The Basics About Multilevel Marketing Businesses

How successful are multilevel marketing businesses? Let's just pump out some numbers here, shall we? Avon, probably the most well-known MLM company in the world, tops $6 billion a year. Amway makes about $4 billion, Herbalife about $1.5 billion and Mary Kay $1.2 billion. That's how well multilevel marketing businesses are doing these days, thanks to the hard work, solid product and service lines and tireless recruitment practices of its members.

What is a multilevel marketing business?

A multilevel marketing business, also known as an MLM is essentially a networking business. Unlike traditional forms of businesses, MLM is made up of representatives, distributors or members who are allowed to recruit other distributors and members to form a downline.

Depending on the business model being followed by the MLM program, members earn by collecting commissions from the sales generated by their downlines and commissions obtained from their own sales. Sometimes, recruiters earn a percentage from the membership fees paid by their downlines. However, in legitimate MLM businesses, this is not the only means with which members earn. Otherwise, the business will be treated as a pyramid scheme.

Are multilevel marketing businesses legal?

Yes. The manner with which an MLM business creates its sales force and pays its members is perfectly legitimate. Problems only arise when unscrupulous individuals begin using the concept of MLM for their own dubious designs, either to promote a business that doesnít exist or a product that is low quality at best. Only when there is a legal backbone to the program and there are real, actual products and/or services being sold to consumers can an MLM be considered legal.

Do multilevel marketing businesses offer real money-earning potential?

MLM businesses boast some of the largest memberships in the world. If the figures reported by MLM companies are to go by, then it's safe to say that there is a lot of money to be made with multilevel marketing businesses. Many people have even made these businesses their main source of income.

However, remember that going into an MLM business is not going to make you loads of money UNLESS you use the opportunity. Like all businesses, a multilevel marketing venture is just an opportunity until you take it, implement it and start earning in the process.

Choosing the right MLM business

Before asking whether a multilevel marketing business will make you money, why donít you ask if it's the right business for you? The products, image, goals and opportunities presented by the company should appeal to you. After all, you will become its representative.

If you donít believe in herbal supplements, for example, you'll probably have a hard time selling products from Herbalife. If you're a man, selling Mary Kay or Avon cosmetics may not be very effective for you. It might probably work but if you're uncomfortable about learning the basics about cosmetics and home products, this is not the business for you.

The point here is to find an MLM company whose products fit your interests and lifestyle. You also have to consider your own preferences and reactions to the products themselves. If you do not trust what your MLM company produces, how do you expect to sell it or at least convince someone to become a member like you?

Success and MLM

It is possible for you to find success as a representative or distributor of an MLM company. It all really boils down to your choice of business to work with and how you will work with your downlines in order to bring in more sales. It's not just about working hard ñ it's also about making the right moves and truly understanding the business.

How You Can Become Successful With An MLM Network Marketing Business

Yes, you can make real money out of an MLM network marketing business. That is, provided you choose a program that uses an effective business model and truly devote your time to grow your business. MLM remains as one of the top money-earning businesses today, whether it operates online or off. To help you succeed in this business, here are several steps you can take to protect yourself and take advantage of this opportunity:

Learn to distinguish the scams from the real thing.

The true causes of many failures in MLM are people falling for scams. The concept of MLM is often taken and abused by unscrupulous individuals and organizations and used to fool people into parting with their hard-earned money. Before you sign up for an MLM business, do your research first to determine if the opportunity is for real.

Find out about the company, its leaders, its background and if you can, interview other members. If it's a real MLM business, you should have real customers and not just derive your earnings from membership fees of recruited members and distributors. The more you know about the business, the better you'll be at making an informed decision later. Check out your State's laws and use guides provided by the Better Business Bureau or check out sites such as Scambusters.org.

Assess the financial demands of the business.

An MLM business will require some sort of initial capital from you, often as a requirement for membership. This will include your fees as a member and probably a starter kit to help you jumpstart your business. At this point, determine whether your finances can handle the expense. You should also try to see whether you could recoup your initial cost within a reasonable period of time.

Sign up for a business that fits your personality.

Not all MLM businesses are alike, so what's good for your best friend may not work as well for you. Consider your interests and strong points. What do you like to do? What types of products will you enjoy promoting? Will your list of contacts also be effective in marketing these products?

Find out about the earning and commission scheme being implemented.

This is another way to determine whether an MLM business is a cleverly masked pyramid scheme. During your research, find out how members will earn in the business. If the commission you'll receive will come only through members' fees, beware.

You might also want to find out if there are other ways you can earn as a member and whether or not there are other benefits that members can take advantage of.

Never miss out on the chance to build your network.

An MLM business is all about your network. You could be a member of one of the most successful MLM network marketing businesses but if you donít build your contacts, your efforts will fizzle out.

Be on the lookout for opportunities to add to your list of contacts. Follow through with leads and help your members build their own network. Remember that the stronger your members are, the better your MLM position will be.

Be a consummate salesperson.

If you're the lazy type, stay a mile away from MLM network marketing businesses. They are a bad fit for you. As an MLM member, you will have to work to sell your products and recruit other members. Understand how your products work and what makes them a cut above the competition. Work on your communication skills, strengthen the network you already have and expand it.

Mafia Marketing Lessons: Five Things Businesses Can Learn From Tony Soprano

1. Trust is fragile. Whether you are dealing with a prospect, customer, or vendor, your relationships will always make or break you. Tony has always been careful to preserve the friendships he felt were valuable. (However, we all know that relationships change over time.) As a business, your reputation follows you. Your marketing, sales, and after market follow up are crucial to your brand's well being. Bad PR can be a nightmare for businesses - especially when it comes to word-of-mouth marketing. If you sell a shoddy product or treat a customer badly, people will find out. They will turn your back on you if you don't set it right. In many cases, they might move on to the competition. (And, help that competition kill you!)

2. Making amends is usually possible. A business can turn bad PR around if they admit their mistakes and seek to correct their errors. Giving money back, offering special discounts toward a next purchase, and making humor out of your foibles can help you if a customer has a bad experience. Offer something up if your company makes a mistake with a person that has given you money. A personal phone call, a free item, a truckload of wine or Armani suits - you get the idea, right? They'll remember how well you treated them.

3. If you want something done right, hire a professional. Tony rarely brokers his own deals - and when he does, he tends to get stressed by the details. Most businesses feel this way at one time or another. If you own a business, more often than not, you should not be the only one telling people what you do. Advertising and marketing are essential to business growth, but as a business owner, you want to focus on maintaining relationships with your customers. Have others that can market your business for you, professionally. Have others that deal with the business muscle.Outsourcing works, but aways make sure to keep the quality in check. Shoddy outsourcing can turn into a nightmare with no ROI at all - and, in Tony's case, serious legal and personal woes.

4. Networking is crucial to marketing. It's who you know - and who they know - that make a difference in your business. Try to network with potential customers in social settings. Local organizations often host networking events in major cities - check with your local Chamber of Commerce. Myspace, LinkedIn, and Youtube are great places for online businesses to hang out and make friends. Send greetings for holidays, learn about your prospects. Keep in touch on a regular basis. Remember birthdays. Know just enough about your customers that you feel like they may be part of the family - and that it's a good thing.

5. Loyalty begets loyalty, in most cases. (Some people, however, are cut throat sociopaths...) If you are loyal to your customers and offer them rewards, they'll feel more involved in your brand. In turn, they may recommend you to other prospects, friends, and family. You won't win brand loyalty with every person you come across, but when you find your niche, and your target audience, you should protect them at all costs. The majority rules when it comes to your online audience - and when you get multiple emails requesting something, such as more information on a product, take a moment to decide to fix it TODAY. When a member of your audience wants more information, give it to them. Then let them know about the favor.

It's true, Tony Soprano has had a bad run of business luck and family issues surrounding him for the past decade or so, but until next week, we won't know how it turns out. Considering that his line of work is a part of a dying breed, he may be unable to stick it out. However, nobody in the world can disagree that the Soprano's has had a great run of it - and we can all learn from Tony's mistakes as well as successes.