The best compensation plan in the world... (Part 1) Social Bookmark This Blog: BlinkList del.icio.us Digg it Furl ma.gnolia Netvouz RawSugar Shadows Simpy Spurl Yahoo MyWeb Google DZone StumbleUpon

So, what is the best compensation plan in the world? Well, let's look at all the factors. This issue is often the subject of much debate and conjecture, typically filled with trite cliche phrases like, "building deep is where the profit is" or "going wide is the key to a stable business."

Is it really just that simple? Could I end my soap-box right here before it starts by leaving in your minds just these two simple phrases? Oh, how I wish. This decades old scuffle won't end that easily, won't end with this article and this topic wouldn't be much of a topic at all to blog (read: rant) about if it really was that simple... now, would it?

No, this is not a simple topic. Many might tell you it's simple by stating phrases like, "The binary is the best comp plan in the world," or "I will only build in a matrix," or "The first thing I look for in a company is to see if they have an Australian plan."

Before we can "wash our hands" of these comments we have to first clearly understand:

1. The evolution of MLM compensation plans
2. Elements of the various MLM plans
3. What elements (bonuses/structures) encourage which kind of human behavior
4. How different MLM plans might function within different
   - demographics (old/young, male/female, liberal/conservative, etc)
   - product pricing (company cost & retail/wholesale pricing)
   - consumption behaviours
5. How goals are critical in choosing the best compensation plan

So, over the next several months I will be elaborating on each of these areas more in depth. It's a common question of those who spend an above average amount of time in MLM, "What is the best compensation plan?" New companies ask me this question all the time, as an MLM consultant and MLM Software provider. In fact, I probably have the "Comp Plan Conversation" 2 or 3 times each day.

To start, I want you to begin thinking about MLM compensation plans as vehicles, something that will carry you from one point to the next. If you will visualize your starting point and your desired destination, along with the various terrains that you will cross during your journey, I believe you'll start to see compensation plans in a far different light than you do today.

What kind of vehicle do you drive? Truck, SUV, Motorcycle, Sudan, or a more Sporty Car? How do you get to work? Jet, Trolley, Ferry, or Bus? What kind of vehicle do you use at work? ATV, Delivery Truck, or Utility Truck? What other kinds of vehicles have their purpose? Helicopter, boat, jet ski, snow mobile, or heavy loader? All of these have some very similar fundamental ideas built into their construction, and no one can really make a solid case that each of those vehicles aren't serving a solid and valuable purpose.

So, I've tipped my hand here and given away the whole premise haven't I? Well, perhaps. I'm not sure any quality article on MLM compensation plans should start off with a singular compensation plan bias and an agenda to convince others about that plans superiority. I have witnessed very experienced and credible MLM experts (in their own rights) beat this issue to death, never once changing the mind of the other. Ultimately, each plan has it's place.

Every individual will have a personal affinity toward a specific plan type that's based on their individual passions concerning a product/service type, training style, and their own personal market place. For the course of these articles I want you to put those biases away, I want you to stand back from your passions just enough to get a good view of the other plans and how they work. You might find that there are far more similarities in some plans than you thought.

So, over the next few months I'll discuss how the Matrix or Unilevel, Binary or Australian plan (1-up/2-up/x-up), or even how a hybrid compensation plan (a mixture of several different plans) fits into the world of MLM compensation plans. I'll also discuss how the various bonus structures work into the whole equation: coded bonuses, infinity & generational bonuses, matching bonuses, CAB's (customer acquisition bonuses), pool bonuses, car/vacation/mortgage bonuses, and simple title bonuses.... and do cyclers or straight-lines have their place too?

Rules of thumb to keep you safe... Social Bookmark This Blog: BlinkList del.icio.us Digg it Furl ma.gnolia Netvouz RawSugar Shadows Simpy Spurl Yahoo MyWeb Google DZone StumbleUpon

As a top MLM consultant and leading MLM Software provider I get asked all the time to evaluate businesses for their legitimacy. Part but not all of a companies legitimacy is how well they meet the legal criteria and avoid anti-pyramid/ponzi and anti-fraud laws. The other parts blend into corporate strategies, capitalization, marketing/branding, product, etc. which I've written and spoken on numerous times before.

However, I want to give some real solid guidelines that can be followed to:

A- As an MLM Company: Help bring your existing/start-up MLM into better compliance
or
B- As an MLM Participant: Aid you in selecting an opportunity

First some basic information... the 4 major agencies/groups involved in governing and enforcing US laws (administrative, legislative, or judicial laws) for direct sales / MLM are:

- State Attorney General, predominately concerned about the safety of the citizens of a particular state and enforcing state pyramid/ponzi laws

- Federal Trade Commission, predominantly concerned about fair trade/commerce practices and policing federal pyramid/ponzi laws

- Food & Drug Administration, predominantly concerned drug/nutritional/food products and claims that are made about these products

- Securities and Exchange Commission, predominantly concerned with investment issues and claims of "returns on investment".

Predominantly governmental agencies and officials want to ensure that the public at large are "getting what they pay for" and are "safe from fraud/misrepresentation". They want to see that when we as US citizens spend our money on a product/service that the product/service is safe, that we pay a fair price, and receive a reasonable product/service for the price paid.

Below I've listed 6 starting, fundamental and important KEY items of concern that must be considered. This group of items could also be a high level litmus test on legality.

Concern #1- Someone pays to JOIN a business/program/plan, doesn’t receive a product/service in return, and IF a commission is paid, then you have cause for concern.

A company can only pay commission when a product/service is sold. Commission can only be paid on the sale of product/service to an END-USER. A company cannot pay commission on membership fees (IE. No head hunting fees).

Issues: What activity generates commission? Is it the sale of product or some other activity, like recruiting others? Pyramid and Ponzi schemes, chain letters, "pay it forward" programs, gifting programs will typically get stopped at the door on this issue. If any kind of "gift" or commission is earned/paid for "enlisting", "recruiting", or "selling" someone on JOINING the program/business/opportunity then this is an issue that needs to be looked at. A commission can be earned/paid on a product or service that was sold, period.

The Cycler Issue: Product must not only be delivered upon cycle. The money spent to join a cycler is what is used to pay commission, if a product is not purchased and delivered at the time of payment, this becomes an issue. If "what someone pays for" can’t be delivered or received until recruiting is preformed (as in many cyclers), then this becomes an issue.

The first question: Is commission paid on a product/service and NOT on a membership/participation fee?

If Yes, see the next question...


Concern #2- A product/service has no commercial value or is unreasonably priced or if people are asked to buy an unreasonable amount (front end loading)... and IF a commission is paid, then you have cause for concern.

Products/Services must have a reasonable value in comparison to the price paid and people cannot be asked to purchase an unreasonable amount of that product/service in conjunction with commission being paid. Obviously if there are no "strings-attached", like a commission plan, then if someone buys a product/service way over priced, or some huge quantity... that’s their business. This isn’t the case when a commission plan is attached to that sale.

Issues: A company can’t just decide to sell the "unique" dirt from their back yard for $X amount and create a business around it. What value does it have? eBooks are gray areas: what value do they have? Is what is charged reasonable? How many eBooks will 1 person use? How many ‘positions’ in a binary or cycler or re-entry is reasonable? Subscriptions pose an issue if it’s for a one time product like "access to a group of eBooks". Who needs $10,000 worth of website malls? And are those malls really worth $10,000? Why?

A good benchmark to hold next to any product/service is: are similar products sold by another company that is not doing a business opportunity? If so, what is the price they charge? If not, why?

Ask yourself this question: would I buy this product if I was not doing the business? If not, why buy it now? Compulsory purchase of product to participate in the business is an issue (see #5 below).

The second question: Is the product reasonably priced, have value, and sold in reasonable quantity?

If Yes, see the next question...


Concern #3- The product/service is only of value to someone doing the business, if so, you have cause for concern.

A product/service must have value to someone NOT in the business.

Issues: Training, business cards, leads, starter kits, promotional CD’s, websites, downline reporting, etc. are all "items" that are typically only of interest to someone doing the business. If I am a training company selling training that helps anyone in any company, or a business card company selling business cards to anyone in any company, or a leads company selling leads to anyone in any company... then these items become commissionable. BUT, if you are a nutritional company and offer business cards to your business members to help them promote their business... you CAN NOT pay commission on the cards. Websites are the same way... no commission can be paid on any tool used to promote your business.

The third question: Does this product/service have value to an end-user/customer who is not participating in the business?

If Yes, see the next question...


Concern #4- When purchasing a product/service as a customer IF that customer is automatically put in the business, then you have cause for concern.

A product/service MUST be sold separately to end-users from the process of joining the business. This cuts 2 ways: a) someone not doing the business must be able to buy your product/ service without being put into the business and b) someone joining the business cannot be forced to buy a product (see #5 below). It may not cost anything to get into the business, but a position in the business needs to be an optional secondary opt-in process after someone buys the product.

Issues: Businesses where everyone in the business is a customer and every customer is in the business presents a problem. A company should be customer focused. A legit business is one where the sale of product, not the recruitment of new business participants is the primary focus. It is important to distinguish between end-users/customers and business participants.

The fourth question: Can a customer/end-user buy a product and not be in the business?

If Yes, see the next question...


Concern #5- Someone is required to purchase a product in order to participate in the business, if so, you have cause for concern.

Participation in a business must not be conditional on the personal purchase of product. In a business opportunity personal consumption may not be a requisite for participating in the business. However, once someone is participating in the business a purchase may be required to advance through the "ranks".

Issues: To sell a Porches’ why would you need to personally buy one? You don’t. Many may say, which I do agree with, that the use of a product enhances ones understanding of the value of that product. We often hear in this industry, "be a product of the product." However, while the use of a product/service may enhance our understanding of it, provide a deeper value and thus increase our passion and ability to share it with others, access to the business opportunity cannot be predicated on personal consumption.

The fifth question: Can a business participant join an opportunity without purchasing
product?

If Yes, see the next question...


Concern #6- During introduction to the business or product/service IF income claims or product/service claims are made, you have cause for concern.

Hype is deadly. Making claims of any type that cannot be proven scientifically or empirically to be applicable universally to some guaranteed degree can present massive legal challenges. Fraud and misrepresentation are major pitfalls of many who would hype their business and product/service in its promotion.

Issues: A clearly stated phrase of excitement and love or adoration for a company or something is not an issue. But to cross the line with statements of how a product/service impacted your life or how you earned $X amount pushes the envelope which might and often does result in a legal issue of fraud or misrepresentation. This is a difficult area for most to clearly grasp, but it’s one that gets more distributors in trouble than any other area.

The sixth question: Is the product/service or business opportunity explained without making claims?

If Yes, you’ve likely found a company/opportunity/plan that will remain free of legal challenges.


Every company should have retained and worked with a qualified MLM attorney and MLM consultant to put in place all solid business strategies, rules, and policies that are in line with the laws of the country and states that business will be conducted in.

MLM Consultant: http://www.melatwood.com/
MLM Attorney: www.YourSolutions.net/mlm_law.php

You should also ensure that the MLM Software company works closely with your MLM Consultant and Attorney to put in place the needed distinctions and tracking required by law and by good business strategy.

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Disclaimer: The materials available through this site are for informational purposes only and are not legal advice. The transmission of any information is not intended to create, and receipt does not constitute, an attorney/client relationship. Internet subscribers and on-line readers should not act upon this information without seeking professional counsel.

It takes more than a good product and website... Social Bookmark This Blog: BlinkList del.icio.us Digg it Furl ma.gnolia Netvouz RawSugar Shadows Simpy Spurl Yahoo MyWeb Google DZone StumbleUpon

Oh how I wish I could take credit for what you are about to read. It's a message I've been talking about for years. Creating a story to share your products is extremely critical in today's "hyper cynical" consumer world. Our customers and business prospects are more educated, have been exposed to our basic message multiple times, and will not fall for the same yesteryear ploys.

The following article ties in directly with a 3 part series I wrote concerning the development of a successful MLM Company: "Questions, Questions, Questions", "The True Secret - MLM is not a "Field of Dreams"", and "A solid place to rest your rump...".

While the following article is not addressed specifically to the MLM channel, the ideas and concepts massively apply.

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Advertising's Most Important Word
By Jerry Bader (c) 2007

If you had to guess the single most important word in advertising what would it be: free, special, discount, sale, new, improved, bígger, better?

So many words have lost their meaning or been corrupted by misuse or abuse that it is not an obvious choice. The words luxury, exclusive, and world class have been rendered meaningless after being applied to everything from eight hundred square foot condos to restaurants that serve microwave frozen dinners. We can't even rely on light, diet, or low carb to actually describe what's inside a package.

What advertisers have done is create a hyper cynical marketplace (Ed. Note: I have been saying this for years, I love the vindication.), where the audience for whatever you sell has lost faith in what is being said. The Web with its emphasis on content gives advertisers a chance to redeem themselves and to deliver meaningful information to its audience.

All Content Is Advertising, All Advertising Isn't
Some may cringe at the thought, but in the final analysis all content is a form of advertising. Content is rarely if ever neutral, even if it doesn't overtly promote a product or service; content always has a point to make, or an idea, concept, or position to advance. If content doesn't provide some perspective, some meaningful knowledge, then does it really qualify as content? The same can be said for advertising, if it doesn't explain, enlighten or engage, it is just noise.

What Is Advertising's Most Important Word?
My vote goes to the simple innocuous word "like": a nondescript word that carries with it all the conceptualization power you need to create a business identity, to form a brand personality, and to position your product or service in the mind of your audience. A previous article of mine "A Website Without Video Is Like..." uses the power of metaphor to illustrate how this little four-letter word can crystallize an idea in the mind of an audience.

Metaphor + Analogy + Stories: The Adman's Best Friends
A metaphor explains complex concepts and hard to comprehend processes by comparing them to common everyday knowledge. We use metaphors everyday without even realizing we're doing it. We 'race' to the office. We work like 'dogs." And we all know, it's a 'jungle' out there. Metaphors are critical to the way we communicate with each other and to the success of our marketing communication and advertising.

Metaphors can be extended into analogies, and analogies into stories, and stories into campaigns; and campaigns developed in this manner have a higher probability of achieving the elusive status of meaningful content that embeds your message in your audience's collective consciousness. There is no better way to overcome a client's objection than to put that objection into perspective with an appropriate allegorical story.


(Ed. Note: It's been said years before I arrived on the scene of MLM as a consultant, "Facts tell, stories sell." This was typically in reference to testimonials. However, as our consumer base has evolved over the years being inundated with miracle stories of healing, huge savings on this or that service, and untold wealth just 30 days away, it becomes increasingly important to package your message in a 'credible' story through metaphor and analogy.)

Overcoming Objections: How Long Is Too Long?
We've all heard the constant bellyaching from impatient Web users about how long they have to wait for everything on the Web. Every time I hear this from somebody, I am reminded of the story (perhaps apocryphal) of the early introduction of the Polaroid Land camera.

Before the days of one-hour photo shops, digital photography, and immediate video feedback, people had to wait up to a week for their pictures to be developed by the local pharmacy or camera shop. When Polaroid came out with a camera that delivered a finished photograph in sixty seconds, people were amazed; the era of ínstant gratification had begun.

So the story goes, a group of adventurers traveled deep into the Brazilian Rainforest to learn about the indigenous people. When they came across a tribe who hadn't seen outsiders before, they befriended them and took pictures of them with the Polaroid cameras they brought along. The natives loved the pictures since they hadn't seen anything like this before, but they did have one complaint, 'why did it take so long for the pictures to develop?'

The problem is not technology; the problem is one of perception. Like the natives who perceived the sixty second developing of photographs to be slow, so to do many Web-users perceive the Internet to be slow when in fact it is an incredible technological achievement where anyone with a computer and Internet connection can access information from all over the world in seconds or, heaven forbid, minutes.

The Better The Story, The Better The Communication
The solution to the problem is better communication, making yourself and your message instantly understood. People who are truly interested in what you have to say will wait for your Web page or video to load. What gets them frustrated is when they wait, and instead of getting a meaningful message, they get a bunch of nonsense that is irrelevant, self-congratulatory or completely incomprehensible.

A video or audio message on your website is more easily grasped than a page full of densely written text or cryptic bulleted points. But you will loose your audience quickly no matter what the form of your message if it's confusing, muddled, overly complex, or buried in b-school platitudes and industry jargon.

You need your message to be understandable, engaging, and memorable and one of the best ways to convey that message is to compare it to something your audience can relate to. It's like teaching your kids a life lesson by reading them one of Aesop's Fables.

Finding Your Metaphor
Some people have a knack for expressing things in a way that an audience will instantly grasp and more importantly remember. For those of us in the communication, marketing, advertising, and creative development businesses it is a necessary skill learned over the years. But for those in the day-to-day grind of business's nitty-gritty it is rarely an ability that ever gets developed.

Creating a Web video campaign that your audience is going to watch, remember, and pass on to colleagues requires a commitment of time and funds, and you want to make sure it communicates your message effectively. Rather than using your traditional approach concentrating on features and facts, try something different; try developing a campaign based on a metaphor that delivers your brand's personality and emotional value-add.

Where to begin? You need to set yourself free from the concrete, and concentrate on the conceptual. If this seems like a difficult thing to wrap your head around, then start with baby steps.

Concentrate On The Conceptual
Any effective marketing campaign whether it's a series of Web videos, direct emails, magazine display ads, banner ads, outdoor billboards, television and radio spots, or any combination there of, will only work if it focuses on a single message.

At the heart of all advertising is the promise you commit to delivering to your clients. No matter how clever or memorable your marketing, if you fail to deliver on that promise, you will fail.

Learn a lesson from the politicians. The general publics' opinion of politicians is about on a par with having a prostate exam. Politicians can't help themselves, they promise the electorate what the electorate wants to hear, and then fail to deliver on promises that can't be kept. Consequently, people become cynical and distrust everything politicians say.

Failure to deliver on your promise to be the cheapest, the best, or the guy with the most features, is like a politician promising no new taxes. Read my lips! Those kinds of promises are a prescription for marketing disaster.

Taking the conceptual approach requires a certain degree of confidence and an understanding that you are going to have to give something up to get something in return. If you present your identity as the Timex of widgets, inexpensive and ubiquitous; then you are giving up the audience looking for the Rolex of widgets, expensive and exclusive.

Audience Resonance: It's All About Striking A Nerve

One of the most memorable commercials ever to appear on television was the 1985 introduction of the Apple Macintosh computer. The anti-big brother message said nothing of bits or bytes, or anything else computer related, but it did establish Apple's character and personality with its allegorical message, a message that is still valid today.

If your marketing message lacks this kind of power and personality; if your advertising is getting lost, or drowned-out by the competition, try finding a metaphor that instantly tells your audience who you are and why they should care.

About The Author
Jerry Bader is Senior Partner at MRPwebmedia, a website design firm that specializes in Web-audio and Web-video. Visit www.mrpwebmedia.com/ads. Contact at info (at) mrpwebmedia.com or telephone (905) 764-1246.


(Ed. Note: Jerry, I love it! It's exactly what my audiance needs to hear and know about. The same old tired lines have brought the smallest of affiliate marketers to the largest of successful MLM companies strife and pain. Your message... OUR message... should be heard loud and clear. It takes more than a good product and a website to get your message out!)

BRING IT ON, BABY! Social Bookmark This Blog: BlinkList del.icio.us Digg it Furl ma.gnolia Netvouz RawSugar Shadows Simpy Spurl Yahoo MyWeb Google DZone StumbleUpon

So, I was part of a discussion recently about gratitude and they/we were talking about all the same old types of things: Why should we be grateful, why is gratitude important... you know the drill.

So, I was sitting there listening to the discussion and I was just about asleep from boredom. As I often do to keep myself awake I piped up and shared my thoughts on the topic. Here are the 4 main thoughts I shared:

#1- Personally, I recognize God as the giver of all things. You might see it as karma, yin/yang, circle of life, the universe, or the laws of physics (how energy works). To me it is God and God is/controls all of these things. There is balance in all things... I didn't say life was "fair" in a subjective, limited perception kind of way... but, life IS ALWAYS fair in an objective, balanced, higher purpose kind of way.

So, as good things or bad things happen it's important to be grateful for what we have and the experiences we have.

#2- It could be worse! I recall my grandpa when I was a child putting a fine point on this issue, which was hard for his 8 year old grandson to understand back then. As children often do I was in a hurry to get places, fell down and skinned my knee in the process. Grandpa Walker glanced over at me with his wicked smile and said, "Want me to step on your toe so your knee will feel better?" Obviously not the most loving of statements a grandfather might say to his grandchild, however, there was no doubt that grandpa loved me. He just had a special way of showing it. Upon his passing the phrase, "Diamond in the rough" was etched on his marker.

What a lesson this great man was trying to teach his grandson. His world growing up was the Great Depression, hard times, and real bad lives for many. It took thick skin to keep ones chin up and he was passing on a lesson that I value deeply. I am in no small part who I am today because of him.

When we think life is rough, we need to really look at what we have and realize that we always have things to be grateful for, even if what we are grateful for is that things aren't any worse than they are.

#3- If you don't appreciate what you have, why should you be given anything more? This is where God and karma come into play. You've likely heard the concepts of Living Abundantly, Laws of Attraction, Power of Positive thinking, etc. You may have heard about "The Secret." Well, the very nexus of this whole concept is that without gratitude, without a grateful heart, without appreciation for what we have - we won't be 'given' anything more than we already have.

Wallowing in self-pity is the best way to stay right where you are. Celebrating our Abundant lives is the best way to find our dreams, hopes, desires becoming reality.

#4- As I see it... this life is a path to self-improvement. The only way to improve who we are is to work on those areas we find hard: Self-control, financial management, optimism... etc. How does a diamond become the hardest and most valuable gem? Not by just slinking along as a pile of sludge for eons and boom one day it automatically transforms into a beautify diamond. Nope... it is only through intense pressure and heat that a nasty black crumbly carbon material is transformed into something so awesome and precious.

...

I know we all have our ups and downs and our challenges... but, if we face unafraid the pressure and heat of the moment we will come through the other side a far better person. Face your fire with determination to conquer and over come! When you walk through the other side you may be blistered from head to foot... but don't you dare complain... put a smile on and be glad that my grandpa didn't step on your toe!

My Challenge To You: Wake every morning and say, "BRING IT ON, BABY! BRING IT ON!"

Call it what you want, but the key to a happy and full life is to create a sense of contentment and appreciation for those things you have and the lessons you have learned, while keeping in mind during the toughest of times that the point isn't the pain or difficulty but the strength gained and the strength you'll ultimately be able to share with others.

A solid place to rest your rump... Social Bookmark This Blog: BlinkList del.icio.us Digg it Furl ma.gnolia Netvouz RawSugar Shadows Simpy Spurl Yahoo MyWeb Google DZone StumbleUpon

Stools come in all shapes and sizes, just like the people who use them. How we use a stool varies greatly. Some of us use them to stand on, some of us use them to sit on or rest our feet on, some of us use a stool as a place to relax, or any number of things.

In talking to clients about the pieces of a solid MLM, the stool analogy comes up often. I'm sure you've heard someone say that just like any solid stool every MLM needs 4 solid legs to be successful. Which is true, but obviously an over simplification.

As an MLM Consultant, it's such an important topic that it's often a major area of discussion with my clients. Previously, I mention the importance of these legs (The True Secret - MLM is not a "Field of Dreams"), and the the often missed but critically important need for the cross bars that hold the legs of any stool together (Questions, Questions, Questions).

Legs and cross bars form the foundation for what will ultimately support our weight. However, a stool without a top serves no real purpose.

Just like a stool without a seat... an MLM company with all 4 legs (product, company, comp plan, training/marketing system) and cross bars (compassion, understanding, honesty, love) will serve little purpose without a solid story...

A good story is the seat of your stool. A good story is absolutely critical.

Early on a new member of your company is likely to hear the saying, "facts tell, and stories sell." And... it really wont sink in for them because those same people who are saying to them "facts tell, and stories sell" will start spewing out facts!

In any random nutritional company a new team member might hear:

"Read what these doctors said about our products main ingredient."

"Did you listen to that scientific audio about the product?"

All the while these new members are being encouraged to learn words like proanthocyandin, xanthons, flavonoid/bioflavonoid, or antioxidant.

Each company has their own language and every industry has their own words and "phraseology" that they use, usually to make themselves "sound" unique.

In a technology company you might hear words like: peer to peer, B2B, Client side, Server side, and on and on.

Very early in my career I joined Melaleuca as a distributor. One of the most interesting things about Melaleuca is how they see themselves in the market. They claim not to be MLM. "Consumer Direct Marketing" is the name they give for the marketing method they use. In their marketing material they list a lot of reasons why they aren't MLM... ultimately to dispel any stigma about the "Pyramid" mind set many have had over the years surrounding MLM. BTW, at it's core roots, Melaleuca IS MLM (multi-level marketing). It may ALSO be "Consumer Direct Marketing," but that is another topic all together.

My point is that simplicity over complexity is important. Far too often companies create new phrases and some times complex ideas to "help distinguish them" from their competing MLM companies, or to "help them stand out" in the minds of those who encounter them. Often to sound impressive or to gain credibility marketers will get into the "BIG WORD SYNDROME" and use phrases that will go over the average persons head. However, complexity, facts and terminology often do more damage than good as new team members and prospects can easily become overwhelmed by the seemingly limitless amounts of information that can be hurled their direction.

The sad thing is that these same people who say that facts don't sell, send their new prospects or team members DVD's to watch, books to read, magazines, CD's, and websites about the product, the money, and the company all of which are filled full of FACTS!

At what point does a new team member throw their hands up in the air and say "TMI"... the new vernacular for "To Much Information!"

Early on in my career in MLM, all this was so counter intuitive for me. I started selling 'stuff' door to door at an age many would not believe. Basically, I've been selling something all my life. But, in the early years of my MLM experience I got to a point where I stopped listening to all the facts people were spitting out. I started doing what I knew worked... and that was talking to people on their level with things they could relate to... using stories, analogies, and keeping it simple.

I learned very young that facts were never something that really mattered... benefits of the product struck a nerve more. How something could make a persons life easier, save them money, give them energy, make them happy, etc. Features are worthless unless they offer understandable benefits. It's the benefits that have always been of value... and stories are the very best way to share benefits.

Your MLM company could have the best product (leg 1), the best company (leg 2), the best comp plan (leg 3), and the best training and marketing (leg 4) along with the needed compassion, understanding, integrity/honesty, and love... and all with the best intentions...

YET, without a solid place to rest your rump... without a solid place for members of your opportunity to rest their efforts, without a simple and powerful story for members to share... you have absolutely nothing.

So, how do you create a story? Well, that's the trick... what message, what benefits, what value can you share that will grab someones attention, stop them long enough for you to share your thoughts, and convey the heart of your offering in such a way that those who have stopped to listen can relate to it, even desire the benefits, and see that indeed the benefits you share in your story are possible for them to attain.

Passion alone is not a story...

Uniqueness alone is not a story...

Financial success alone is not a story...

Duplication of success alone is not a story...

Combine these things in a simple and powerful way and you have a story. You need to find those things that really stand out and make your company different. Maybe it's your product or comp plan or rewards or the marketing or system... what really matters most is your story... does your story sound different? Or does it sound like every other opportunity?

To digress slightly: people don't go to work at their JOB for the money. I know, you're saying to you self... what does this have to do with this topic... just keep reading. What motivates people? Why do people go to work?

They work not for some figure in their bank account... they work for the home, the car, the boat, the cloths, the life style for their families... they work for the things that the money will buy... not for the money itself. MONEY is not a benefit... people don't really care about the money. It's about not having to worry... it's about being able to go out to eat if you want to on whim... it's about spending time with family without worry... it's about the "things" that they want to make their lives comfortable.

A good story talks to people in ways that allows them to see themselves having and attaining these things. If you have signed up for my Free training Thesystem101.com you have learned about F.O.R.M... family, occupation, recreation, and money. Each of these 'areas' are important to people generally... but if you listen real close... it's not the JOB but the freedom, it's not family but the time to spend with family, it's not recreation itself... but the freedom to do the things we want when we want... and money is simply the means for reach freedom in the minds of most people.

When you tell your story... talk about 'earning enough to make your house payment every month', or 'earning enough to pay your car payment', or 'taking a vacation'... relate the money you would normally talk about... to their lives. Make the story about them... and find their "why" (what makes them tick). Rambling on about all your facts will never touch the lives of those you're sharing your facts with... until you start telling a story that is relevant to their life.

Crafting your companies story is as important as choosing the right product to sell or the comp plan that creates the exact human behavior you're looking for (sponsor 2 or 3 and have those 2 or 3 do the same, for example).

IMPORTANT: The story is the start of a new members experience... it is the first thing they will hear or see as a prospect and it is what they will try to emulate. When they start the business they will try to copy the pattern you used to enroll them. If you sent them a complex DVD full of facts... they will send all their prospects the same complex DVD full of facts. If you walk them through a simple process with an understandable story... they will try to emulate this same simple process.

The efforts of thousands and the success OR failure of untold thousands more will rest on the story you craft. Duplicate a horrible story full of complexity, facts, and 'unique' (read contrived) terminology... and you will duplicate failure.

Duplicate a simple and unique story that your target market can easily relate to and understand... and you will duplicate success.

The True Secret - MLM is not a "Field of Dreams" Social Bookmark This Blog: BlinkList del.icio.us Digg it Furl ma.gnolia Netvouz RawSugar Shadows Simpy Spurl Yahoo MyWeb Google DZone StumbleUpon

In recent conversations with consulting clients (mostly perspective mlm software clients) it's interesting to note that many feel MLM is like the movie "Field of Dreams" expressing sentiment similar to, "If you build it they will come."

Far too many companies look at MLM as a method of taking their product to market thinking it's a fast and cheap method of reaching thousands of people who will consume and then tell others about their product.

Others look at it in a more sinister way. MLM for them becomes a format to abuse the unknowing, the newbie, and the inexperienced. While this taints public perception on MLM, these companies are the huge minority. There are good, great, and even excellent companies that use MLM to move their product to market while empowering those individual members of their business opportunity.

I'm not a lawyer, but I will state that not all businesses classified as "legal" are all good, nor all those classified as "illegal" all bad. It's been stated, "The road to hell is paved with good intentions." I have seen many good hearted and good intended companies struggle to meet the minimum definitions of "legal", while others whose sole motives are purely that of greed are able to properly jump through the hoops of the legal guides without issue.

MLM can be much more than a method of distribution, in the right hands it can become a powerful tool of empowerment that can lift those members/distributors who participate. Unfortunately those who would abuse MLM can twist it into a powerful tool of devastation.

The True Secret to developing a successful company is not even a secret at all. It's right in front of everyone who is headed down the path toward developing a company using MLM as a method of marketing. The secret is the people, those who participate in an opportunity to share a product they love.

[Digression: Of course there are those who are able to sell Ice to Eskimos, so to speak, and need not love the product. That's not the norm. Most in the masses will tell you, I don't like to sell, or I can't sell. But that's not exactly true. Everyone is selling something.

In an article I wrote some time ago called, (Netripenuer 101) Find that Something! I wrote:

"I can't recall how many times I have heard the phrase 'I am not a sales person' or 'I can't sell' or 'I don't want to sell anything'. Each of these phrases was said by someone SEARCHING, even DESPERATELY SEARCHING for a way to make money online or just make money period. "

"The bottom-line: SELLING is the only way to make money. If you are not selling something (Trading Dollars for a Product/Service), then you are not EVER... NEVER EVER... Going to earn any $$$. "

The seeming paradox is revealed by realizing that most people don't see "Sharing" something they love with someone they love as "Selling." We do it all the time; with movies we like, a great restaurant, a home builder that did a good job, etc. etc. We just tell others what we think and why.

The difference in the mind of the masses is the motivation. If it seems we are motivated by money to tell you we like something, and we think that you think the reason we are telling you is because of that money... Then that's selling (in our minds). But, if we're motivated by a Higher Calling of passion for the product... It changes how we fell about "Selling"... (in our minds) it becomes "Sharing".

Please think of a business, any business, or anyone who has earned/made any money at all, at any time. Was that money earned/made with out the sale of a product, concept, idea or service?

The answer is an EMPHATIC... NO! Ill drop this point for another time...If you think of one email me: mel@melatwood.com]

Back on topic:
As a consultant I was in a typical conversation with a client years ago, a conversation that I've had over an over with many a start up MLM company. They were asking me how to guarantee they would be successful. Without contradicting myself, I clarified that while I could offer no ultimate formula that would guarantee their success, I would share the Truest of all Secrets... The KEY INGREDIENT for real success. The 4 letter word I gave to him as the key, simply went in one ear and out the other... Or perhaps right over his head. I realized then why traditional business people have difficulty with the concepts in MLM. Unfortunately this key word is typically left out of traditional business altogether. It's rarely discussed as a viable business concept, even seen perhaps as "hokey".

However, this word is the driving force for success in MLM as the concept (while touted by many, but not really practiced at heart) of duplication is critical. Duplication requires more than a company driving for numbers. It required creating a base relationship. In my article '3 Steps to Victory in any Home Business', I wrote, "Helping others accomplish the same level of success you have is what pushes you and your income to the next level. Often forgot but ever important is that your groups success directly impacts your success. Help them reach their goals. Help them be successful and you too will obtain your own Success."

While that was written with members/distributors as the audience, it has great application for companies. The 4 letter key word I shared with my client is critical in this process. Many 'top' builders, trainers, and consultants in the MLM community preach a concept of number, numbers, and more numbers. They use tactics that teach people to build a home by "Throwing mud on the walls. What sticks, sticks! What doesn't... who cares? Move on." This mentality of looking at the numbers rather than the faces of individuals is a pitfall many MLM companies get into as they try to reach the projections in their Business Plans.

Several years ago I created a website called www.H-I-C-K.com based on a motivational speech I gave at a clients national convention several months before. I risked sounding like a loon back then... and I will risk it once again. HICK is about simplicity of life. It is about removing the complications of dishonesty, lying, deceit, discrimination, disloyalty, disenfranchisement, etc, etc.
As a continuation of the thought, making life simple through honesty, integrity, charity, and kindness, it has occurred to me that many companies wondering What went wrong? or What happened? When faced with their failing company they have only to look at how much they actually cared about their members/distributors. The lack of caring is actually more hurtful and destructive than all out hate. While many might feel that apathy is simple, in MLM it is FAR more complicated.

Most companies don't start their new MLM business set on taking advantage of others; they simply are not focused on others. So, many with apathy proceed forward unaware that they are providing a tool that will generate hope and excitement, that will inspire and motivate, and that will invigorate the dreams and aspirations of people who desire to simply better themselves, their lives, and the lives of others. Apathy by a company to the strength and importance of the human spirit is missing the fuel, the key ingredient, which can ignite an explosive momentum.

The real key is love.

What is love? Others have said it best "http://en.wikipedia.org/wiki/Greek_words_for_love". Obviously the English language lacks the clarity on this to accurately express in a single word the concept of love. Agape or Philia, Greek words defining specific types of love, are the foundation for the concept of H-I-C-K expressed above.

As I mentioned in my last blog, most people focus on the 4 legs of the stool: Company, Product, Compensation, and Training & Marketing System. While these are indeed critical, it has become an ever increasingly difficult chore to simply make ones decision based solely on these 4 factors. In every stool you've ever seen there have been 5 other pieces. Not just the 4 legs, but the top (the story), and the 4 rung's holding the 4 legs together (Honesty-Integrity-Charity-Kindness). One can not possess these last 4 characteristics without Philia or Agape, which is Love.

Those with Apathy will leave out Charity and Kindness and find themselves making justification of their lack of Honesty or Integrity. The main legs of their stool will become wobbly in the top (the story). Their story, while perhaps not apparent at first will start to shift and become unstable over time.

Without 4 solid legs a company is nothing... but you can't make a stool of 4 solid legs without the rungs between the legs. These rungs (Honesty-Integrity-Charity-Kindness) are the glue that holds everything together.

Atop the 4 legs is the seat or top (the story). There is no good story without 4 solid pillars of corporate strength held together with Philia/Agape and displayed as the 4 rungs of Honesty, Integrity, Charity, and Kindness.

For a company to create a cohesive, synergetic, and even an explosive combination it requires more than simply using MLM as a model of distribution in isolation. A company must apply these concepts to encourage, cultivate, and tenderly care for the needs of it's distributors.

Ultimately from a corporate perspective we're looking for loyalty back from those in our company. We want people to stick with us. You'll notice it's hard for a human not to love something or someone that loves it. There is no greater bonding force than to feel like you matter and are cared about. It is the very core essence of human motivation, to be valued and loved.

Countless fathers and mother slave away each day sacrificing of their time and energy to provide for their families. They do this for the validation they hope will come through the love of those they are doing it for. If that validation and appreciation is not given we find homes dividing, fathers and mothers abandoning their posts, and the disintegration of the family.

In your hands, as a company that provides an opportunity, you hold the ability to awaken the fire inside those whose fire has been extinguished.

It's the faces that count, not just the numbers.





.

Questions, Questions, Questions Social Bookmark This Blog: BlinkList del.icio.us Digg it Furl ma.gnolia Netvouz RawSugar Shadows Simpy Spurl Yahoo MyWeb Google DZone StumbleUpon

As an MLM Consultant, on a daily basis I talk to more than 10 new people doing research on MLM Software, MLM Legal issues, MLM Comp Plans, or a ton of other topics related to MLM. The one thing most of these individuals want to know is: "How do I build a successful MLM?" What do I tell them? Well, I tell them exactly what you are reading right now.

To start it's a good idea to look at the industry as whole. There is no real way to know exactly how many "MLM" type businesses exist. Some try to quantify it in terms of "Legit" or "Legal"... But that kind of classification is so vague from one country to the next or even one state to the next. Some MLM Consultants or MLM experts claim there are approximately 2000 MLM's. This figure is at least lacking one 0.

Since Cognigen and the birth of replicated websites (independent distributor websites that are duplicates of the main corporate site) in the mid to late 90's MLM software has become more and more competitive. New categories within MLM called Affiliate programs or Referral programs have emerged allowing many thousands of "Brick and Mortar" companies to develop an independent sales force via the internet. Many hundreds of these companies have a multi-tiered commission structures (pays commission to more than one person based on a single sale). In essence, these companies are MLM (Multi-Level Marketing).

At the same time that Affiliate programs started going nuts in the early 2000's, MLM companies of all types and configurations started popping up. As it became more and more inexpensive to buy MLM Software, individuals who would have otherwise been unable to afford to take their idea and turn it into a company now started popping up all over the place. A new generation of MLM companies was born, the virtual product. Anyone with an idea, content, information to sell could now do it easily over the internet.

Today there are easily over 20,000 "MLM" type companies around the world. All of these, looking for independent sales people to do 2 things:

A- Market their product/service
B- Market their MLM program.

So, you ask, "Okay, how do I start one of these "IF" it's so easy." Well, while it might be 'easy' to start an "MLM" type business... it's a lot different topic to talk about creating an ongoing "successful" corporate structure.

Distributors often ask, "How can I choose the RIGHT MLM?" (my take on this question) That question is just as difficult to answer as "How do I build a successful MLM?" However, over the decades different successful (and not so successful) MLM distributors have created lists of things they typically look for. That list typically goes something like this:

A- Unique quality product
B- Financially stable & well managed company (the founders & corporate management)
C- Lucrative compensation plan
D- Solid upline support and/or good marketing/duplicable system

It varies from person to person on how they word this list, or weight the value of each. However, typically there are 4 key elements. Some times referred to as the 4 legs of MLM, as in a stool requires 4 legs to be stable. Some will however say that the Product is more important or the compensation plan is more important. You can read some of my thoughts on this topic here (CLICK HERE)

This is a good list for anyone to look at as a high level guide for developing a corporate MLM concept around. However, don't be fooled into thinking that a product or a compensation plan or the stability of a company or the upline support or system or any combination or all 4 together of these are the "be all" and "end all" formula for a successful MLM business... because frankly... THEY'RE NOT!

The real deep, bottom of the pit, rock bottom line is that there is no formula. No MLM Consultant no matter how good can tell you exactly what you have to do step by step to be successful with your particular resources and ideas.

Again... Frankly... some ideas are just... well... stupid !?!?

It takes more than just 4 legs to make a solid stool. In fact most stools have cross members, elements that hold the legs together. Of all the pieces I personally feel... these cross members are the most critical to the success of a company and yet, most companies forget about them or don't recognize them at all.

Most serious companies that have their "ducks in a row" will put together a fairly solid stool. That template has been laid out for a few decades and is easy to use as a guide.

However, I have seen companies with a great product, super comp plan, well funded and properly managed, with a solid marketing support team and system and they just drag for years, never really generating solid growth. I've seen such companies just lug and plod along until finally they start changing the 4 legs of their stool around. They play with the comp plan, introduce new products, throw money at the infrastructure and hire new people, and even revamp their distributor advisory boards and marketing systems. All that in an effort to "Spice" things up... most end up making things worse, making distributors upset, and slowing growth even more.

The real keys to unlock growth lies within the passion of the human being. Those non-tangible qualities of the human spirit: hope, aspiration, desire, and dreams.

If you truly want to know the secret to opening the box... You'll have to wait until I write my next blog.

More to come...

..

MLM Resource Directories Social Bookmark This Blog: BlinkList del.icio.us Digg it Furl ma.gnolia Netvouz RawSugar Shadows Simpy Spurl Yahoo MyWeb Google DZone StumbleUpon

Reguardless of your experiance in MLM you always need good solid resources to help you build your business and to help you grow. There are a lot of sites out there, but I want to list 3 that are key.

1- www.MLMTower.com - MLM Resources
2- www.OnlineMLM.com - MLM Forums
3- www.MLMInsider.com - Complete MLM Resource

As an MLM Consultant I use these sites all the time to keep my finger on the pulse of the MLM community. Email me resources sites you think are quality and I'll share them with everyone.

Google Coop - Explosive Potential for you MLM Business Social Bookmark This Blog: BlinkList del.icio.us Digg it Furl ma.gnolia Netvouz RawSugar Shadows Simpy Spurl Yahoo MyWeb Google DZone StumbleUpon

Explosive new release by Google! I know many of you have participated in Ryze or other online networking sites. Some of you have likely participated in the new public book marking trend. Well, Google has come out with their own version... and it is heating up.

This will be the future of Google's search engine algorithm! What does that mean? Well, what do people want? This is how Google is going to find out and it will be the foundation of how peoples websites rank in Google. If you don't already have a Google Account, now would be the time.

Below I have sent you my Google profile link. Signup for Google if you don't already have an account, and then subscribe to my profile, and I will subscribe back to yours. The ultimate in simple link exchanges, and it's likely to sweep the world of online Web 2.0 communities!


http://google.com/coop/profile?user=012622892704638976670

Please post your Google Coop link here so everyone can subscribe!

In promoting your business you need people to talk with... right? :) No brainier there.

You need people to share your idea with.

A- Warm Market
B- 3 Foot Rule - people in the lukewarm market
C- Buy leads - people in the coolish market
D- Advertise - people in the Fridged Cold market

However, each of these areas have 2 thing in common... that is networking / developing relationships and Exposing your idea/opportunity to others.


In recent years companies like Ryze (a social networking concept) [http://www.ryze.com/go/yoursolutions] were a great way to directly meet new people online and share concepts and ideas... share resources and information... promote your business and even just make new friends online.

In the last 6 months a different concept called Social Book Marketing... [http://del.icio.us/ (type in MLM Software and you'll find a list of several of my companies at the top)] was introduced to all you to upload or enter your favorite websites into a search-able directory that others could then have access to... they could then add your favorite sites to a list of their favorite sites... and so on... basically sharing bookmarks.

Google basically combined the two into one with Google Coop. Giving you the ability to create your own network of people and favorite sites and content all at the same time.


Google then uses this complex web of networking to feed into its formulas for ranking website. The more in your network... the more people subscribed to your site... the higher your page ranks in the natural listings in Google. IE. FREE Traffic. On top of that you have an ever growing list of people and sites to share your opportunity with.

For example visit my site again: http://google.com/coop/profile?user=012622892704638976670 Notice near the bottom of the page a list of people/sites I have subscribed to... and a list of people who have subscribed to me or my site. As I subscribe and meet new people they are exposed to my websites and what I offer. As they share their offer with others, my face is listed at the bottom of their site... MLM Pro is my alias. So, if that appeals to someone... they click my face and vwalla they are taken to my page... where they can subscribe and bingo... I have a new person subscribed to my site... and a new prospect for my product or service.

Beyond that... the more people who visit and find my sites valuable... the better rankings I start to get in Google for the key words I have chosen for my site... free traffic.

Mel Atwood, MLM Consultant
www.MelAtwood.com

Mel is a proven veteran of the MLM and Marketing Industry and has spent over 10 years developing, consulting, executing, and implementing business & marketing strategies on and off-line. He has held various positions with MLM Companies as both a corporate officer and as a consultant. He is a published author, public trainer, motivational speaker and private mentor. 

Product VS Opportunity Social Bookmark This Blog: BlinkList del.icio.us Digg it Furl ma.gnolia Netvouz RawSugar Shadows Simpy Spurl Yahoo MyWeb Google DZone StumbleUpon

Product VS Opportunity
(The age old debate. What is more critical?)

First... let me state... this is only my opinion based on years of successful experience, both in the field, in corporate MLM positions, and now as an MLM consultant. You could possibly call it an Expert Opinion, and some time experts disagree on the same factual observations... that's life. However, if you're not an expert, seek out a few on this topic before personally making up your mind on this topic. A successful upline in your business is typically NOT an expert.

Additionally, please be clear that as we talk, I'm not addressing the idea of Distributors purchasing product monthly (auto-ship or auto-bill).  The issue is "what to focus on" and "what is one more important"... also, this article will address if distributor product USE (not purchase) is critical (or not) for their success.

The questions that should always be asked when considering a business:

#1- Does the product have a market?
(IE. Is it a quality product, can I relate to it, is it easy to understand?)

#2- Is the compensation for the sale of product fair?
(IE. Is the compensation plan understandable, is it clear how I earn money, is the compensation for the effort expended reasonable, am I being paid on product sales or recruiting?)

#3- Is the Company Credible & Supportive?
(IE. Well funded, solid infrastructure, founders/owners/management, product delivery, commission delivery, websites, tools)

#4- Do I have good access to Systems/Support/Sponsor?
(IE. Simple Step-by-Step System for sharing info on the product(s) & business, Conference Calls, Upline availability, Sponsor Credibility, Meetings Available, Marketing Resources)

Notice that product is only 1 of a 4 legged stool. Remove any leg... and you will fall! 
(For more on this go to:  How to select the Right MLM business!)

90% of the people "IN MLM"
(meaning joined as a distributor)
are in it for the money!

Most join IF they can see the value of the product and can relate too it... NOT because they have actually USED it before hand. (Perhaps 10% of those "IN MLM" were first customers.)

90% were searching for an income opportunity of some kind... wanting an opportunity of some kind... and they could see the value of the product... they could relate to it... So, they joined. In 50% of the cases (perhaps even lower) they'll actually use the product on an ongoing regular basis.

It is critical to understand the synergy between all 4 legs... but to start you have to understand this:

There is No Opportunity without a solid Product and
A solid Product alone does not make an Opportunity!

Product IS NOT most important... It may be the first question to ask... that's only because if you can't get past that... no sense in looking at anything else. It is part of a complete overall synergy, without which there is NO REAL OPPORTUNITY.

The same can be said for any other of these 4 legs.

Companies that focus on product fail their members. Companies that focus on Comp Plan fail their members. Companies that focus on the Company fail their members. Companies that focus on Systems/Support/Sponsors fail their members.

My point is product is not the Most Important part of an overall successful BUSINESS OPPORTUNITY.

If you wanna be a customer that shares a product with other customers...
that's just fine... but MLM is just a Hobby for you... NOT A BUSINESS.

Dispelling Myths: A Business is not made up of customers telling other customers. A Business is made up of Distributors sharing a product with customers and finding other Distributors.

Use the product.... IF YOU LIKE. But, It's NOT critical for success in your BUSINESS for you to do so. (It may be critical for your health or your wallet or your attitude, depending on the product; but not critical for your success.)

There are Many Cases out there to prove my point. All the propaganda your mentors fed you while you were growing up in your MLM career will not change these facts.

#1- Companies with POWERFUL products (even products that CURE CANCER, CHANGE THE WORLD) that do not have the other 3 legs in place will not offer their members a serious chance at long term success.

#2- Companies that focus on Customer gathering and product alone... will stall.

#3- Companies that focus on Distributor gathering and opportunity alone... will stall.

A miracle pill, fancy jungle juice, revolutionary VoIP, some techno Wizard driven Widdget... will only get you 25% of the way there. Don't get me wrong PRODUCT IS VERY CRITICAL!

NOT 50%, not 75%, not 100%.   Only 25%!

As an example... If you're in a Juice company... then be excited about your Juice product, and even use it if you love it. For you maybe it's Fruta Vida, Mona Vie (Monarch), Xango (Mangosteen), Eniva (Vibe), Agel (gel), Xooma (Powder), Morinda (Noni), Sea Silver, Affinity (Just-2), FreeLife (GoJi), URI (Powder).... many others.

Dispelling Myths:  Without fair compensation, a solid company, and great support... there just isn't an opportunity in any of these companies.  So, go the next step and evaluate every aspect of a company... not just how great their product is.

There are a TON of very valuable products. For some... the science is better than others. Others have very credible Doctors and Research by 3rd party firms... others just have individual ingredient studies. All of them claim to be the best... when in reality... they all have something to share.

They all talk about Proanthocyanidins, Anti-Oxidants, ORAC, Charged Ionic Fluids, Bio-Available... on and on and on...

For technology companies the buzz might be VoIP or WiFi, for investment companies a new exciting strategy of investment, for information companies perhaps a new way to think about the world and organize ones life!

You might have the question: "If the product is
so valuable, why shouldn't everyone be using it?"

While it is a good question... it is on it's face irrelevant to Distributors. If we're talking about nutritional products, perhaps I have diabetes and there's too much sugar in it... perhaps I just can't stand the taste... perhaps it does funny things to me.  But, I can still recognize it's value to others.

How does use of a product equate to selling the product?

I'm sure you've heard the phrase "Could sell snowballs to Eskimos". One does not need to be "A Product of the Product" to be effective at sharing product... use of the product is entirely optional for success. While many want you to have a personal experience with the product so you can share that with those you talk to... (and this is a nice bonus) It's not critical. Why?

Distributor use of product is irrelevant to long term success of an MLM.
What is critical is the use of product by the end consumer/customer. Most MLM's blur the lines... make distributors customers and customers distributors. 90% of the MLM's that are attacked by the AG's or FTC is due to the lack of a real product being sold to a real customer. Often used in reference is the case against Amway itself... or the 70% rule.

Customers and end users where the main focus here. Basically the court wanted to spot "Garaging" from happened, and wanted to see more product reaching end users.

Most MLM's from that point started implementing policy that would slow "Garaging". They put in smaller monthly quota's, put in their policies that 70% needed to be resold, and encouraged the development of customers. In practical application the participants of MLM and even the MLM owners themselves view distributors as end consumers... and this is dangerous on 2 fronts.

#1- When most people enroll to "Make Money" and don't, they usually quit buying the product. Unless a leader keeps working a downline will unravel from the bottom up.  Many have seen this when they slow down or retire... because their efforts to fill the holes, made by those leaving, isn't happening any longer.

#2 - Constant recruiting becomes an issue when there are no REAL retail end customers. Like a revolving door... people in people out... if you quit putting people in... the check goes down.

Customers, not interested in the business, are the key to stability.

The courts, FTC, & AG's agree.

But, growth happens NOT from customers...
but from distributors... so, you NEED both.

I don't entirely agree with the below courts position... and it is just 1 case. However, this is something many people need to consider. In 1996 a court ruled that commissions COULD ONLY be paid on product sales to non-distributors.

http://mlmlaw.com/library/guides/omnitrition.html
http://mlmlegal.com/personal.html

There are a lot of takes on this... but #1 should be the that CUSTOMERS using product is more critical than distributors using product. No matter ones perspective on this issue there is an underlying misunderstanding in the MLM world about the idea of commerce. Basically, move products to end users who will use the product because they love the product.

(For more on this go to:  (Netrepreneur 101) Find that Something!)

If you go to the next step and indicate that distributors are customers and thus a prerequisite for doing a business is the love of a product regardless of the opportunity... I think you cross the line.

If someone loves the product they are selling... MORE POWER TO THEM. However, that saying comes to mind... "Could sell snowballs to Eskimos". Even if I don't like snow personally, and I was good at sharing things with others... I could sell snow.

Most people however, are not sales people... they are regular joes... so, while I don't personally care if you use it, I think a better way to put it is: Is it a product I can see the value of and can relate too?

Some people would never use Vitamins, minerals, and jungle berry juices... BUT, if they can see the value and can relate to it... they can do just FINE sharing it with others.


Belief in the product doesn't require personal use. To sell/share a powerful and valuable product does not require personal use.  One can truly believe in the benefit of a product for others without experiencing or having the benefit themselves. Most people will NEVER see a result with MOST products... but, they can believe in the science... they can believe in what they've been told... EVEN IF they don't see a result themselves.

The point here is... you have your choice of HUNDREDS of companies that have BEAUTIFUL products. Again, some perhaps better than others... But, they ALL have 1 thing in common...

Inevitably opportunity rests not JUST with the product... but, with Compensation, Company/Support, & System/Support/Sponsor as well... all wrapped up in a synergetic ball! You need ALL 4 legs.

This applies to service companies, information companies, technology companies, etc.

Don't get lost in the product... unless you JUST want to be a customer...

If you want to build a business... if you want to make a career in MLM... if you want to generate success and teach success... You'll empower your "team" with greater insight into the BIGGER picture.

The point?

CUSTOMERS are Critical... But a Distributor and a Customer are 2 different things. A customer uses the product only for the product. They want a good price and they want to see the product/service work.

DISTRIBUTORS are Critical... But a Customer and a Distributor are 2 different things. A distributor can use the product if they should like... but, personal use (while perhaps nice) is by no means essential. The purpose of a Distributor/Representative is to "spread the message".

While the business model of MLM has been "be a customer and share the product with other customers and get them to do the same" ... there are flaws with that mentality when pairing it with the idea of Building a Business. On its face customer referrals is Brilliant! And it WORKS for the company as a means to move their product. The company wants you to associate yourself as a customer for many reasons.


I can think of 20+ companies this second (there are hundreds... perhaps thousands that do this)... companies like Dish Network, BMG, Columbia House, Ronco, the Cable Company... and on and on... where they encourage you with incentives... mostly NOT financial (perhaps rebates or discounts or free stuff)... but incentives none t