Forums

Weaknesses In the MLM Model - Did I Miss Your Fav One?

Post a reply


Enter the code exactly as it appears. All letters are case insensitive, there is no zero.
   

Expand view Topic review: Weaknesses In the MLM Model - Did I Miss Your Fav One?

Re: Weaknesses In the MLM Model - Did I Miss Your Fav One?

Post by Jared_Brown on Tue Feb 21, 2012 11:27 am

I agree with the "blind leading the leading" as a weakness. This is a major problem because so many new network marketers are following the wrong people and not making it big and then giving up on their business all together.

Re: Weaknesses In the MLM Model - Did I Miss Your Fav One?

Post by harryfassett on Sat Feb 18, 2012 1:53 pm

Hey, the most sound words to hit the Network Marketing Industry in decades, "Snacks sound great - universal demand, no 'splainin ta do, quality, value." Thanks for the quote Steve, and no "pawmarks" required. :0)

Tools, and information are some of the best things to sell for sure, and I make thousands of extra dollars a year selling them too, e.g. imtoolsuite, sitesell, and infusionsoft software are excellent IMtools and some of the best on the market today for every range of business, big or small.

Plus tools are great for getting into the hands of your group to use and show them how to best utilize them for much more leverage, and marketing scope than they would have otherwise.

Of course I'm the type of person who feels very comfortable selling Internet Marketing tools, information, and total ecommerce solutions to businesses, to marketing something as simple as healthy snacks.

Because I'm not an either or personality type or have a fixed "skill set" that doesn't allow me to move in whatever direction I need to go when I need to "on the fly" and when marketing trends (which I watch very closely) dictate to stay ahead of the curve and ahead of most of the competition in whatever industry I'm marketing my products and services too.

Anyway, again Steve, you make a lot of good points and many distributors think (chasing fantasies) that thinking positive, and knowing a bunch of rose colored sayings, quotes, and even platitudes are going to make them rich, when nothing could be further than the truth.

It's hard work, dedication, getting scraps and bruises (maybe physically and physiologically), and even feeling highly uncomfortable in this "PC" age in order to get the concrete results one is after, and making things happen for the good of all involved. Not just talking a good game and getting little or no results for months or even years like many even here at BN.

Well with all that being said. I think you should read my blog post here at BN on "You Can't Build a Large Sustainable Business in your Robe and Bunny Slippers" here http://ow.ly/99vl2 and let me know what you think and like about it Steven? :) Because after all, sharing is caring and votes, tweets, and other mentions do help all involved here at BN. Thanks.

Make it a great weekend! HF P.S. It's like why listen to the 95% who are still trying to make it, when I can listen to and do what those who have already made it do. No offense, but I don't listen to most of the people even here at BN most of the time unless I think it's something they found out about online that can help my business more, because I've done and have built more business since 1995 than most will ever achieve even here, but that's not to impress you, but to impress upon you I guard my time, and who I listen to to a "T" as they say, i.e. too many cooks in the kitchen and Johnny come latelys nowadays. Good day!

Re: Weaknesses In the MLM Model - Did I Miss Your Fav One?

Post by JoycePenner on Sat Feb 18, 2012 1:35 pm

Harry, you've got giving the sales pitch down pat.

Steven what you say is the truth, to an extent. Products must be (and most are) extraordinaire ! Otherwise retention and autoship is exactly what you describe. My upline has a customer retention rate of 100% after 8 years and that says a lot about the products.

Take a hard look at your operation as if it were a real business - you know - 5 year plans, operating budgets, forecasting, market research, a P/R and Advertising agency on your side, a professional accounting firm, crack administrative assistants, attention to channel partners (read: outsourcing), company-mandated continuing education (hint: this means you, and maybe even your significant other), oh, and paid leave! (until you are winning all the incentive getaways, take a damn break once in awhile)


Agree with you 100% and that's where people are getting led astray. No business training.

But I have a much bigger problem that isn't resolved without a paradigm shift in business strategy. I discovered a long time ago you can't lure a big hitter into your business with "more stuff" - you need a bigger, bolder story. The one product or service you can adopt that fits that bill is tools, and the highest-earning folks in the recruiting space know it - in fact, have known and exploited it for DECADES - you can earn more developing books, tapes (today dvds), seminars, events, courseware, and speaking fees, than you can EVER earn in a distributorship commission (with rare exceptions) - just ask Sieg, Dillard, Budd, D. Smith, et al which part of their business rakes in more - it's no contest.


Agree with you again. Too many people trying to turn themselves into the next Ann Sieg or Mike Dilliard and they won't or can't.

You can build a large organization of happy customers/distributors but it takes the proper business mindset, the total focus on what you want to achieve and the absolute unselfishness to help other people WITH YOUR OPP (read sales) to reach their own personal goals.

Great article and thanks for posting !
Joyce

Re: Weaknesses In the MLM Model - Did I Miss Your Fav One?

Post by pawmarks on Sat Feb 18, 2012 12:55 pm

Hey Harry,

Snacks sound great - universal demand, no 'splainin ta do, quality, value.

My problem is not with the process of autoship - the theory behind it rocks. It's with the melding of the theory and human's propensity toward short attention spans, fickleness in consumption habits, etc.

But I have a much bigger problem that isn't resolved without a paradigm shift in business strategy. I discovered a long time ago you can't lure a big hitter into your business with "more stuff" - you need a bigger, bolder story. The one product or service you can adopt that fits that bill is tools, and the highest-earning folks in the recruiting space know it - in fact, have known and exploited it for DECADES - you can earn more developing books, tapes (today dvds), seminars, events, courseware, and speaking fees, than you can EVER earn in a distributorship commission (with rare exceptions) - just ask Sieg, Dillard, Budd, D. Smith, et al which part of their business rakes in more - it's no contest.

And while there is the whole "ascension" or "escalation" sales funnel or marketing model to concern yourself with if you are an advanced shovel seller, there are no autoships to worry about, no downlines to babysit, and few demands on your time if you get the robotics and the outsourcer/talent delegation leverage engineered correctly.

Re: Weaknesses In the MLM Model - Did I Miss Your Fav One?

Post by harryfassett on Sat Feb 18, 2012 11:21 am

I agree with about 80% of what you say Steven, however on point #2 you "drop the pelota". For example, I'm on autoship for "Snackhealthy" because I really do enjoy the healthy snacks they offer.

The very healthy snacks are very competitively priced overall, and healthy all natural snacks shouldn't be "cheap" like you see the junk snacks - which are way overpriced for the quality - all over the place that are full of processed sugars, corn syrup, and other artery clogging agents and junk you find at the grocery stores, convenient stores, mini-marts at gas stations, 7/11, and Circle K's etc.

Another example; I'm distributing the Snackhealthy snacks to convenient stores here in Los Angeles, and they are having no problem selling them, because the people that like to eat healthy (my target market) have a hard time finding anything they want to eat, let alone buy in 99.9% of the convenient stores here in Los Angeles.

Besides, I'm not making money retailing the product, the money is made on the "wholesale" volume on the back end paid by the main office and Network Marketing Company. Plus eight other ways to get paid for top producers.

So again, you make a lot of good points Steven, however I've been getting healthy snacks into mini-marts and convenient stores all around Los Angeles no problem, because they have 1000's of "built in" customers that buy snacks of all kinds all the time.

The healthy snacks company I work with even allows visitors to my distributor site to order wholesale without having to become a distributor or reseller whether it be one item, a few selected items or a bundle at no extra cost.

The only requirement is the customer has to be on "autoship", and I know you think that's a dirty word, but with out autoship you have no reliable business model to begin with, because you can't rely on human beings to remember to place their order every month, or you and your business is dead before it even gets off the ground.


Plus, if the distributor feels obligated to do anything, even autoship, then they are in the wrong business to begin with, and that's another losing proposition.

Last thought, regarding healthy snacks. They are great for fundraisers for one's church, children's school or other charity, and they are healthy unlike 99% of the snacks sold at fundraising events.

And, I heard this on a TV program I was watching a while ago, that some of the ingredients in many junk food, and candy snacks cost the company that manufactures those snacks less than a dollar a ton?

Yes, I said some of the ingredients in 100's of junk snacks cost less than 1 dollar a TON! Go figure why we have so many "junk dealers" everywhere here in Los Angeles.

Plus the possibilities for new snacks are endless and the company is formulating and making new healthy snacks all the time, so things stay fresh.

Besides, how many more pills, potions, and supplements with a body by vi, jake or flake, or hommer program do we need, because we have too many as it is, and 90% of the population isn't going to stick with them anyway, so they may do something that is easy, and simple to do to gain better health over time and that's just to Snackhealthy. :0)

Weaknesses In the MLM Model - Did I Miss Your Fav One?

Post by pawmarks on Sat Feb 18, 2012 10:23 am

I have studied, researched, pondered, and pontificated on the "recruiting space" or "organization-building" business model for over 1/3 of a century now (since 1979 when I developed my first 5,000+ distributor org)

Some of the weaknesses in this now 150 BILLION PER YEAR global model (IMHO):

1. The blind leading the blind. This is as old (since the late 1930's Nutrilite - precursor to Amway) as the model itself. It consists of non-marketer/entrepreneurs being taught how to go after other non-marketer/entrepreneurs, subsequently bringing them to any number of events during which everyone hopes (or even prays) that someone, somewhere in the org will figure out this marketing thing in time not to quit (few do, sadly)

2. Autoship ( a more recent "enhancement" to the model) in which you are obligated to consume a product or service you often have only mild interest in consuming, primarily so you can qualify for the commissions - until / unless you "get religion" and really buy the story of this "stuff", you are almost guaranteed to fail, or at least cancel your autoship (and that behavior is truly cancerous to a marketing organization as it often starts a chain-reaction - especially in a binary)

3. The biggest entity in the whole mix (the one making or creating the value in the first place) is never the marketer or trainer - by definition - they've GIVEN UP THAT ROLE to the distributors - however, they rarely keep their incompetent hands off the marketing and training, insisting on arbitrary rule-making, producing outdated or downright embarrassing literature, and even posing as authorities on how to market. Which often makes for an ugly tug-of-war between seasoned independent marketing orgs and the company principals and staff.

4. The products. These are predominantly focused (60% some say) in the "wellness" segment - nutrition, personal care, cosmetics, weight-loss, etc - allegedly to mimick the business model of the telcos or utility companies in order to produce monthly ongoing sales - which they are fond of calling "passive" or "residual". (hint: THEY AREN'T!) A huge disconnect with this approach is three-fold:

A. The products are often overpriced compared to modern distribution models such as big-box stores and discount houses. (and yeah, I know the drill - "pay for quality once or apologize for mediocrity forever") - might have worked pre Costco and Wally World and economic melt-down - way tougher today.

B. Using non-marketers (see #1 above) to convince people they should buy an overpriced product is a recipe for failure to begin with.

C. Operating within the recruiting space attracts a ton of people who sign up for the DREAM (of residual earnings) rather than any real belief (or interest) in the products themselves - leading to more disastrous results / lack of motivation / ease of taking a fast exit in about 30-60 days, etc etc.

5. The whole "duplication" mantra - "do it the old-fashioned way" (friends, parties, hotel meetings, etc) rather than learn that painful "Attraction/Authority/Blog Marketing" approach put forth by a small number of mavericks who practice high-volume evergreen lead generation, both on and off the net.

With all the above said, there is a lot of money being made and the industry lurches forward.

A gameplan?

Stop playing by most of the rules of the past 60 years and learn what really sells, what really works, what targeted prospecting is all about, how to leverage video, articles, blogs, social media, and direct response tactics (mostly overlooked) along with advanced technologies and behaviors like phone broadcasting, dial and ditch, mobile marketing, social media backlink syndication, forced viral sharing, and other "off-the-radar" approaches rarely mentioned in polite conversation (except in hushed tones) among the company muckety-mucks and traditional org developers of the past 60 years.

Take a hard look at your operation as if it were a real business - you know - 5 year plans, operating budgets, forecasting, market research, a P/R and Advertising agency on your side, a professional accounting firm, crack administrative assistants, attention to channel partners (read: outsourcing), company-mandated continuing education (hint: this means you, and maybe even your significant other), oh, and paid leave! (until you are winning all the incentive getaways, take a damn break once in awhile)

Oh, and learn the art and science of professional follow-through - it isn't just the recruiting space that gets this one hopelessly wrong after centuries of trying - it's all businesses, worldwide.

Top

cron