Good afternoon! Today, I’m going to make a lot of people angry.
I need you to understand that it is not my intention or approach to upset anyone. My intent and focus, my mission, is to educate and help people understand how the network marketing industry works. And in order to do that, I realize that some people may be offended or upset by what I say. If you are one of those people, I apologize in advance. I am not anti-MLM or anti-network marketing. In fact, I think network marketing and MLM is probably the best place on the planet for the “little guy” to start with a few hundred dollars and turn that into a huge residual income.
Unfortunately, network marketing and MLM have sketchy reputations. Personally, I’m anti-BS and I want to take a few minutes to look at one of the most misunderstood pieces of this puzzle.
Today I want to see the “company event” or “company conference”. You’ve heard of them (or been to them) – It’s a big MEGA-EVENT where a few key speakers come on stage and tell their “million dollar story”, the CEO or Chairman can come on stage and speak about how amazing the company is. they have, what an amazing line of products, ad nauseum. Typically, companies will also launch a new product or product line at the event. Distributors will typically pay several hundred to several thousand dollars to attend the event, plus travel, lodging, etc.
What about these things? What are they for?
First consider this: most of us are creatures of habit. If in doubt, go look in your fridge. The types of food you see there today will likely be the same types of food that will be there 3 weeks from now. We buy out of habit.
As a business I need to know that the absolute best and most receptive customer I could ever have is a customer who has usually bought from me before. The group of these buyers, as a whole, can be called my “customer base.” My customer base has already shown that they will buy my products. They have also shown that they are willing to continue buying my products.
A network marketing company or MLM is no different. They have a customer base. They call these customers “dealers”. These distributors have demonstrated the propensity to buy a particular type of product. They usually buy it monthly on “autoship.” So if I’m a business looking to generate more revenue, how can I do it?
Well, one option is to have a mega event. A network marketing or MLM company can advertise this “weird-weird” gathering as an annual (or semi-annual) mega event, a training conference, whatever. The company can fill an auditorium with current customers (distributors) and then bring in keynote speakers who talk about how much money they can make with this company, how great the product is, how great the opportunity is, etc. They charge each dealer a premium price (usually several million dollars) while also branding the dealer as a “buyer” and with enough money to purchase additional products.
Once everyone enters the auditorium and everyone gets really excited, the company can launch a new product or product line and literally guarantee that the launch will be a success. Because the company labeled everyone “buyers” and with enough money to buy, the new product launch is an absolute success. The company generates income. The dealer spends money.
This is the same principle that all other retail businesses use. Think about it: Have you ever purchased something online and then continued to receive emails or “spam” from that company with additional and special offers? That company understands that you have bought from them before. And will probably buy from them again. So they keep sending special offers.
Again, I’m not saying that networking companies are bad, or that MLM companies are trying to exploit their distributors. I am saying that network marketing and network marketing is about business. Making a ton of money in this industry is downright easy if you understand how the numbers work. But the other side of the coin is that if a distributor doesn’t understand the numbers, he’s likely to make a lot of financial donations to his company.
Of course, these “rah-rah” meetings are not completely useless for distributors. Most distributors will surely leave that event highly motivated. And motivation is very important. But motivation without the right tools usually spells disaster.
Think of it this way: If I’m REALLY motivated to change the oil in my car, but the only tools I have are a fork and steak knife, I’m going to have a very difficult time getting the job done. Motivation has very little to do with my inability to change the oil, I might want to change the oil more than anything else I ever wanted; it’s really about having the right tools and the knowledge to use those tools effectively. That is the conclusion.
If you are a distributor then you need to know what you are doing. If you spend $2,000 on an event, I at least hope you get more of it than some extra product. Invest in your knowledge, invest in your skill set, and watch your business grow.
I, Joshua Fuson, accept full responsibility for these words. If you have any questions regarding this material, you may contact me directly at my home office at 641-856-7555. Copyright 2006 Fuson Enterprises.
