mlm network marketing

The Truth About Network Marketing: Should Your First Business be with a Multi-Level Marketing Company?

As many of you might know, I officially started my journey into entrepreneurship through Amway and LTD. It was where I had the opportunity to learn the true entrepreneurial mindset, learn more about what freedom really is, and even more about what this country is all about. I also got to meet great go-getters that I plan on bringing onto the podcast from time to time.

While I might not have gotten great financial results from being in it, I’m glad that I was able to absorb the knowledge and influence. Without that experience, I really don’t know where I’d be today. Maybe a teacher or engineer somewhere. I’m really not quite sure.

What I do know is that what I’m doing today allows me to utilize what I found out about myself when I was active in Amway. I realized that I do like to teach, coach, and work on a team.

However, I also realized some of the things that I wasn’t so great at as well. One of those things was to scrape off the negative connotation that comes with the industry. I just found it too difficult to constantly fight through that stigma. I hated being in “one of those things”.

So in this post, I’m going to utilize a list of Pro and Cons that was inspired from the Fizzle forums and give them my personal touch. They are items that the original author (Tony Rush – who’s earned well over $100k in a single month) and I have learned about through working in our groups (and what I’ve found out since I was active) and hopefully it will allow you to make a better choice if joining a group and company is good for you!

Pros:

Build on a Shoestring Budget / Low Barrier to Entry:

As with an online business, you really don’t have to have that much money to start. Of course the more skills you bring to the table (sales skills specifically), the better off you’ll do from the get go. (In the online business world, the more technical skills you have, the more things you don’t have to pay others to do.)

Can (Should?) be a Part Time Endeavour:

While starting a traditional business is definitely time intensive, doing an MLM isn’t nearly as bad. In fact, because they’re designed for you to bring more people into the group as opposed to just sales, it’s almost foolish to not have a job as you’re getting started. Building your army of distributors takes time!

Team Game:

The more people you bring into your team, the more you’ll win. Period. That said, don’t rely on one person that you bring into your team to do all the recruiting. You won’t get rewarded for that. It’s not how it works.

Personal Development:

Your “Upline” has your best interest at heart. If you do well, they do well. So they’re going to want you to be as great as you can in all areas of your life – not just in bringing in money. The more stable your life is in the business, the more stable their life is. The more business skills you have, the less work they have to do in your line of sponsorship (LoS).

Learn about Real Freedom:

Somewhere in your upline there will be people who have really made it. These people live celebrity lifestyles without the worry of having to dodge paparazzi. With the ability to see and learn from these folks directly or from team events, this is often the first time that many people honestly see that they don’t have to work a 9 to 5. For many people who might be familiar with online business, they might also realize that they have better skills to perform in the MLM arena because they don’t have to have “technical” skills to do the work there.

True Passive Income:

Real Freedom comes from being paid over and over for work you did once. That’s the whole idea of passive income. If you become a sponsoring machine in your first two years in business and you do well in your own personal circle of sales (selling to people you know), you have really the main ingredients to be successful at any MLM. You build your group and help others build theirs. It’s really that simple. If you can’t do these two main activities, you’re going to have problems in having true success. (If building courses and creating other content is more your thing, then I HIGHLY recommend going the online route. This is definitely more my strong suit!)

Don’t have to handle Customer Support:

Again, your job is twofold: selling and coaching. You sell the idea of the business to prospects and the products to customers. You coach downline to do the same thing.

What your job doesn’t consist of is having to worry about invoices, returns, shipping, and other merchant issues. Totally the opposite of having your own online retail store.

Built-in Community:

There was a saying that I learned in my LTD days that I still use with online business making. You’re in business for yourself, but you’re not by yourself. In an MLM, this is particularly true. Again, you’re upline and downline both want you to succeed. When you succeed, they look good and are more likely to have success.

However, you can find plenty of community to help your online business as well these days. There’s plenty of Mega Groups on Facebook as well as paid membership sites like Fizzle. Heck, many courses that are out there these days have a group as part of the bonus for enrolling!

Cons:

So now that we’ve looked at the things that I think are great about MLM’s, let’s look at the issues that I saw when I was active.

Low Barrier of Entry:

This is on both lists because there are simply some folks who shouldn’t be in business – period. They don’t know how to invest in themselves and/or their business. They’re consumers through and through and only take. You don’t want these kinds of people on your team and taking up your time as a coach.

Little or no Autonomy: Remember how I was talking about Freedom up above? Well, there is a catch to that. When it comes to your business, you usually have very little or no freedom when it comes to prices of products, what your online portal (“website”) looks like, marketing materials, and how customers are interacted with from the customer support side. You’re essentially a freelance salesperson/coach. Unless you make the board of one of these companies (which is possible in Amway), your thoughts on the business are not going to be anything more than feedback.

This personally drives me CRAZY.

Stigma of being in “one of those things” or a Pyramid Scheme: Yeah, I hate having to fight this. So many people believe that MLM’s are pyramid schemes. Heck, I’ve known a few people that would even go out of their way and tell others that I was in a pyramid scheme. Simply this aspect of being in an MLM can make life and the work you’re trying to do uncomfortable – even if you have all the best intentions in the world.

Not all MLM’s are created equal:

Some MLM’s like Amway have been around for awhile. Amway, itself, has been around for 50+ years. However, most MLM’s come and go as quickly as a summer storm. So one of the things that you’ll want to make sure you do is kick the tires if you’re thinking of joining a particular group and/or company. Find out how long they’ve been around. If they’ve been around for awhile, then you should be good. If they’ve only been around a handful of years or less, then check out the fruit on the trees. Are the leaders where you want to be? Do they have high morals or do they give you a feeling of being used car salesfolk?

This is a really important thing you check out!!

Commitment Levels Vary:

You might be completely jacked to start your new business. However, not everyone is going to be as excited as you are. You might sponsor some people who simply get started because you’re the most confident people they know. There might be people you sponsor who put more work into building this thing right away and then vanish all of a sudden. It’s probably because they’ve found the next shiny object project.

A Cult-like Experience:

Again, for many people, this might be the first time that many people have ever been exposed to self improvement material. At first, it feels unnatural that all of these people are constantly talking positively about life. For me, it was just weird.

Once you get past this, though, and you realize that there are all kinds of people in the group, you’ll find that there’s not many places like this in the rest of the world. In our perspective, this is great! It solidifies our interest in the group because we feel that it was the group that gave us this new understanding of the world.

In the perspective of the people that we’ve been around up until we joined the group, we might be changing in a way that they’re not comfortable with.

So, when those people, who might be life long friends or spouses, criticize the MLM, trouble might be brewing. The folks who are on the outside “just don’t understand” from the perspective on the member. From the outside, the member is drifting further away.

From what I’ve found out, this is entirely from a lack of communication. It’s completely unnecessary for relationships to get to this point. However, they do and I think you should be aware of it.

Wrap-Up:

It might sound that I’m being ungrateful of my experience. However, it’s the contrary. I really enjoyed my active years and it really helped me change for the better.

The thing is that I don’t think many people see both sides of MLM like I do. Once you get in it, and if it’s really the only thing you’ve experienced, you might find it hard to leave. Or, if you’re like people I know that have built their fortune on it alone, then you can’t explore things outside of it due to risk of losing what you’ve built.

Ultimately, these are some of the reasons why I ultimately focused more on building New Inceptions.

However, not everyone minds these limitations. If what you’re passionate isn’t going to bring in the resources for you to continue to pursue it, then perhaps you should consider being involved with a MLM company. Simply think of them as a vehicle for you to bring in income that allows you to engage in your passion more.

Action Steps:

If you’re interested in getting into Amway, checking it out, and being shown the ropes, I’d be more than happy to sponsor you. The products are great and there’s plenty of people who aren’t Independent Business Owners (IBOs) and want to use the products as well. The last I checked, the buy in is around $63. However, you can get larger starter packages that have sample products at a discounted rate.

Also, Maria is in various ones herself. Each group has it’s own products. One is insurance focused, another is jewelry based, and yet another is health food based.

Connect with us if you’re interested to see if any of the lines that we’re involved with might be a solution for you!

For further information about MLM’s and network marketing, there’s a great podcast session with Michael O’Neal that I think you might want to listen to. The MLM he’s involved with is Isagenix. This particular interview features him in a conversation with David Wood at a dinner table at Joe’s Crab Shack. David is a multi-multi-millionaire in Isagenix and you can get connected with his brand here.

They talk more than just MLM, however. They also talk real estate and the entrepreneurial mindset as well. A well rounded great talk. The best advice towards MLM starts just after the 57 mark. However, the conversation is great after the 34 minute mark.

Also, David mentions an interview of Tony Robbins in there as well talking about Network Marketing. Here’s that interview:

So, I think that’s a good start. Let me know if you have any further questions regarding this topic below. Those of you who have seen some success in an MLM in the past – whether financial or not – let me know about your experience too!

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