Is Network Marketing a Scam - Empower Network

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Is Network Marketing a Scam - Empower Network

  1. 1. ==== ====If you are really interested in building a strong Marketing Network please watch this video to seereal people makeing real money! Money hits your account instantly!http://www.empowernetwork.com/almostasecret.php?id=vfblane==== ====Network marketing, or multi-level marketing, is one of the fastest-growing business models of thepast few decades. Between 1993 and 2003, total direct selling revenues grew by 7.1% annually,dramatically above the rate of growth of the economy -- and of total retail sales (according to theDirect Selling Association).The most prominent examples of direct selling companies include Amway, Avon, Mary Kay, NuSkin, and Herbalife, which recently went public. In 2003, U.S. total direct selling sales totaled morethan $29 billion, or almost 1% of the over $3,397 billion for total U.S. retail sales (U.S. CensusBureau).Any business model that has achieved this kind of success probably has lessons that all businesspeople can learn from. We define this family of business models as a method of distribution inwhich people are paid for sales volume generated by people they have recruited into thedistribution network. 20% of American adults reported they are now (6%) or have been (14%) adirect selling representative -- defined as "the sale of a consumer product or service, person-to-person, away from a fixed retail location." In 2000, 55% of American adults reported having, atsome time, purchased goods or services from a direct selling representative.A significant number of network marketers have negative experiences with the industry. That iswhy 70% of all people who have ever been a direct selling representative are no longer in theindustry. For the purposes of this column, we will not go into the challenges and problems in thenetwork marketing model. There are plenty of Web sites on that topic.We all work for ourselves. Gone are the days of being a "company man" -- your career is yourbusiness. Multi-level marketing just makes that explicit. Yet one of the things that makes thesector most attractive, the low barrier to entry, also creates some its greatest dangers. Manypeople get into it without the necessary skills to run a successful business.We are primarily interested in what lessons all business people can learn from successful networkmarketing practices. We recently interviewed some of the industrys top experts and found sevenlessons that all sales and marketing professionals can use to be more effective, regardless of theirindustry:Every business is a relationship-based businessSo says John Milton Fogg, founding editor of Networking Times, author of The Greatest Networkerin the World, and one of the most successful teachers of network marketing. You cannot sell aninferior product with a superior relationship, but you need at least a functional relationship to sell
  2. 2. your product. That is particularly apparent in multi-level marketing, an industry built around belly-to-belly sales.Think analytically about your networkShaul Gabbay, in his book Social Capital in the Creation of Financial Capital: The Case of NetworkMarketing, reports that the fastest-rising group of entrepreneurs [of the direct sellingrepresentatives whom he studied] were those who had initial weak ties to dense networks. Inother words, successful salespeople penetrate an untouched market, and then work to gain a highmarket share in that market. This is easier to do if that untouched market is highly dense;everyone in it knows all the players. Why? Because word of mouth in that type of network willspread more rapidly about the value of your product or service. This principle is particularlyevident in network marketing, an industry where "networks go to work." However, the same ideaapplies to almost any business.Create a community around your productOne of the great ironies of the software business is that not only do many software companiesoutsource their development off shore; many also outsource their customer support to their owncustomers! When Best Software encourages you to visit their user forums to discuss your issuesin using Act! software, that is a very cheap way for Best to support their product. Multi-levelmarketing companies rely almost exclusively on their communities for sales, support, follow-up,and recruiting.Leverage the unleveragedIn 2002, 79.9% of the direct selling sales force was female. 56% completed only a partial collegeeducation, technical or trade school, or have only a high school education. This sales force looksvery unlike the traditional American corporate sales force, which typically is much more male andhas a higher level of education. However, the direct selling sales force looks just like theircustomers. People can be very effective salespeople when selling to their own community,because the common culture and interests create a foundation to build strong relationships morequickly.Build a relationship first"Internet marketers and network marketers share a common, terminal disease," Fogg says. "If youthink of the whole process like dating, we bring someone to our Web site, and then we ask them tohave sex immediately. There has to be some courtship first." One of the delicate aspects ofnetwork marketing is that people leverage their personal relationships to sell a product. Althoughthat leverage makes some people queasy, the success of the network marketing model showsthat many people do comfortably build multiplex relationships: Their friends are their customers,and vice versa. With delicacy, you can do the same thing.Not everyone is a prospectOne mistake some network marketers make, as do many other sales people and marketers, isthinking of everyone they meet as a prospect. In network marketing, this is known as the "Three-
  3. 3. Foot Rule", i.e., anyone within three feet of you is a prospect. But top network marketers dont dothis. Max Steingart, creator of the "Success Online" training course for network marketers, saysthat its not just about figuring out when to make your pitch, but even if to make your pitch. "Youjust build relationships with a lot of people. Some will become prospects and some wont," hesays. "Theres no timetable. If the time is right, youll know."Use online networksThe network marketing industry is a particularly good industry for leveraging online networks.Steingart teaches people how to "make the world your warm market," specifically by using onlinenetworks. He reports that when he instant-messages someone to start a conversation aboutpotentially joining his distribution network, 50% of the people he contacts will respond to theconversation. More and more sales and marketing professionals will use online networks toaccelerate their sales.What else can traditional businesses learn from the best practices of successful networkmarketers? We welcome your comments and feedback.David Teten and Scott Allen are coauthors of The Virtual Handshake: Opening Doors and ClosingDeals Online, the first business guide to sales, recruiting, and business acceleration with onlinenetworks, and joint contributors to TheVirtualHandshake.com resource site. They write a monthlycolumn about online networks for FastCompany.com, where this article originally appeared.David Teten is CEO of Nitron Advisors, an investment research firm which provides institutionalinvestors and law firms with direct access to frontline industry experts. To participate in paidconsulting opportunities, join Nitrons Circle of Experts. Scott Allen is the About.comEntrepreneurs Guide, providing free resources and guidance to help entrepreneurs as they startand grow their business.Article Source:http://EzineArticles.com/?expert=Scott_Allen==== ====If you are really interested in building a strong Marketing Network please watch this video to seereal people makeing real money! Money hits your account instantly!
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