MULTI LEVEL MARKETING Prepared By ABHISHEK KUMAR LBSIM

MULTI LEVEL MARKETING Prepared By: ABHISHEK KUMAR LBSIM PGDM(EVE. )

HISTORY MLM started in the US, in 1959, by business partners Rich De. Vos and Jay Van. Andel, originally with just one single product and a new and unique business vision. They believed that they should be paid relative to the benefit the company continued to get from their original work.

MLM Multi-Level Marketing(sometimes called Network Marketing, Referral Marketing or Direct Marketing), multiple levels of people are marketing a product to consumers. A sales representative (also referred to as a distributor, member, affiliate, partner or associate) gets customers and recruits and trains another sales rep to get customers. The products and company are usually marketed directly to consumers and potential business partners by means of relationship referrals and word of mouth marketing.

Sales rep gets customers and trains another sales rep to get customers. “Refer a friend and you’ll receive a discount on your next purchase, ” this is multi-level marketing.

THE TRDITIONAL COMPANY In a non-MLM company, a sales manager and sales reps are hired by the company. Once a sales manager is overwhelmed, the company can hire another manager or convert a sales rep into a manager.

Traditional companies (non-MLM) use “Multi-Width” Marketing.

The Multi Level Company An MLM company “starts” by recruiting one person who gets customers and recruits sales reps with the option to become a manager. The MLM company only pays commissions, not salaries. This is beneficial to the company because of rapid expansion by the number of trained sales reps. This is also beneficial to the sales reps because their income isn’t limited to only what they can sell - they can also earn commissions for having trained other sales reps.

MLM is Organically, the MLM industry is a fantastic model. Here’s why: �In its organic state one person shares a valuable product or service with another �A person shares a business idea with another �The person who shares the business with another ONLY profits IF the person they shared the business with succeeds. These three steps are the organic concepts of MLM and are absolutely brilliant.

What kind of products are sold most in MLM? 1 - Products should have a authentic presence other than mlm system also. 2 - Price should not be over for repurchases. 3 - Manufacturer of Product should have good reputation. 4 - Health Products are sold most in MLM.

Criticism Of MLM The Federal Trade Commission(FTC) issued a decision, in 1979 in which it indicated that multi-level marketing was not illegal in the United States. AMWAY was found guilty of price fixing and making exaggerated income claims. MLM's are also criticized for being unable to fulfill their promises for the majority of participants The exploitation of personal relationships for financial gain

MLM Compensation Plan Ø Unilevel Plan Ø Matrix Plan Ø Stairstep Plan Ø Binary Plan

UNILEVEL Plan üAs the name suggests, the plan allows a person to sponsor one line of distributors, called a "frontline. “ üThere are no width limitations, meaning there is no limit to the amount of people one can sponsor in the frontline. üThe common goal of this plan is to recruit a large number of frontline distributors and then encourage them to do the same. üUse only one commission type, the level commission type.

STAIRSTEP Plan §Sales volume is created by recruiting and by retailing product. §Various discounts or rebates may be paid to group leaders. § Once predefined personal and/or group volumes are achieved, a representative moves up a commission level. §The original upline usually continues to be compensated through override commissions and other incentives.

MATRIX Plan • Matrix plans often have a maximum width and depth. • When all positions in a representative's downline matrix are filled a new matrix may be started. • Representatives in a matrix earn unlimited commissions on limited levels of volume with minimal sales quotas.

BINARY Plan o. It allows distributors to have only two front-line distributors. o. This "spillover" is one of the most attractive features. o. The primary limitation is that distributors must "balance" their two downline legs to receive commissions.

MLM Companies in INDIA q. Attitue Trading (P) Ltd. q. Amway q. FLP q. Tupperware q. DXN q. RCM q. Modi Care q. Oriflame q. HLL q. RMP

WORKING Of MLM RMP(Resource of Money & Power) Choose your product among 12 different products ü Get the Demand Draft ü Choose your sponsor ü Get your sponsor id USER ID – vij 0003 id TRACKING ID – RMPLKJH 14098

RMP has Binary Plan

SALES TECHNIQUES �Look for a prospect �Attending Business Meeting/Seminar �Convince prospect for the business profits �Take the joining �Give training

RMP BUSINESS POLICIES �Commission �Incentives �Ceiling �Car Loan

Intellectual Distribution Of Products Because intellectual distribution represents the best opportunity for network marketing companies and their sales forces to succeed, what it is called the METS Formula Motivate, Educate, Train, Support

What’s wrong with MLM…? ? �MLM Sales Technique: Rumors, Slander, Defamation �Math and Common Sense �Learning the Hard Way(exploitation of personal relation) �High-pressure Selling �"Mother, Let Me Tell You About a Fantastic Opportunity. . . " �Dubious Claims �Motivation: Powerful but Misguided �Exaggerated income claims

REWARDS Commissions based on the ongoing sales volume of your downline group. Lots of personal recognitions, public recognition and encouragement from the entire team.

CAREER GROWTH IN MLM Most MLM companies provide career growth in terms of Levels and Target is ceiling. Commission earnings are weekl These levels are, like: SILVER GOLD PRESIDENT CLUB STAR DOBLE CROWN DIAMOND CROWN

Check points for the legal MLM �Company must have their own branded products. �A good residual plan is must. �Value for money should be there at the time of joining. �Products should be of daily use or must have repurchase power. �Quality should be good as it is word of mouth business. �Management should not be a part of some past illegal things. �At least a Private Limited firm should be there.

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