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Network Marketing - 4 Reasons Why They Have Such a Bad Reputation |
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Written by R. E. Bloom
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Wednesday, 14 May 2008 02:59 |
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How come it is that even though businesses that pay people commissions to sell products to their family, friends, and others are heralded as such horrible businesses when anyone in marketing would agree that word-of-mouth advertising is the best way to sell products?
by R.E.Bloom
How come it is that even though businesses that pay people commissions to sell products to their family, friends, and others are heralded as such horrible businesses when anyone in marketing would agree that word-of-mouth advertising is the best way to sell products?
Well, as I and others have observed in the last twenty years in the industry, there is a trend that very well may be causing this bad wrap, if not at least a major player in contributing to it.
I'll name it DEFAULT
This is something that has been experienced by us all in the industry. We get into a program and set it all up just right. What a blessing it is! We have money coming in that we never knew possible. The birds are chirping and the blooms of the day fill us with awe and wonder. The, suddenly and without warning, everything diverts back to DEFAULT. Storm clouds close in. Appointments are missed, all decisions are delayed, hours are lost, emotions run on high, and a ton of other things go wrong. Simply because of DEFAULT.
Nearly all businesses run on the pyramid plan-not just MLM types. At the top is the CEO, the president, the great leader. He or she has a few trusted associates who help run the show. These operate at the second level of operation, and usually receive a slightly lower pay. They, in turn, have others who report to them. And on it goes until at the very bottom, and at the lowest pay scale, rests the largest group, the factory workers, laborers, cleaner-uppers. To get from the bottom to the top of the pyramid is very rare in conventional business. But everyone knows that this is just the way businesses are run.
Then MLM comes along and changes the paradigm... so they say.
"Just stick with us, and we'll show you the best business in the world. In our business, you don't have to stay on those bottom levels and get paid less that the president. You can enjoy living like a CEO, have vacation whenever you like, travel the world in style, and even have oodles of time to spend with your family" and on and on and on they tell you. They draw circles all over a piece of paper and who you how it's possible.
All goes well... for awhile. Then one dark, dreary day you realize your American Dream, with all the fine-tuned settings you have struggled so hard to make, has gone into DEFAULT. And you find yourself again on the bottom of the pyramid, just like in conventional businesses.
Most people don't realize that nearly every network marketing plan is designed with a DEFUALT button. This causes it to go back to the old pyramid style of big CEO at the top racking in the cash and little guys on the bottom scrounging around for whatever little money they can make. This DEFAULT system works with various methods. They're called by a variety of names, but we'll list only four here. I think you'll recognize them.
1. Jump Start: The company knows most people won't go beyond the initial "buy-in". So they sell you a package and gets profit from the "introduction packet" they sell you and free advertising you give them because you are "pushed" to tell everyone you know and to do it fast.
2. Breakage: when you have to give up your "points" or "bonuses" because you didn't meet some monthly goal. The company keeps the money.
3. Break-away: when you "advance" to a higher level you leave behind some earning potential you had struggled hard to achieve. The company keeps the money.
4. Exhaustion: The company wears you out quick by requiring monthly quotas of new people enrolled knowing full well that you will eventually get tired and give up. Because the average recruit will only be able to enroll 2-3 people, the new enrollment requirement is kept high. When you leave because you're too tired, the company gets to keep all those new people and the money they're bringing in.
This is a short description of some of the ways network marketing companies make the big profits. They are designed to cause your own businesses that had lots of earning potential to DEFAULT back to you being the little guy on the bottom of the conventional business pyramid.
But the good news is that not all MLM opportunities do this! Look for those who specialize in helping the "little guy", who don't use the mechanisms mentioned above.
About the Author:
There's hope! Check out the industry first in real helpful attitudes for the little guy at BioGenX. You'll be impressed. Visit BioGenX today!
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