How To Do Network Marketing In Online? (A New Era For MLM)

According to the Direct Selling Association (DSA), a lobbying group for the Network Marketing industry, reported that in 1990 only 25% of DSA members used the network marketing business model.

By 1999, this had grown to 77.3%. By 2009, 94.2% of DSA members were using it, accounting for 99.6% of sellers, and 97.1% of sales. Companies such as Avon, Electrolux, Tupperware, and Kirby were all originally single-level marketing companies, using that traditional and reliable direct selling business model (distinct from MLM) to sell their goods.

However, they later introduced multi-level compensation plans, becoming network marketing. The DSA has approximately 200 members while it is estimated there are over 1,000 firms using multi-level marketing in the United States alone.

How Does Network Marketing Works- (Traditional System)?

Network marketing companies offer a business kit that included products, training, and membership. If you want to become a member, you have to purchase this business package. They call it an independent distributor, it means your success depends on your effort, on how you will run the business.

Network marketing companies create their own specific compensation plan, like a binary system you have a left and right downline that can help the growth of your network.

You have to attend the business training and orientations together with your new members. If you are the sponsor or up line, teach those new members how to sell the company product and sponsor others who duplicate the process.

For every people you have recruited, you will get the referral commission and for every product, they have purchased you will get some rebates or points.

Independent distributors develop their association by either building an active consumer network, who buy direct from the company, or by recruiting a downline of independent distributors who also build a consumer network base, by that means expanding the overall network.

In network marketing, you don’t have to pull out a big capital. There’s no skilled required or educational background for you to start. You can do it even you are a low-profile person; it is a home-based business that you can expand through your friends, relatives or acquaintance. You can ask their help to build your network.

What Problem You Face In Traditional Network System?

• The common problem of network marketing is the marketing strategy of the company, it becomes pyramiding in a way that members are only focusing on recruiting downlines so they will get the commissions.

• Because the products are not easy to consumable or much expensive than other products that you can buy to the market or malls. Sometimes, members face difficulty in selling the products to other people as I said the product is much expensive.

• They are also facing problems in understanding the compensation plan and cannot explain it to their recruits. Also, there are sometimes conflict in their time because they have to attend meetings and seminar, the people they are invited to attend is not available for that schedule.

• If the members are only focusing on recruiting people, and the products are not flowing the way it needs to be. There is a possibility that the company will be closed or bankrupted.

• In a traditional system, you have trained to do business around your friends and family first. But time will come once, you see, you couldn’t find your prospect where you can ask to buy your product or join your business.

• According to a report published on the Federal Trade Commission’s website, at least 99% of people who join networking companies lose money. However, Network marketing’s function because downline members are encouraged to hold onto the belief that they can achieve large returns, while the statistical questionable of this is de-emphasized.

How To Do Network Marketing In Online-A New Era

Although there have some disadvantages, or you could face some problems with Network Marketing, but I can’t say “You shouldn’t do Network Marketing Business”. Because there are thousands of Network Marketing companies that still exist and doing very well in this world. And hundreds of thousand network marketers are working and getting rich.

But time has changed. If you want huge success in Network Marketing business and grow very fast, then you need to do it digitally, instead of traditional networking system.

There are some different ways that you could follow to start your network marketing business online, some basic ways I am going to show you here.

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You could also promote your business product which you normally sell to your family and friends. But now you can sell the product in a wide online market.