What is it about MLM that gets people so emotional? (Part 3)

July 4, 2010 at 10:35 am | Posted in Lifestyle, MLM | Leave a comment
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This is becoming a very interesting journey. I started down this path looking for the logical explanation to the question with an expectation that once having uncovered the root cause of all the angst, that there would be a perfectly simple resolution.

But so far, nothing that simple. What we have discovered so far is:

  • The industry is huge and supported by over 65 million people worldwide.
  • Those involved seem to have, overwhelmingly, a positive opinion of the industry
  • By and large, the industry weathered the GFC well and continues to grow.
  • Significant business commentators and educators seem equally positive in their assessment of the industry.
  • A financial assessment of some of the significant players in the MLM industry reveals listed corporations that are well managed, financially sounds, and, for the most part, good investment prospects.
  • And the business model provides an equal opportunity.

Which has got me to the point of looking at

  1. Is it the ‘marketing’ part of MLM that gets people worked up?
  2. Is it telling people you know that you are involved in a MLM business?
  3. Is it a personal fear of failing in a business where anyone (and I do mean anyone) can succeed?
  4. Or is it just the fear of something we don’t really understand?

Let’s take a moment and get analytical about these 4 possible answers.

#1 Marketing, selling, the fact is we all sell every day.

From the first time we negotiated with a parent for the toy we wanted in the store we began selling.

Presenting ourselves to someone new (we only have one chance to make a good first impression); convincing friends that we should go to the new Mongolian restaurant; making sure the boss understands the phenomenal job we did on the new project; inviting the good looking new team member to lunch; negotiating with our children, spouse, partner, family on just about every thing imaginable; and even selling ourselves on the idea that it will all work out ok in the end if we just work harder, give more, learn more.

And the list goes on and on.

But, whatever it is or isn’t, it sure is selling! And we all sell, every single day of our lives.

#2 Hi Mum, guess what your favourite son, the budding lawyer, is about to do?

(this is courtesy of my business partner – I am, of course, much nicer Smile)

I remember the first time that a good friend asked me to look at a new business opportunity. Until then no-one had ever prospected me for anything (something to do with an attitude that even a Mum has problems with) so I had no idea what network marketing was about, but I sure as heck had an opinion; not worth anything, but nonetheless my opinion.

So, as all good friends would do I immediately let go with both barrels and told one of my closest friends exactly what I thought of people who got involved in ‘that sort of thing’ Now, I must have been really good at selling my opinion (no facts, no experience, no research, no basis for anything I was saying) because he quit on his dream.

And that is what we do when we are too lazy, too arrogant, and too full of our opinions; we sell our garbage to everyone else.

Roll the clock forward several years. I am running my own multinational software business with an ego that has not got smaller with the passage of time, and my wife tells me we are going to have coffee one evening with our closest friends and hear about the new business that he is looking at.

Wow! Déjà vu, it’s one of those things again (I just know, my antennae are alert to this sort of rubbish) but I agree to behave and go and listen.

Body language (arms crossed, head down, legs crossed) says ‘ok, do your best, you’re not getting my wallet’ but I listen; perhaps because they have a friend, Irish, interesting, a successful businessman doing the talking. He explains the business model, he talks about creating passive income, and he shares how he has built the life of freedom that he has always expected, but never saw, in his own business.

What I saw was the starkest contrast between his new business model and my conventional business model that had me running a day-care for very expensive, very talented, adults.

What I saw was an opportunity to have the income, the time, and the ability to live my life on my terms, not according to the demands of a boss or a business.

So, for me, the journey started, and I thank God every day for network marketing.

Well Mum, no lawyer or business executive, I have decided to take control of my life.

#3 Fear of failure? Most people are driven more by the desire to avoid pain than the desire to gain pleasure.

But, failing is just not in the vocabulary – right?

It is, after all, such a simple business programme so how could I, especially having enjoyed some success in a far more complex business structure, be anything other than an overnight success?

But success in MLM is not based on prior success, education, or any measurable demographic; it is an industry predicated on being the last bastion of free enterprise, the ultimate level paying field, the peoples franchise.

So, if an unemployed college dropout can become a superstar in MLM, what does that mean for my success prospects if future success is not based on my past successes?

Start from scratch, learn a new business, learn new skills, become more focused on the success of team members, and become a committed coach and leader.

Seems like this is either a great encouragement for the serious team builder or a great threat for the solo act.

#4 Fear of the unknown

I heard an expression some years back to the effect that ‘the only people not involved in MLM are those who don’t understand what it is all about’. Bit extreme perhaps, but I guess we are controlled by a fear of the unknown.

Certainly MLM is a business model that is, for most of us, the antithesis of every other business or job we have been exposed to. Now, for me, that was its #1 appeal; it is so not like a conventional business.

    • If you are struggling you don’t get fired; you get support and encouragement and mentoring for as long as you want.
    • People who have succeeded want to share their insight not hoard it as their ‘edge’.
    • There is no glass half empty mentality; other people’s success does not diminish your prospects, it grows the industry, so we all win.
    • The more successful we are in helping others achieve everything they want, the bigger and stronger the business that we end up with.
    • But, look at the dialogue that goes on in our head

But it can’t be that easy; after all, we all know that if it seems too good to be true then it probably isn’t true.

Yep, that’s it; too good to be true.

But who said that it was easy?

What they did, or should have said, is that it is a very simple business with minimal overheads, low downside risk and great upside benefits.

Simple; not easy!

Nothing worthwhile is easy; it requires hard work, commitment, learning new skills, stepping outside our comfort zone, and growing as a person.

We don’t become different people because of our success; we become successful because we change as people.

Growth is always confronting, always uncomfortable, always a stretch. But if we have a desire to be more, have more, contribute more then we need to become more than we are right now.

Makes sense when you think about it. If right now we were everything we needed to be to be more than we are, then why aren’t we?). Easy to see why

MLM has been described as a total immersion personal development experience!

And maybe that’s it.

Perhaps the idea of becoming a different person is just too scary; and what if it isn’t enough? What if I can’t be the person I need to be? What if I don’t know how to grow into that person?

Ok, I will stay where I am, after all, it isn’t that bad. Right?

Yeah …. right!   But, what if I did succeed, what if I could have a different life?

Questions …..

What would you do if you knew you couldn’t fail?

What could you achieve if someone could show you and coach you on a system that takes the guess work and uncertainty out of building a successful business that creates real passive income?

For about 2 million people this year that possibility is the Holy Grail in their quest for true freedom.

Now, that sounds like another good topic ….

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What is it about MLM that gets people so emotional? (Part 2)

June 29, 2010 at 9:06 pm | Posted in Lifestyle, MLM | 1 Comment
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Despite the vocal condemnation of Network Marketing, it so far seems that the facts speak clearly to the contrary view.

  • We have seen that the industry is huge and supported by over 65 million people worldwide.
  • Those involved seem to have, overwhelming, a positive opinion of the industry
  • By and large, the industry weathered the GFC well and continued to grow.
  • And, significant business commentators and educators seem equally positive in their assessment of the industry.

Let’s take a look at the financial stability of the industry. After all, if this is a questionable business it would be reasonable to expect that the players are equally questionable.

An extract from a recent investment banker report (October 2009) sheds interesting light on the state of the industry. It is worth noting that many of the major players are publicly listed corporations.

Direct selling companies have been gaining momentum this year driven by their ability to recruit in times of rising unemployment, coupled with their broad global diversity, providing access to the consumer-growth markets of the world. Underlying momentum should continue to build, with reported results poised to benefit from recent currency headwinds becoming tailwinds beginning in the fourth quarter. We have seen steady and marked acceleration in results for our direct sellers (Tupperware Brands Corporation (TUP­—NYSE), Herbalife Ltd (HLF—NYSE), USANA Health Sciences Inc. (USNA—NASDAQ), Nu Skin Enterprises Inc. (NUS—NYSE) and Avon Products Inc. (AVP—NYSE) that are on calendar quarters vis-à-vis expectations over the past couple of quarters after what we believe was the fundamental bottom in the fourth quarter of 2008.

Direct sellers, on average, beat consensus EPS by more than 21.5% on an equal-weighted basis in the second quarter of 2009, up from more than 8.9% in the first quarter, after missing by nearly 1% in the fourth quarter of 2008.

The complete article can be read at Direct Selling News

 

Once again, this seems more like the assessment one would have expected of the more robust end of the business spectrum; hardly indicative of a shaky business model.

Now, this isn’t really a great surprise given that the business model is so compelling.

I believe that the biggest challenge for people looking at MLM for the first time is to acknowledge that the business model is different and although we can compare and contrast, the reality is that it is different – and different by design!

There are primary and fundamental beliefs in this business model:

the recommendations of a friend or trusted person have the greatest influence on our buying decisions;

wealth is created by either putting money to work or people to work; and

significant numbers of people want to be in control of their financial future.

Creating leverage in any business requires a business model where every person has the same amount to gain. Where one person has more to gain than another then that disparity of opportunity will always result in an equal or greater disparity of effort and commitment. The typical business model pays an employee just enough to have them turn up every day and go through the motions.

If this seems outlandish for any of you – how big a pay cut will it take for you to start looking around? And that assumes that you are currently happy with what you are paid.

Hence the “equal playing field”.

Everyone has the same opportunity to reach whatever income they desire. This does not mean that everyone does but anyone can, provided they are prepared to do the work.

As an aside, when I started with my current company there were already almost 500,000 registered associates but in less than 6 months I was in the top 100 income earners. Obviously timing was not the issue, nor location, nor gender – just a willingness to do the work.

The products and services that MLM companies take to market are promoted by people who are already committed users of the product (“a product of the product”) which ensures that the promotion is based on personal experience and credibility, not a slick advertising programme.

It also places on the company the obligation to create superior products and services that are innovative, creative, segment leaders with clear consumer benefits.

In many instances, the products are unique, patented, and only available from the associate – and almost without exception consumable, ensuring automatic repeat business.

Given that the industry continues to grow, typically above the growth rate of the retail sector, we have to come to the conclusion that the products represent outstanding quality and value.

The alternative, highly improbable given the unprecedented regulatory scrutiny that the industry operate under, is that there is a huge group of people worldwide who are either oblivious of, or uniformly ignore, the quality, efficacy, value considerations and prostitute themselves and their relationships in their quest for a dollar.

Ok, let’s now look at the “marketing” part of MLM.

Next blog …

What is it about MLM that gets people so emotional?

June 21, 2010 at 6:20 pm | Posted in Lifestyle, MLM | Leave a comment
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It seems to me that for many people there is just an immediate, emotive response that is just not supported by any serious analysis; and even more interesting, despite this apparently almost universal knee-jerk distain, not only are there more and more people involved in MLM, but most of the people actually seem happy with the experience.

So, what are the facts?

2008 (the most current figures that I could find):

In the U.S.

  • 15.1 million people involved in some form of direct sales (that’s 5% of the US population!)
  • $29.6 billion in sales

Global

  • 65.3 million people involved
  • $114 billion in sales

Satisfaction surveys run by the Direct Selling Association in the U.S. revealed –

  • 80% of sellers say direct selling meets or exceeds their expectations; and
  • 85% of sellers report a good, very good or excellent experience with direct selling

And most revealing, 74% of U.S. adults have purchased products from a direct seller!

If, as is asserted so loudly, most people would have nothing to do with MLM, why would 74% of adults buy products and services from such an apparently distasteful distribution channel? It makes no sense!

In 2009 the world experienced an epidemic of layoffs, down-sizing, and corporate failures but not one person involved in MLM lost their job. What happened instead reflects the basic integrity of MLM.

A recent update on MLM in 2009 commented “direct selling is still strong around the world. Seventeen countries now have more than US$1 billion in sales annually through this channel of distribution.

The results are indisputable. Business in North America is gaining representatives; Asia is decreasing slightly in revenues, but growing in direct sellers; South America continues to rise; and Europe is doing well.”

With a history that goes back over 50 years, MLM has been scrutinised by probably more regulators than almost any other industry, and continues to be subject to intense scrutiny, MLM has grown to be the distribution method of choice for many companies:

  • Robert Kiyosaki has applauded the industry. Check out his video clip.
  • Donald Trump has even endorsed and promoted a MLM (ACN, the world’s largest direct seller of telecommunications services) and featured one of their products on Celebrity Apprentice.
  • Warren Buffet has bought several direct sales companies including Pampered Chef and is reported as saying “dollar for dollar, it’s the best investment I’ve ever made.”
  • Sir Richard Branson, founder of Virgin Records and a host of other Virgin companies, founded Virgin Cosmetics in the UK — a direct sales company.

And, seriously, it sure as heck can’t be related to the unreasonable expectation that everyone who joins a MLM company is going to make a bucket of money – that is just impossible!

Let’s face it; do you remember the job interviews where you got the pitch about the great career prospects that were on offer for you in the company? And how you could go all the way to the top?

The reality is that it didn’t happen and wasn’t ever likely to happen. We just knew that believing otherwise is just fairy tale stuff.

The standard business structure is the same – a pyramid shape – where the chance for most of us ever crawling up the pyramid to the top is about zero.  Of the 350,000 who work for GM only 1 gets to the top – no level playing field; no chance for an aspiring new recruit; and very long odds.

In a MLM business everyone starts with the same opportunity and can reach the top levels regardless of when they start and what their background is – as long as they have a determination to treat their business as a business not a lottery.

And the odds of making it to the top? About 1 in a 1,000 – better odds than 1 in 350,000

So, what is the real reason so many apparently have a negative attitude towards a good, solid, open business opportunity that gives someone willing to invest some time the chance to live life for real?

More on that in my next post.

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