You may have heard about how many people have been able to create financial freedom by working with an MLM or network marketing opportunity. This article explains why there is such a potential to create a large income, and why duplication is absolutely vital to making that happen.
The terms, MLM and network marketing are different ways of saying the same thing. MLM is the older term. It stands for multi-level marketing, which emphasizes the general payment structure. Network marketing tends to emphasize the fact that you are working as a team. You network with them.
A lot of people believe that they are illegal because their pay plans are similar to pyramid schemes. MLM companies sell products, so there multi-level pay plans are not illegal at all. If they didnt sell anything, and all members were required to pay money, then it would be against the law.
Those are completely different animals. You should not be against MLM just because some people use the pyramid structure in an illegal way. That makes just as much sense as never getting in a car, because you are against bank robberies, and most bank robbers use cars in the commission of their crimes. (Its ridiculous.)
The potential to make a great living with network marketing stems from the fact that you work with others. Its a group effort. You make money on the sale of products from everyone in your organization, and that can go several levels down. In a similar fashion, people in a number of levels above get money when you make a sale or purchase.
The real success stories in network marketing come from the process known as duplication, which can be extremely powerful. Duplication is what happens when you refer someone to join under you and you teach them to be able to refer others and then they do, and teach their referrals to do the same. Duplication is downright powerful.
When there is a lot of duplication over the course of time, the creation of wealth is a distinct possibility. If you can not create duplication, it might still be possible to make some money, although not nearly as much.
Heres an example: The monthly commitment is for purchases of at least $50 a month. You get the biggest commission on your direct referrals (first level), and less money on your the other levels, your indirect referrals. Lets say its $10 on level 1, $5 on level 2, $4 on level 3, $3 on level 4, $2 on level 5 and $1 on level 6.
Duplication is so powerful that if you have a ton of it, you might make a lot of money, even if you only counted the sixth level which is only a dollar profit. On the other hand, if you are great at referring and terrible at teaching others how to refer, then even without duplication, you could make some residual income, just from the $10 first level payments alone. However, it would not be anything like what duplication would bring you.