I know this sounds like a stupid question, BUT most people never make any profits from their MLM businesses. It may have something to do with the high level of attrition, so I am going to show you how to avoid it!
My History
Ok, so I lost money on my first three ventures into Network Marketing. Not a lot, but in 1973 I really didn’t understand the industry. I joined a company called Aladdin, and 10 years later had two attempts at Amway. I got to use a lot of great cleaning products, but the end result was lost friends and the sale of 3 cans of glass cleaner!
The next time, I took a different approach. I used advertising, health shows, called people I knew, etc and kicked my business into profit in 3 months. For the 14 years since then, I have earned some sort of profit every month. It hasn’t always been plain sailing, but my best month was just over $15,000 in commission.
What Normally Happens
You meet someone who has an income opportunity. This is going to change your life and get you out of the rat race for good. You can achieve your dreams if you only believe!
You are connected to someone who is successful in the business, and sometimes guided to a webinar, conference call, or meeting where a bunch of people rave about the company, business, products, and all the money they are making. This gets you really excited and you part with some cash to get started.
Phase Two
The fast start manual usually tells you to go call everyone you know, and put an offer to them to talk to your up line. You are told it is a numbers game and that someone will be interested. This is the way it works. For most people, they work through their list, have some success for the first few months, then those people don’t recruit anyone and drop their orders. They are left with a garage full of products, phone bills, and vehicle expenses. Some find a leader or two, and their business starts to grow.
Phase Three
Once you exhaust your contact list, you may turn to advertising and promoting to people you don’t know. The internet is full of ways to part you with your money. There are purchased leads, lead capture systems, unlimited advertising opportunities, countless courses teaching you how to attract people using the net. There are virtually unlimited ways to promote your business and max out your credit card in the process.
| The focus for most Network Marketing business is to recruit new distributors. |
Now I know that means an illegal pyramid scheme, but since Dexter Yager of Amway figured out that a recruiting system made more money than selling products, this has been the main focus of those wanting to get rich! It is OK if you have a large pool of cash to start with and are prepared to part with it, but for everyone else, there must be a way to get paid while you build.
An Alternate Model
Back in the days when Amway and Herbal Life started, the focus was on selling products. I remember visiting my Amway “Direct” and he had a garage full of products for his team. Now we don’t have to hold inventory, many forget that success is built on product sales. I maintain that to build a solid long term business, your main asset is loyal customers who stick with products that have changed their lives for the better.
If each distributor in your organisation maintains a customer base sufficient to cover all their expenses, then the commission becomes profit! The fact is that these solid, long term businesses were built on the backs of regular customers. Somewhere along the way everyone forgot this and started focusing almost entirely on business partners. Distributors now leave in droves – disillusioned.
Network Marketing Revival
For many years, I grappled whether it was better to chase business builders or customers. What I have found increasingly over recent years is that when you start a recruiting drive, everyone wants to recruit you instead! There is so much reverse marketing it is getting ridiculous. On the other hand when I find new customers they are rarely talking to another network marketer, and because they want my product, they are not trying to enro0l me in their gig!
What I Did With This Knowledge
Well I decided some 6 years ago to start marketing products using the internet. Since then I have honed my skills to reach more and more people who are interested in what my products can do for them. Network Marketers contact me, wanting to learn how I do it. Some join my Network Marketing business. It means I can spend time at home writing interesting articles like this one, and spending quality time with my family and 5 year old daughter.
The Perfect Business
Robert Kiyosaki calls Network Marketing the perfect business. He is right, providing you learn how to leverage. I have now made available everything I learned along the way for you. Simply learn how I did it, with step by step instructions on how to set up your own systems, build your own, and then share it with your organisation.
It is not the only way, but I have proven it works over many years. Learn more by visiting http://mlmprofitbooster.com
John Gaydon
Hi John,
I can relate to your article. I too marketed offline and went through similar experiences. Switching from offline to online marketing has been a very exciting journey. I have tried many different approaches and I am a true believer in attraction marketing. It is important to get connected to the right people at the right time with the right system, and it works!
Leverage is the key to this business. You cannot do it on your own. Well, maybe some people can, but I have discovered I need to use leverage intelligently to reach my goals. I love this business and the fact that we can learn from each other makes a huge difference than trying to do it alone. You showed the perseverence you must have in this business and I think new marketers really need to take note of what you had to overcome to get to where you are today!
Thanks for an excellent article and sharing your experiences.
Raena Lynn
Hi John…
Excellent article. I like the part about after all the years of trial and error, you discovered using the internet and the attraction marketing principle. It is refreshing to be able to read that there are individuals who are confident enough to share their challenges with others…to show others that it can be done through different portals than the usual friends, family and those you love to annoy:).
Martin
It is all about giving real value to people. I agree you must first find those who want what you have to offer. Every business must have customers to survive! Don’t forget that the distributors must also become the best customers of their product. You can’t sell what you don’t believe in!
Interesting comment about “reverse marketing”. I suppose if someone is trying to recruit you, there is no harm in trying to recruit them into your business. I’m not a big fan of that though, I just tell people I am happy with what I am doing, and that I am open to keeping in touch. Things change, and by keeping a professional profile I find that sometime people will want to talk to me later if what they are doing doesn’t work out.
Everyone has their unique story about life, business, relationships, etc. It’s always interesting to learn about the journey someone went through to get where they are today. You’ve certainly been open to sharing your story with us throughout your blog posts. It reminds those that still haven’t earned what they expected, to be hopeful, determined, and to keep that belief that network marketing can be the answer if we go about it the right way.
Thanks for sharing your story again John!
-Jaclyn Castro
John,
I enjoyed your post but have a bit of a different take on network marketing. I am not against it in any way. I think it’s a wonderful business model. I am all for empowering others to be their best and have always been.
Like Joyce mentioned, I too have not made much money in network marketing after 10 years and it caused me to take a long hard look in the mirror. Now, we’ve all heard that the only way to fail in network marketing is to quit. I don’t agree. Some get in and don’t work the business and they get what they reap. But, some give it all they’ve got and still don’t make the money they expect.
The questions becomes at what point do you make a solid business decision and move on? I know there are others like me out there, still with an eager entrepreneurial spirit, but frustrated and disappointed with their network marketing results.
That’s where I am now putting my attention – on coaching those folks who have learned from network marketing but have not been financially rewarded. I coach them to discover their true passion and to learn how to make a good living with it.
Thanks for letting me post here. I encourage all in network marketing to press on, but for those who find they cannot I’d be thrilled to speak with you.
Warmly,
RICK
(Not sure if my CommentLuv is working properly with the blog change so here’s my new URL http://inspiredandinbusiness.com.)
Hi Rick,
Thanks for the comment. I understand if you are not making money after 10 years, something is wrong!
Thinking back, I would say that massive action in the early months has made all the difference for me. First I won’t join something I don’t believe in, and the few times I have been persuaded otherwise I quickly lost interest. My ability to share what I am passionate about with lots of people stems from a belief that they will really benefit. I set up systems to position myself as an expert, and then just keep promoting. Commentluv doesn’t work on my blog since they changed it, so I had to remove it. A bit of a pity, but out of my hands.
I know most people don’t make it in MLM. I am putting some more thought into this and hope to have an article about it in the near future.
Great post John and so true. Everyone thinks their company and products are the very best out there. I just chuckle when other marketers pitch their fabulous company on me. I found I much rather enjoy offering Free Recruiting tools that will help any Networker in their business.
Have an awesome day and enjoy Networking!
Lynn
Hey John,
I love how you always throw your authentic voice out there!
I personally think it’s good to have a healthy balance of reps and customers in your mlm business.
When aspiring networkers learn how to effectively build relationships without a outcome attached and learn how to market their business,they will then crack the code to success in this industry..
Your advice and story can help share an important perspective to those already in the biz or looking to jump in.
Congrats on all your success in the industry..15k is not a bad month at all.
-Ro
Thanks Ro,
Love your work by the way! Those reading this can learn something from you!
Really enjoyed your article John. I was in direct sales as a district manager for my company for nearly a decade and many of the same principles apply. I’m glad to see a growing number of people approaching network marketing on such a smart and professional level.
Hello John
One of the main difference in network marketing and other types of business is the ability to leverage. What is sad is that many people never understand the concept of leverage. Thanks for sharing your experience and how you have used you knowledge to create leverage.
Thanks
Perry A Davis Jr
Music City
Hi there Joh,
A really well worked piece on the pitfalls of Network Marketing. Many people do not understand the residual benefits of MLM and just expect to be in the money from day one – hence lots of cancellations in the early months. Little do they realise that if we have stickability we all benefit from the long term compensations plans that these companies offer their members . Find a business , find a good and helpful sponsor and then stick with it, I say. But those initial choices are crucial….
be careful, study and then take the plunge and remove the bridge!
Best wishes
Pete
HI Pete,
I appreciate your input. Wise advice for everyone reading!
Thanks for sharing this John,
It seems like a rite of passage in Network Marketing to struggle at first. Those who persist and adapt like you have end up thriving.
I am SO glad that I don’t have to hold a garage full of inventory for my team!! Ye-ha!
I agree with you and Robert Kiyosaki and feel that Network Marketing is the perfect business model. When it is done correctly, the results can be amazing!
John,
Love your video in your top sidebar widget. Looks like you’ve lived a very interesting life! I agree with you 100%. There are so many benefits to attracting customers and not trying to “recruit” distributors. If they like your product, then customers will stick with you. If they really like it they’ll tell other people about it. If they really, really Love your product, they’ll ask to work with you as a distributor in your organization! Very simple. My belief is that if you don’t have a product that “stands alone” then it’s not a legitimate Network marketing business.
Thanks for this post!
Jupiter Jim
Was always great information, just stopping by to say hi and to read what was new on your blog, TTYL
Being in Network Marketing for a long time and not making much money, I totally agree with you assesment of how most people run their businesses into the ground. But I feel that there needs be to a balance between customers and business builders. Most people seem to put to much pressure on people to build the business when they just want to buy your product. Knowing the different in what a person wants is important and I am just learning this important lesson.
Hey John, great post here! I agree with what Donna said. A lot of network marketers don’t know anything on how to leverage their market. This industry is very powerful IF we educate ourselves and do what is right and avoid what is wrong. Thanks for sharing this post! Keep it up!
Thanks PJ,
Appreciate your input.
Leveraging your market is everything! Glad you wrote this post because many Network Marketers go about it the wrong way. They don’t understand how to leverage and become “pests”
Sometimes when I get an i.m. from someone, and they want to talk to me I know it’s about selling something. If I like that person I will chat and tell them that I can’t handle it right now. The end, they are great and we part as friends.
On the other hand, some network marketers, friend me then send me to a sales page. Not a good way to start a friendship!
MLM’s can make people money if they know how to do the job well.
I only wish that more people in network marketing could see this post.
Blessings,
Donna