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Network marketing, also known as multi-level marketing, is a business model which involves a pyramid structured network of people who sell a company’s products. The participants in this network are usually remunerated on a commission basis. That is, people in this network get commission every time they perform the specified task.

You probably have an image firmly planted in your mind of what network marketing (also known as direct sales or multilevel marketing) is all about--housewives buying and selling Tupperware while gossiping and eating finger sandwiches, or a high-pressure salesperson trying to convince you how easily you can become a millionaire if only you and your friends and their friends and so on would buy and sell vitamins with him.

Both of these images couldn't be further from the reality of network marketing. It's neither a hobby nor a get-rich-scheme but an opportunity for you to earn money running your own part- or full-time business..

Direct Sales

Network marketing organizations sell their product directly don’t make use of any well-defined channel of trade..

Independent Business Owners

The participants are called IBO as they work as if they are promoting their own business.

System Of Hierarchy

Suppose a person ‘A’ has a person ‘B’ under him. Now ‘A’ will get the commission whenever he makes a sale and also a part of commission when ‘B’ makes a sale.

Less Or No Advertising

Dependency on direct sales helps the organization to rely less on advertising as personalized contact have more convincing power than advertisements..

No Fixed Salaries

This is a commission based network where participants (not employees) are paid commissions to perform the specific task..

Accountability

Everyone is accountable only to himself. The more he sells, the more he earns.

An Overview of Network Marketing

Here we provide an overview of what network marketing is, how it works, and some educational options that may prove beneficial for a career in network marketing .

Education Options

though there are no specific educational requirements for direct sellers, individuals interested in network marketing may find it beneficial

Lesson Summary

Network marketing utilizes a network of people to sell a particular product or good to others. Those interested in this career may benefit from sales management, marketing,.

Participant consumerism

Consumers of an MLM company's products/services can, in theory, be merely end-user retail consumers.

Distribution of profit to participants

It is important to distinguish between the MLM company itself versus the so-called "independent businesses" run by the MLM participants.

Participant movement

While participants' movement up the pyramid of an MLM can be accomplished in theory, and indeed this is one of the distinguishing factors between MLM.

 

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