A successful friend in the investment business who’s interested in learning how NM works got this email today from a contact of his.
“Most entrepreneurs I know *loathe* network marketing. This is because it monetizes personal relationships, which is disruptive to community. Considering that the primary reason driving most entrepreneurs is ‘I want take care of my family’, they generally stay…away from this methodology unless they’re desperate.”
Before you dismiss this, ponder the argument. Who hasn’t heard of people who joke about being in the NFL (No Friends Left) because of their NM activities? How would you reply?
MLM is finally gaining respectability. Like all industries, there is a high failure rate with new companies. Unfortunately, we have also attract a lot of sleazeballs, who take advantage of people.
We can be in business for a few hundred dollars or less. That is good and bad. Many people have been able to make a lot of money, however we have also attracted the dreamers and people without the qualifications to be successful
We are attracting people in record numbers and in a few years, the numbers will be in the millions.
My reply would simply be:
There are bad apples in any industry including the corporate world. And even though Network Marketing is synonymous with deception and abuse it is far from the truth. Network marketing is just a distribution model but it is still a legitimate business model. Like any other business it will not be a business unless you have customers (and your family and friends are only bonus customers). To grow your business you must find others who would like to have their own business without spending huge amounts of money. That will save you the headache employees bring. If you are desperate I suggest that you find a job first and start your business part time.
I certainly understand the question, because that’s how I felt for 15 years.
After a couple of years of observations, I think I understand the reason. People badger their friends and family when they don’t have the skills to generate leads and grow their business. When you know what to do and how to do it, there is no need to twist anyone’s arm. (That’s why personal development is so important!)
I would answer the question this way — “Unfortunately, in the past, there have been a few large and visible companies that have operated in that manner. Most people realize this does not work, and are adopting business practices that are sustainable.”
Walter Reade (from Wisconsin)
Many entrepreneurs I know will not join NM because they do not want to tarnish their reputation. The other day I was talking was about my product and I said to the effect that I distributor and he jumped in with, “I can’t get into something like that. I have to keep my name clear.” I didn’t ask him to join (and I wasn’t going to). A topic of conversation came up that was relevant to my product, so I told what I take. He asked me where he could get them and that is when I said, “From me, I sell them.” Right then, he interrupted me with his remark. This is how many people still perceive NMing. Thankfully, there are people like us changing this.
No, he didn’t order. At least, no yet. 🙂
Which entrepeneurs is this person referring to? I can think of four (besides myself and the crowd here) right off the top of my head who love it:
Donald Trump
Robert Kyosaki
Paul Zane Pilser
Marshall Sylver
All these guys have made millions other ways and yet they still either participate in NM or highly endorse it as a way of making residual income.
BTW, Marshall Sylver, “The Millionaire Maker” has a new internet radio show that you all might enjoy. It’s on from 2p-4p Central time and features some training and some live Q & A. It’s a chance to get a self-improvement seminar every weekday in the privacy of your own home. If you can’t make the live show, they play taped re-runs throughout the day. For details, go to http://www.SylverRadio.com.
Have a blessed day!
Michele
http://www.GoodHealthMadeSimple.com
http://www.Michele.NetworkMarketingCentral.com
The comments above seem to equate “monetizes personal relationships” with bad apples in NWM or a business model that doesn’t work. I think the comment speaks more to the fact that many new NWM distributors confuse the relationship aspect of their business with “taking it personally”, plus they are not trained in prospecting beyond “sharing with a few friends”, the normal unrealistic hype we’ve all heard. I would reply:
“You have a good point. I think, unlike other kinds of businesses, many NWM entrepreneurs are told its’ “just sharing with your friends”. New distributors take that literally by approaching friends, then take rejection personally, get stressed or focus on the money. This can create the kind of disruptive relationships you mentioned, not because of the methodology but because of an unrealistic model for prospecting.
I think successful network marketers, like other successful entrepreneurs, understand the importance of building honest relationships and solving problems to create lifelong customers and partners. This seems like the kind of business approach that could build a stronger community, doesn’t it?”
Most entrepreneurs are self starters and need little direction…The frustration comes when you are somewhat dependent on others for your success…The majority of the people want to be an entrepreneur, but don’t realize that setbacks, rejection, consistency over time, are all part of the program…Opportunity comes knocking, but it is always wearing work clothes…
Most entrepreneurs or business-minded people haven’t really been exposed to the power of residual income and know very little about how network marketing works. If you “show them the money” and give them a glimpse into how duplication drives this business model, the switched on ones will pretty soon be looking at ways to make this work for them. Those that can’t get over the hurdle that they may need to talk to friends and those within their circle of influence, you wouldn’t want them in your business anyway.
“Most entrepreneurs I know *loathe* network marketing. This is because it monetizes personal relationships, which is disruptive to community.
Because this belief is so prevalent, and there is even some truth to it, is why I am with my current company. We actually attract entrepreneurs because we offer them a means to build their business without jeopardizing relationships, and without having to guess at how to attract customers and business builders.
It is built into the system, which is designed so that customers watch an infomercial, then call us to complete their purchase. (no, these leads are not free, nor should they be).
We also run infomercials for the opportunity. When you can have interested people calling you, who know they can start their own business and have interested people calling them, all of sudden we are able to focus on what is really important:
* building a business to take care of our families
* serving customers who want what we have to offer
* sharing the business with people who are looking for a business
I now feel I have the best of everything to offer others who are looking, and I can build a real business, with as many customers as I want without the hit-or-miss approach of traditional MLM. Residual income is not only a factor, it is compounded because every business owner can amass tens, hundreds or thousands of customers, rather than having to rely on the $50-$100 personal consumption of each distributor beneath them.
Sponsoring is optional, rather than the driving force of my business.
Tracy
About Me
My Business Blog
There’s no reason why NM should monetize personal relationships.
That it does is symptomatic of the underlying major flaw with the business… the typical participant, who – in lacking the necessary commercial awareness – conducts his/her activity in a manner which is wholly inappropriate.
The first sign of this is often gross overstatement of ‘the case for NM’, and/or the benefits of a particular product/service/opportunity.
As regards a reply, I’ve always advised clients to honestly acknowledge the situation and then lead onto the ‘needn’t be, and I don’t’ path.
“Most Entrepreneurs” is a pretty broad category….
Realize there are nay sayers about everything in life (even entrepreneurs) and look for people who are interested. If they aren’t say “Next” and keep moving. Teach and encourage your people to do the same.
You are an entrepreneur too – what do you think!
There are bad apples, yes, and one can certainly take a “well who wants people who feel like this anyway” attitude…but that doesn’t change the perception expressed in the email that most new people experience.
If we can do something about that perception, instead of berating those who hold those views, wouldn’t that help the entire industry?
“…it monetizes personal relationships, which is disruptive to community.”
That sure nails it, doesn’t it?
My response would be something like this:
Well said, but be careful not to throw the baby out with the bathwater. The “traditional” MLM strategy is to approach friends and family. Companies teach this because it works for them, but it leads to a 95% failure rate. It’s mooching, not marketing.
Yet, the MLM model is cost effective and it can be highly productive in the hands of a skilled marketer who recognizes, in the words of Peter Drucker, that “The purpose of a business is to get and keep customers.”
MLM is just a distribution channel. It’s gotten a bad rap because of the “relationship marketing” concept of short-sighted companies and practitioners.
Good advice for any entrepreneur:
“Eat and drink with your relatives; do business with strangers.” ~Greek Proverb
Real marketing is relational: building relationships based on the needs, wants, and desires of customers,, not one’s own. That’s how you get and keep customers.
I would say:
“You are so right, hitting up family and friends to find customers and partners has given network marketers a well-deserved black eye. But you might be surprised how the industry is changing to eliminate this practice without sacrificing repeat income and leverage, the two things that make it such a unique and profitable method of business. Would you be interested in hearing what’s changed?”
If yes, then:
“First, we now focus on building a core group of repeat customers on whom we earn a small percentage each month, you know, like AOL and the cable companies do. Well, actually most every company relies on some kind of customer base, right? Second, instead of pitching everyone we meet, we find these customers by connecting with people who already have indicated an interest in the kinds of products we sell. The only thing we might ask a friend is if they know of anyone who might be interested in “a product for someone who finds they don’t eat enough fruits and vegetables every day,” for example. Do you think that would feel less intrusive to folks than a sales presentation? We’ve found that doing business this way removes the angst from both sides. Think?”
“We handle recruiting the same way, by approaching people who are already looking for a home business as well as inquiring of others if they know someone who is in that position. Our goal is to get the information to people who want it…and only to those who want it, just like other forms of advertising. Does this sound like a more ‘normal’ way of doing business to you?”
Whew, this was harder to do (without writing the great American novel) than I expected.
Dianne
This is exactly why it is important to have a system where people come to you, you don’t go chasing after them.
Think of ways you can bring people to you to ask “What are you doing and how can I do it too”. That is how I do my business.
It’s kind of like the people who are out there beating people over the head with their religious beliefs. It doesn’t make the religion “bad”.
The bible says we will be known by our fruit. We don’t have to broadcast our religious beliefs. People will know us by our fruit.
Same with network marketing. We don’t have to broadcast that we are a great network marketer and everyone MUST join us. Those who know, like and trust you and are interested will ask you.
Create relationships and the right ones will raise their hand.
In my current company, I have NEVER asked anyone to join my business. All have asked me if they can join me. That is because I have a system that works and I created a relationship with them before they joined my company. Every one of them are my friends and family.
Roxanne
Kim says “If we could do something about that perception”.
Although I agree this is a common perception within the borders of the U.S. where we take pride in our individuality oftemtimes to the detriment of others. It is not like that in other parts of the world. Take the Philippines and Japan as an example where family values and social networks are interwined. They embrace NWM because of the opportunity NWM affords their entire community. You never hear them complain and say “Gee he’s trying to make money off of me!” Which in reality is what corporate America has been doing for decades. They rent you out at wholesale prices and pay you just enough so you won’t quit and take your skills to some other competitor. In NWM you get paid according to the value your product or service brings to the market place. Entrepenuers who have a problem with the NWM model are often so ingrained in the corporate model. They want to have their own business so #1 they can be BOSS and #2 so they can exploit others for their own benefit.
I think Kim has a great idea and the only way I see the change coming about is to start teaching it to others while they are still in the cradle.
Wow – a lot of people I know developed relationships around their business and enjoy those relationships to this day. Anyone making serious money is not mad at their sponsor or upline for introducing them to the business even if their sponsor is no longer around.
If you cannot approach your friends and families about something that could change their lives and benefit them as well maybe you don’t have the relationship you though you did with them or your business/product might not measure up.
People do repeat business with people they like. (Period)
If someone does not choose to be part of your business there could be many reasons (including you). A sure way to find out is when a good friend joins in someone else’s group and feels very hurt that you did not respect them enough to even talk with them about it.
As for your friends comments in the email about entrepreneurs – it sounds like an excuse or cop out. Don’t take it personally or let it discourage you. Most entrepreneurs I know are in business to make money and be in control of their lives. Who wouldn’t love to work with people they really love and care about! Be an example that they would like to follow and be in business with.
Don’t remember where I found this but it’s one of the best answers to ‘what is Network Marketing’ that I have ever found. Yes, it includes the word ‘explosive’ and in this case, even us girls can use the word comfortably.
What Is Network Marketing (originally referred to as ‘Team Marketing’). Conceived in the 1940’s NM has blossomed into a $84 billion a year industry during the last decade. The excitement and driving force behind NM is the opportunity to develop a marketing team from which you earn commissions on your Team’s marketing volume. These commissions form one of NM’s major profit centers. They change a marketing opportunity from a limited, unexciting income to an explosive career with unlimited income potential by duplicating yourself through others.
Don’t know what entrepreneur can argue with that statement.
What has given us the bad name is thinking, as Kim says, anyone who can fog a mirror can do it and being taught to put pressure on family and friends first. The heavy hitters are selling ‘pie in the sky’ so that those initial recruits will sign on for the ‘big package’ rather than looking for those ‘keepers.’ My sponsor in the first NM company I joined told me quality comes from quantity. Go for the ‘big package’ and don’t be concerned if they ever order again.
Once NMers start telling the truth about what it takes to make the gangster money, teaching New School ROMs and philosophies, looking for those for whom it’s the right thing to be doing, and helping their recruits make money first, only then will our industry be taken seriously.
Venetta
http://www.venetta.myflpbiz.com