What’s Wrong with Network Marketing?


Network Marketing 1For the most part, I write about topics that target entrepreneurs who build their businesses from scratch. Over the next few posts, though, I want to delve into another kind of entrepreneurship that is often overlooked – network marketing.

Few people are neutral about the idea of network marketing. Most people, even those who have never contemplated entrepreneurship, fall into one of two camps:

  • Those who see network marketing as a great opportunity to make money without the risk involved with building a business from the ground up;
  • Those who run away screaming from anything that even vaguely looks like a network marketing business.

Of course, the second camp is much larger than the first. Most people hate network marketers with a blood-curdling passion. There are few simpler ways to get someone to hang up on you than by saying, “I have a business opportunity you might be interested in.” It’s also a good way to get friends and family members to avoid your calls and visits.

So what’s so wrong with network marketing that it has become reviled by an overwhelmingly large segment of society?

Honestly, I don’t think there’s anything intrinsically wrong with network marketing. It’s a perfectly viable business model that has helped thousands of companies grow exponentially and millions of people become business owners without the typical hurdles of starting a company.

It’s more about the perception of network marketing perpetuated by several factors:

1) The products often can’t stand on their own. Network marketing companies sometimes place too much emphasis on building downlines and not enough emphasis on offering unique, desirable products. The products themselves are treated as a “technicality” to prevent the network marketing opportunity from turning into an illegal pyramid scheme.

Think about it. Would you really pay $39 a month for chocolate bars if not for the network marketing element? How about weight loss supplements? I don’t care what kinds of insane claims the manufacturers make — you can go to Walgreen’s and load up on similarly-touted (and ineffective) weight loss pills to your heart’s content (for a lot less than you would pay in network marketing membership fees).

A product should be something you would buy even without the network marketing aspect. If it has standalone value, it’s a viable product to promote through network marketing. I chose Legal Shield for this reason — as a business owner, I recognize the importance of having an attorney review my contracts, send collection letters, offer tax advice, etc. It would be well worth the $17 a month I pay even without the opportunity to sell it to others. Which brings me to my next point…

2) Too many people get into network marketing to “get rich quick,” not to offer products they believe in. As with any business, if you don’t have a passion for what you’re offering, you’re probably not going to get very far. If you’re going to get into network marketing, it’s a good idea to choose a company that offers products you would use yourself. Otherwise, you’re going to have a hard time hearing “no” (which network marketers have to hear a lot of) and probably end up wasting your investment.

No single product is right for every marketer. I could personally give a rat’s furry crack about weight loss supplements (seeing as how I’m 6 feet tall and about 135 lbs, it’s little wonder), but other people go crazy over them. Similarly, I’m passionate about affordable legal services, which might be as exciting as watching paint dry for some people. With that, we’re on to point three:

3) Many network marketers, especially newbies, don’t consider their prospects carefully. When you get into a business and are excited about making money, you start trying to get anyone and everyone to join your downline. After you’re done with the low-hanging fruit (family and close friends), then what?

Don’t get me wrong — sales and organization memberships can come from some of the most unlikely sources. I’m not talking about judging a prospect. What I’m talking about is coming up with a quick, unobtrusive introduction that instantly qualifies a potential prospect. In my case, it’s two statements of agreement (“Lawyers are expensive” and “more people would use them if it was affordable”) and a question (“Do you mind if I show you how I provide people with unlimited attorney access for $17 a month?”) I can gauge interest pretty quickly without investing a lot of time. If there’s no interest, I just move on. I don’t waste my time following up with people who could care less. Instead, I spend that time working with people who, like me, see value in the product.

Next time, we’ll look at the nuts and bolts of getting into a network marketing business, so you can decide if this type of entrepreneurship might be right for you.




Categories : Getting Started

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