When I did a search for today’s blog topic of “What is an MLM” I had to have a good laugh. But in reality what I found it is actually not that funny, and unfortunately not surprising.
Instead of quality information to help you understand what an MLM business is; I instead discovered lots of internet marketers bashing the MLM industry with the hidden agenda of diverting you from getting involved in this incredible industry and instead trying to convince you to join either their program or buying a product they recommend.
Shameful but not surprising.
You have to be very careful when researching anything online as there are always marketers putting out information with a hidden agenda. They come across as trying to help you out, but in fact they are trying to sell you something.
In this post you are going to get the facts on what an MLM is.
You are going to get the truth on whether it is something you should become involved in.
And lastly I am going to be very upfront on what it takes to be successful in this industry.
So What is an MLM Anyway?
MLM stands for Multi-Level Marketing. The more popular name is Network Marketing.
It is a very legitimate and potentially lucrative business model that has been around for many years now and has been responsible for creating incredible levels of success for countless people around the world.
It is considered to be a home based business. Which means you run it out of your home. Most people spend about 2 hours a day working on their business and this is more than enough time to do very well with it if you do what is required during that time frame daily.
Being based out of your home allows the startup cost to be a fraction of what a traditional business startup cost would be. Allowing everyday people to go into business for themselves.
Where a traditional business would cost in many cases well over $100,000 to get started, a MLM business would typically cost under $500 to get started.
How the Model Works
So the best way to explain how this business model works is to give you an example.
Let’s say you have a good friend, let’s call him John-boy. He calls you up and says he has a business opportunity that he thinks you may be interested in and asks if you would take a look at it.
You agree to take a look.
He then sends you a website that has a video presentation of the opportunity that explains how the business works, how you get paid and what the product is.
You are intrigued so you decide to join. The startup cost is $300. John sends you to a website that allows you to enroll yourself into the business.
When you sign up you are now in business…
The company will typically send you a starter kit with some business resources and tools to help you build the business as well as some product.
John gets paid a commission for enrolling you into the business and a commission on the product that you ordered with your startup kit.
When you enroll into the business you also become a customer of the company. You will want to become a product of the product, meaning you will want to use the company’s products monthly.
It is hard to promote and recommend a product you do not use yourself.
You will also want to order product monthly to have as samples to share with people. John will get a commission from any product order you place moving forward.
What Multi-Level Means
When you join the business you actually join a team or an organization within the company. John-boy was a member of a team.
John-boy is what is referred to as your up line, you are in his downline or his team.
This means he is above you in the compensation plan structure, which again means he gets a commission off of any product order you make.
John also has an up line. There could be thousands of people in John’s up line above him. They also get a small commission off of any orders you place.
Now Here is The Exciting & Profitable Part
The opposite of what I just explained is also true.
Your business goal is to go out and ask other people if they are interested in looking at your opportunity or product.
You want to build a large team of people “under” you. You want to build your own downline, team or organization.
When someone joins the business because you brought them in they become part of your organization under you. They are what is referred to as your downline.
You earn a commission for sponsoring them into the business AND you earn commission off of every product order your new team member makes.
Let’s say you enroll 20 people into the business, you would get a commission for sponsoring them into the business and also a commission off of every product order they make monthly.
Now here is the very cool and powerfully profitable part of how multi-level marketing works, this is where big money is made and the power behind this business model…
The Secret to Success
In MLM you earn off the efforts of others and not just your own efforts. It is very much of a team environment.
Because what happens is you also earn a small commission on any product orders made by anyone your new team members bring into the business, because they are also in your downline and forming a part of your organization.
And this magic process continues on down the line…
Meaning you will earn a commission from anyone that new person brings in and everyone they bring in, and anyone they bring in and so on and so forth down through your origination.
So you can see your goal is to build your own large organization of people who use the product monthly and share the opportunity with other people on a daily basis, hence growing their team and yours.
As you and your team continues to share the opportunity and more and more people join the team your income continues to grow from all of the sales on product that happen within your team.
As the old saying goes I would rather get a little from a lot of people versus a lot from one person.
And that is how mlm works. You get paid a commission on the product orders of a lot of people. And it adds of quickly.
So What Does it Take to Be Successful?
Like any business or anything worthwhile in life it takes a rock solid commitment to making it happen. It takes hard work, dedication and persistence.
You are going to have ups and downs and you are going to have frustrations and set backs. Again this is the same with anything worth achieving in life.
Success is not just given to you. It is achieved by the people who go after it, work for it and as a result deserve it.
If you are looking for a get-rich-quick scheme, MLM is not it.
Now if you are looking for a way to completely revolutionize your life in the next 2 – 5 years you can do it in this industry.
You are going to have to be coachable and you are going to have learn new skills and you must allow yourself the time to get good at them.
In the end success in this industry is not hard no matter what you hear.
The activities you perform on a daily basis to build a multi-level marketing business are simple. They are purposely designed with that in mind.
In order for anyone to be able to build a large team or organization they need the other people on their team to be able to have success also. This is accomplished by keeping the business building activities simple.
Success in this business is simply…
Learning the skills required to meet new people, learning the skill of becoming friends or building rapport with the people you meet and then simply asking them if they are open to looking at your opportunity.
That is it that is all!
And finding new people to meet is now a simple thing because of social media sites like Facebook. I have hordes of training on this site designed to help people learn how to find new people to prospect.
At the end of this post I am going to give you links to additional posts you can read to get more information on how MLM works. I’ll also include some posts that show you how you can use Facebook to build your business so you can get an understanding of how that works.
The Bottom Line
When it comes down to it, multi-level marketing or network marketing is a business opportunity like any other from the stand point that you are going to get out of it what you put into it.
If you get frustrated and quit then obviously you are going to fail.
But if you can make a commitment to yourself that you are going to be a success at this no matter what and then put a plan in place to go and make it happen and stay the course no matter what than your success is inevitable.
Here are some additional resources you can look it you want to learn more about this business model:
And there you have it my friend, you now understand the basics of what an MLM business is. If you have any questions drop them in the comments and I will do my best to answer them for you.
Cheers to YOUR Success!
P.S. Discover the exact step by step process to build a highly profitable MLM Business. Sign up for my FREE Boot Camp at the bottom or side of the blog and get started building your own successful downline today!