Do you know about - Chasing The Holy Grail - How To achieve Leverage In Network Marketing
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I'd like to talk about the oldest profession in the world, tracing its roots back to the garden of Eden. Now before you pick up stones to castigate me, allow me to explain myself. The subject of this article is "Network Marketing," which is interchangeably called "Referral Marketing," "Word of Mouth Marketing," "Multi-level Marketing" or naturally "Mlm." It is a first cousin of franchising, a younger sibling of "Direct Selling," and is in turn an older sibling to "Affiliate Marketing."
As Mlm guru Tom Schreiter likes to point out, "most population do network marketing every day, they just don't get paid for it!" Thus, when the Serpent talked to Eve, and then Eve enticed Adam to sample the forbidden fruit, she was engaged in "belly to belly" Referral Marketing (and we've been paying the price ever since!)
Network Marketing is a method of doing company whereby a company markets its goods and services directly to the end buyer by means of an independent jobber force, as opposed to working with wholesalers who then stock their products in sell outlets.
So instead of spending advertising dollars up front to promote their wares in malls and supermarkets, its marketing funds is redirected into a commission bonus buildings for the jobber force. Commissions are paid out after the sale is made, allowing the parent company to gain the leverage of a huge advertising budget, without the upfront capital outlay. In other words, the sale comes first, income is generated and commissions are paid out after the coins are in the coffer.
In fact, the Holy Grail of Mlm is "leverage," both for parent companies and for their independent distributors. "Give me a lever long enough, and a fulcrum on which to place it" exclaimed Archimedes, "and I can move the world!" Leverage is why companies employ the multi-level marketing model, and leverage is what attracts hordes of prospective entrepreneurs to commence an Mlm career.
Direct selling has a long history in the United States, and is usual linked with the door-to-door salesmen of Fuller Brush>, Kirby Vacuums, Watkins or Avon fame.
Similar to direct sales, Mlm distributors get paid a direct commission by the parent company after each sale they make. In addition, there is an occasion to earn indirect commissions, by recruiting other distributors and getting paid on their personal sales volume, and so on and so forth, down manifold levels or generations, in a snowballing effect. Hence the term "multi-level marketing."
"Is this a Pyramid Scheme?"
It is usually at this point in a pitch to a prospective company associate that a jobber might encounter the dreaded "pyramid" objection. The litmus test used to determine either a schedule is a bona fide network marketing plan, or a pyramid or Ponzi scheme is naturally to ask either there is an actual, legitimate goods or assistance being marketed, or if instead it's purely a money game without anyone substantive, other than cash, exchanging hands.
In other words, would Grandpa Jones or Aunt Tilly buy the goods or assistance just because it tastes good, makes them feel better, gives them real benefits, etc? Without any financial incentive?
Just as franchising had to face the Us congress in the 1940's, network marketing had its day in court when the Amway Corporation won a landmark victory in 1979, which declared that its company model was not a "pyramid scheme" as long as it fell within the approved parameters.
As Tim Sales explains in his presentation brilliant Compensation, "there's nothing wrong with a pyramid!" It's one of the most stable corporal structures in architecture, as attested to by the Mayan and the Egyptian civilizations. Governments and corporations all employ the pyramid model. In fact, when someone asks me either Mlm is a pyramid I often reply, "Oh, you mean like social Security? No, it's nothing like that!"
Multi-level commission structures are often employed by real estate brokers and guarnatee companies who may extend "override bonuses" to agents who refer other agents.
Professor Charles King, from the University of Chicago School of Business, and Tim Sales debunk the "pyramid myth" in their superior brilliant compensation lecture, which is thought about the premier Mlm apologetics piece to date.
Leverage: The Holy Grail of Any company Venture!
As I said before, the name of the game is leverage. A original job is typically an inefficient way to gain the leverage need to create true wealth and "time freedom." There one must trade hours for dollars. Stop working, and you stop getting paid. Owning a company is a better way to leverage one's time and money. The following quote is attributed to America's first billionaire, the notable oil tycoon John Paul Getty: "I would rather have 1% of the efforts of a hundred men, than 100% of my own efforts." Some say Andrew Carnegie coined that phrase. But in either case, both men grew rich off its principle!
Network marketing, has been dubbed "The People's Franchise" because it allows average persons to work from home, and build leverage in their spare time by building up a network of customers and distributors. Mlm philosopher Jim Rohn would call this working full time on your job while working part-time on your fortune!
Network Marketing usually involves far less seed capital than original franchising. In theory, any average Tom, Dick or José can bootstrap his way up from nominal start-up fees (typically less than ,000) to complete financial leverage in a long-term passive, residual income stream. Now things don't always turn out this way, and often population will point fingers at Mlm and say it doesn't work or it's flawed because only the top 1% make any money, or "you have to bug your family and friends," et cetera, ad nauseam. Yet, as my father has drilled into my head ever since toddlerhood, "Abuse doesn't take away the use."
Rock Star Income: My Personal Mlm Saga
At this point I'd like to shift gears and get personal here. I'm going to share with you my own personal ups and downs in this curious commerce over the procedure of the past 12 years.
For starters, I was introduced to the understanding of residual income through my passion for music. When I was 14 years old my dear mother ordered a 6-string guitar for me from a Sears catalog. I'm sure she may later have second-guessed her decision, as she had to suffer through my studying process, together with the eventual smashing of this guitar in utter frustration. By and by, though, I got pretty good and thereupon embarked on a prolific song-writing career.
While living in Texas in the early '90's I joined the Dallas Songwriters Association, and it was there I learned that the authentically "lucky" songwriters could earn royalties on their compositions for years or decades to follow. In reality, even though there's an element of luck in the music industry, "luck" is authentically nothing more than "preparedness meeting opportunity." I wasn't prepared to pay the price to make it big in music, and so I naturally lived on as a legend in my own mind.
But colse to this time, a fellow grad student at my alma mater, the University of Dallas, approached me one day and asked: "How'd you like to make money every time somebody picks up the phone?" This was the quiz, that launched my Mlm career! I grasped in a flash of insight the beautiful entirety of this abstraction called "leverage," and I could see clearly that multi-level marketing was going to be my means to this coveted end.
I began attending standing-room-only hotel meetings with 800 eager entrepreneurs in the room, while which the speaker would point out that he had built an society 10 times the size of that group. "Do you suppose any of those folks made a phone call today?" he'd ask? Dollar signs danced in my head as I tried to compute his override bonuses on all those ringing minuscule Atm machines in homes across the country
When the actual process of building my network of customers and customer-gatherers moved more moderately than I had imagined it would, I made the coarse mistake of most rookies who do not understand the growth curve and thus panic while the incubation period: I jumped ship, and found someone else telecom schedule without 0 start-up fees. I had seen this fee as a wall to entry.
Over the next year, using the internet as a marketing vehicle, I referred a handful of customers and distributors and ultimately developed a personal society of over 1,000 customers on whose monthly phone bills I was paid a small percentage. This was back in the days of 15 cents a minuscule long length calling!
But I soon learned my first big chapter about Mlm: developing a company colse to a commodity was like building a house of cards. Once long length rates started dropping, behalf margins became razor thin. At one point, Excel Communications, a Network Marketing company based in Dallas, Texas, had grown to be the estimate 4 long length carrier in the Us. Their top jobber was earning a stratospheric .2 million per month. Excel went out of company about 5 years ago, and with it vanished the hopes and dreams of millions of distributors for that elusive "long term residual income."
The problem, as I later learned, is that because of small behalf margins, Excel relied heavily on "coding bonuses" that were generated on the 0 startup fee to become a distributor. To me it became a case of the emperor having no clothes. Only a fraction of the top earner's checks could have been thought about true residual income, based on long length call volume. In my humble, but strict opinion, Excel was a thinly veiled Pyramid scheme that managed to fly under the Ftc radar, until its eventual collapse any years go.
Sizzle vs. Steak: How to set yourself up for Long Term Residual Income
Because I'm a high-tech, tool kind of guy, I had turned my nose up at marketing nutritional products. But in reality, this arena is where the bulk of Network Marketing volume is derived. I learned someone else critical chapter at this point: nutrition and supplementation is a very stable market, and many of the older, well established companies such as Shaklee, founded in 1956, Herbalife (1980) and even Amway (1959) have a wellness component as their flagship product.t.
On Shaklee's corporate web site (www.shaklee.com), the following quote is found:
When everybody else was spending their marketing dollars on advertising, Shaklee invested what would estimate to billions of dollars in rewards for population who spread the word. Not to mention millions of dollars in study and development.
Mlm companies that sell nutritional products are able to allocate more of their operating funds into study and development, and thus often create a superior product. A top grade goods usually costs more, which in turn requires an education process that is hard to get from a 30 second advertisement. Enter "word-of-mouth referral marketing." population who have great goods experiences tend to want to share those experiences with their "warm market" (i.e. Friends, families and neighbors).
As I said earlier, most population do network marketing every day, they just don't get paid for it! I met a gentleman recently who told me that after he moved into a new improvement in Simpsonville, South Carolina he referred 19 of his friends to that community. They all bought homes based on his recommendation! I asked him either the home builder had sent him a check to thank him for the roughly .5 million worth of company he sent their way, and with a resigned shrug he naturally said "No.
Mlm allows that natural human tendency of sharing good news free rein, with great financial rewards to boot.
A good goods can create excitement, emotional attachment and above all, stability, for years, even decades. In contrast, all dial tones pretty much sound the same, so it's hard to get attached to a commodity-like goods or service. Ironically, when Excel collapsed they sold their database to the Shaklee Corporation and encouraged their jobber force to rebuild their networks within Shaklee's venerable, stable brand name.
I have a good friend who is the top jobber in a nutrition-based company. His motto is "Build it once, build it big, build it for life!" It's crucial for anyone considering becoming a home-based entrepreneur in the Mlm arena to thought about study the company he wants to get in bed with. The administration and vision behind a company are as important, if not more so, than the type of compensation plan or even the goods itself. Once the hand is on the plowshare there should be no looking back, no jumping ship. Explosive growth usually occurs after a distinct tipping point, and great patience and trust is required to keep pushing past this point.
"Get There Firstest, with the Mostest!"
Timing is someone else crucial element. The mavericks in this commerce are the ones who get in early and help build out a company jobber force in its unstable, start-up phase. Those who back the right horse are usually the stuff of Mlm legend, who go on to earn ongoing royalties of ,000 to 0,000 a month or more for decades thereafter.
I've polled any top networkers about the best time to get into a well-researched Mlm opportunity, and the consensus is usually some time in the 5 to 10 year mark. Prior to a 5-year track article there could be a pretty high level of risk. After 10 years a company is usually pretty stable in it's original market, and thus harder to drill and build locally, at least with any kind of double-digit monthly growth momentum. At this point companies usually count on international expansion to help continue increasing their income base.
Six Inches Away From Success
Back to my own story, now. As I became more and more intrigued by the leverage element of Mlm, I became a voracious reader. There's a saying that "leaders are readers," and I began to soak it all up. While I still held down a original "J.O.B" I began to turn my car into a rolling studying center. Incidentally, residual income snobs like me always say J.O.B instead of "job" when referring to the unhappy fate of linear income wage slave cubicle convicts. It's an acronym for "Just Over Broke" or "Journey of the Broke."
While at my place of employment, I could not wait for 5 o'clock, when I could merge onto the parking lot also known as 635 Lbj Freeway in Dallas and fly into my world of Mlm dream-building, listening to hours and hours of recorded motivational talks by Mlm deities such as Tom "Big Al" Schreiter, Kim Klaver, Mark Yarnell and Randy Gage
A third major chapter I learned is that to be prosperous in Network Marketing you have to turn your mindset. Just as new wine should not be poured into old wineskins, so the idea of making a living as a home-based entrepreneur has to ultimately crowd out and thoroughly eliminate any desire for the false protection of a steady paycheck. At one meeting I attended the speaker said, "Go and hold your head under water for 3 minutes. When you want success as badly as you want air, there'll be no stopping you in this industry!"
Most population are only 6 inches away from success! I'm talking about the grey matter in your cranium. You have to see yourself as a 6- or 7-figure earner first, before you can authentically cause that to happen
Fortunately, you don't have to become a superstar to have genuine success in Network Marketing. It's been said that having 0 a month in passive income would make a huge divergence in most people's lives. The bulk of network marketing organizations is made up of part-timers and bread-and-butter product-users. As in any other area of life, the Pareto Principle applies. 80% of the money is going to be made by the top 20% of all distributors. Mlm is no dissimilar in this regard from real estate sales, car sales, guarnatee sales or even original company models.
Another paradigm shift I had to face is that most population are like ropes. You can't push them, only pull them by the "law of attraction." My jobber society is an all-volunteer army, and so leadership in Network Marketing involves being a good coach, mentor, instructor and inspirer.
In divergence to working one's way up a corporate ladder, Mlm is by all means; of course a level playing field. Chances are, corporate Vp's do not earn more than the Ceo, but in Mlm I can sponsor someone who goes on to build a bigger check than I do. How this is possible is explained in great detail in Tim Sales' brilliant compensation video.
In fact, ask any jobber with a large society (let's say 5,000 distributors or more) and they'll tell you that 80 to 90% of their company comes from the efforts of 2 to 4 population at most. Tom Schreiter says that if your society has one leader, you'll be financially free. If you find two leaders, you'll be rich. If you find three leaders, you probably miscounted!
This is most by all means; of course true in my case. A minuscule over 4 years ago, colse to the same time I moved my family from New Hampshire to the Carolinas, I was introduced to a goods quite offhandedly, by a friend who told me in passing about a bad case of poison oak he had just managed to get under operate by means of a juice made from the mangosteen fruit. I jokingly asked him if a mangosteen was a "Jewish mango," but I stopped laughing and became intrigued when I saw his results with my own eyes. I asked him to send me some data on this newfangled product, which had only been on the shop for a minuscule over a year, and I did some research.
A 12-year "Overnight Success Story" in the Making
Being attuned and open to new opportunities, I realized that this company and this goods is what I had been making ready to find over the procedure of my ups and downs in this industry. Remember, "Luck is when preparedness meets opportunity," so after 8 years of looking I "got lucky" and became an overnight success.
I got out my rolodex and began contacting key company associates from my former Mlm experiences. My preliminary efforts rapidly began to snowball, because all the magical ingredients had finally come together for me: timing, great management, a killer unique goods and a breathtaking compensation plan.
In my understanding and experience, opportunities like these come along maybe once a decade, and I am very grateful I paid the price and stayed in the game long adequate to be rewarded for my network marketing efforts!
Today I have an society of over 25,000 independent distributor/customers, which produces a monthly sales volume of colse to 0,000. This amounts to an .4 million dollar company I operate in shorts and a t-shirt, from a spare bedroom, which continues to grow and thrive either I work it or not. I couldn't stop the growth of this company if I wanted to!
In a recently published book called "Beach Money," Jordan Adler said something that authentically hit home: When you have a residual income, the more work you do the less you get paid! How's that for irony? In other words, if someone makes ,000 a month and works 20 hours a month to avow that level of income, he's essentially making ,000 an hour. But if he can keep making that estimate of money and reduce his monthly workload to say 5 hours a month, he just gave himself a 400% raise and is now making ,000 an hour.
My goal is to get to ,000 an hour! I guess that means I better work a minuscule less this month! Oh well, it's time for a nap anyway. What good is leverage if you can't take a good nap whenever the mood hits you!
I hope that you are now attuned to the wide world of occasion and excitement that Network Marketing can afford you. There is so much more I left unsaid about this favorite commerce in which I have found a permanent home, but suffice it to say that after all the hard work, ups and downs, failures and successes, I can truly say to you: It's well worth it! I hope that all of you find your own Holy Grails, and I wish you all the very best.
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