Created by simonsellen on 11 Jul 2010 | Tagged as:
Multi-level marketing (also called network marketing) is a business model which utilises a combination of direct marketing and franchising. Typically, individuals become associated with a parent company in an independent contractor relationship. Sellers are compensated based on their sales of a product or service, as well as the sales of those they bring into the business. The parent company often provide a huge amount of literature and promotion materials that can be used by the seller to help them get the sales and sometimes give directions where the seller can obtain mlm leads.
I guess you have already figured out that businesses who do not use the words “multi-level marketing” or “network marketing” use other terms such as “affiliate marketing,” “home-based business franchising,” etc.
Affiliate marketing is of course a term we are much most familiar with. However, what is unique to the mlm industry is the fact that you can build your business using any recruiting model you want, use any type of lead generation known to man and even go back to the cave man days of face to face recruiting. But who’d want to do that when you have the internet, right?
A big plus point is that you can purchase specific mlm leads like that will make selling your products a lot easier. MLM leads come in a variety of forms. The simplest is from online surveys or customer feedback to determine if a costumer would be interested in other similarly related products. Often these also get done over the phone and it is perhaps this mlm lead that is the most valuable. Why? Because a person actually spoke to the potential costumer already who has expressed an interest in a certain product or category of products. A business can accumulated 1000s of these leads and then sell them on to other business or their affiliates who in turn contact these leads again and try to sell them the respective products. This can of course be anything from ebooks to commercial insurance to vacations.
Some of these products are worth a lot of money. For example, take a summer vacation for 2. This easily amounts to £1500. The 1000 mlm leads may only have cost £150. This means you have 1000 leads or potential customers that have already expressed some interest in the product you are contacting them about. What is the chance of you selling at least 1 or 2 of these holidays? Probably very high. So you invested £150 and even if you only sell to 0.2%, you still make £2850 profit! Not bad. Of course it does take a certain amount of skills to do this and Money Ideas strongly suggests you do a fair amount of research and training in MLM Lead marketing before you spend any significant money on this. There is no point in investing into this sort of business only to realise 2 months down the line that it requires a lot more work and isn’t for you. On the other hand, it works for a lot of people and generates an acceptable amount of passive income for them so it may well be one of the right money making ideas for them.