Succeeding At Network Marketing » product

Word of Mouth

Alan — Mon, 29 Nov 2010 08:51:48 +0000

Why Is It Called Network Marketing?

Network marketing is called network marketing because we market through a network.

By utilizing our networks, we’re bringing customers, customer gatherers, people who get other people interested in the company, and market exposure to their company and products.

By doing this, they make it possible for someone to start with no business experience and yet have the potential to become very comfortable, and even wealthy by learning on the job and applying what they learn.

Why Do They Do This?

With the use of our networks, the company can get lots of exposure, lots of customers, and lots of profits (if they do it right).

By so doing, they eliminate most of the expense of PR firms, marketing agencies, branding agencies, market research firms, focus groups, etc.

Then they can take all that expense that they’re eliminating and pay that money to the field of sales reps and marketers that are bringing the customers to the company.

The more people you bring to the company who gather customers, and the more customers you bring to the company, and the more leadership you provide, the more handsomely you’re going to be rewarded.

Why Does This Work?

Because of the power of word of mouth. Here’s what one writer has to say about word of mouth: “In our business lives, positive word of mouth generates referrals and referrals generate business. So, word of mouth is one of the most important marketing tools that can contribute to our success. What could be better than a customer mentioning how pleased they were with a service you provided to others who may need this service? Free advertising… that’s what word of mouth is.”

Here’s another: “Media Guerilla points to interesting research from Intelliseek that finds that consumers are ‘50% more likely to be influenced by word-of-mouth recommendations from their peers than by radio/TV ads.’ ”

And finally, “Even more important than its credibility, reach, speed and ability to break through the clutter is its power to get people to act. In study after study with almost every category of buyer, word of mouth has been shown to be what is known as the proximal cause of purchase – the most recent thing that happened before purchase. In other words, the purchase trigger. People tend to make major purchases on the advice of trusted peers or experts.”

What Role Does Advertising Play?

The whole role of advertising in network marketing could be called finding new launch points for word of mouth. In other words, you advertise to find someone who will start a word-of-mouth campaign among his/her friends, family, acquaintances and business associates.

If you’re good at networking and getting referrals, you may never need to resort to advertising, but that’s the subject of another article.

Helpful Information

To learn more about the brilliance of the how you get paid for your word-of-mouth avalanches, check out Brilliant Compensation.

To learn more about how to determine if a company is a good candidate for word of mouth to catch on, go to www.AlansMLMTips.com and sign up for the “7 Days, 7 Insider Secrets” email newsletter.

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In the end, all business operations can be reduced to three words: people, product and profits. Unless you’ve got a good team, you can’t do much with the other two. – Lee Iacocca

Who Is Successful In Network Marketing?

Alan — Mon, 11 Oct 2010 09:29:34 +0000

Introduction

I am currently reading a book by David Nelson called Create Your Fortune In Network Marketing. I want to share a little bit of it with you as I found this very interesting as it does answer the question I posed, who is successful in network marketing?

Let me introduce him to you. David has been a full-time, network marketing professional for over 20 years. He has a successful track record as a distributor and trainer. He’s had over 100 articles published in industry trade publications. David has a total commitment to network marketing and the viability of network marketing as a home-based business enterprise for part-timers and newcomers, and not just the select few full-time recruiters. Because of this philosophy, Cutting Edge Media labeled David the “Protector of the Part-Timer.” He is also a contributing author for Network Marketing Magazine.

The Road Not Taken

In his book, David quotes from a well-known poem by Robert Frost called The Road Not Taken. David uses it to illustrate a choice that network marketers make between focusing on the product, or focusing on the opportunity.

However, I think it applies equally well to the choice that people who want to be self-employed make between traditional businesses and network marketing. Consider that as of April 2009, there were 154,731,000 in the civilian workforce. Most estimates place the number of network marketers between 6 million and 15 million.

“I shall be telling this with a sigh

Somewhere ages and ages hence:

Two roads diverged in a wood, and I—

I took the one less traveled by,

And that has made all the difference.”

Characteristics of Successful Network Marketers

“Here are some characteristics that help people become successful network marketers. They are not in order of priority or importance…

Have a white-hot desire to make money.
Like people and are genuinely interested in them.
Can empathize with others and understand their point of view.
Are willing to help others achieve their goals.
Are entrepreneurial minded.
Have a high energy level and like to be doing things.
Take initiative.
Have discipline.
Are willing to make a sacrifice for a future.
Have the skills to organize their time and money in order to accomplish goals.
Don’t allow rejection to be personal.
Are interested in personal growth and development.
Have good communication skills – listening as well as talking.
Make and keep commitments.
Work with a sense of urgency.
Have a high level of self-esteem and self-confidence.
Have a positive mental attitude and a winner’s mentality.
Are willing to learn from others.
Are good teachers, trainers, and motivators.
Are consistent and persistent in working toward goals.
Are not looking for a “free lunch.”
Are team players.
Have had success in other areas of life.
Seek an improved lifestyle.
Place a priority on time freedom
Are proactive – take initiative and responsibility to produce desired results.
Are ambitious.
Are honest, moral, and ethical.
Will follow-up and follow-through.”

How many do you have? If you don’t have them all, are you willing to go through the personal growth and development (# 12) necessary to acquire the ones you lack?

If you liked this excerpt, you can check out the whole book at Amazon.com. Leave a comment and let me hear from you.

Other Resources

If you’ve never considered network marketing as a business before, you should watch Tim Sales’ video called Brilliant Compensation where he outlines the beauty of this method of business.

I also recommend that you sign up for the “7 Days, 7 Insider Secrets” email newsletter at www.AlansMLMTips.com, for some important pointers on how to pick a company to work with.

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“Nothing in the world can take the place of persistence. Talent will not; nothing is more common than unsuccessful men with talent. Genius will not; unrewarded genius is almost a proverb. Education will not; the world is full of educated derelicts. Persistence and determination are omnipotent.” – Calvin Coolidge

Network Marketing And A Mystery

Alan — Mon, 16 Aug 2010 07:53:36 +0000

Business Briefing

I listened to a very interesting business briefing over the weekend. Now, before you roll your eyes and go, oh no, not another business briefing, let me explain what I found so interesting about it.

This briefing had all the usual components, what the product is, what the company is and when they started. You can see the five things that every business briefing or opportunity meeting covers on an earlier blog post of mine called Five Things To Evaluate. This briefing had them all.

What was different about it was the fact that this briefing started with the statement that the upline giving the presentation had done some research into why so many people fail at home businesses. This stuck out like a sore thumb for me, this was something I had never heard in a business briefing. In an industry where statistics say that anywhere from 85% on up of all new recruits quit or fail, if someone said they had found a reason for all that quitting or failure, I wanted to know what it was.

I’ve Seen This Before

Now the funny thing about this was it’s something we’ve probably all heard of, participated in and done with our recruits. What was different was the position it was given and the exact wording of it.

I just went to my bookshelf and of the first eight books I picked up, seven of them mentioned it. (The eighth one was more of a motivational book than a book on network marketing.)

What Some Of My Other Mentors Say

A book that I just finished reading put me in the prospect’s shoes and he put this at number three. Most of the seven books I mentioned above put it near the end of the book.

Most of the companies that I’ve observed or participated in personally at least give lip service to it.

So What Is It Already?

After all that buildup, after I tell you you’re probably going to think “that’s it?”

The top reason found for all that failure was training; effective training. Training that gets you the basics of what you need to do quickly and efficiently and gives you a step by step plan of how to do the business with no wasted effort and makes sure that you understand exactly why you’re doing each step.

With new recruits, it’s essential that you help them get some initial success quickly or they’re going to be gone just as quickly.

Why do you think that almost every book on or about network marketing mentions training and encourages you or even implores you to read books, listen to training videos, listen to training audios? Could it be that no one has come up with a simple, workable system that anyone can use and get started with? Remember that 85% or higher failure or attrition rate?

There are a remarkably few skills that you need to learn to succeed at network marketing, but very few people come into network marketing already knowing them.

What To Do?

You could go hide in a cave or bury your head in the sand, but that won’t bring you the success you want, desire and long for. If you’re here, you’re either already involved with network marketing, are considering getting involved in network marketing or are looking for a better company to work with. (Or maybe you’re a personal friend who likes my writing, that might be possible too…)

If you’re new to the industry and are considering becoming a network marketer, I highly recommend that you go watch the video Brilliant Compensation. This video gives you a fascinating look at why network marketing is such a brilliant home business.

If you’ve decided to become a network marketer and aren’t sure what company to work with, or are overwhelmed with the choices, or don’t know how to evaluate the differences between different business opportunities, go to www.AlansMLMTips.com and sign up for the “7 Days, 7 Insider Secrets” email newsletter. This will give you some great free tips on how to choose a company to work with.

If you’re already with a company and looking for training, there are so many sources of training that it becomes tedious to sort out the good from the bad. In a future post, I’m going to cover some of what I think are the best.

For now, I’m going to sign off. Till next time, make it a great week!

Humor

Sometimes I notice funny email subject lines, I thought this one was great! I received it from Toshiba yesterday.

“Weekend Special: Free Memory and Hard Drive Upgrades – Starting at $399”

How much would it be if they weren’t free?

Network Marketing and Product Sales

Alan — Mon, 12 Jul 2010 08:18:17 +0000

Where Does The Money Come From?

I really didn’t think I was going to spend any more time on the basics of picking a network marketing business to work from home with, but an email I received this week changed my mind.

It was an email asking me to check out a company that this individual thought was a “winner” and wanting to know what I thought about it. Since one of the things I do to continue my own education is check out other companies, I did go to the website and look around a bit.

Doing so got me to wondering if people have any clue where the money comes from in a business – traditional or network marketing – either one.

What does a company get paid for? Anyone want to take a guess? Yes, you there in the pink blouse? Sales, you say. Well, close, anyone else? Okay, you there in the cowboy boots. A product or service. That’s right!

The only thing a company gets paid for is delivery; delivery of service (think electrical company providing electricity, lawyer providing legal service, phone company providing phone service) or delivery of product (anyone not know what Wal-Mart, Target or 1-800-FLOWERS sells). Every company is in the business of delivering something, whether it is a service, a product, advice or access to information.

Some people think it is sales because that is where the money usually changes hands, but what is that money paying for? It’s paying for the past, present or future delivery of the service or product.

You may be asking by now, what the heck does this have to do with network marketing? (Or, maybe not, you might be brighter than I was when I first started in business for myself.) But bear with me, I’ll get to the point shortly.

What Does The FTC Say?

In a 2004 United States Federal Trade Commission (FTC) Staff Advisory letter to the Direct Selling Association states: “… The critical question for the FTC is whether the revenues that primarily support the commissions paid to all participants are generated from purchases of goods and services that are not simply incidental to the purchase of the right to participate in a money-making venture.” – Kohm, James A. (January 14, 2004) (reprint). RE: Staff Advisory Opinion – Pyramid Scheme Analysis. Federal Trade Commission.

In plain English, that means that if you make money from recruiting other people into the program without any product or service changing hands, you might be in a pyramid. On the other hand, if nobody makes any money from recruiting, it’s probably not a pyramid.

If the product or service sale is obviously separate from signing up for the business, it’s probably not a pyramid.

This gets tricky to evaluate sometimes because less ethical companies try to obscure it.

Where Does The Money Go?

In a traditional business, money gets allocated to various parts of the business; so much for basic overhead (rent, lease or mortgage; lights; phones; water; trash service; etc.). Then so much for marketing and advertising, so much for salaries, so much for the sales force, accounting department, the actual production of the product or service, and so on, to cover all the various functions that make a business go.

In a network marketing business, money gets allocated the same way. But it gets divided up differently. In a network marketing company, you still have the basics of putting the company there, just like with a traditional company. There has to a headquarters, production facilities, lights, phones, etc. But all the money that a traditional business puts into marketing, advertising and sales gets put into the compensation structure to reward the independent sales force for their work promoting the company and the product and making sales.

Traditional Business (Brick & Mortar)

Now, I’m probably belaboring the obvious, but here are a couple examples of traditional businesses.

TV Repair Shop – rent, test equipment, advertising, employees’ salaries, electricity, phone service, internet service, heating/air conditioning, water, trash disposal, shelving, computers, TV parts, etc. plus profit. Product = repaired TVs. People pay for repaired TVs which pays for all the foregoing.

Flower shop – rent, advertising, employees’ salaries, electricity, phone service, internet service, heating/air conditioning, water, trash disposal, shelving, computers, flowers, vases, baskets, balloons, greeting cards, ribbons, stuffed animals, etc. plus profit. Product = beautiful ways of saying thank you or congratulations, Happy Birthday or “I love you.” People pay for those, which pays for all the foregoing.

Network Marketing

The network marketing company itself has to pay for the home office, the home office employees, rent, electricity, phone service, internet service, heating/air conditioning, water, trash disposal, product development, product delivery, etc., but theoretically no marketing or advertising. (Most companies do some marketing and advertising to their sales force, that’s you and me, to keep them motivated, interested and in the know about company plans.)

Then there’s the independent sales force. You/me/they sell the product or service the company provides which brings in revenue for the network marketing company, which in turn pays you for those sales.

Examples:

Mona Vie – sell a bottle of their nutritional drink and get paid for it.

Pre-Paid Legal – sell a legal plan and get paid for it.

Primerica – sell an insurance plan and get paid for it.

Seems Simple, Doesn’t It?

But, some companies don’t keep it simple like that.

One company I investigated paid a residual commission on cell phone service that your job was to find customers for. That’s legitimate. Where it got murky was that they paid commissions on the purchase of the website you needed to do business on line, they paid commissions on the sale of their promotional magazines, and there was a bonus on signing someone up for the business. Near as I could tell, most of the money was not being made on the sale of the cell phone service.

Point! I said I would get to the point shortly. Here it is, the company this individual wanted me to check out was a grocery company. You pay a one-time fee to sign up, I think it was $200. You recruit others into the company, who pay their $200, after five people cycle through under you, you get $500 of which part of it goes back to start your new “cycle” and part of it is paid to you in the form of a voucher.

The selling point was that this $200 voucher, which you could earn as often as you could sign up five people, would pay for your groceries and so you’d never have to pay for your groceries again.

Now stick with me here, if nobody ever actually buys groceries except with their vouchers, and you can’t get vouchers without recruiting people to work with you, what are you getting paid for? If you answered that you are getting paid for recruiting, go to the head of the class.

They are selling it as a business where you can earn free groceries, but in reality you’re getting paid for recruiting people. Which means when enough people complain to the FTC, they’ll look into it and shut it down. The people who haven’t had time to recruit anyone when the FTC shuts it down are out their $200.

For more on pyramids and scams and how to detect them, you can look at Pyramid, Scam, or For Real.

Free Groceries? Or Free Information?

One of the 7 Insider Secrets is what kind of products to look for, along with what kind of company to look for.

It’s really a great set of criteria to evaluate a company with. Go to www.AlansMLMTips.com and sign up for the “7 Days, 7 Insider Secrets” email newsletter.

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I always wanted to be somebody, but now I realize I should have been more specific. – Lily Tomlin