Network Marketing and the Current Economic Crisis
I have been involved in the network marketing industry since the early 80s when a good friend and her husband introduced me to Shaklee, a health and wellness company which has been in business since 1956.
Since that time, Ive tried my hand at a number of companies, experienced a fair degree of success in some and didnt do that well in others. But not matter what my degree of success, I keep coming back to network marketing because I believe it is an idea whose time has come, especially given the economic crisis we’re currently experiencing..
In this article, Im going to talk about:
- Why network marketing is the business model of the future and
- Why a change in mindset is absolutely critical if you want to be a successful network marketer.
Please understand that I am NOT an economist who can say with certainty why were in the mess were in. Im just your average citizen who has been directly affected by the downturn in the economy for over a year and trying to figure out what the heck is going on..
Outsourcing = Lost Jobs in America
Lets first take a look at whats happening in our economy right now with respect to employment. I can speak from personal experience and tell you that finding a job that pays a salary that is commensurate with my education and experience (i.e., a Masters degree and 33 years of experience) has been extremely difficult. Ive been searching for a year now and have yet to be hired. I could probably find a job as a waitress or an office clerk, but that income isnt going to give me the money I need to support myself..
One of the main reasons for the difficulty Americans are having finding employment that would probably have been fairly simple to obtain five or 10 years ago can be boiled down to one word: OUTSOURCING. Many large corporations use outsourcing as a way to cut costs and increase profits. Furthermore, technology in general and the Internet in particular make it extremely easy for these companies to find individuals in other parts of the world who will do the same work that formerly highly paid Americans were doing, but for a lot less money.
U.S. unemployment is at an all-time high. The official figure is somewhere around 9%, but Ive read other sources that put it as high as 23%. Unfortunately, these jobs are never coming back to the U.S. Even the green jobs that President Obama promised during his campaign arent going to appear in abundance over night to help Americans get back on their feet. Common sense tells us that its going to take time for these jobs to come into existence, and its not going to be fast enough to help people who need help now.
The Blame Game: A Waste of Precious Energy
I am not trying to make the people in India, the Phillipines, and other countries who have the jobs we used to have as the bad guy. Im sure they are delighted to be able to have some of the wealth that we Westerners have taken for granted for so long, and I certainly dont fault them for it. That would be a form of misplaced aggression when the real culprits are the large American corporations that are doing the outsourcing.
But being angry with Corporate America is, simply put, a waste of energy. Why not channel that energy into creating something for ourselves that takes advantage of new trends in technology and marketing that have the ability to help the average person create an excellent income from the comfort of home?
The Power of Word-of-Mouth Advertising.
Let me ask you a simple question. When you’re watching television and a commercial comes on, what do you do?
- Sit back and enjoy the commercial.
- Mute the sound.
- Go to the kitchen for a snack.
- Use TiVo or some other device to skip the commercial.
A recent survey reported that 90% of people skip TV ads via TiVo/DVR. NO ONE is paying any attention to TV commercials. Corporations know this, and its one of the reasons you now see commercials at the movies where they are pretty difficult to avoid. Companies are desperate to get our attention focused on purchasing their products and services.
On the other hand, most of us have no problem recommending products, services, movies, etc. that we like to our friends and family, and even strangers if the opportunity presents itself. Corporations know this, too, and are starting to take advantage of what has come to be known as word-of-mouth advertising for the simple fact that it is so much more effective than traditional forms of advertising.
Why Not Get Paid To Share Your Opinion
Network marketing companies know this and have been marketing their products through word-of -mouth advertising for over 50 years. Instead of paying exorbitant amounts of money on traditional forms of advertising e.g., radio, TV, print which are becoming less and less effective, they use that money to PAY average people like you and me to share our opinion of products and services that we like with our friends, families, and yes with strangers, too.
Here’s How Network Marketing Works
The network marketing company pays you to share your opinion of its products and services through its compensation plan. There are many different kinds of compensation plans out there, but this is the basic way all of them work:
- You find a network marketing product or service that you are going to use on a continuous basis because you really like it and/or it has benefitted you in some significant way.
- You naturally want to tell other people about the product because of your high opinion of it.
- When someone buys the product or service based on your opinion, the network marketing company thanks you by paying you for your efforts in getting them another customer. You have in essence become an independent contractor hired by the company to get the word out about their products and services.
- In addition to promoting the product or service, you can also invite other people to join you in promoting it because, like you, they really like the product, want to use it, and are happy to tell other people about it. Often these individuals start out as customers and decide to become independent distributors for the company because they like the product so much and they have an opportunity to make some money sharing their opinion about it. And the people you recruit can also recruit people to do what you both are doing, and so on, so that, eventually, the company garners a huge sales force that it is paying to tell people about their products and services through word of mouth advertising.
- The compensation plan pays you a commission on the products that people buy directly from you AND it pays you a percentage of the commission that the people you have recruited have earned and a percentage of the commission that their people have earned, and so on.
And because everyone is purchasing and using the products every month, you get paid every month. This is known as passive income because you dont have to do anything else to earn it; youre getting paid on the efforts of the people who have joined under you, known as your downline. And depending on the size of your downline, you can potentially make a lot of money month after month. Your success is guaranteed when you take the time to help others succeed.
Choosing a network marketing company doesn’t have to be difficult, as long as you look for certain factors (e.g., how long the company has been in business, whether or not its products are supported by clinical trials) that give you the best chance of creating and maintaining a successful and profitable business.
Network Marketing is a Business, Not a 9-to-5 Job
To get started in any business, you are going to have two kinds of expenses or money that you have to spend in order to make money from your business:
- Start-up costs.
- Monthly operating expenses.
People often dont understand this and balk at becoming involved in a network marketing business because they are thinking like employees. When you have a J.O.B., you simply come to work, do your assigned tasks, and get a pay check. You dont have to spend any money to get hired, and its pretty much guaranteed that you will get a pay check as long as you continue working. But as we have seen over the last few years, that guarantee isnt what it used to be. Moreover, network marketing businesses have some of the lowest start-up costs of any other business structure.
Network Marketing is NOT a Get-Rich-Quick Scheme
Network marketing programs are not get-rich-quick schemes. Like any other business, its going to take some time before you start seeing a profit.
Therefore, most people who get involved with network marketing keep their day jobs until the business starts showing enough profit to enable them to quit. And its not difficult at all to do network marketing part time because you only need a few hours a week to share your opinion of the product or service you are passionate about and give people in desperate need of income an opportunity to make a good one.
Network Marketing Is NOT an Illegal Pyramid Scheme.
In a 1979 decision by a Federal Trade Commission (FTC) administrative law judge, it was ruled that Amway, a network marketing company founded in 1959, was not an illegal pyramid scheme because distributors were required to sell products to receive commissions, as opposed to merely recruiting distributors to get those commissions, as the FTC originally alleged. And because all legitimate network marketing companies require that you and your downline sell products in order to receive commissions, regardless of the fact these compensation plans pay on multiple levels, they are NOT illegal pyramid schemes.
A 21st Century Business Model
As I said at the beginning of this article, the jobs that have been outsourced to other countries are not coming back. It simply doesnt make sense for a corporation to keep jobs in America when outsourcing them to countries where they can get them done cheaply increases their profits.
However, there are other companies coming on the scene that understand the power of word-of-mouth advertising and are choosing the network marketing business model to promote their products and services, providing a lifeline for individuals hard hit by an economic recession that’s going to take years to move out of.
Solavei: A 21st Century Company
Here’s a network marketing company that is using the power of social media to help its members succeed. Solavei offers great mobile service at a great price – UNLIMITED 4G voice, text and data for only $49, or free. You have the opportunity to earn real money when you share Solavei with others.
To learn why Solavei is one of the fasted growing network marketing companies, click here.