Why Does Network Marketing Get Such a Bad Press?

Network marketing is often viewed as a bad thing because some have been known to overpromise, and often use pressure tactics on their prospects. These misconceptions are inaccurate. Network marketers deserve a good reputation, not a bad one.

In this post I want to show how Network Marketing gets bad press and why it’s unjustified.

network marketing bad press

Why Network Marketing is Not a Pyramid Scheme

Network Marketing has been unfairly labelled as being synonymous with Pyramid Schemes, which is an unfair characterisation of the industry in general.

The truth is that network marketing companies are different from pyramid schemes in many ways including product quality, customer service standards, compensation plans, and company culture.

Most importantly network marketing companies do not require participants to pay a fee to join a network, whereas pyramid schemes do. The network marketing company may encourage people to pay for a product pack at a discount so they have samples. Or they get promotional material that will help them get started in their new business.

Network marketing companies have a network-based business model. As a result, the new business owners earn money from their product sales. They also earn from the income generated by people they have enrolled into the network to whom they have also sold products.

In network marketing, like in any other job, you need to work hard and put in lots of effort. You must treat it like any other job, with attention to detail and dedication.

If you do this, tremendous results are possible; if not, exactly as with any other job or business opportunity, network marketing is more likely than not going to lead nowhere.

network success

The Difference Between Network Marketing and Pyramid Schemes

Network Marketing:

All Network Marketing companies are based around a physical product or saleable service model. The product offers a means of earning money because the seller gets a commission. The business owner can increase earnings by recruiting others into the business and helping them to do the same.

It’s a business that is based on duplication and the most successful are really good at this.

Pyramid Scheme:

Pyramid Schemes are illegal in most countries, and not part of network marketing. Any claims or suggestions to the contrary are false allegations made for anti-competitive purposes.

A pyramid scheme can be explained easily in the form of an investment. This is no ordinary investment though. A person is invited to invest money into the system with the promise of great potential profit.

The person puts money in, but then they have to bring in 3 people to invest the same to get paid. If they don’t do this, they lose their money, and therefore the only reward they get is a loss of money.

Governments then took charge and outlawed this kind of scheme because there was no means of earning without recruiting.

Network Marketing companies are scrutinised and licenced so they are allowed to trade. They pay their independent distributors commission for product sales and therefore comply with the terms of the licence.

network marketing vs illegal pyramid schemes

Key:

Illegal Pyramid Scheme

Network Marketing

Level 1 – Pays in £3000
Enrols 3 people – Earns Commission
Level 1 – Joins free. Buys £100 Start-up kit (£100 cost, £180 in product value)
Earns from product sales and recruit’s product sales down 4 levels.
Level 2 – Pays in £3000
Enrols 3 people – Earns Commission
Level 2 – Join Free – Some buy Start-up Kit
Earns from product sales and recruit’s product sales down 4 levels
Level 3 – Pays in £3000
Enrols 3 people (with difficulty) – Earns Commission
Level 3 – Join Free – Some buy Start-up Kit
Earns from product sales and recruit’s product sales down 4 levels
Level 4 – Pays in £3000
Cannot enrol 3 people, so NO commission and loses investment.
Level 4 – Join Free – Some buy Start-up Kit
Earns from product sales and recruit’s product sales down 4 levels
As you can see, the illegal pyramid scheme is dodgy for sure. If anyone in ANY level doesn’t recruit 3 people, they lose their investment with no means of getting it back! The person at the top gets commission for ALL levels and those under get a commission from investments made by the people they introduce.
With Network Marketing, however, because it goes down 4 levels, a person on level 3 could introduce someone who is a tiger at this business. They could position them under one of their level 2 people. This means the original level 1 person is not getting ANY benefit from this because they would need to have level 5 payouts to do so.
What this means is that the income of the original level 3 person could overtake the income of the person at original level 1. This is possible because of potential bonus payments made by the company. This is highly unlikely in a traditional business and not possible in a pyramid scheme.

 

Why Network Marketing is NOT Scam!

Network Marketing is often referred to as a scam. This is not a fair reflection of the business in general. Yes, you have to be careful when choosing a company to work with, but most are legitimate and honest.

Most people who get into Network Marketing are not “business-minded” in many ways. Some of this comes from desperation, but most of it comes from poor training. The training hasn’t changed for so long and is often based on the “friends and family” route.

It’s time to get training on the use of social media to help with sales and recruitment, but not to fully concentrate on just friends and family. Also, making use of branding through having your own website and learning about simple blogging to tell your story and grow your influence.

Brand Yourself!

the importance of personal branding in network marketing

People join people, so branding yourself is key.

Those people who say “network marketing doesn’t work” are not looking at the whole picture. Sure, only a low percentage are very successful, but what is the reason for that?

If people are earning a large amount from their network, they have been successful for a reason and that is PROOF that, when done properly, Network Marketing DOES work!

Why Do Most Network Marketers Fail?

Most network marketers fail because they either don’t make enough money to cover expenses or make even less than that, while others succeed wildly! It’s up to you.

The first thing to learn about network marketing: there is no such thing as an easy road to riches! To succeed at anything takes hard work and determination, but those who stick with network marketing reap great rewards.

Those people who see network marketing as some sort of get-rich-quick scheme are likely to fail. Like any other business or venture, one needs to plan and set goals one wants to achieve.

Network Marketing is hard work and time consuming with sometimes no financial reward for months on end. But those who stick at it can reap huge financial rewards.

If you have a traditional business, the last paragraph could be familiar to you, especially when starting out. All business takes time and effort to be successful and network marketing is no exception.

The major difference between network marketing and traditional business is the level of investment to get started. Maybe this is also a factor in the overall success rate.

If you spend thousands to set up a traditional business, you are likely to work very hard to recoup the money. However, if you can join a business for nothing and start to promote the products and don’t succeed quickly, you haven’t lost that much. If you fail with the traditional business, you lose a heck of a lot more!

Business requires the right mindset too, regardless of start-up costs or not.

network marketers need a business mindset

Business Needs Consistency

Any successful business requires that you invest your time, hard work, and energy into it to reap rewards. You can’t just sit around and expect things to happen for you when network marketing.

You also need to be consistent in your thoughts when network marketing. When you’re not getting the results you want, don’t look at the business as a scam and close up shop.

There are plenty of legitimate network marketing companies out there who could help you with your business. You might also want to see if there is anything in the company’s training material that needs updating or improving.

Consistency doesn’t just require persistence; it requires staying on task and completing all of the tasks that network marketers should be doing. It’s about staying positive and not letting yourself get discouraged when things don’t go your way.

It’s also important to connect with other network marketers because they will understand what you’re going through and help you make your business a success! One bad networker can destroy an entire network marketing team with their negativity.

Most successful mlmers got where they are by working at it and learning as they go along. Stay positive, network with people who are like-minded, and don’t give up!

Remember that network marketing is about helping others succeed too. Helping others in your team to build their businesses will make your team and business grow faster than you think.

help other business owners succeed

 

Network Marketing Can Be Learned!

Network marketing isn’t for everyone. Some people just don’t have the right mindset to see something through or work hard to achieve success. However, those who do put in the effort reap great rewards over time.

Ask yourself these questions:

  • What are your thoughts on network marketing?
  • Is it a road worth taking?
  • Are you dedicated to your future and want to make a success of network marketing?

These are questions only you can answer.

How To Be Successful in Network Marketing

The network marketing business is a highly competitive that requires commitment and consistency. It is often compared to traditional businesses, but network marketers do not have the same start-up costs. It is important to network with others in this space for encouragement and motivation. This will make you more successful in your own network marketing business.

Be consistent and use your time to complete tasks such as promoting the business, products and working hard every day. Show up daily and do what you need to do to progress your business. Remember that it is a BUSINESS, not a hobby!

Many top earners in network marketing have created their own blogs, YouTube channels so they can share their content and knowledge regularly.

Top influencers, like Ray Higdon and Eric Worre have had great success with their blogs and video channels. Why is this? Because they regularly showed up to create new content based on their own experiences. Sharing knowledge that works is a great way to grow a following.

I remember Ray talking about a book call Go for No! It’s a very simple concept. You speak to people and make sure you go out to get 10 or more “Nos” a day. Because you are speaking to many people every day, chances are you will also get a “YES”. That doesn’t mean you stop after your first positive reaction. The going for 10 “Nos” is the whole point of the task at hand.

This is a great way to build your team quickly and when you get the hang of it, you can get more and more “yes” replies each day.

I recently saw this video interview featuring Ray Higdon and this may be very helpful for you:

You can get the book Go For No Here.

If you decide to go with network marketing and believe in it, stick to it! Learn from successful networkers, and stay consistent! If you do this, there is no reason why you won’t be on your way to success.