How to Start a Networking Marketing Business
A networking marketing is known as multi-level marketing (MLM); it involves recruiting of other business inclined people into your network. The people so recruited will start to buy products from the networking company for sale and for their consumption.
As they buy, they, in turn, will start recruiting and building their own networks or down-lines. You are entitled to a monthly commission from the amount your down-lines pay to join and their purchase value of the networking company’s product.
It means, therefore, if you recruit one person, when they start buying the networking company’s product, you earn a commission on the purchase price. The more people you recruit, the more commission you earn. It doesn’t stop there however, the people under your down-line are allowed to recruit their down-line and they also earn a commission when their down-line makes purchases from the networking company. These recruits will earn a commission for their recruiter as well as you who recruited their recruiter – hence multi-level marketing.
How to start a networking marketing business
In MLM there are wide promises that you are going to earn big money and eventually own a car and a house, but in the vast majority of cases, it is a fallacy. To make headway in the business, you must grow your network to a reasonable level since there is a positive correlation between the recruits under you and the commission that comes to you through them.. To be successful in this business, you must work extremely hard, play the tricks of the trade by recruiting people by whatever method you adopt to grow your network geometrically.
- Self-analysis
- Choose products to sell
- Choose a network marketing company
- Funding your business
- Set up your business phone
- Create your website
- Set up a mailing list
- Choosing a Suitable Location
- Marketing your network products
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Step 1 Self-analysis
Be truthful to yourself. Have you understood the intricacies of network marketing? Do you know that the business is demanding and can be risky too? Do you know where you have the strength and where your weaknesses lie? Have you analyzed the network marketing industry? Do you know why they are sometimes criticized and its activities sometimes subject to litigation? Have you investigated what people call illegal pyramid scheme, why the initial cost for registration is always high and their techniques for growing their network is not always straight forward?
It is important for intending network marketing people to have a good background of how the scheme works before dabbling into the business. For example, if you give those on your down-line the impression that they would own a car or a house within two years if they grow their network to 300, when in fact you know it is highly impossible to achieve this number unless they indulge in illegality. You are under an obligation not to provide misleading information that will lure and trap unsuspected business-minded people.
When you have examined yourself, carry out a market survey on the networking industry particularly within your locality to find out how many are there, the products they are selling and how well they are doing? Evaluate your findings and make up your mind whether you will be able to do the business.
At this stage, you look for opportunities which you can always find in Small Business Opportunities section of Entrepreneur. There are some network marketing companies you can contact for useful information. Speak to their up-line sponsors for their model and payment plan to you. You will be able to learn some networking tips in this process.
Find out if you have enough experience to go into network marketing without having any sort of training. The point is that for you to stand out from the crowd as a professional network marketer, you need to be professionally trained and have a professional certificate in your area of business. It is easier for the network marketing company to work with you if you possess any of the under-listed certifications:
MBA in network marketing
AMA certified professional marketer
Certified network marketer
Certified Training for Direct Sales/Network Marketing
Certified Marketing Management Professional
Step 2 Choose products to sell
Choose the products you are happy with and you think you can sell without much difficulty. There are a lot of alternative products on offer ranging from toiletries, makeup, home cleaning supplies, cell phones, health supplements etc. Choose a product line that is popular and that other people will enjoy marketing.
In every industry, some brands outperform others because they have been in the market for a long time apart from possessing good quality, and the general public know them for that. Other brands are best known for the way their customers care personnel handle customers’ cases and complaints.
Some of the leading brands/network marketing companies operating in America are listed below; many others are not included here.
- Forever Living Products
- Viewer & Co. KG
- Natura Cosmeticos SA
- Herbalife Ltd.
- Ignite Inc.
- Yanbal International
- Telecom Plus
- Tupperware Brands Corp.
- Primerica Financial Services Inc
- Nu Skin Enterprises, Inc.
- Viewer & Co. KG
- Avon Products
- Mary Kay Cosmetics
- Fuel Freedom International
Step 3 Choose a network marketing company
Having selected the products you will be comfortable selling, the next hurdle is to choose the network marketing company that fits well into your plan. The company that fits well into your plan is the one that will offer you a commission between the ranges of 15% and 25% and you will begin to make a profit quickly. Arrange for your products to be regularly shipped, e.g., every month.
Step 4 Funding your business
You must consider in detail how to finance your network marketing company. Your start-up capital may be far too small if you decide to hire an office space and build a factory with all the necessary production facilities; you need to seek external funding. But if on the other hand, you decide to join a network marketing company, it may be much easier to start your business without looking outside for business finance. If you consider joining a network company where you are going to sell the company’s product, you can do your business from home or share an office space with a friend.
But is always a good idea when starting your business to have a business that shows the direction you are to follow; in this case, the business plan which will show you the financing requirements. With the business plan in place, it will be easy to convince the financial institution, or a friend or other financiers to come forward and invest.
The following options are available for you to raise the initial capital:
Personal savings and financial assistance from families and friends
Sale of property and stocks, if available
Raising funds from investors and other financiers
Sale of shares from quoted companies
Seeking for a loan from banks and other financial institutions
Step 5 Set up your business phone
You can create your business phone and separate it from your phone. This has become necessary for you to know when important business calls arrive. With the business line, you can have a pre-recorded warm greeting that introduces your business and ask callers to leave their contact details when they can’t get you on the phone.
Step 6 Create your website
You should set up your website for the network marketing company. The site should be done through your network marketing company. Ask for it and you are likely to be given a site that is similar to the main company website. You will do your business conveniently with this site.
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Step 7 Set up a mailing list
You should begin compiling a mailing list. To do this, you will need to search online for a mailing list supplier. Buy from the one that sells names and addresses of Business Opportunity Buyers. With this list, your conversion rate is likely to be improved. Don’t order for plenty names at this stage, but for names between 400 and 700 to test mail the list and if they happen to be credible, you will now order the number that will meet your needs.
Step 8 Choosing a Suitable Location
Location matters in this business since you are most likely to be seeing members of your network face to face. At the start-up stage, you can use your home if finance is the problem, but if business begins to take shape, you will need an office space. The office should have access to both human and vehicular traffic. This is necessary if you want to see the loads of clients that come for business and be able to achieve your profit objectives. The size of your network and what you envisage the future holds for you will determine how big your office space will look like.
The reason for the office is that when your products arrive from your network company they need to be kept safe until they are sold through members of your network.
You also need an office or hall to hold meetings with members and prospective members of your down-line to give them the latest update and other matters of importance.
Stage 9 Marketing your network products
Typically, to operate a network marketing company, one needs to obtain the required product/service and then build a network marketing software app. that will organise and then monitor the progress of network marketers and others in their downlines.
Network marketers after paying for registration fees and other starts up fees, will have to recruit their network marketers and are encouraged to continue recruiting more network marketers as an ongoing exercise.
The following are some of the marketing strategies to be adopted to sell the network marketing company products/services:
- Advertise on the social media, internet blogs and forums to get your message across..
- Send direct mail containing introductory letters and brochures through email to network marketers, sit at home mothers and other residents in your area of interest.
- Organise or engage roadshows in targeted communities occasionally to sell your products and recruit more network marketers.
- Give discounts to your customers and make out days they will be entitled to such discounts.
- Use directories such as yellow pages to list your network marketing company.
- Advertise your business on local newspapers and radios.
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Conclusion
Network marketing can be extremely profitable if member network marketers have so many people in their network and they are determined to put in their very best efforts to make the business take root and grow. However, if this is the case, network marketing is not likely to make headway.