MLM or Multi Level Marketing is a business model. "But how does it work?"
Let’s take a look at the real world first, for this example; let’s use a Print Advertising company.
A company has a Director at the top of the tree.
Who Then Recruits the Marketing Manager.
The Marketing Manager will promote the business building up brand awareness and also bringing in sales for the business.
The Marketing Manager will get paid a percentage of revenue brought in by the Marketing and by way of salary.
The Director gets paid on all volume.
The Director then decides to employ a HR Manager.
The HR Manager will recruit staff for the company and be paid a salary to do so.
Then the HR Manager brings on telesales staff that starts selling the advertising for a salary and a percentage of sales.
The telesales staff will get paid a percentage of the volume that they bring in and also receive a salary.
The HR Manager and Marketing Manager now gets a percentage of revenue if the sales staff hit a target, and the Director gets paid on all the volume.
Now that you can see how the real world works, let’s see how it compares to the MLM (Multi Level Marketing)world,
The Product I will Use For this example is Web Hosting.
The first person in a MLM programme will be you, you are the Director, Marketing Manager and HR manager all rolled up in one.
So you join a hosting site with a MLM structure as a member which cost $10 a month for the hosting of your website and will pay you 10 percent of all your sales. Now you have a space in the World Wide Web to send people to.
You will start to market your new online business through different channels to start driving traffic to your site.
You get 5 sign ups in your first month and get paid $5 for your volume, but you need to pay $10 to renew your hosting account. So in your first month you managed to cut your expenditure by 50% and increase you company size by 500%.
In your second month you get 6 sign ups and get paid $11 for your volume. Your first level duplicates your success and also brings in 5new members each. They get $5 each and you make $36. But you need to pay $10 to renew your hosting account. So in your second month you managed to make a profit of $26 and increase your company size by a further 600%.
In your third month you bring in 7 new people and get paid $18 for your volume. The 5 from your first level that you signed up in the first month bring in 6 each and the other 6 sign up 5 each. That’s another 60 so in total you’re making $68 per month, with a team of 78 employees’ and growing.
So to summarise the two different business worlds are not that different are they?
Im using The SpiderWeb Marketing System to promote my Hosting website
Also check out my other article on Ways To Build A Business
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The SpiderWeb Marketing System
If your having trouble getting MLM Leads have a read.
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Contributor's Note
Please leave feedback for and of my MLM or hosting aticles bacause I am always learning new things every day!
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