An issue in determining the legitimacy of a multi-level marketing company is whether it sells its products primarily to consumers or to its members who must recruit new members to buy their products. If it is the former, the company is a legitimate multi-level marketer. If it is the latter, it could be an illegal pyramid scheme. The Federal Trade Commission has been investigating multi-level marketing companies for several decades and has found many that blur the lines between the two. According to industry data, there are 90 million members worldwide, but relatively few earn meaningful income from their efforts. To some observers, that reflects the characteristics of a pyramid scheme.

Here is how they mostly work: You sign up and pay the buy-in fee to receive your startup kit, and then you start clogging everyone’s social media feeds about your new venture and beg your friends and family to join you on your “journey to financial success”. You host a bunch of fake parties and wine tastings or worse, you meet up one-on-one to catch up and the whole thing turns out to be nothing more than a demo and sales pitch where you guilt your friends into buying stuff they don’t want or need. After you subject them to that, you then try to recruit them to join your team of consultants, or whatever term your particular MLM uses.


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Write articles or blogs. Writing is an effective way to get in front of your market through other people's websites, and your only cost is that of your time in writing. The key to writing an article or blog that another site will run is to make it useful and informative, but not advertorial. As a network marketer, you have two types of articles and markets: The first is related to your product or service. If you sell candles, for example, then write a Valentine's Day post on creating romance with candles or something about how candles can improve mood. The second option is related to direct sales and the MLM business. For example, you can write articles about how your MLM career changed your life or how to be successful in direct sales for lifestyle and business websites. Just know that most places won't want you to directly promote your business within the article, but they may allow you to include a link to your website in your bio.
But more than product selling MLM/NM provides a lucrative option to earn great part/full-time money and most importantly passive income. Once you sign up somebody in the business by selling a product and he signs-up someone else and so on, you create a network of people who are recommending a product or offering a business opportunity thus generating sales for the company and also earning 10-125 of the total sale happening through your network. In MLM u get percent of every sale that happens in your group of people directly (when u personally sell to someone) or indirectly (your team member sells to someone). So, if you have a network of 10 people and your team sold product worth $1000 then you would earn $100-150 as commissions. For direct sale u get more money.
(May 2017 update: did this go under?) The sign up cost will make you do a triple take (almost four figures), but you get to set your own retail price on every product you sell. If you’ve got the skills to make people cough up the cash for their products (which, btw, are pretty legit), you could definitely make that money back. They’ve also been winning plenty of awards (even a growth award from the Direct Selling Association themselves).
You see, there are lots of other people who need to sell the same products as you to make money too. And quite possibly living in the same area, with the same pool of potential customers as you. So if you have the misfortune to sign up to an MLM that’s already popular in your area or social circle, you’ll probably find it hard to recruit customers.
Kay, you don’t need a lot of money to buy essential oils, NOT AT ALL! Specifically now that distillers will sell directly to small businesses with very minimum amount, your $100 will buy you a lot actually. Averagely, your cost with MLM in a single bottle will be around 25x-30x more. So it is not the cost; but the business set-up (packaging, presentation, etc.).
The cons of mlm are that most people getting into mlm don’t understand mlm. They apply the incorrect philosophy and it becomes a recipe for disaster. I see dozens of people monthly that join a mlm, don’t work and don’t yield any results and as a result, leave with a bad taste. But with correct leadership that problem could be averted. That is precisely why I love my company. It has the best leadership (in my opinion) and they properly train their agents.
Don’t just focus on the glowing reviews from distributors who are making $50,000 per month. You should also pay close attention to those people who never made any money and gave up after a few short months. Why did they give up? What are the common complaints from unsuccessful distributors? Answer these questions to gain insights into the MLM you’re considering.
In just 30 years, Melaleuca has grown from a little startup in rural Idaho to a billion-dollar enterprise doing business in 19 countries around the globe. It has become one of the largest catalog and online wellness retailers in North America. And it is the largest manufacturer of consumer packaged goods in the Northwest. Today, more than a million customers shop with Melaleuca every month.
Commenting on other blogs and social networking profiles will expand the MLM distributor’s own network of friends, generating a new group of free MLM prospects. This should not be confused with spamming. Commenting should be done on specific posts and not just in a haphazard manner. Remember; each comment will include the name of the MLM distributor and a link to their website, blog or social networking profile.

Hi JP. Good stuff all the way around, my man. Hey, I’ve been approached by Ariix, & didn’t know if have heard of them, and if so, a simple 👍 or 👎 will suffice, unless you’d like to elaborate, of course. One obvious concern I have is that (& can disclose this, since it’s of public record/knowledge per the list above), the current leadership in place at Ariix all came from USANA, and given the FBI/SEC became involved with USANA in ‘07, & Ariix opened in ‘11, well….I think you know from where I’m coming as it relates to anything you may be able to convey. Thx again, JP, for all of your efforts, & if you’d feel more comfortable in emailing me, obviously that would be perfectly fine! And apologies on this extremely verbose message!😳
Don’t give up, and don’t throw money into areas where you don’t have to. There’s no such thing as completely free marketing leads – you are always risking something, whether it is your brand, or your future earning potential. However, with good networking, passion, and the right people, you can achieve success. Talk to some mentors and more experienced marketers today, and see what they have to say for you. You may be surprised at how much you can bring in, with the right choices when you are getting started.
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Instead of focusing on just the product, the MLM distributor wants you to buy the product and become a distributor.  You will usually be invited to come to a conference at a local hotel where the higher level distributors (sometimes called diamonds) come in to pitch the product and get everyone emotionally excited about where this magnificent new business can take them.
Thank you for your article. I am also with doterra and I never in my life thought I would do something like this. The reason I started was because of health issues that led me to the oils. I have been an RN for 23 years and I feel more free and excited to share about health than ever. If you are going into something to get rich quick, I think that is the wrong attitude. I think most of my fellow doterra wellness advocates, have come to the same realization as me. I believe most of us started out trying to help ourselves and our families. I left my nursing job of 17 years in Feb, not because I am making enough money to replace my past income, but because I truly love helping others and I love the company and what it stands for. I can’t argue about MLM’s because I truly don’t care about that side of it. Maybe I am wrong to think that way. I hope that this ride doesn’t end anytime soon because the difference that doterra is making in my life, and the lives of those around me, is amazing. Thank you again for your information and your viewpoint.
Breaking into the world of travel bloggers, hotel hoppers, and digital nomads with #wanderlust was one of the best ideas MLM ever had. Everyone out there wants to work remotely nowadays, and a huge portion of those people want to do it so that they can travel. So, a remote income opportunity with a travel MLM just makes sense. WorldVentures is hitting this niche hard, having been named one of the Inc. 5000’s fastest growing companies twice in a row.
The main sales pitch of MLM companies to their participants and prospective participants is not the MLM company's products or services. The products/services are largely peripheral to the MLM model. Rather, the true sales pitch and emphasis is on a confidence given to participants of potential financial independence through participation in the MLM, luring with phrases like "the lifestyle you deserve" or "independent distributor."[16] Erik German's memoir My Father's Dream documents the real life failures of German's father as he is lured into "get-rich-quick" schemes such as Amway.[17] The memoir illustrates the multi-level marketing sales principle known as "selling the dream".[18]
Although emphasis is always made on the potential of success and the positive life change that "might" or "could" (not "will" or "can") result, it is only in otherwise difficult to find disclosure statements (or at the very least, difficult to read and interpret disclosure statements), that MLM participants are given fine print disclaimers that they as participants should not rely on the earning results of other participants in the highest levels of the MLM participant pyramid as an indication of what they should expect to earn. MLMs very rarely emphasize the extreme likelihood of failure, or the extreme likelihood of financial loss, from participation in MLM. MLMs are also seldom forthcoming about the fact that any significant success of the few individuals at the top of the MLM participant pyramid is in fact dependant on the continued financial loss and failure of all other participants below them in the MLM pyramid.
Be careful when choosing a place to get your leads. Not all MLM Lead companies are created equal. It is going to be the single most important decision you make when trying to grow your MLM Business. Make the wrong choice and you will waste your time and money as well as the time and money of your downline. Make the right choice and you can be building your business successfully for years to come. http://www.abettermlmlead.com
Develop a referral program. Just like in other businesses, people who are referred by others are easier to convert to a sale than people who weren't, because they're usually coming to you with some interest in buying. Many people you talk to won't be interested in buying right away, but they might know people who are. Happy customers may want to share your product or business. You can develop a referral program to give people incentive to refer others to you. For example, you can give them a 10 percent discount on their next purchase for every new customer they refer. 

Kathleen, you are right about the “direct sales” thing. They use it because MLM has the well-deserved bad connotation with pyramid schemes. I try to explain to people that true direct selling would be something like Ebay… there’s no inherent multi-level commissions implied by the term “direct sales.” It almost reminds of calling an illegal dog fight a “recreational gaming event.” It may be true, but is far from an accurate description.
Other than that, great info, but I’d have to respectfully disagree with the logic behind not being a part of an MLM. It’s one business model. And whether you want to make it your full time job or just dabble, so long as you find a product and company you love, it can be a great way to diversify your income streams. $5000 a year (or $5) is more than most people make on their 401K, savings or any other conventional ways of investing. It’s an investment, and for those that chose to continue through the plateau, it results in residual income. Don’t like sales? Some of the companies are moving away from the door to door type sales models and putting a lot more emphasis on team building and adding value. And many companies are also discouraging distributors from spamming on social media- again- it comes down to the individual and their own business acumen. We can spend our lives blaming they systems or we can just own ourselves and be grateful for whatever we’ve learned from, and created out of each opportunity presented to us. It’s the choice of the individual at the end of the day but one thing I can say with certainty is that someone who blames MLM for their lack of success is lacking responsibility for themselves in other areas of their life too.

In March I joined an MLM company and I’m lost… my first reaction to network marketing was I’m not a sales person, to which I was told it’s not about sales but about building relationships. The other thing that makes me crazy is I see a lot of folks who appear so fake with their bubbly “everything is coming up roses and bubble gum” that I cringe. I’m honest to a fault and happy but not giddy. I feel like I have writers block in that I’m not sure what direction to take to get my business going, the struggle is real right now… Any thoughts or suggestions I can take away.

As non-employees, participants are not protected by legal rights of employment law provisions. Instead, salespeople are typically presented by the MLM company as "independent contractors" or "independent business owners". However, participants do not possess a business in the traditional legal sense, as the participants do not hold any tangible business assets or intangible business goodwill able to be sold or purchased in a sale or acquisition of a business. These are the property of the MLM company.
We have been accumulating this BizOpp Buyers file for a few years now.  So we have combined them all together to come up with a huge list of over 1 Million of our best Business Opportunity leads.  Each record has name, postal address, phone, email address, date, time, IP address. This list combines the scope and price of a mega database with the targeting of our bizopps seekers lists.
Internet marketing lead generation is without doubt the best way for you to attract the most prospects possible to your business. The tricky part is how to effectively use network marketing lead generation without wasting a lot of time. You could spend hours just spinning your wheels online and not acquire near enough leads to justify the time. We’d like to share a few of our short- and long-term strategies for how to effectively make your business boom through network marketing lead generation.

The most common high-pressure tactic is the lure of getting in on the ground floor. But in direct sales, a good opportunity is a good opportunity no matter when you get in. In fact, you're safer to go with a company that has been around for more than five years (the longer the better) than a start up. Any effort a representative makes to prevent you from studying the company, talking to others, and "sleeping on it" isn't someone you want to work with. 
Because of the encouraging of recruits to further recruit their competitors, some people have even gone so far as to say at best modern MLMs are nothing more than legalized pyramid schemes[4][19][20] with one stating "Multi-level marketing companies have become an accepted and legally sanctioned form of pyramid scheme in the United States"[19] while another states "Multi-Level Marketing, a form of Pyramid Scheme, is not necessarily fraudulent."[20] In October 2010 it was reported that multilevel marketing companies were being investigated by a number of state attorneys general amid allegations that salespeople were primarily paid for recruiting and that more recent recruits cannot earn anything near what early entrants do.[60] Industry critic Robert L. FitzPatrick has called multi-level marketing "the Main Street bubble" that will eventually burst.[61]
What you want to watch out for are "fast track" programs or pressure to have inventory that requires additional investment. Due to this practice, the law now requires MLM companies to buy back inventory, but that doesn't mean you want to be saddled with debt before you start and truly understand the business. Having a few popular products on hand can be nice, but don't fill your garage with products unless you know for sure, based on your experience in the business, that you can sell them.
Choosing a company that offer quality training and support may help your business a great deal.  You must be taught the rudimentary of marketing, referrals and how to close sales.  The best company should help you to upgrade your skills to help grow your business. It must share with you secretes of driving your website and how to effectively utilize the leads. It must help you brand your business and reach to as many clients as possible.
“What causes the average, otherwise shy person to suddenly think they can be a wealth-generating salesman? Because someone showed them “the math.” I’m sure you’ve heard it. All you have to do is find 5 people to join, and those 5 will find five, and those five will get five, and 6 months later you will have 20,000 people working for you, and you’ll be earning $10,000 per month. Really?

With so many of the fastest growing MLM companies pushing to have you join, it can get confusing when you’re looking at MLM products, compensation plans, where to get leads, marketing tips, and most of all – can I really make money with this? What you need to remember, is that the best MLM to join in your situation is going to come down to one thing – finding a product and a business you are excited about sharing!
The database should provide information about businesses and individuals who have willingly offered their personal information through telephone interviews and opt-in Internet forms. Because of this, you know that the opportunity seeker email leads that you will receive are open to the business opportunities that you will be offering them and will not be annoyed when you call them with your proposal.
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* Why 10 years? Because that amount of time really seems to matter. For example, according to research, since 1956 thousands of different MLM, Multi Level, or Network Marketing companies have opened their doors; and to date only +/- 50 MLM companies have found a way to celebrate their 10th anniversary and still remain in business today. Now, to be completely fair, we should also point out that each and every company on our list was at one time a start-up company too.
The cons of mlm are that most people getting into mlm don’t understand mlm. They apply the incorrect philosophy and it becomes a recipe for disaster. I see dozens of people monthly that join a mlm, don’t work and don’t yield any results and as a result, leave with a bad taste. But with correct leadership that problem could be averted. That is precisely why I love my company. It has the best leadership (in my opinion) and they properly train their agents. 

As with all MLMs, the real money to be made isn’t in selling their products but in recruiting more people to join your team (basically, doing the work for you). So the real winners are the person who started the business and the very first people she recruited. This top of the pyramid is also where all of the success stories tend to come from. Among the most vulnerable to these pyramid schemes are people in smaller towns and rural areas. Market saturation prevents growth in a small town, because once everyone you know starts selling it, no one can make any money and you’ve essentially created your own competition.
MLM businesses get a bad rap because they have such a high "failure" rate. However, there is much misinformation regarding these stats. First, the failure rate in business in general is fairly high. Second, it's easier to walk away from a business in which you invested $50 versus one in which you invested $5,000. Finally, because of the way MLMs are presented, many people sign up for the quick buck, instead of paying attention to whether or not they like the product or are willing to follow the marketing plan.
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