Network Marketing – The Benefits, Drawbacks, and Tips for Success


There is a chance that you’ve got a an idea of what network marketing (also called multilevel marketing or direct sales) is about: housewives shopping or selling Tupperware while eating finger food or a salesperson with a high pressure trying to convince you that you could quickly become a millionaire, if you and your friends, and their friends will purchase the item. 

Network Marketing, Multi-level Marketing, multilevel marketing

However, the reality behind network marketing is hard work is needed to succeed. It’s not a pastime or an opportunity to make money; instead, it’s a chance to earn money working full-time or part-time.

What is network marketing?

The concept of network marketing refers to a commercial model based on independent sales representatives who sell to other people, typically at their homes. It is possible to establish your business partner network or sales representatives to help create prospects and make sales should you decide to start an enterprise in network marketing.

While numerous legitimate companies offer network marketing, some have been classified in the past as pyramid schemes. They may emphasize the hiring of salespeople who might be asked to buy costly starter kits in advance.


Multilevel marketing (MLM), cell marketing, affiliate marketing, direct marketing to consumers, referral marketing, and home-based business franchising are just a few terms that are used to define network marketing.

Network marketing firms often create layers of salespeople. In this, salespeople build their own salespeople’s networks. The people who begin the new level (or “upline”) are paid commissions on their own sales, as in addition to the sales of those who are in the tier that they created (the “downline”).

A different level could emerge in time, offering an additional commission for the top tier and the middle and lower tiers. So, the profits of salespeople depend on their recruitment and sales of products. People who joined early and are now in the upper level earn the highest.

Different types of Network Marketing

#1. Single-Tier Network Marketing 

Join an affiliate program to promote their products or products via one-tier network marketing. It is not necessary to find other distributors as direct sales will be your sole source of revenue. Avon is a brand of cosmetics that uses a single-tier marketing strategy for networking.

Specific affiliate networks offer you a fee for driving traffic to the affiliate’s site. Single-tier networks also include pay-per-click (PPC) and pay-per-lead (PPL) affiliate schemes.

#2. Two-Tier Network Marketing

In contrast to single-tier network marketing, the two-tier network marketing model needs some recruitment; however, your salary isn’t contingent on this. You’re paid by direct sales (or traffic that is directed to a site) in addition to direct sales or recommendations generated by distributors or affiliates that you contract to be your employees.

#3. Multilevel Marketing

Multilevel Marketing (MLM) is one of the two or more-tiered marketing network that is based on distribution. Name-driven networks and marketing-driven networks are two other types of strategies for marketing in networks. There could be incentives to recruit in certain MLM programs since you could earn cash five or more levels deep.

The Benefits and Drawbacks of Network Marketing

There’s a stigma attached to companies that market through networking, particularly those with many levels. They could be described as pyramid schemes. That is, salespeople at the top tiers can earn huge amounts of money from commissions earned from their lower tiers. The lower ranks have a lower chance of earning money. The company earns money by providing high-priced starting packages for new employees.


The attraction of these network marketers is that they allow those with determination and excellent sales skills to establish an income-producing business with a modest initial investment.

Based on the Federal Trade Commission (FCC), the single-tier networks used for marketing are more secure than multi-tier systems. People are judged by the number of distributors they sign up for.

What is Network Marketing? Network Marketing work?

Multilevel Marketing (MLM) Cellular marketing, direct marketing for consumers, affiliate marketing, refer-marketing, and franchising for home-based businesses are just a few words used to describe network marketing.

Network marketing firms often build salespeople in layers where salespeople are enticed to recruit their salesperson networks.

  • People who create the new level (or “upline”) are paid commissions from their personal sales, as also the sales of others who are in the tier they begin (the “downline”).
  • In time, a brand new tier might be created, offering additional commissions to the top tier and the intermediate level.
  • The income of a participant in network marketing is contingent upon the product’s sales and the recruitment process.

Anyone who joins the team of network marketers has to go through two steps: education and the second is sales.

#1. Training

Following your joining, the initial step is to be an official distributor for the company. You’ll be the primary person to sell the items from now on.


Since the job involves selling and recruiting distributors, you’re joining, or your sponsor will offer you comprehensive sales and product training.

The firm will provide you with details about the product along with promotional items such as brochures for advertising and Marcom tools that will aid you in your first steps with the business.

You’ll be able to understand the complexities of the product line of your business as well as the safety and quality requirements they have to adhere to, their performance with the competition, what kinds of questions customers can expect, as well as solutions to the most frequently asked questions in addition to other information.

Many companies offer sales training as well as recruiting new employees. In the majority of cases, a short workshop is used for this.

#2. Sales

You are now prepared to start working after the company has taught you how to sell products and product information and has given you the right equipment and resources, along with a start-up program. Your mentor will be with you throughout your training and will assist you in getting into the business.

The process of identifying or making an inventory of potential customers and selecting them, making an appointment for them in person, and then giving them the MLM business plan, addressing questions and helping them in making a choice of joining your Network and then following up with them regularly in order to make a decision that is positive will become a part of the selling procedure.

Registering as distributors, getting training on products, selling and equipping them with tools, marketing material, and a starting kit is an element of the process, encouraging them to work with them to assist them in building their networks.

In addition to utilizing and establishing an agent network for distributors, you’ll try to boost sales at your retail store. Your friends, family neighbors, your local community, and your coworkers, as well as your company, and other companies with whom you have connections, are all worthy of inclusion on your list of potential prospective retail sales customers. That’s how a simple Network Marketing business plan works.


What are the requirements to be successful in this field?

#1. Make wise choices

When it comes time to select an option, there are six essential elements to be considered. First, reliability. What is the age of the business? The second is the high-quality products or services that consumers will require and will.

The third factor concerns the plan for pay: just how fair and fair is the distribution overall? This is important as the pay plan decides how you’ll be compensated or not. There are just two questions to ask in this respect what percentage of every dollar of sales goes to distributors each month? And how fair is the distribution of the pennies among members who are new and those who have been around for a while?

The integrity of management and the company is ranked as fourth. If feasible, look into the CEO’s background, experience, history, and theirexperiences in the field of network marketing. Did they have any success in other companies in the field? Have they got a good history?

The fifth element is timing and momentum. Review the business’s current situation, how it’s doing, what’s happening with it, and if it’s growing.

Training, support, and management systems comprise the six and final items that are on this list. It is possible that you have found an outstanding company with exceptional management and products that can make a difference. A compensation program that is incredibly equitable and generous and steady and in motion. However, none of that is worth a lot unless you have a practical arrangement. The majority of businesses employ the concept of transferable training, where mentorship comes into play.

#2. Do what they are teaching

You need to have the ability to pay attention and learn from your mentors to be successful. Due to the way the business is organized, it’s in the (MLM veterans from your company’s best interest to ensure that you are successful, which is why they’ll be willing to share with you the process. What your mentor accomplished to get there is possible to replicate. Still, you must be ready, be open to learning, listen and adhere to the systems.

#3. Review the upper-ups

Various names refer to it; however, the most popular term is “upline,” which refers to those above you. What are their strengths? Do they greet the person you are addressing by your name? Do they help you with creating a strategy? Do they care equally about your success as they do their own? You should be able to contact your top line and be able to call anytime and tell them, “I need some assistance.” The amount of assistance you receive from people in the top positions in the company is vital.

#4. Start by taking the lead using your downline

Within the Network Marketing sector, there’s a term for those that are not formally introduced. Still, the person who introduced them is so busy recruiting new people that they cannot instruct and train the new recruiting process. It is recommended to commit a minimum of 30 days with someone new to the field in training, coaching them, and holding their hands until they’re comfortable enough to venture out independently.

You should ask yourself whether you’re willing to follow through. Are you able to do this? It’s all about forming long-term relationships with your colleagues here. It’s not about just inviting people into the company and then moving them on. It’s about working with them and helping to build relationships.

#5. Utilize the internet

Many people are heavily relying on the internet for marketing. It is possible to create autoresponders for your website so that when you receive leads, the autoresponder can contact the leads. Following up is among the most crucial aspects of the business. Many individuals will receive a phone call from an interested person or may contact the person to indicate their interest; however, they do not follow up. The automation of the internet has made it possible for a much more reliable process of follow-up.

The main drawback of using the web is populated controlled by spammers. If there’s one thing that I would advise against making use of the internet for marketing, that’s spamming. Because it could damage not just your reputation, but as well your reputation as a company you’re working for.

#6. Make sure you take good care of your business

This is a firm that requires the services of an accountant as you would running a franchise or a shop. In terms of tax, you can take advantage of the same tax write-offs when you run an enterprise that is full-time, so do your research before you sign up before you begin to earn money from it. What effect does this affect the tax implications of your business? What type of write-offs do you have?

It is essential to form a support group of people around you. I would suggest looking for lawyers in the field of network marketing who are knowledgeable about the various regulations and their impact on your company. It is also possible to find Accountants specializing in dealing with businesses that operate from home, specifically in direct selling.

Can I Earn Money joining a Network Marketing program?

This isn’t impossible but unlikely. Certain people are extremely accomplished at network marketing due to their ability to attract new members to the Network. Making commissions from team members’ sales in the downline are the two primary sources of revenue. The more people in your downline and the more money you earn – and the larger your team you’ll be able to build and the higher the amount of money you’ll earn.

A majority of those who sign up to legitimate network marketing companies earn minimal or no money even. There is a chance that they will be unable to make funds. There are people who may be involved in a fraudulent pyramid scheme without even realizing that they are interested and could lose all the money they’ve invested. Before you join, take some time to research the subject and talk to others about the scheme.


Are network marketing and advertising an elaborate pyramid scheme?

The pyramid selling plan works in a similar way to Network Marketing in the form of attracting individuals for the Network.

Are network marketing opportunities a viable job?

The majority of network marketing firms are based on the same idea: customer satisfaction. We can conclude this: the outlook for network marketing in the coming years is positive in India, and the sector is expected to create a lot of job opportunities. You can join any of India’s best direct marketing businesses to earn an extra income.

Why is network marketing bad?

As a result, most businesses will offer products to protect their schemes; no law declares the operation of this type illegal since MLM promoters can attract certain prominent people in their fold to demonstrate their trustworthiness in the beginning.


Originally posted 2021-12-08 18:21:00.

Leave a Reply