketing or “MLM”) doesn’t have the best reputation. Yes, there are a handful of multi-billion dollar corporations in this field (like Amway), but there are also many, many short-lived companies that appear out of thin air and, very quickly, disappear back into thin air, leaving its distributors out in the cold.

My experiences with network marketing opportunities have been pretty dismal. It is hard to recruit other people into the solid companies that have been around for years. And the “ground floor” opportunities that no one has seen before often end up getting shut down by the government or grow so fast, they can’t handle the growth, and they implode. I’ve even seen some network marketing experts get tired of their companies and focus on teaching others about network marketing (or other businesses),instead of working with an actual network marketing company.

Can you make real, honest money with a good network marketing company? Even though I’ve been burned over and over again, I believe you can. Of course, finding a good network marketing company is like finding a needle in a haystack. And the hype about “just signing up a few people and getting rich overnight” is crazy. Network marketing, like any home business, takes time, money, and energy to make it work. In fact, all of the heavy hitters I know have put in a bunch of time and money to create systems and marketing tools to  make their huge down-lines. It didn’t just happen like magic.

Over the years, I’ve discovered some very interesting “secrets” about network marketing and if they’ll help you save some serious money, I’m happy to share them!

Network Marketing Secret #1:
Many heavy hitters earn MOST of their money selling training materials, NOT in promoting their network marketing opportunity.
Here’s a secret you may not know. Many “Heavy Hitters” (people in a network marketing program that normally create large down-lines) get a large portion of their income from selling training tools, marketing materials, or auto-pilot lead-generating systems, NOT from their efforts in their network marketing company.

Yes, these heavy hitters have, in most instances, created large down-lines in their network marketing opportunity. However, early on, most heavy hitters realize that a majority of the people who get involved in any network marketing opportunity need help. Most people who join a network opportunity are only able to promote it part-time, and many don’t have the marketing or sales expertise necessary to create a large down-line or make many sales.

That’s where the heavy hitter comes in. Armed with books, courses, tapes, coaching, coop advertising programs, turn-key lead generation websites, tele-seminars, and just about any and every product and service needed to promote a networking opportunity, the heavy hitter starts to turn his down-line into a virtual money machine.

Very quickly, checks from training courses, coaching, ad pools, websites, and coaching can eclipse the money the heavy hitter is making from the networking opportunity itself. You see, when the heavy hitter promotes the networking opportunity or sells the products, he has to share his commissions with the company and his up-line. However, when he’s selling training tools or other materials to his down-line, he gets to keep 100% of the profits for himself. 

I’m not saying that it’s wrong for these heavy hitters to create and sell networking tools and courses. But what I want you to understand is that if you follow a heavy hitter into an opportunity, or get involved because a big name heavy hitter is involved, you may want to look at what else he or she is selling. You may discover that they’re using the company to build a large down-line to which they’re then able to sell training tools.

Network Marketing Secret #2:
Do what the heavy hitters do.
Understand that what heavy hitters do and what they say to do to be successful can be two different things. Make sure you’re willing to do what they’re doing if you want to make the money they’re making.

Quite a number of years ago, I was at an opportunity meeting where a heavy hitter was promoting a network marketing deal. I can’t remember the opportunity, but I’m pretty sure it’s no longer in existence. The guy promoting the opportunity explained how easy it was to make money. You didn’t have to talk to anyone or meet people face-to-face. All you had to do was send out an audio-tape and you could build a huge down-line just like he did. 

Here’s the problem: What he was saying and what he was doing were two different things. He claimed you could build a huge down-line by just mailing out tapes. If that was the case, why would anyone need to fill a large hotel conference room and pitch the opportunity for a few hours? If it was as easy as mailing out tapes, I’d expect him to be at home, shoving tapes into envelopes, and taking them to the post office. The truth is that most heavy hitters work very, very hard to create their down-lines. They fill up hotel conference rooms and hold 1-day live seminars to get people involved. They travel from city to city, all across the country, talking to groups about this brand new opportunity.

They’re on the phones, day and night, closing people into their opportunity. They’re doing nightly conference calls, pitching their opportunity endlessly. Yes, it pays off, but it’s worlds different than the “easy” system they suggest you should use to promote the opportunity. I know of one gentleman who has built a $300,000 a year income in one opportunity, and he’s done it by sitting at home, closing people by phone, for years and years and years. In fact, he’s chained to the phone, Monday through Saturday, from 9am to 9pm, taking calls and closing people. While you might think that the income he’s making is phenomenal, let me ask you these
questions--

First, would you be willing to sit on the phone, 12 hours a day, Monday through Friday? That’s 72 hours a week. Do you feel comfortable pitching people your opportunity by phone, over and over and over again, for many years, to build up a six-figure income? Remember, we’re not talking about your first year. We’re talking about doing this, non-stop, for 2 to 5 years or more before you create a six-figure income. 

Second, are you willing to live your life knowing that any day your six-figure income can disappear in a puff of smoke? Imagine putting in these long hours, maybe even reaching your goal of a six-figure income. But, like many network marketing companies, let’s say it crashes and goes out of business. If you’re lucky, your down-line will stick with you and you can move them into a new network marketing opportunity. But imagine the feeling of going from $100,000 a year with a company down to $0 instantly! Especially after putting in all of those long hours. 

If you’re serious about making money in network marketing, I’m not trying to talk you out of it. Personally, I’m not a big fan of network marketing opportunities. Throughout my 19 years of searching for wealth-building secrets, I’ve only stumbled onto a handful that I considered worthy of investing my time and money. However, if you like network marketing opportunities, just be aware that the heavy hitters, the people making the big bucks, are usually doing more than mailing out a few postcards. They’re traveling all across the country, doing live tele-seminars, closing hundreds of people a month by phone, talking to people in person, and putting in a lot of time and energy. Don’t expect to duplicate their incomes if you’re not willing
to duplicate their exact actions.

Network Marketing Secret #3:
The “opportunity” is the always the focus, NOT the product.In many cases, the product that the network marketing company is selling is usually secondary to the opportunity. Let’s not kid ourselves. Often, network marketing companies are built as money-making opportunities first and the product is added as an afterthought. In fact, if you listen to people promoting some of these networking opportunities, you only hear about the compensation plan and possible income. You rarely hear about the product, how in-demand it is, or how well it’s selling. Even if you do hear something about the product, the opportunity to promote it is always the main focus. Rarely is the main focus promoting and selling the product.

Be very, very careful about getting involved in a networking opportunity that focuses MORE on getting involved in the opportunity than in selling a product. Here’s why: there are only a finite number of people in the world. Therefore, there are only a finite number of people who will be willing and able to join any networking opportunity. Without strong product sales, most networking companies will implode, because recruiting efforts slow down when the opportunity hits critical mass. Then, people who came in later find it difficult to sign up new clients and end up moving to a newer “ground floor” opportunity.

I can think of one networking company that is a multi-billion dollar corporation and has been around for years. They’re huge. However, try to sign up other people into this company when just mentioning the name of the company will turn people off. In fact, their name is synonymous with “MLM meetings”. Today, just to get people to attend opportunity meetings for this company, recruiters have to make sure they DO NOT mention the company name. They wait to tell them the company’s identity AFTER they’ve got their audience locked in! 

So how does this company survive? They do it with sales of products and training materials to its members and customers of its members. They continue to create new products and their huge member base continues to sell these products. Yes, there is still some focus on the opportunity itself but product sales are also very, very strong.

If you find someone pitching you a networking opportunity where the product has taken a backseat or it seems overpriced, low quality, or something just “tacked on” to a networking opportunity to make it legal (they have to sell something or it’s a pyramid scheme), watch out! 

Network Marketing Secret #4:
Most people don’t get a single commission check from their network marketing opportunity.
It’s true. Most people don’t get even a small commission check from their network marketing efforts. And many of the people who do get a check don’t make back more than their investment in products and training materials. Often, you only hear about the handful of heavy hitters who are making six-figures in the company. Rarely do you hear about the thousands upon thousands of members making little or no money. However, it’s the one or two success stories advertised in all of the company’s ads that pull people in like crazy.

Whenever someone brings a network marketing opportunity to me, I let him or her know I have ONE RULE about looking at new opportunities. I will ONLY look at new opportunities IF the person presenting it to me... the person who wants me to sign up... has made significant money in the program. So far, that has stopped about 99.9% of the networking pitches I normally get. Most people who contact me about an opportunity like this have “someone in their up-line” who is making a bunch of money. Or they listened to a heavy hitter on a teleconference who is raking in the cash. Rarely, if ever, is the person who brings the opportunity to me making any significant money. I normally tell that person to keep me in mind and once they start making a significant profit (usually enough to replace their income) to come back and present the opportunity to me again. So far, I’ve never had someone return to me with his or her success story and re-invite me to join their program. That, to me, says volumes!

Network Marketing Secret #5:
Heavy hitters get special treatment.Heavy Hitters often get extra “perks” or better placement in a network marketing company as “payment” for joining (since they’ll create large down-lines, bring large down-lines from their old program, and can be a BIG NAME to attract others).

If you had a new, fledgling network marketing opportunity, you’d want a lot of heavy hitters to join your program, right? Once that happens, you can start promoting your opportunity, cross your fingers, and hope that some new up-and-coming heavy hitter will appear from the thousands of new recruits into your program. But the chances of that happening are slim. A better option would be to go to a current heavy hitter, someone with a large down-line, lots of experience, and an in-depth knowledge of how to create big money for their networking company and offer them a special deal.

What type of special deal? Higher placement. Instead of coming in further down the company’s payment plan, the heavy hitter might be placed further up the commission structure, closer to the company, so he can instantly benefit from the work of the down-line that’s already in place. The heavy hitter might also get bonuses, be paid to speak at the company’s annual meetings, and get other perks as well. 

Heavy hitters who have proven themselves rarely have to start from scratch. Normally, they’re a welcome addition to any networking opportunity with the company running the opportunity often feeling obligated to reward the heavy hitters who join their program. Remember, it’s impossible for the networkers on the front lines to know what’s going on in the headquarters. The heavy hitter that joined your program because “he just loves it so much” might have also joined because he’s getting perks that you don’t know about.