10c. MLM Programs, IUH 2009-12, 2ND Ed, R513A

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Preface
Dr. Don, Founder ICFO

 

10c. MLM Programs, IUH 2009-12, 2ND Ed, R513A

1.2       MULTI-LEVEL MARKETING PROGRAMS

The benefit of multilevel marketing could be also known as multilevel earnings. A single avenue of earning is you selling your product or service results in a one-time sale. There are no residual benefits to you unless you have a store such as ClickBank will you possible earn an additional sale of the same customer. Adding a multiple tier opportunity enables you to gain earning from your downline, perhaps one level or more – giving you greater and perhaps residual earnings from your one time sale.

 

In another Pay per Click or Pay to Read Section, you will see that those sites that actually pay you, pay your very little and the only way to make any real income, is to get paid from your work and the work of others – your downline.

 

The likelihood of a top guru joining your affiliate or MLM site is nil, because they can make their own sites faster that you can join them. So you either take your time and slowly build your downline, or you create your own site with enough content and value, that perhaps your will attract a Joint Venture partner, or o a top performance joins under you and brings his or her downline with them. For one opinion on the differences, see the following video

 

 

 

MLM VERSUS AFFILIATE MARKETING

An interesting MLM versus Affiliate Video. (Subtle selling vs. recruiting and selling) Also discusses Cash Gifting Programs and Pyramids Scheme – Legal issues. Do your homework. Limited money made from 2 tiers, 98% do not make money. Worth seeing! Search for 2 create a website and you will find a very aggressive and successful lady. See the difference ways she advertises from blogs to videos. MLM and Affiliates Marketing, Difference Between Affiliate Marketing and MLM

 

This site wants your direct view so we cannot publish the article, but we can link to the article. Link only site. AffiliatesSeeking.com is a good source of information on this subject and others.

IS IT MLM OR A PYRAMID?

 

TIP: Without your Due Diligence to check out a program before you spend your money, you may be at risk of participating in a pyramid scheme

 

Multilevel marketing plans, also known as “network” or “matrix” marketing, are a way of selling goods or services through distributors.

 

These plans typically promise that if you sign up as a distributor, you will receive commissions — for both your sales of the plan’s goods or services and those of other people you recruit to join the distributors. Multilevel marketing plans usually promise to pay commissions through two or more levels of recruits, known as the distributor’s “downline.”

 

If a plan offers to pay commissions for recruiting new distributors, watch out! Most states outlaw this practice, which is known as “pyramiding.” State laws against pyramiding say that a multilevel marketing plan should only pay commissions for retail sales of goods or services, not for recruiting new distributors.

WHY IS PYRAMIDING PROHIBITED?

Because plans that pay commissions for recruiting new distributors inevitably collapse when no new distributors can be recruited. And when a plan collapses, most people — except perhaps those at the very top of the pyramid — lose their money.

 

The Federal Trade Commission cannot tell you whether a particular multilevel marketing plan is legal. Nor can it give you advice about whether to join such a plan. You must make that decision yourself. However, the FTC suggests that you use common sense, and consider these seven tips when you make your decision:

 

Avoid any plan that includes commissions for recruiting additional distributors. It may be an illegal pyramid.

 

Beware of plans that ask new distributors to purchase expensive inventory. These plans can collapse quickly — and also may be thinly-disguised pyramids.

 

 

 

Be cautious of plans that claim you will make money through continued growth of your “downline” — the commissions on sales made by new distributors you recruit — rather than through sales of products you make yourself.

 

Beware of plans that claim to sell miracle products or promise enormous earnings. Just because a promoter of a plan makes a claim doesn’t mean it’s true! Ask the promoter of the plan to substantiate claims with hard evidence.

 

Beware of shills — “decoy” references paid by a plan’s promoter to describe their fictional success in earning money through the plan.

 

Don’t pay or sign any contracts in an “opportunity meeting” or any other high pressure situation. Insist on taking your time to think over a decision to join. Talk it over with your spouse, a knowledgeable friend, an accountant or lawyer.

 

Do your homework! Check with your local Better Business Bureau and state Attorney General about any plan you’re considering — especially when the claims about the product or your potential earnings seem too good to be true.                                                                                      FedTradeCommission

LOTIONS AND POTIONS: THE BOTTOM LINE ABOUT MLM PLANS

Lose weight! Firm up!

Look better! Live longer!

 

‘Tis the season for consumers to be confronted with a wide range of health, beauty and fitness products and promotions. Many of these items aren’t available on store shelves and are sold only through distributors.

WHAT ARE YOU BUYING?

Many companies that market their products through distributors sell quality items at competitive prices. But some offer goods that are overpriced, have questionable merits or are downright unsafe to use.

 

The Federal Trade Commission warns consumers to apply a healthy dose of caution before buying products advertised as having “miracle” ingredients or techniques and guaranteed results. Many of these “quick cures” are unproven, fraudulently marketed and useless or even dangerous. Before using one of these products, the best prescription may be to check with a health professional.

WHAT ELSE IS FOR SALE?

Some distributors sell more than diet and exercise plans, vitamin supplements or wonder creams. Many may sell “opportunities,” too-a chance for you not only to buy, but also to market, the products. In addition to describing the benefits of their product or program, these distributors may encourage you to become a distributor.

 

 

 

If you sign up as a distributor, you may be promised commissions or other rewards-for both your sales of the plan’s goods or services and those of other people you recruit to become distributors. These plans, often called “multilevel marketing plans,” sometimes promise commissions or rewards that never materialize. What’s a worse, consumer are often urged to spend or “invest” money in order to make it.

WATCH OUT FOR PYRAMIDS

Steer clear of multilevel marketing plans that pay commissions for recruiting new distributors. They are actually illegal pyramid schemes.

 

Why is pyramiding dangerous? Because plans that pay commissions for recruiting new distributors inevitably collapse when no new distributors can be recruited. And when a plan collapses, most people- except perhaps those at the very top of the pyramid-end up empty-handed.

HOW TO EVALUATE A PLAN

If you’re thinking about joining what appears to be a legitimate multilevel marketing plan, take time to learn about the plan before signing on.

What’s the company’s track record? What products does it sell?

How does it back up claims it makes about its product? Is the product competitively priced?

Is it likely to appeal to a large customer base?

What up-front investment do you have to make to join the plan?

Are you committed to making a minimum level of sales each month?

Will you be required to recruit new distributors to be successful in the plan?

Use caution if a distributor tells you that for the price of a “start-up kit” of inventory and sales literature

-and sometimes a commitment to sell a specific amount of the product or service each month-you’ll be on the road to riches. No matter how good a product and how solid a multilevel marketing plan may be, expect to invest sweat equity as well as dollars for your investment to pay off.

YOUR RESPONSIBILITIES

If you decide to become a distributor, remember that you’re legally responsible for the claims you make about the company, its product and the business opportunities it offers. That applies even if you’re simply repeating claims you read in a company brochure or advertising flyer.

 

When you promote the qualities of a product or service, you’re obligated to present those claims truthfully and to ensure there’s enough solid evidence to back them up. The Federal Trade Commission advises you to verify the research behind any claims about a product’s performance before repeating those claims to a potential customer.

 

Likewise, if you decide to solicit new distributors, be aware that you’re responsible for any claims you make about a distributor’s earnings potential. Be sure to represent the opportunity honestly and to avoid making unrealistic promises. If those promises fall through, remember that you could be held liable. FedTradeCommission

 

 

Thanks for Reading – 10c. MLM Programs, IUH 2009-12, 2ND Ed, R513A

Dr Don, Founder, ICFO

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