What is MLM? and why are most people afraid of that?

Philippines
September 9, 2009 10:42pm CST
I do too, because before I do not understand the meaning of it. Let me share you something i got from one blog. Multilevel Marketing is one of the fastest growing yet most misunderstood methods of moving products in use today. It has been termed by many as the Wave-of-the Eighties. But, it will go far beyond that. By the 90's more than 100 billion dollars woth of products and services has been moved through Multilevel Marketing companies. As we are in the 21st century watch out! What is MLM? This question is quite frequently in response to a button we often wear or we have seen wearing by others. Let's explain it. Marketing simply means moving a product or service from the manufacturer or provider to the consumer. Multilevel refers to the system of compensation provided to the persons who are causing the product to move or the service to be provided. "Multi" means more than one. "Level" means generation. There are really 5 basic methods of moving products: Retailing. ex. the drug store, the department store,.... You go into a store and buy something. Direct Sales. ex. Tupperware, Avon, ..... Multi level Marketing. This should not be confused with retailing and Direct Sales which commonly is. Mail Order. This can be an MLM but mostly is included in the Direct Sales category. Pyramid Sales.This type of Sales is to often confused with MLM. The fact is, Pyramids are illegal. The main reasons they may be illegal is their failure to move a product or to provide a valid service. If a product doesn't move, how can you even call it "marketing", let alone "Multi level Marketing". Multi level it may be, but Marketing they are not!!! Now, most objections that people have about getting into Multi level Marketing are due to not realizing the difference between MLM, Pyramid Sales and the Direct Sales methods of marketing. This is understandable because most reputable MLM companies belong to the Direct Selling Association. We have been conditioned to think of MLM as door to door direct sales programs because our first encounter with them was when a distributor knocked on our door to sell us something. Anyway, there are some features that differentiate MLM from Retail and Direct Sales companies and on very significant difference is that in MLM you are in business for YOURSELF but not BY YOURSELF. Being in business for yourself means you are buying the products WHOLESALE from the company you are representing. This means also that you can use these products for your own consumption at WHOLESALE PRICES. Since we are buying products WHOLESALE we can, if we wish, sell these products at RETAIL and make a PROFIT. The most common misunderstanding about MLM is the notion that you HAVE TO sell retail to be successful. You may sell if you want to or have to due to your particular program procedure, but in regard to making the larger sums of income, the real success is in building the organization. Let your sales come as the natural result of building the organization. The word "selling" triggers negative thoughts in the minds of about 95 % of the people. In MLM you don't need to "sell" the products in the traditional sense of the word. However, the PRODUCT DOES HAVE TO MOVE or NOBODY GETS PAID. When you build an organization, you are actually building a network through which to channel your product's or services. Retailing is the foundation of Network Marketing. Sales in MLM or Network Marketing come from distributors SHARING with their friends, neighbors and relatives. They never have to talk to strangers. Network Marketing or MLM is building an organization in which a lot of distributors all retail a little. So, you see, its not going door to door every day calling on strangers. Another point that differentiates MLM from Direct Sales is the SPONSORING of other distributors. This is called RECRUITING. When you SPONSOR someone, you are making a COMMITMENT to TEACH them how to do what you are doing, building a BUSINESS OF THEIR OWN. Sponsoring is what makes a Multi level Marketing business so different an makes it grow. As your organization grows, you are building toward becoming an INDEPENDENT SUCCESSFUL BUSINESS PERSON. You are your OWN BOSS. With Direct Selling companies you work for the company. If you decide to quit that company and move to another area, you end up having to start all over again. In almost all of the MLM Programs you can move to another area of the country and sponsor people without losing the volume generated by the group you left behind. In MLM Programs you can make a lot of money by building an organization as your primary function. A Multi level Marketing Organization is not a pyramid scheme. The pyramid is built from the top down and only those in at the very beginning can ever be near the top. And the price of the products or services get every step higher and higher, leaving the people at the bottom broke. In the MLM Marketing everybody starts at the bottom and has the opportunity to build a large organization, even larger than his sponsor's organization if he wants. MLM Marketing is the solution to the distribution costs of the most companies because there will be no more channels between the producer and the consumer. And the most part of the benefit can be paid to the distributors. That is the meaning of MLM to that person.... while now I want to know your views about it? and why some of us afraid to try it. Be honest, maybe we have the same view with it.
5 people like this
8 responses
• India
10 Sep 09
Hi Grecy, you provided much detailed information about MLM. When it comes to me, I am not afraid of that. But I have no interest towards MLM. I hate too. I still see few people in my contacts working successfully through MLM. but it wont suits me as neither i dont have the talent they have nor i am not interested in those works! Have a nice time!
• Philippines
10 Sep 09
That is also my problem, I don't have the talent in that area! LOL Thanks for the response.
• India
10 Sep 09
Haha.. so nice..
@rsa101 (37952)
• Philippines
10 Sep 09
I think the term afraid is worn but rather cautious is much more fitted word to describe what you want to tell us. Well for me, I think I have joined many but I have not found it to be profitable unless you are good at selling or recruiting people to sell for you. Well I am not that kind of a person that is why I am cautious but not afraid to see MLM. Here in the Philippines there has been many MLMs too that exist before and now is not existing anymore. So it is just normal that people are cautious about joining in an MLM because the stability of the company should first be dealt with before deciding to join.
• Philippines
10 Sep 09
so we have to ensure that the company exist for years is that what you mean? How can we see in transparent figure that the company is credible? Thank you!
@rsa101 (37952)
• Philippines
10 Sep 09
Yeah, not all MLM are like what you said in the write up..... Some are just starting and may encounter problems along the way and may go under.
• India
7 Oct 09
Yaar, There so many reasons thats why people afraid to MLM. 1)People thought MLM is a scam. 2)I don’t know anything about marketing. 3)I’m terrible at marketing and I don’t want to bother my friends and family about money 4)I just don’t have the money. Finances are really tight right now. 5)People afraid from rejection. But In my point of view people must not afraid to reject. It is fact of any profession.
• Philippines
11 Oct 09
hello, am not into multi-marketing, and probably it's not good now since we are still in crisis. only those who have good charismatic skills can be successful in the field. this is too much for me, and almost every-time i almost got scammed by asking for a loan. but thing my family and friends were smart enough to refuse me.
@vandana7 (98526)
• India
10 Sep 09
Hi grecychunny, that was a lot of information on the subject. I have a few issues with MLM. First, I am not sure that what lands on my hand is indeed authentic! Second thing is I have to sell the stuff, I am using my friends to make profit! I mean, my friends would give me a good amount any day, but I am doing it on sly to them. That doesnt feel good to use my friends. This is the reason I never went in for insurance agency and such assignments. I want friends for life, and not people whom I need for using them. So MLM is definitely not my cup of tea. As a matter of fact, I do know of a number of people fleeing from Amway agents, the way they run from insurance agent. So thanks but no thanks.
• Philippines
11 Sep 09
Oh you have your personal reason. I understand. I don't want to use a friend to for a money.
• India
4 Oct 09
I should thank you for putting MLM in the right perspective. A great innovative idea, simple in concept, easy to execute and has created wealth for the poor like no Government could ever do. Strong lobby against it from organized business as the middlemen (you can define them... there are too many out there) would lose their lucrative source of income. No surprise that even real giants like reliance industries have started their own net work marketing Company, Aspire. (see more details on the site www.reliance-mlm.com
@Jamian (2603)
• Philippines
23 Sep 09
they are afraid because they don't know nothing at all. ;p I am earning good in mlm, you can check it out in my profile and blog.
@Hatley (163781)
• Garden Grove, California
10 Sep 09
mlms are indeed just the same as pyramid schemes those few on top make monies from all the levels below, and that is just the same as pyramid schemes just more big business bilking all the m any that are u nder him. The people at the bottom are left broke believe me. read about the scamson the net by googlin mlms. you will see that I am indeed right no matter what whitewash they may give it it is still a scheme to benefit just the top few people.