MLM, or multi level marketing, is a technique where a product or service is promoted through a whole group of people. Each person in the group searches high and low for another person who could be recruited and placed in his down line. The more people recruited by you the more you earn because every time someone in your down line makes a sale he or she earns, and you earn a portion of the sale as well. So it is in your interest to get as many people to sell the product as you possibly can.
There is a problem with this system though and that is the fact that there can be an end loser if the product being sold meets what is called a market saturation point. Another way an MLM can fail to yield profits is when the MLM is a pyramid scheme, better known as a ponzai scheme. There are ways to detect this that we will endeavor to explain in this article. However, first we must explain an MLM ponzai scheme.
A ponzai is a program where there is definitely an end loser. Let us take a simple MLM scheme where people had to buy in for a few hundred dollars then they had to get others to buy in for the same amount in return for a percentage. After they got a certain number of people to sign up they recovered their money and there after it was profit all the way. And when each member they recruited managed to enlist another member they both earned a percentage. Each member tries to get people to sign up and the list continues to grow. Eventually there will be very few or no one wiling to enlist in the program and this will lead to losses for the people at the bottom of the list. It is easy to spot these scams.
Apart from using common sense to spot MLM scams there are web sites that are dedicated to exposing MLM scams. A simple search on any of the popular search engines will reveal whether the MLM you are contemplating signing up for is a scam or not. There are also government registered sites that display legal notices served to MLM scams.
In the final analysis, it should be noted that it is not in the interest of anyone to jump into an MLM program without the due research and in-depth study of the program and the management behind the scenes. The integrity of the management is of greatest importance as is the product that they are selling. If the product has no commodity value the MLM is as close to a scam as it can get.
MLM is a marketing technique that involves building a team of affiliates, marketing the product that you are marketing too. There will come a point when you will never have to push the product again because someone somewhere is doing the selling for you and every time any one of your affiliates makes a sale you get a commission too, without doing anything at all.
There are basically two types of MLM leads. One is called the unqualified lead and the other; you guessed it, a qualified lead. The unqualified lead is someone you spoke to about the product you are trying to sell but he or she is not really interested in. These people could be anyone you met, in the coffee shop, on the street or in a bus. If they are not interested in buying the product or service but they still took your contact information from you, they are added to the list of unqualified leads. If they were not even interested in taking your contact details then they are not leads at all and should not be thought of anymore.
If an unqualified lead takes your details there is a chance the lead can convert at a later date. However, this is not always the case. Most people take your details just to humor you or to get you off their back. A qualified lead is someone who has decided to make contact with you by requesting some information through email or phone or any means. This lead could also be someone who has decided to buy something from you. However, even qualified leads are quite difficult to convert to customers. A person who signs up with you and requests information about the product may opt out and decide not to buy. So closing a deal is quite a task at times.
A good way to market through MLM is to generate opt-in leads for the product.
Opt-in MLM leads is nothing but giving a person the opportunity to opt into the program. There is no forcing or selling involved in opt-in leads. Anyone who is opting into the program is doing so on his or her own free will. This is a method of getting prospective people interested in your MLM to opt-in to the system where by they get a news letter or updates of the program from time to time by opting to receive these updates. When they sign up for your opt-in program you can contact them from them to time to try and convince them to join through well written sales letters and news letters.
Opt-in MLM programs must always have an opt-out facility to respect a person’s privacy; sometimes it is mandatory by law.