Multi-Level Marketing and Attraction Marketing
What is the Relation Between them?
If you are a network marketer, you may have heard alot about attraction marketing and you might find it all very confusing to say the least. Attraction Marketing has been taking the MLM/Network Marketing industry by storm. But is attraction marketing worthwhile considering what it is and how it can help you in your business.
Firstly, let us explore a few terms. MLM stands for multi-level marketing, and these are direct sales opportunities that have been around for over 100 years, despite the fact that some people still call them pyramid schemes. Nothing could be further from the truth. They are now deeply rooted into our culture, our economy and our daily lives. Who has never been approached by someone offering to sell them diet pills, skin care, and household cleaning products. They are as American as apple pie.
The top ten MLM companies in 2016, are as follows:
It is interesting to note that one company, Nerium which offers anti-aging products only started in 2011, and Amway has been around since 1959.
Most of these companies operate in a similar fashion. You might be approached by someone to purchase their products, and then get a spiel about joining their team to earn some extra money.
One of the downsides to joining an MLM, is that they require you use the product, and in some cases will require you to buy product if you don’t sell anything during the month. This is required to continue your membership with the organization. Usually, after you maintain 2-3 regular customers, this will cover your membership and get you product to use at no cost to you.
Is there money to be paid in MLM? Well of course, but unfortunately over 99% actually lose money. It usually winds up being more work than they bargained for, or they are just not able to get comfortable approaching people.
All these companies tell you to make a list of everyone you know, (warm market) and then to start-up conversations with people whom you meet around town on a daily basis as you go about your lives (cold market). Usually people run through their warm market pretty fast, make a couple of sales, move on to the cold market and become disillusioned. Are there people who make money? Of course, but only a small minority.
Most of the money spent is by members – something that Network marketing companies acknowledge. They do not come from retail demand. Much of the product being ordered is to satisfy volume quotas. Sales are driven by members vying for sales contests or for volume targets.
After people have run through their warm and cold market, they are good prospects for what we call Attraction Marketing. They need to find a better way to find prospects, and get leads. We will cover this in the next post.