I wrote this article a couple of years ago, and it became fairly popular on several article directories, with thousands of views and many newsletter owners immediately picked it up since it is a decent primer on network marketing.
Why Network Marketing?
Perhaps a better question to ask would be “Why Not Network Marketing?”
Of all the various types of home businesses, Network Marketing has proven itself over the years to be the leading method by which the average person can achieve above average results.
Thousands of people, just like you, join Network Marketing companies every single day. Whether you’re only looking to make a few hundred dollars extra each month or create a large residual income, Network Marketing can help you achieve your goals.
“But what exactly is Network Marketing?”
Network Marketing is a method of moving products from the manufacturer to the consumer via word of mouth advertising. Instead of the middleman (wholesaler or jobber) taking his or her cut before moving the product to the retailer, the ability to earn that money is passed directly on to you, the Network Marketing distributor.
For example, a traditional brick and mortar business model goes something like this:
Manufacturer -> Wholesaler -> Retailer -> Consumer
The manufacturer creates the product and sells it to the wholesaler/jobber who then raises the price and moves the product to the retailer. Since the retailer is in business to make a profit, he too must raise the price. The end effect is that the consumer could be paying a lot more than they should be for that particular product.
The Network Marketing business model is somewhat different.
Network Marketing Company -> Distributor (You) -> Consumer
In this example you can see that the Network Marketing Company is selling the products directly to you, the distributor, and you move then on to the end consumer. This allows you, the distributor, to receive the difference in price from wholesale to retail, which would, in a traditional business model, be taken by the wholesaler and retailer.
But that’s only part of it. When you help someone else get started in his or her own Network Marketing business, you will receive an override, or residual, on the volume of business that person does, which can, in and of itself, end up being a large portion of your overall earnings.
“But I’ve heard that Network Marketing has a 95% failure rate.”
This is true of all small businesses, home and traditional brick and mortar, not just Network Marketing, but the figure tends to be incredibly misleading. People quit things all the time for various reasons, not just Network Marketing. Maybe they didn’t understand that Network Marketing does require work, or they don’t have enough time to build it right now, or possibly the time just isn’t right for them.
Whatever the reason people quit, they don’t want to admit to themselves why they quit, so they end up blaming Network Marketing in general or this or that company in particular. This is why Network Marketing gets such a bad rap in the media.
But thousands upon thousands of people worldwide are earning a portion of or a large part of their incomes directly from Network Marketing. So the business model does work…if you work it.
Whether you get involved with Network Marketing or not is your decision. I’d recommend that you keep an open mind, do your due diligence, investigate several different companies, and then make your decision, based not other people’s opinions, but your own research.
