| Author |
Message |
RayvinAndRob
Member
Joined: 22 Jun 2007
Posts: 195
|
# Posted: 31 May 2008 11:58
Reply
Thank You, Vishal.
I'm so glad you changed that.
Perhaps a good question to ask now is, "What is a pyramid scheme?"
And can MLM/Network Marketing be fairly categorized as one?
Rob Nyte
__________________
Source of Influence-- All our philosophy is dry as dust if it is not immediately translated into some act of living service.(Mahatma Mohandas K. Gandhi)
|
Vishal P. Rao
Joined: 23 Jun 2005
Posts: 1034
|
# Posted: 31 May 2008 23:34
Reply
From Wikipedia...
A pyramid scheme is a non-sustainable business model that involves the exchange of money primarily for enrolling other people into the scheme, usually without any product or service being delivered. It has been known to come under many guises. Some famous examples including the massive Albanian Pyramid Schemes of 1996 were technically not Pyramid schemes but Ponzi schemes.
__________________
|
RayvinAndRob
Member
Joined: 22 Jun 2007
Posts: 195
|
# Posted: 1 Jun 2008 01:03
Reply
Apparently many MLM / Network Marketing companies, while having a product or service to sell to the end consumer, have a "non-sustainable business model."
But I haven't personally verified the truth of that statement. How many network marketing companies would I have to evaluate in order to confirm or disconfirm that?
However, it seems to me the general consensus is to accept the famous statistic we read everywhere, namely, 97% of network marketers fail within the first year in business.
I'm not sure where that statistic comes from but assuming it were true that's not an encouraging sign for the network marketing industry.
While we may never know for sure what the real reasons are for this apparent lack of success in the network marketing industry, we can be fairly confident it has something to do with the business models of some MLM companies.
In most cases, the distributors of such companies are forced to recruit people into their businesses because they cannot sell their company's products. They are either too expensive to buy at the retail price or you have to sign up as a 'Preferred Customer' or some such hoop-a-lah just to purchase something.
When people see they can buy the products for much cheaper at wholesale than at retail, they quickly realize it makes sense to become an affiliate. That way they can get their products and perhaps earn a little money on the side.
At least that's their hope but, quite often we hear stories of how people are not able to earn money from their recruiting efforts or from their sales efforts either for that matter.
In fact, the problem with most MLM business models is they require you to recruit too many people into your business before you start seeing a substantial profit, sometimes numbering in the thousands.
I can think of one very well-known company in particular that's been around for a few decades that requires its distributors to recruit about 2800 people on a monthly autoship of 100 bonus points of volume in order to earn $10,000 per month.
It takes a special kind of person to accomplish that. He or she may be very good at sales and a naturally persuasive and charismatic individual who has no problem building a downline that large all by him/herself.
But most people are not able to duplicate that kind of effort. It means being a salesperson and such and most of us don't want to be a salesperson.
I wonder if these 'naturals' fall into the top 3% who seem to succeed in the industry?
Nah, it couldn't be! That wouldn't leave room for all those MLMers out there are succeeding without having to be a salesperson and without having to recruit thousands of people.
Believe it or not, there are people who are earning $10,000 per month in their network marketing business from both retailing and recruiting. And how do they do it?
They don't actively chase leads. They don't bother their warm market about joining their business. They don't pay very much (if anything) for advertising.
No, they do network marketing the way it should be done because they are in what I call a 'Five Pillars Company.' These are five things a network marketing company absolutely MUST have in place for anybody to have success with it.
I've written about these 'Five Pillars' many times elsewhere. But there are, again,
1. Company Management Experience and Integrity.
2. Right Timing of the Company in an Industry that has a Proven Growth Potential, such as the wellness industry.
3. A Remarkable and Consumable Line of Products.
4. A Compensation Plan that Pays its Part-Timers. They Make Up 95% of the Work-at-Homers. Only 5% Do It as a Full Time Business.
5. A Duplicatable system aka Method of Operation which is easy to follow for the masses.
So besides these five criteria for choosing a legitimate company, there must also be a business model which allows affiliates to both retail their products at a reasonable profit and recriut others who want to do the same, without having to become a "sponsor monster superstart space commander salesperson, rank 9."
Rob Nyte
__________________
Source of Influence-- All our philosophy is dry as dust if it is not immediately translated into some act of living service.(Mahatma Mohandas K. Gandhi)
|
alasycia
Member
Joined: 4 May 2008
Posts: 287
|
# Posted: 3 Jun 2008 04:45
Reply
Multi level marketing seems to be a bit of a "hot potato" on forum discussions, with its detractors and supporters getting very upset.
Firstly - remember it is only a sales/marketing system for a company that produces a product or service. If you dont like selling - directly or through people you introduce to a company - then maybe MLM is not for you. Because without product sales on multilevels or one level - there is no business.
It is NOT the same as a franchise. A franchise is a one level operation where you buy rights to sell company products under THEIR name and with their format - Macdonald's being a good example. And quality control and corporate identity is a big issue in franchising.
In multi level marketing - you are an independant contractor/distributor and often without any contract either. Whether the company keeps consistent controls on the WAY in which their products are sold - depends on the company.
Regrettably there are many who do not do this and as a result we get the heavy pressure motivation selling in place of good sales training. And many of the companies are aware of this and are quite happy with the situation. no names mentioned, but some of the "training talks" for MLMs are based on "belief" and all sorts of nonsense instead of good solid training in promoting the companies product. another reason why it has such a bad name.
Multi level selling is only legal if earnings come primarily from sales and comissions on them. If referall comssions from anything other than product or service sales form a major part of your earnings - then then the business is trading illegally in nearly all countries in the world. It is a pyramid. and a big red flag.
If there is no real product or service for sale - then you are in a ponzi -and run like h*ll. This kind of MLM seems to be on offer all over the internet.
As a business model, companies that use MLM usally have their products at a higher price than those who do not have to pay so many levels of comission - and I thinbk this is often the reason for failure for many people selling in them. The stuff is generally very expensive - good or not.
At the end of the day, MLM or not - I agree with the comments made here.
You do not expect to pay a company to sell their products - and 90% of online opps are sales opps. And you should expect a reasonable start up cost if you are starting a home business, but to pay an ongoing fee, doesnt make much business sense unless you are getting something tangible in exchange.
And of course watch out for the red flags. Would you do business offline with someone who met you in a bar, with no name and no business address and no way of contacting them apart from a contact form on a website? NO you wouldnt. So dont do it online and then wonder why it has gone sunny side up!
Reputable businesses online should be identifiable, with real traceable owners with real names and addresses and proper terms and conditions of business and real products or services that are properly financed to be sustainable, not something that disapears one day when you switch on your computer, leaving no forwarding address! LOL
__________________
|
Homeboy
Member
Joined: 4 Feb 2008
Posts: 219
|
# Posted: 10 Jun 2008 10:03
Reply
One thing that always baffles me with MLMs is - how on earth do normal people get thousands of people to sign up for something? It seems an extraordinarily difficult task even for experienced salespeople, and yet this performance level is typically required before seeing any decent ROI with these things.
I think this is why most people label MLMs as scams, because they're usually advertised as being so easy your grandmother could do it. Etc. etc. They generally disguise the fact that there's a LOT of work to be done...
__________________
|
RayvinAndRob
Member
Joined: 22 Jun 2007
Posts: 195
|
# Posted: 17 Jun 2008 21:18
Reply
Hey Homeboy,
Sponsor monsters are extraordinary people. But ordinary people can't duplicate them. The reason you believe you must match their performance level to have success in the MLM industry is because that's what you've been taught by them. And that's what they've been taught by their upline sponsors.
We're here to tell you, Homeboy, that there's a better way. There's a way to do network marketing without having to do anything extraordinary. It's a way that any average person can follow.
It requires only 10 SIMPLE steps. They are not easy steps to take but they ARE simple, Homeboy, if you are coachable and teachable.
__________________
Source of Influence-- All our philosophy is dry as dust if it is not immediately translated into some act of living service.(Mahatma Mohandas K. Gandhi)
|
msmoney008
Member
Joined: 10 Jun 2008
Posts: 3
|
# Posted: 18 Jun 2008 14:23
Reply
Hi Every Body , Can any one give me the idea about "Method Reports LLC". Any sort of Review or anybody has tried it . Thank U
|
rcarney6
Member
Joined: 18 Jun 2008
Posts: 37
|
# Posted: 18 Jun 2008 16:49
Reply
"I agree with a lot of posts here in that there are a lot of internet scams out there, but not all programs you have to pay for are scams. If you wrote a digital book that teaches internet marketing, would you give it away for free? I certainly would not!"
Yes, some products offering lefitimate information will charge for their books or materials. This is like geting books about business from book stores.
When you get good information, you have to act upon it.
The key is to "read between the lines," and realize that it is legitimate to pay for information, but to be careful of some of the upsells.
__________________
|
tbadly
Member
Joined: 4 Jun 2008
Posts: 23
|
# Posted: 18 Jun 2008 18:27
Reply
Just to reiterate a couple of things said above, MLM companies are just like other companies in that they sell products to survive. They've just espoused a different marketing (hence the term network or multi-level marketing) strategy that involves paying commissions to distributors instead of advertising dollars to magazines, billboards, internet firms, television, etc. If you enjoy marketing (and that includes sales), then MLM is likely to be a good fit for you.
__________________
|
PennyWise
Member
Joined: 21 Jun 2008
Posts: 22
|
# Posted: 21 Jun 2008 02:11
Reply
If you wrote a quality eBook, why not give it away?
Number 1: Quality is remarkable
Number 2: Whatever your topic, you can include useful Ads
Remarkable. Kind of sounds like Re-Marketing doesn't it? Unless this eBook revolutionized the world as we know it (which, by the way, it doesn't) I wouldn't tell anyone beyond my dog lying next to me. If I had to pay for it, I promise you I wouldn't even tell her.
Any consumer-minded information can have more resources (hint: ads.)
A positive cycle to look for, in an endeaver to make money:
1. Customer's HAPPY (well informed and knows what to do next.)
2. Advertiser's are happy because the customer wants them.
3. You're happy because the Advertiser pays you!
1. Customer's HAPPY...
__________________
|
RayvinAndRob
Member
Joined: 22 Jun 2007
Posts: 195
|
# Posted: 22 Jun 2008 11:20 · Edited by: RayvinAndRob
Reply
We agree. Network marketing is about selling products and services and sponsoring people into your business.
For that, you need skills.
Why not offer a free ebook to struggling and frustrated network marketers who believe it's their fault they're not having any success?
How about NOT putting any affiliate links or advertisements inside the ebook, except for a few inexpensive business building tools that you don't profit from?
How about not mentioning your products and services in the ebook at all?
How about helping people aquire the skills they need for building THEIR businesses for F*ree? No sales agenda.
Sound strange?
Maybe.
But people will remember you when you help them. For free. Without an agenda.
__________________
Source of Influence-- All our philosophy is dry as dust if it is not immediately translated into some act of living service.(Mahatma Mohandas K. Gandhi)
|
PennyWise
Member
Joined: 21 Jun 2008
Posts: 22
|
# Posted: 22 Jun 2008 18:40
Reply
That's a lovely idea.
How, may I ask, does this system support itself financially?
__________________
|
OM_Dave
Member
Joined: 19 Jun 2008
Posts: 4
|
# Posted: 23 Jun 2008 15:41
Reply
fsagarnaga: Remember usually, if it sounds too good to be true, it is not true.
I have seen this statement several times on these forums from everyone. To say it's an understatement would in fact be an understatement.
__________________
|
ipodnano7
Member
Joined: 25 Jun 2008
Posts: 19
|
# Posted: 25 Jun 2008 09:10
Reply
Some work at home websites are legit, reading approved reviews may help identifying the good ones from the bad ones
__________________
|
kpm2319
Member
Joined: 28 Jun 2008
Posts: 28
|
# Posted: 28 Jun 2008 19:56
Reply
Any program that promises millions of dollars is a scam. There are a few that are upfront with you and say in the beginning your best days might be $100 and then you learn the system over a couple months and make more money. kevin mulcahy
__________________
|
kpm2319
Member
Joined: 28 Jun 2008
Posts: 28
|
# Posted: 28 Jun 2008 20:17
Reply
Also, look and see if they offer support, a system where you can have your questions answered.
__________________
|
SunshineS
Member
Joined: 4 Jul 2008
Posts: 2
|
# Posted: 4 Jul 2008 02:58
Reply
If it is too good to be true then it is a scam!
__________________
|
polo234
Member
Joined: 10 Jul 2008
Posts: 9
|
# Posted: 15 Jul 2008 14:37
Reply
so how do u deal with the fact that you cant just make money without having some klind of investment......no one is online to give you free money right?
__________________
|
RayvinAndRob
Member
Joined: 22 Jun 2007
Posts: 195
|
# Posted: 15 Jul 2008 15:38
Reply
Hey Polo234,
I would deal with it by finding a good opportunity first and then saving up for the initial investment and making certain I could afford to cover any monthly costs while I brought my business into profit.
Questions:
1) Do you know how to properly evaluate opportunities?
2) Can you save $500 over a period of time?
3) Can you afford to spend about $250 per month while building your business?
__________________
Source of Influence-- All our philosophy is dry as dust if it is not immediately translated into some act of living service.(Mahatma Mohandas K. Gandhi)
|
PMHayes
Member
Joined: 23 Apr 2008
Posts: 129
|
# Posted: 17 Jul 2008 23:54 · Edited by: PMHayes
Reply
A good MLM business model is one that teaches duplication, not how to be a Sonsor Monster, as R&R put it, above. Duplication is taught by example. One person does not have to sponsor thousands for their MLM to work for them. That's a super human feat for most people.
A good model is one built on this premise. Sponsor two. Teach each of those to sponsor two. Teach them to teach their recruits to sponsor two. In a very short time, you have an organization that is growing, thriving, and sustainable because everyone who comes in learns how to sponsor two and teach their downline to do the same. Folks, it's not rocket science. MLM is very simple.
Now, I realize that that system will have points where it breaks down, not everyone who comes in will follow through. But it doesn't matter, the ones who do will sustain the growth of the organization. There will always be people who will join you and drop out because it didn't "work for them." And, they will probably blame you, or the company, when it was their own fault that they failed.
But that doesn't matter either, unless of course they came in under someone who did not teach them the simple geometric progression of two sponsoring two sponsoring two, etc. In that case it is the upline's fault. Yes, that happens, and yes, it gives MLM a bad name. This goes back to R&R's bad business model. But if one sticks to the basic plan above, and teaches and passes that model down, one will be successful because the real power in MLM lies in the fact that teaching others to be successful makes one successful in the process.
I do, by the way, believe in R&R's statement about giving something away. My blog is a good example of that. I do not sell one thing from the blog. It is intended to be a resource, a help, to the online community and to those searching for a "how to" in MLM and Online Marketing. I get quite a few visitors to my "business" websites by folks who have visited and been inspired by my blog, and by articles I have published in ezines and other online article directories.
Great thread, people. Let's keep encouraging each other to excellence and integrity. Let's restore the reputation that MLM was intended to have all along. Success being achieved by people helping people helping people.
Mitch
__________________
|
RayvinAndRob
Member
Joined: 22 Jun 2007
Posts: 195
|
# Posted: 18 Jul 2008 16:36
Reply
PMHayes: R&R's bad business model.
Excellent points Mitch. Here are a few other ones to consider:
1) Bad business models drive distributors to spend their time recruiting others instead of retailing product.
2) Good business models allow distributors to retail product without requiring customers to sign up for anything.
3) Bad business models have products at wholesale prices and products at retail prices.
4) Good business models have products set at one price whether you're a distributor or a customer.
5) Bad business models drive a recruiting behaviour in distributors.
6) Good business models drive a retailing behaviour in distributors.
7) Bad business models have their prices so high that distributors put them up for sale at cheaper prices on ebay hoping to recover some of their losses before getting out.
8) Good business models have products people would buy even if there were no business opportunity attached.
9) Bad business models destroy families and reputations.
10) Good business models enhance and strengthen families and reputations.
__________________
Source of Influence-- All our philosophy is dry as dust if it is not immediately translated into some act of living service.(Mahatma Mohandas K. Gandhi)
|
justlikethat
Member
Joined: 18 Jul 2008
Posts: 37
|
# Posted: 18 Jul 2008 18:05
Reply
Hey everyone!
Wish I would have found this site a couple of weeks ago! Thanks for all the advice and tips!
__________________
|
Flyboy
Member
Joined: 25 Jan 2008
Posts: 17
|
# Posted: 19 Jul 2008 22:34
Reply
Simply put, any MLM depends on building a downline to survive whether it be 1 or 100 downline. Every single one of them are selling the exact same products you are which equates to market saturation in a short period of time. There is no getting around that fact. The only ones truely profit are the very top of the food chain. Usually the top 3 to 5 in the company. It is a proven fact and the evidence is certainly out there. Just do a few searches and you will find plenty of proof.
As to how ordinary people can sell it so easily, well they are highly motivated when they first begin and the upline is trained to recognize which ones are hot and can sell and they devote their attention on those few real motivated new recruites. I do agree that there are both those that swear by MLM's and those that hate them. I am neither of those. If you think about the concept of an MLM, and compare that to a truely independent business, are they even close to each other. I think not. A truely independent business will have it's own wholesale suppliers and have many different sources to produces income streams. MLM's can't make that claim. You are NOT usually allowed to freelance and supply your own products when you are tied into an MLM.
You usually HAVE to get your products from the upline which in itself means you are not free to search for the best wholesale price which ensures you can set and make the most profit. Buying from a true wholesaler allows you to compete in the marketplace with a price 1 step above that of the wholesaler. In a downline situation, if you are very far down the line you will find to many price jumps between you and the true wholesale price for you to compete even with a small retailer or etailer. If you are looking for a preset business model, an MLM may be what you want. If you are not affraid of some long hours, hard studying, and hard work, than why not set up your own business with your own wholesale suppliers?
__________________
|
kaazoom
Member
Joined: 18 Jul 2008
Posts: 4
|
# Posted: 20 Jul 2008 09:10
Reply
I have been a victim of many home business scams over the years. The Latest one was as a 'rebate processor'! I'm sure I have 'sucker' written on my heead! The ad said you could make money simply by dealing with rebates for companies. There were no companies. They promised that you could make money with just a few minutes work. The ad tried to make you think that there were limited positions in your area. What they didn't say was that it required you to do affliate maketing and then offer a rebate on the products you sold! They promised a refund if you were not satisfied, but their email address goes nowhere! I'm not sure whether I can name the program here, otherwise I would.
If anyone sends you a email offering a job as a rebate processor avoid it like the plague. One thing I have learnt to do before signing up for any program and that is to go to google, type in the program's name followed by the word "scam". It isn't perfect way of checking, but it can often save you a lot of money.
Paul
__________________
|
weesa2005
Member
Joined: 14 Jul 2008
Posts: 1
|
# Posted: 23 Jul 2008 00:49
Reply
What was the "Rebate Processr" Program scam you used? I'm nervous now as I have signed up with one called "Process at Home". Was it the same one? It offers many other ways to make money like redirecting traffic to yor website, blog etc and getting search engines to pick you out with attached tags (code) to get attention to the products your marketing.
Do tell
Weesa
|
Vishal P. Rao
Joined: 23 Jun 2005
Posts: 1034
|
# Posted: 23 Jul 2008 01:17
Reply
weesa2005: I'm nervous now as I have signed up with one called "Process at Home".
http://www.work-at-home-forum.com/14_6170_0.html
__________________
|
thebestbuyguy
Member
Joined: 31 Jul 2008
Posts: 3
|
# Posted: 31 Jul 2008 22:37
Reply
It is really sad all the crap that people sell. I fell victim to the "Type at Home" business scam. It promised 1 to 3 thousand dollars a month, but all you pay for to get started is information you can find for free by doing a search on google. Tragic.
__________________
|
luvtravel
Member
Joined: 11 Dec 2006
Posts: 808
|
# Posted: 2 Aug 2008 06:47
Reply
I am very fortunate to have found a business that has been in business for 9 years and is a business model that works and is sustainable and definitely not a scam.
However I was in a travel MLM that is a ponzi and I did lose money, I lost commissions because of the way it was modeled.
Now'a days the word "scam" is thrown around loosely.
IF you join and you don't lose money BUT your in-law joins same program and they did lose money, is it a "scam"???
Autosurfs are popular method of advertising IF AND ONLY IF it is not shared by a bunch of CONSENTING adults who get together and decide to share revenue in the form of rebates than its called a scam and DOJ and the AG will enter in, shut it down, and its labeled "scam: http://www.sec.gov/investor/pubs/autosurf.htm
Again I am glad the company I proudly represent is run properly
and will generate sustainable income.
Terri
__________________
|
annadenise
Member
Joined: 9 Mar 2008
Posts: 300
|
# Posted: 2 Aug 2008 10:46
Reply
I agree, Terri. People need to look at the length of time companies have been in business, the quality of their product, their plans for expansion, and their customer support. It is even better when they have a physical location that you can actually visit and phone numbers as well as email addresses to contact them.
I've been the route in the past that many of us have been through where we join the latest and greatest and it can be great for a short period of time, but too many people loose and only those at the top really do well. Or you get money back guarantees when it is only run by 1 or 2 people - how much can you count on that? I sure never got my money back in those. Are they all officially "scams"? Maybe not, but people should be very aware of what they are getting into.
I am so happy myself to have found a company that is run well and will be in business 20 years from now.
__________________
|
Moneymann
Member
Joined: 7 Aug 2008
Posts: 4
|
# Posted: 7 Aug 2008 19:36
Reply
If you are already working in real estate or in some kind of direct marketing or sales job, you most likely are perfect for online network marketing. You will know deep down if you are bieing scammed. Do your research, ask other folks on this forum, and then dive in never looking back! 
It really helps if the products you sell, or company you associate with, actually has a brick and mortar office! Scams will have nothing, but the real thing will be proud to publicize their offices and locations.
Do your research into the headquarters of anything you are tempted to try.
__________________
|
