What is Network Marketing?

By authors Oct19,2022
Network marketingNetwork marketing

Network marketing can seem like a complex concept, especially to those unfamiliar with how it works. It has earned its reputation as an industry where only the most successful businesses get ahead and everyone else falls short. However, in reality, you can use network marketing strategies to advance your business no matter what stage you’re in or what product or service you’re offering. Here are some marketing tips that will help you build your business from the ground up.


Network marketing, also known as multi-level marketing (MLM), direct selling, and referral marketing, involves a company paying individuals for sales or for recruiting others. Companies that use This marketing strategy are primarily interested in building networks of independent distributors who will advertise their products. However, most network marketing companies don’t sell anything directly themselves. They rely on those distributors to do so. So, if you aren’t comfortable promoting other people’s products or services, it probably won’t be a good fit for you to join one of these companies. The other option—home parties—is more promising; but even then, you are going out of your way to convince your friends that they need whatever it is that you have come up with.

The Basics

What is network marketing? Quite simply, it’s a means of building a business that involves more than one person. In other words, if you want to make money by recruiting others into your organization instead of starting from scratch (and inviting them to sell your products or services), then you’re in network marketing.

Industry Statistics

According to Statistic Brain, about 24 million people in North America will be part of a network marketing company by 2017. While that number may seem like a lot, it pales in comparison with Asia’s 90 million. Globally, nearly 200 million people involving in this field of marketing. That’s 27 per cent of all companies worldwide. And sales from network marketing companies have increased every year for almost 10 years straight; reaching $31 billion as of 2013! It isn’t just for social media gurus anymore. Now it’s used more frequently by brands who want access to international markets or expanded channels of distribution. It’s clear that network marketing has grown rapidly over recent years and will only continue growing as businesses realize their potential.

Network Marketing – Pros & Cons

Network marketing, or multi-level marketing (MLM), has been around for decades. If you’ve heard of Tupperware parties, you’re familiar with network marketing. Companies hire individuals who are passionate (or at least excited about) about their brand or service. Those people go out and recruit other people, who then also recruit others, etc. As long as all those recruited people buy from your company (and earn a commission from sales), you keep earning money from every sale your recruits make. Some see it as a pyramid scheme—especially if they lose money on their investment in recruiting others—while others consider it a legitimate business model, they can use to grow their own business.

Is MLM Right for You?

If you have a product or service that you can sell online, then it may work for you. Network marketing companies sell products through distributors, which may include friends, family members, door-to-door salespeople or other independent representatives. Sign-up fees vary considerably. Pay depends on how much time distributors spend selling products and how much they sell. Some network marketing plans require participants to purchase inventory. Investigate plans carefully before joining. And make sure you are willing to commit to getting paid on performance rather than commission alone.

Evaluating an Opportunity

It offers a great way for entrepreneurs to grow their businesses without investing thousands of dollars. But like any new opportunity, it’s important to look at whether or not it makes sense for your company. If you’re looking at joining an MLM (multi-level marketing) company, there are two key questions you need to ask yourself. Does your product or service complement that of other members in your network? And do those other people sell more than you? The best marketing companies allow independent contractors to market their products alongside members. This helps maximize profit potential without too much risk—after all, if one person isn’t getting results from an offer, another might just have better skills.

Also Read: What is an NFT?

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