What is MLM/Network Marketing?By Robert Phillips On February 19, 2010 Under MLM Training & Tips
If you have been looking into starting your own internet business there is no doubt that you have heard of MLM or network marketing. If you are new to internet businesses you probably have no idea what that is. This article is going to clear up exactly what MLM/network marketing is.
MLM stands for multi-level marketing, and is a selling method in which you become a distributor of goods and services for a company. You are an independent agent and are supposed to recruit and train other independent agents to sell for a company. Those who you recruit are added to your downline, and you earn a commission on all of your sales and your downline sales.
An MLM or network marketing business begins with someone who is offering a product or service for sale. They believe that their product is worth something and decide to set-up a company to produce and distribute their product. A company will now produce their product and create a name for it.
At this point that company will begin to consider how it will distribute their product. There are three ways to distribute their products. You are probably familiar with two ways to distribute an item: retail, where you sell an item in a store, and direct sale, where a salesman goes door to door selling an item. MLM is another form, a system that tries to move a product from the company to the consumer.
The basis of the success of this strategy is people are more likely to buy an item from another person than from a company. A company will hire you to become an independent agent where you will be able to sell that companies product and earn a commission on every sale. Also, you earn a commission on every sale your downline produces.
Many believe this is a pyramid scheme, but there is a distinct difference. Pyramid schemes involve people exchanging money simply for enrolling people into the scheme. Network marketing involves people receiving money when the people they recruit actually sell a product. The key is in network marketing a product is actually being moved before you receive money.
MLM or network marketing is beginning to be seen as a successful way to earn money working on the internet. It is as simple as selling a product, recruiting others to sell products, and earning a commission from a company for every sale. That is the basics of MLM/network marketing.
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