“Is it just another one of those deals?”
A lot of people ask that question when approached with a network marketing business – especially with all the hype and different network marketing companies out there, along with the questionable past reputation of Amway.
Contrary to what some think, network marketing is becoming very popular to those entrepreneurs looking to create a passive, residual income. So popular, celebrities and business tycoons such as Donald Trump and Robert Kiyosaki, a best-selling author of the books ‘Rich Dad, Poor Dad,’ the ‘Cash Flow Quadrant’ and ‘The Business School for People Who Like Helping People,’ are giving their endorsements to the network marketing industry.
In the summer of 1998, Trump made an appearance on the David Letterman show and was asked by Letterman what he would do if he lost everything and had to start over from scratch. Without hesitating, Trump said “I would find a good network marketing company and get to work.” The audience started to shout and boo him. Trump looked out at the audience with his dead-panned response and said “that’s why I’m sitting up here and you are all sitting out there!”
Trump and Kiyosaki co-authored the book ‘Why We Want You To Be Rich: Two Men, One Message.’ In the book, the two listed network marketing as one of the best ways, for the average person, to gain financial freedom.
“If you can change your outlook, change your values, and change your rules, you’ll find there’s a whole other set of rules out there that are more conducive to those who want to be rich,” says Kiyosaki. “One of the reasons I consider a network marketing business a perfect business is simply because companies will work with you to get the business skills that makes you rich. Always remember, it’s not the money that makes you rich, its business skills.”
Another advantage to network marketing is its low start-up cost, especially in comparison to traditional business start up costs.
“That’s the beauty of network marketing companies,” he said. “They allow you the time at a low cost and will work with you to make the transition,” Kiyosaki said.
A network marketing business is just that – a business. It’s not a get-rich-quick scheme. Trump, Kiyosaki and many others will agree it takes work, time and persistence.
“This is a passive income,” Kiyosaki said. “You work hard for a few years and income keeps flowing to you – possibly for the rest of your life. It’s not a get-rich-quick formula. You don’t just do it overnight, It takes time.”
According to the Direct Selling Association, more than 32 billion dollars is generated for the direct selling/network marketing industry in the U.S. and more than 100 billion dollars world-wide. The people generating this revenue include more than 15 million distributors in the U.S. and 50 million world-wide.
The DSA’s research shows some of the most popular reasons people choose direct selling is because it’s a good way to meet and socialize with people, earn extra income, and to own a business. It also allows flexible work schedules and earnings in proportion to efforts.
T
here are no required levels of education, experience, financial resources or physical condition. People of all ages and from all backgrounds have succeeded in network marketing.
According to recent DSA surveys, 74 percent of Americans have purchased goods or services through direct sales/network marketing. That’s more than the number who have purchased through television shopping and on-line computer services combined. People value the products available through direct selling and 45 percent of Americans want to buy from direct sellers.
Dr. Charles King, University of Illinois Professor of Marketing and a graduate of the Harvard Business School, said network marketing is growing beyond traditional retail sales methods.
“Network marketing is the most powerful channel of distribution in all the marketing disciplines,” Dr. King said. “It gets products to consumers more efficiently than traditional wholesale to retail programming.”
Dr. King is a network marketing expert who has been researching the industry for more than 17 years. He is often called upon by network marketing companies around the world as an expert witness.
“The fact is network marketing has been proven by traditional marketers to be a successful program in building distribution along side the traditional channels of marketing,” Dr. King said. “This is a unique channel that adds a whole new unique dimension.”
Network marketing is so popular, companies like AT&T, Sprint, Proctor & Gamble and General Foods have been involved.
Network marketing is a sub-category of direct sales. The difference is when a salesmen makes a sale in direct selling alone, the salesman makes a commission and it’s all over. In network marketing, the salesmen continue to get paid over and over from sales and from the sales his associates make.
This passive, residual income model of network marketing allows businessmen to work smarter instead of harder.
“I would rather have one percent of the efforts of 100 people, than 100 percent of my own efforts” said John Paul Getty, America’s first billionaire.
It appears the truth is getting out about network marketing and it’s becoming more and more appealing.
As Kiyosaki says, it could be “the perfect business” for the right person with the right work ethics and persistence to become financially independent.
It’s recommended to research the industry, a potential product or service, the company, and the compensation plan before getting involved. If someone has the right attitude and work ethic, a great product or service that a lot of people want and need, with the right pay plan, he can make as much money as he wants to make.
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