In a survey yesterday, I asked: How long will it take Lulu, who’s never owned a business before, to make $2,000/mo in her new network marketing business? We assumed she’d spend 5 hours per week.
(Let’s say that her product package is about $55/mo, and that she earns $10 on each auto-ship product order. They have a $750 start up recruiting package, on which she earns $75. Say she earns 7% on any downline orders.)
The options ranged from 6 months to 36 months plus. (Results so far are here.)
I picked 36 months. Here’s why.
(in no particular order)
1. It will take the first year for Lulu to understand what she needs to do to make money. Sorry – duplication, education, buying leads and going to events do not earn her one dime. Those things cost her money and time.
2. It will take the two years for her to realize that it takes way more up front time, effort and money than she imagined – to earn any money.
3. It will take two years for her to learn to talk to people about her product or business in a way that doesn’t turn the listeners off.
4. It will be two years before she earns a steady $200/mo (maybe longer).
5. She’ll discover and rediscover every day during the first two years that it isn’t as easy as they told her it would be, nor as easy as they keep telling it at the company events and upline meetings. She’ll wonder if it’s her.
6. She’ll change companies at least once in the first three years.
7. She’ll feel like quitting at least once a month.
8. She’ll get her hopes up once a month because of a potential customer or rep on the horizon
9. She’ll lose some of her friends.
10. She’ll discover that the business model of getting people to buy initial product packages that are too big for them isn’t worth the money she earned on them.
11. At the end of the first year, she’s probably negative $2,000-5,000. At the end of the second, upside-down $10,000.
12. She’ll see there are many ways to earn income that are much less stressful than doing network marketing – the way she’s been taught to do it.
13. She’ll discover there’s no upline support if she isn’t bringing in sales and recruits.
14. She’ll wonder every day how to find good people – someone like HER – who is willing to do what it takes to improve their own lives. Where has everyone who wants health and wealth suddenly gone?
15. If she makes it to year three, she’ll start over and learn to:
- Distinguish between building up a customer base and getting reps.
- Not work with upline who insist on their way or the highway.
- Find people to work with cross-line or cross company who are more like her.
- Find a company that pays well for getting loyal customers, not just reps-as-customers or reps who buy stuff for their garage.
- Learn to talk to people in an authentic human voice and tell her personal story.
- Learn to never make another promise about what the product will do for someone, or how much money someone can earn…
- Learn to niche-market – i.e. how to ask for people who share the values she does – values that make her a loyal product/service customer of what she sells.
- Learn to look for people like herself as reps for the business.
- Learn to ask for referrals always, so that neither she nor her listener feels stress when there’s not a match.
- Realize it’s OK being who she is and doing things her way, on her own schedule.
- Realize that all marketing is an uproven experiment until something clicks for her.
- Realize she can feel wonderful delighting and amazing her niche members, not everyone.
- Realize it’s good to relax a bit and finally have fun with it…
This is a list of things that came to mind today, based on having built 5 NM businesses and training thousands of reps over the last 15 years.
What would you add to the list, based on your personal experience?
—
P.S. I’m starting again and will keep you posted on how things go in today’s marketplace.
Kim,
I think you have really captured everything right here. I too put down 36 months. I am at 24 months in my own business. I can just about follow along your post like I have done every thing you have mentioned in my own journey, except that I have not changed companies at all.
I am completely satisfied with my company and my products and our compensation for getting customers is good. I am happy/lucky that I found something that really fits for me. To me that makes all the difference.
I have seen people in my group jump from company to company looking for the golden goose. It seems to me that people are not able to or don’t want to put in the time to learn the skills they need to be successful. They want it to happen overnight and when it doesn’t they are gone.
So I don’t have anything to add to your list because I think you really covered it well.
Regards,
Erin
This is such refreshing and ENCOURAGING post Kim! You see, I am with Arbonne in Canada and the growth here has been so explosive that MOST of our upline reached the second highest level of management in record time – that means they are driving the coveted White Mecedes Benz and making the big banana bucks. So because that “precedent” has been set by our upline, it is often easy to compare myself to their journey and wonder what I’m doing wrong? Why is it taking ME so long? However, I have spent A LOT of time in my first year, studying the industry, learning from you and the courses & resources you offer, and trying to figure out how to do things genuinely and without compromising my friendships or using my family to keep me in business. My husband sees the possibilities, but also knows that I tend to move on to the next thing if I don’t feel successful ‘fast enough’ This post reminds me to have a long term outlook and that it’s a marathon not a sprint. That strengthens my committent for the long haul and that’s half the battle! Thanks again for the ‘reality check 🙂
Sheri
Excellent. Well said. Well spoken. Gonna print this for my recent newbies.
And I agree with Sheri.
The learning curve is huge and not for the fragile.
Products are important, but WE are more important. Work more on you than on the business. I thnk it’s Michael Claus who drives that home all the time.
Thanks Kim. This helps.
Lisa Dingel
Success
I agree with most of what you said, Kim, I am just shy of 24 months, but I am making a good chunk of change more than you show at 24 months on recruiting alone and I am NOT planning on changing companies. But, I have thought numerous times about quitting, I am spending a ton more on education and such than I am earning, but I feel passionate about our company, product and industry. However, something that I have overlooked as being very important, is building customers. For anyone getting into this industry for the first time, don’t underestimate the POWER of customers! Thanks for this post! It was great to read and I will share with my team as well!
I too said that it would take 36 months or more.
Lulu has never had her own business and, moreover, can only devote 5 hours a week to the endeavor. If she were working the business full time, the learning curve would of course be much steeper. She may very well be able to start earning that extra $200 a month in less than 6 months.
The one thing not mentioned here is the absolute prerequisite:
Absolutely, obsessively loving – madly loving – the product that you’re promoting. That’s what gets you through the tough times and moves you forward.
It’s that missionary zeal that moves you forward. If it’s just a business to Lulu, she’ll never make it past a year. After all, as you said Kim, there are much easier ways of making money than Network Marketing.
Great list, that’s all I can think to add.
Cheers,
Rani
Kim,
As Lisa Dingel said in the above post, this is a good one to print and keep.
I just want to say that your approach to NM has kept me from pulling the plug on my own business.
My upline is in New Zealand and after taking almost 2 months going through their program I have realized I do not like the hype, lack of support that I need and the way they go about finding prospects.
Your resources are great and just what I was looking for. These kind of posts tell it like it is.
I have all your MP3’s and listen to you everyday.
I love my product and with your resources will build my business the New School way.
Better to tell all the LuLu’s out there the realities
of business straight on. If they bail then you won’t have to do therapy.
Dianna
While I agree with what you are saying Kim, I wonder if giving a list like this to a newbie might scare them right out of business.
Therefore I’d like to suggest that it is our responsibility to help the newbie understand what being in business really means. We throw that word around as if it’s something everyone does everyday. Like taking a shower.
A Network Marketing Business should be defined in the same way as any other business:
Business – the principal activity in your life that you do to earn money
Serious work or endeavor
The occupation, work, or trade in which a person is engaged
Here’s one for you Kim—stage business – incidental activity performed by an actor for dramatic effect; “his business with the cane was hilarious” (lol)
I have had several so called traditional businesses and as many of you might know they involve lots of research, evaluation, development, sometimes money and certainly right timing. Add to that government regulations and requirements and you ask yourself, is it worth it? The answer can only come from the heart. Is it really what you want to do? And do you have enough determination to see it through the tough times? Passion is the only thing that will carry you through.
I believe the responsibility to inform our newbie is ours. We should be teaching them exactly what it will take to succeed. That is why all of your material Kim is so valuable. Network Marketing is not a hobby:
Hobbies are practiced for interest and enjoyment, rather than financial reward.
A hobby is a spare-time recreational pursuit.
An important determinant of what is considered a hobby, as distinct from a profession, is probably how easy it is to make a living at the activity.
If our newbie is going to be successful in our business, they must have the desire to learn and develop themselves into a success, just like we are. And the exciting part is that we take this journey together …. all the way to the top if that’s where they want to go.
I love this business!
Linda
Add to the list?
Simple. Just 5 hours a week ain’t nearly enough for someone serious. Double it and then add a bit more. That way the timeframe should shrink to around year.
Picking on a comment…
>I wonder if giving a list like this to a newbie might scare them right out of business.
Hopefully… yes. NM needs fewer people and better skills.
> …to be successful in our business, they must have the desire to learn and develop themselves into a success.
And that’s a process based on personal responsibility – a comparative rarity in this business in which we spoonfeed people rather than take a ‘straightforward, no-nonsense, punches-not-pulled work for grown-ups’ approach.
Credit to KK for having the decency/courage to post such a pointed piece highlighting the downsides. We need more of this as a foundation upon which to build solid stuff – rather than the usual ‘anyone can do this and quickly – it’s real easy’ hokum.
Boy. You did hit the nail on the head. So many things against you when you come into this, nobody but you anywhere around who thinks customers ought to be what you’re looking for.
It’s nice that there are others now who see the customer picture, but you’re still stuck with an upline that doesn’t see it, so that even if they’re alive and willing to help you, they’re not on the same planet, so they can’t.
The picture you painted looks a whole lot like me, and I always have thought I was to blame somehow, because I never got anywhere.
5 hours a week is a lot for a person with a full-time job and/or a family. I don’t think such a person can expect to scrape up more than that. There’s only so much energy to go around.
Where is that company with such a low minimum monthly purchase, and such high commissions, though? I have yet to see it. Double the expense, and half the commissions. That’s more realistic for my experience.
bk
One of the “secrets” of network marketing is consistency.
John Milton Fogg called it a Single Specific Daily action; Teresa Romain teaches the power of “something”.
A lightbulb went on for me when I looked at the numbers of recruiting one new person each month and teaching that.
When people work out what they are going to do, and then how much of it they need to do to get their one a month goal -that’s when things start to happen.
And, and Kim says, it can take a long time to get to that point….it did for me!!
I am going to be sharing this with many people. I think it helps people to realize they are “normal” and that there is nothing wrong necessarily with the company, product, training, etc. Even in my current business, it took me a while to come to the realization of WHO my ideal target market is. Now that I realize that, things have really progressed in my business quite nicely. I have 20 yrs experience and training in the industry, so it has been more about finding the right company, product, comp. plan, support and of course right timing. Nothing is certain, however with the right mindset and the right training coupled with the right attitude and tools one can be on the road to success. I have learned to also explain to people that they need to discover their strengths and how to use them to grow their business. Not everyone has the same God given talents, so you can’t expect to be just like your mentor if they have different strengths than you do.
I have had some of those same feelings….until I took your “3 scripts class” and found a workbook called “5 Steps for Strategic Planning” by Paula English that increased my learning curve….Now I have a professional business plan with a growing predictable business attracting the right people who are like me, using and consuming a broad range of products on a consistent basis and getting the best results ….thanks for all the great training you are doing….
http://www.paulaenglish.com
Virginia Holley