What is Network Marketing?
Before we get into too much detail about Network Marketing, let’s get a few things straight. First and foremost, network marketing (NM) is a huge industry. In fact, it is one of the highest grossing industries in the world.
Moreover, it is endorsed by some incredible entrepreneurs, Warren Buffet (net worth $72 billion), Richard Branson (net worth $5 billion) and Bill Gates (net worth $84 billion) just to name a few.
Furthermore, the industry tends to interchange the name ‘network marketing’ with MLM or direct selling, although this only leads to confusion. Whilst there is an overlap of principles from one to the other, neither provide an accurate description of what network marketing is, or how it works. So, thanks to Eric Worre, here is the best description and explanation of NM that I have found to date.
What is Network Marketing?
Network marketing is the marketing of products or services through a network of distributors. It is not a business based on sales. It is a business based on marketing and promotion. Put simply, network marketing is a channel of distribution. Think about it in the same way that retail or franchising business models work. They take products or services from the manufacturer to the customer, typically using a shopfront (or online store these days). In a nutshell, this is what we do, just without the shopfront.
“Network Marketing companies empower independent entrepreneurs to monetise the most viral form of marketing, which is word-of-mouth marketing.” Sulaiman Rahman
By using word of mouth advertising, distributors become the ‘middle men,’ and are able to move products, services and or business opportunities with 3 simple strategies.
- Personally. We personally educate others about the value of our products, service or business which are often industry leaders and unavailable anywhere else in the market.
- Building and constantly expanding a network of other distributors doing the same thing.
- As leaders, we implement training and apply strategies to that network to improve its productivity.
Why Isn’t Everyone Doing It (yet)?
There are plenty of reasons for people to both join or not join an NM company:
- Bad experiences
- Poor understanding of the industry
- Believing they have to ‘sell’ to friends and family
- The ‘pyramid scheme’ misunderstanding
- Lack of belief in the industry and in themselves
- Unrealistic expectations of wealth
I don’t list these things to imply that the industry is completely free of any wrong doing. In fact, I know of several companies that absolutely do verge on being a pyramid scheme. But it is becoming more recognised and regulated, and in time I believe it will become mainstream.
Aside from the above, I also acknowledge and accept that not everyone wants to be their own boss. We aren’t all wired to take opportunities or to genuinely believe it’s possible to achieve more. Sometimes people have never considered that there was an alternative.
But My Mum Says It’s Wrong
Social conditioning is an incredible thing. We’re taught from a young age that if you want to be successful you have to work hard in school and get good grades. Then you can get a good job, work for 40 years, and when you retire you get to enjoy some free time. We’re taught that working for someone else is the only way to get ahead and that anyone that ‘makes it’ just got lucky. What a load of bullshit. The people that make it, regardless of what industry they are in, are the ones who chose to do something different!
Network marketing isn’t for everyone. But it is an opportunity. And while you can definitely make some money on the way, achieving a full-time income from NM is a long road. If it is done right, however, it not only promotes the industry, your income earning potential is uncapped and incredible. It is the best way for the average person to improve their circumstances, create an asset, build wealth, and earn residual income.
Did this help you to understand the Network Marketing industry? Are you already part of a company and experiencing some success? Let me know in the comments below or on Social Media!