Recession--A Network Marketing Explosion

Written by Sherri Kirklin on Jan 29, 2008 6:42 am

Network Marketing: Recession Creates

An Explosive Industry 2008

“Recession causes
people to open their minds to gaining alternative
sources of income.” Lou Clements,
Marketwave Inc.

We will examine the reasons
why recession is a great time for networking so you can be in a better position
to discuss them with potential Business Builders or “I Caner’s”.

1. Evaluate History

(a) Recessions: people experience and economic downturn…lost jobs, lost earnings, lost hope, lost security,
etc. Where to turn?

1950’s: early 1950’s, no network marketing companies
worth talking about; late 1950’s, Shaklee, Neolife, and Amway all
came out from 1956-1959. Unemployment rate low in first half (in fact
in 1953 it was an all time low of
2.9%). In the last half of the 1950’s,
the unemployment rate was highest since
the Great Depression in 1958 at 6.8%.

1960’s: early 1960’s all networking continued to
flourish with advent of Mary Kay in
1963, and Avon, Tupperware, and Fuller Brush all achieving momentum. Late
‘60’s saw a great softening in the industry with
no new companies coming on of any significance.
Unemployment high in the
first half of the decade; over 2 and ½ million workers were back to work in the
second half.

1980’s: Again we saw the network marketing industry
really flourish in the first half;
while in the second half of the decade, it softened and many network marketing “fiascos” occurred. When networking is soft, people and companies take more risks. There were twice as many lawsuits in the second half of the 1980’s as were in the
first half. In the first half the unemployment rate reached its highest level
in 40 years at 9.7%. While at the end of the ‘80s there were
almost ½ the number out of work as
there were in the early ‘80’s.

1990’s: Once again, the trend occurs. In the early 1990’s (1990-1994) huge momentum in the industry, in fact
“there was more wealth created in by
way of MLM from 1990 to 1994 than any other time in history.” Network
Marketing Lifestyles May 2000. From
1996-1999, we had a network
marketing recession. In the early 1990’s, the unemployment rate
was very high and then in the later years in the 1990’s it hit a 30 year low of 4.2%.

Why were the 1970’s
an exception? They really were not but
they played out
differently. It was an exceptional
decade…the first half of the ‘70’s saw
unemployment rates jump. The attention
to network marketing took off but
with all the heightened attention, five times as many lawsuits were filed from 1970-1974 than all of those filed in
the ‘50’s and ‘60’s, and the big
one, Amway, which challenged the very existence
of network marketing, lasted until finally
settled in 1979. This legal dispute of course dampened what otherwise would have been
a greater boom in network marketing in the second half of the decade. In the first half, recession of ‘73-’75, many
MLM companies’ growth took off.

2. Where are we headed in 2008?

All major indicators suggest recession: stock market, credit card debt, mortgage foreclosures, fall of the dollar
against foreign currencies, company
earnings reports across all sectors, manufacturing sector, employment figures, etc.

3. How do we take advantage of this opportunity?

(a) Market health
products? This does not solve the
average person’s perceived need/want. Health cannot be a major priority in this
time.

(b) Make a shift to
support people in building residual streams of income
to empower them to withstand any kind of economic downturn. “Recession causes
people to open their minds to gaining alternative
sources of income.” Lou Clements,
Marketwave Inc.

4. What are the selling points of a network
marketing business?

(a) Security (not
found in a recession)

(b) Financial
freedom

(d) Self-development

(e) Self-employed;
no boss so no sacrifice of your own values;

Creating your
own standard for the ethics in your business

(f) Time freedom

(g) Purpose
driven: helping others with focus on
them

(h) Unlimited
income: no one telling you what you are
worth

(i) Residual income

(j) Dream again

(k) Great relationships