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    43 Replies Latest reply on Dec 22, 2009 5:34 AM by snvservices

    The good and bad of Network Marketing

    Dao Marketing Newbie
      Three Questions:

      1. Do you feel Network Marketing will be the business of the 21st century?

      2. What are the pros to network marketing and what are the cons, do you feel the pros outweigh the cons?

      3. Is there a database available to find people interested in Home Based Businesses, specific to the Network Marketing model?
        • Re: The good and bad of Network Marketing
          LUCKIEST Guide
          Good question. Yes I do feel Network Marketing will be ONE of the businesses of the 21st century.
          With technology changing (almost daily) so much is on line. We can do almost everything from reading a
          newspaper, to buying and selling and banking from home.
          Do not know if there is a database available to find people interested in Home Based Businesses,
          BUT there is SCORE online. They could help.
          LUCKIEST
          1 of 1 people found this helpful
          • Re: The good and bad of Network Marketing
            Lighthouse24 Ranger

            Good question.

            1. I think that Network Marketing (or MLM), as it generally exists today, will vanish for all but a few types of products. For companies that use MLM, the value of a downline has traditionally been to introduce new distribution channels and new customers -- and the downline took about half the total profits for that. The Internet and other technology advances have resulted in better and cheaper ways for a company to market directly to potential buyers (by one estimate, 93 percent of all U.S. consumers are already "databased" by at least one on-line seller) -- so the downline potential is being squeezed out. I do think a new type of MLM will emerge for certain companies and products where the downline individual is not so much a seller/distributor, but rather a post-delivery servicer. (That "servicer" role would help reduce the thousands of MLM complaints on file with BBB's, Consumer Affairs groups, and state Attorneys General, too.)

             


            2. Pros and cons depend on who you are in the whole deal. If you're the company, the advantage is that you essentially have other people using their money to get you new customers. The disadvantage is that you have no control over how those people represent (or misrepresent) you. If you're in the downline, the advantage is that you can get into your own business easily. The disadvantage is that unless you're in the network early and can build a proftable downline of your own, you probably won't make much money. If you're the customer, the advantage is you might be able to buy a product that you'd have never seen in a store or even known about otherwise. The disadvantage is that if you are not satisfied with that product, the downline individual who sold it to you may be unwilling or unable to correct the problem or refund your money.

             


            3. I'm sure there are many such databases, but I can't offer a specific link or pointer.
            • Re: The good and bad of Network Marketing
              DomainDiva Ranger
              Actually a great deal of marketing is 'network marketing'...word of mouth advertising is very important. (Right Nat? ;) )

              I am in a health and wellness MLM. The company is privatley held and the owners are actively involved in the business. This company also provides training. The training seminars have helped me become a better businessperson and gotten me over my fear of public speaking.

              Dr. Charles King @ U of Illinios @ Chicago (UIC) teachs MLM. MLM I believe is as good or bad as the people that participate. Just like any other business.
              1 of 1 people found this helpful
                • Re: The good and bad of Network Marketing
                  NatOnline Tracker
                  Yes DomainDiva, you are 100% right :-)

                  I tried the chamber of commerce here when I was running my graphic design company, it was a wast of time and money, people were rude.

                  I also had long time ago a meeting with a SCORE counselor, this person was very nice but knew nothing about my industry or to promote it.

                  Once again, the best marketing you can have is word of mouth, trust me I am in business for 7 years now.
                    • Re: The good and bad of Network Marketing
                      coffee times Newbie
                      hi, i'm new at this and not very good on the computer but i need to learn to network and this is a good place to start. i have a small coffee shop just 10mins outside asheville nc its been in business for two years its not been easy either. since i opened a bunch of corp business have opened around me like vultures waiting to strike it rich. now that i'm still here they are starting to close all around me. score has not helped me a bit even though i have tried with them several times. the chamber of commerce has not either matter of fact they had flat out told customers you don't want to go there its to far from town really now what is that. either i'm stupid or just determined. i just found out that a local bbq place is opening in the store next door this is great it will bring lots of business to an end of town that has lots of money but very little knowledge of whats around them these kind of people is what builds a business if you can get them to your door. i have tried several kinds of marketing but it only works while paying lots of money for it and only during the duration your doing it so its not worth it. the only thing i have found that works is word of mouth. but in these crazy days of economic problems thats a big problem people are set in there ways and places like mc, cracker barrel etc its hard people are afraid their kids toys are from china what about the food they eat. i serve a healthy menu no fried foods organic coffees etc. and its still hard. what small local business needs to do is brand themselves but score or chambers etc don't teach you this and this is the hardest thing out there. so i thrive on word of mouth with my case its my cake and the awards i won for them. still its not enough richer people want more than what they pay for and thats hard image to keep up with. so help me out too.
                        • Re: The good and bad of Network Marketing
                          CorpCons08 Ranger
                          coffeetimes,

                          I commend you for your effort and persistency. Do you have any local business owner networking groups? There are nationwide organizations that meet once a week to exchange their services with each other and you may benefit from such a program? Another idea would be to have some kind of special that none of your competition can compete with. Maybe a special flavored coffee or holiday dessert or something. People flock to things that they cannot get anywhere else.

                          CorpCons08
                          • Re: The good and bad of Network Marketing
                            NatOnline Tracker
                            I hear you and I found some commun issues with the Chamber of Commerce which will bring you nothing.

                            I will give you an example of what I have experimented with them when I was photographer, graphic design, and print broker. When I was member I asked kindly to display my brochures on a big brochures spot for members companies. I gave them around 100 copies, 2 weeks later my brochures were not their, and I asked why. The lady at the front desk was telling me that before to put my brochures, I needed to wait a free spot, 6 months later, my brochures were not there. I did in 1 year a one job for a member but nothing terrific. never had a recommendation by telephone, nothing. Paying for this kind of networking when all the new members are looking for business and not giving business, then old members are already set with companies they are working for a long time. I sent thousands brochures to members with no results, then send brochures to companies in Yellow Pages with a lot of results for free. No it wasn't a problem with my brochure but rather with this networking.

                            To help you I recommend you to make a fidelity card with rubber stamps, when a customer comes to the 10th time offer them the 11th coffee for free, also try to do a little menu with a coupon of $1 so people can bring it to work and talk to co-workers about your business, another thing, if you can create a delivery service with a minimum of $...it would be a plus.

                            Hope you will find this helpful,

                            Good luck
                            • Re: The good and bad of Network Marketing
                              LUCKIEST Guide
                              Coffee times, Good luck, As you said " the only thing i have found that works is word of mouth"
                              Word of mouth is the BEST and least expense form of advertising. It sounds like you are a survivor.
                              Other businesses come and go, yet you are still there.
                              I like Nat On Line answer. Giving out a card and the 10 one is FREE. (my wife loves that)
                              I am a SCORE Counselor and sorry you did not get good results. Please try again. You can also contact
                              SCORE online and reach out to MANY SCORE Counselors online. We all have different answers.
                              Hope this helps, LUCKIEST
                              • Re: The good and bad of Network Marketing
                                stillbrowns Newbie
                                Coffee...you stated that your business isn't in an active part of your community, but it sounds like you offer a product that many people may be interested in. Have you thought about providing a service where you bring your product to other local businesses? You could provide refreshment at local gallery showings, small business meetings, to doctor's offices as a gift from the pharmaceutical reps....I think there is a market for you, it just may be in a place that you aren't looking.
                                • Re: The good and bad of Network Marketing
                                  hagget Newbie
                                  Dear Coffee Times,
                                  Sometimes free coffee can generate a few heads which they will tell someone else you offer free coffee from time to time. Find out local businesses and offer free coffee to employees and catch a few sporting games in community with advertised t-shirts offering coffee too. Advertise on your car that you are established offering free coffee to anyone watching you sign on car. Keep it simple and watch your competition and learn a few eye candy advertising at best. Location is tops and aggressive tactics can help too. Invite the local politician, chief of police, fire marshall, etc. for free coffee with a one meal that you know they will talk about for days to peers. Everyone isn't healthy eaters just talkers. Keep community relations open most of your business because people remember people not just the food. On election time donate a few meals to the seniors who's been in the community for 50 years they know everybody or enough people to invite a lunch or dinner gathering at your business. A few birthday parties for your children friends will help too.
                              • Re: The good and bad of Network Marketing
                                NatOnline Tracker
                                Oh I forgot, I really don't like the concept to pay and be member of BBB, Vegan, and all the services like that to make money.

                                Independance is KING and FREE ! :-)
                              • Re: The good and bad of Network Marketing
                                BarryHurd Wayfarer
                                I just read this thread and was left scratching my head.

                                While MLM is network marketing, not all network marketing is MLM.

                                For instance blogging and online communities (like this one) is online network marketing.

                                1. Do you feel Network Marketing will be the business of the 21st century?

                                Yes I do, fueled by technology changes in blogging and social media. Affiliate marketing will evolve into a much leaner machine that is based on referrals and recommendations by the people we know (which is a huge reason Facebook is attracting so many marketing dollar right now)

                                2. What are the pros to network marketing and what are the cons, do you feel the pros outweigh the cons?

                                The pros are moving into a relationship based selling model, rather than a product based sales model. You can jump several levels into the sales cycle by finding people who you already know or who trust a referral enough to make a business transaction. The con is that there is a tendency in folks to put too many eggs in one basket and not develop multiple channels of business.

                                3. Is there a database available to find people interested in Home Based Businesses, specific to the Network Marketing model?

                                Yes... its called Google. I've done a lot of research on home based businesses, which more and more businesses are adapting to the model. The technical / corporate version of "home based" is calling it "virtual". Everyone on my team is virtually based out of offices across the U.S. After having a decade of corporate life and cube farming under my resume, the need to have a physical office is getting less and less needed. One major shift is that physical mail is even going truly electronic, a professional contact in the northwest here received over ten million in funding to launch EarthClassMail (a virtual PO Box that scans physical mail and sends it to you via the net anywhere in the world)
                                  • Re: The good and bad of Network Marketing
                                    CorpCons08 Ranger
                                    Everybody is entitled to their opinion. Can you tell me more on why you do not like network marketing?
                                      • Re: The good and bad of Network Marketing
                                        BarryHurd Wayfarer
                                        I'm assuming you are referring to MLM type of network marketing?

                                        Many large Fortune 5000 companies use network marketing... so I can' see how that includes "poor desperate people who usually are in debt."

                                        For instance the Advertising and Public Relations industries both work offsliding scale percentages that often feed several layers down through vendors and affiliated business partners. The usual percentage in the advertising realm starts at 15% for referrral business, which trickles down into everything from online sales to national newspaper campaigns.

                                        Network Marketing is also used by street salesforces with a high-turnover rate. For instance when I was at Verizon we had a salesforce of four to five thousand nationwide. Every single salesperson exposed us to a personal and professional network ranging from 50 to 5000. Basic math told us we had an inherent network of 200,000 to 25,000,000 word of mouth contacts in the circuit at any one time.

                                        The MLM model used by companies like Amway (Quikstar) or a variety of other businesses often does present itself to people who are targeting the wrong demographic, but the successful salespeople and marketers within those groups have extraordinary professional networks. If you ever network with the diamond level of Amway for instance, they often have an inner-circle of succesful six-figure incomes representing a wide variety of industries.

                                        If you look at the online model of network marketing (affiliate marketing) sites like commission junction have large groups in the tens of thousands of users working as MLM structured business networks. It is one of the fastest growing areas of online marketing due to things like blogging and online communities.
                                      • Re: The good and bad of Network Marketing
                                        Dao Marketing Newbie
                                        Hi Barry, thanks for your insight. I would like your opinion of the company i am in business with-- Pre-Paid Legal Services, Inc. we use the direct marketing approach, also referred to as Network Marketing. We are different from the standard MLM because we offer a stand alone product. If you are not familiar with us please go to my website daomarketing.com. There is a short movie or you can click on the links for members or associates.
                                        Thank you in advance, Rick Mosca
                                      • Re: The good and bad of Network Marketing
                                        puzzleman Tracker
                                        Dao Marketing,

                                        I don't know about the answers to your first two questions but for number 3, my suggestion is to try Craigslist.com. I have posted employment ads for seasonal part time employees and have been very successful. Another resource to try is Goodwill. They have employment counselors that can set you up with what you are looking for. Have also been successful with them as well. Plus they are still feeding me applicants even though I am not in need any longer. Still taking them as you never know when the diamond will show up.
                                        • Re: The good and bad of Network Marketing
                                          Healthy Girl Newbie
                                          Pre-Paid Legal has a credible service that makes legal assistance possible for people who otherwise could not afford it. Be cautious about the marketing structure for yourself, though, as the distributor. In times past, the product was great for the customer, lucrative for the attorneys, but many distributors felt ripped off. Exorbitant debt was built right into the marketing structure. It looked like you were making great money on the surface, but you were really creating great debt to the company. I've heard that the marketing structure has changed, but I'm not familiar with the changes that have been made. Hopefully it's much improved. Just FYI

                                          As for finding a website to find distributors, try http://www.UltimateSuccessCDs.com Tracy Biller sells MLM leads and shows you how to use them. He provides general training for MLM distributors Might be worth looking into.

                                          Hope this is helpful,
                                          Healthy Girl
                                            • Re: The good and bad of Network Marketing
                                              Lighthouse24 Ranger

                                              Healthy Girl, have you personally used Pre-Paid Legal, i.e., did you enroll as a member (not an associate) and pay the annual fee -- and then use the service as a member to obtain legal assistance? Thanks for responding.
                                                • Re: The good and bad of Network Marketing
                                                  Dao Marketing Newbie
                                                  Lighthouse do you have a personal grudge against Pre-Paid Legal?
                                                    • Re: The good and bad of Network Marketing
                                                      Lighthouse24 Ranger
                                                      DaoMarketing: No. Why do you ask?
                                                        • Re: The good and bad of Network Marketing
                                                          Dao Marketing Newbie
                                                          Hi Lighthouse24, well you said in the forum on employee benefits that you felt the plan had little or no value ans that you would tell your employees not to use it. Have you or someone you know been a member and had a bad experience if so i would like to know.
                                                          Thank you in advance.
                                                            • Re: The good and bad of Network Marketing
                                                              Lighthouse24 Ranger

                                                              The comment to which you refer was not in this thread, but in another post where you asked all business owners in this community for their opinion of pre-paid legal services (and where you urged us to purchase it as a critical "life saving" benefit for our employees).

                                                              In response, I offered my opinion: that I would not use it myself, nor recommend it to my employees. That opinion is not based on past experience as a user or member, but it IS based on facts provided by the company itself to the Securities and Exchange Commission (public record) as well as on information published by consumer groups and the state Attorney General. Even so, I did not present any of those facts to this community -- I merely stated my opinion.

                                                               


                                                              Does that address your question or concern?
                                                                • Re: The good and bad of Network Marketing
                                                                  Dao Marketing Newbie
                                                                  Lighthouse thanks for responding, if you could direct me to the information you referenced, the sec report and which State Attorney General has a problem with Prepaid Legal it would be very helpful. Also which consumer groups have an issue with PPL. We will investigate and see if the issues were resolved.

                                                                  Thank you, Dao Marketing
                                                                    • Re: The good and bad of Network Marketing
                                                                      Lighthouse24 Ranger

                                                                      I really don't understand why you're asking me to point you to information about YOUR OWN company. I haven't presented anything in this forum other than my OPINION -- that I would not use or recommend the service. Why is that an issue for you?

                                                                      You can search SEC filings at: http://www.secinfo.com/ or on the company's own website.

                                                                      I did not write that a "state Attorney General has a problem with Pre-Paid Legal." However, many state's websites warn that multiple complaints are on file and being investigated because: 1) associates (not the company) have grossly misrepresented the member benefits, 2) associates have used the term pre-paid legal "insurance" (rather than "services") in states where it is illegal to sell insurance without a license, and 3) employers may or may not be able to deduct the cost of pre-paid legal services (because it may or may not qualify as a legitimate employee benefit -- rulings have been made each way, and are still pending in some states).

                                                                      As far as summaries of consumer-initiated complaints, yu can start with consumeraffairs.com.

                                                                      While I doubt anyone else is even reading this thread anymore, it's worth adding that Barron's published a very balanced and factual article:

                                                                       

                                                                      http://www.smartmoney.com/barrons/index.cfm?story=20060426

                                                                      Are we done here?
                                                        • Re: The good and bad of Network Marketing
                                                          CEO Space Scout
                                                          1) I think the network marketing will be "a" business in the 21st century but not "the" business.
                                                          The vast majority of MLM or network marketing businesses only have about a 1% true success rate.

                                                          Even the very large and oldest company Amway (Quixtar) are running into problems and legally have to inform all new members that the average representative makes only a hundred or so dollars a month.

                                                          2) I have always said the pros of MLM or NWM are that anyone can join and the costs are relatively small. If someone is very motivated, they can start a business easily with all resources and training provided and since the upline have a vested interest in the new person, they get help. This is why Robert Kyosoki and Donald Trump promote them. It is an easy start for a motivated person.

                                                          The con is very often times the person who joins doesn't truly have an entreprenuerial mindset and doesn't have the drive, determination and time to make a success of it. Most of the upline will stop helping those who aren't "working" the business by attending meetings and bringing prospects etc. So most of the would be "business owners" end up paying monthly for a while or buying products (all which support the upline) and don't make any money of their own.

                                                          3) There are several forums where home based businesses and money making opportunities abound. Just search google for home based business forums. One that I know about is called whydowork.com forum.

                                                          I would caution you though. Since most business opportunities are low cost, those sites also attract all manner of scam artists promising get rich quick programs and often time offering outright illegal schemes.

                                                          I would only deal with MLM or NMM companies that are listed with the Direct Marketing Association
                                                          http://www.the-dma.org/index.php and the better business bureau http://welcome.bbb.org/.

                                                          Good Luck
                                                          • Re: The good and bad of Network Marketing
                                                            blitzlocal Adventurer
                                                            Network marketing, as opposed to MULTI level marketing, has been around forever.
                                                            The online component-- via affiliate marketing-- is growing, since trackability on the web is increasing.

                                                            Dennis
                                                            analyst, blitzlocal.com
                                                            small business advertising agency
                                                            • Re: The good and bad of Network Marketing
                                                              promo.plan Newbie
                                                              Network marketing is a marketing has been around for a while and is based on relationship building, so it sounds to me you're referring to Multi Level Marketing. To me, It's a business model that it's getting more and more relevance in the 21st century.

                                                              The good is that if you work at it you can develop a regular stream of income. Then again, anything you work at is likely to get you that result.

                                                              What I don't like about it is that, except a few exceptions, is based on recruiting rather than selling a product and it attracts many people that are looking for a quick and easy way to get rich.
                                                                • Re: The good and bad of Network Marketing
                                                                  Adventurer
                                                                  Hello, you sound you know exactly what it takes to succed in a network marketing company. The fact everyone need to get into one. I would say if you do a certain something all the time then you should hope that there is a mlm doing what you love. espcecially it it is a no brainer. I myself love to travel but do not like to pay retail. So i pay wholesale! And i dont give my commissions to anyone but me. take a look. e mail me with any questions. This is the next Google. http://WWW.terryhorn.worldventures.biz/ Some people love to go and google the name and always you will see scam. Well that person is just trying to get you to buy there product to.. terry@pandorasdesigns.com
                                                                • Re: The good and bad of Network Marketing
                                                                  JoMoho216 Newbie
                                                                  Whats your feel on Network Marketing... I feel that it may be the new way a lot of business in done more and more people everyday are finding home based jobs
                                                                  • Re: The good and bad of Network Marketing
                                                                    dpeterson Wayfarer
                                                                    There is one network marketing / affiliate marketing company that is a member of my Chamber of Commerce that I see at just about every "network" event that I attend. He works hard on his business, and lately he even had to get his wife involved because he is getting so busy. The point is Network Marketing is nothing unless you market the business.

                                                                    Why do network marketers fail... They fail to realize that you have to work very hard just like every other salesperson in the world works hard on lead generation and the sales process in general.

                                                                    What's good about network marketing? The good is it is almost like buying a franchise with no money. What's bad about network marketing? It takes a lot of work to get any business off the ground and this doesn't appear to be revealed when a person buys into the business.

                                                                    I personally like network marketing but if buy into the hype you and don't devote 100% of you time to this (or any) business you will probably struggle.

                                                                    David Peterson - President: Atlanta Sales and Consulting
                                                                    http://atlanta-sales-training.atlantasalesandconsulting.com/