MLM - what is it? Successful business or scam?

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

In the key queries of search engines, next to the abbreviation MLM, there are often such words as a scam, pyramid, divorce, and even a sect. And this is primarily due to people's misunderstanding of the essence of this business. Many believe that this is an ordinary financial pyramid, in which money goes “up” and settles in the bank accounts of its organizers. Moreover, in recent history such “schemes” really worked, and many lost their savings in them. But such pyramids do not exist for a long time, and some MLM companies have flourished for decades. And many "networkers" working in them achieve something that cannot be achieved at work for hire - financial independence.

How is it really? MLM - what is it? Let's start with the fact that this abbreviation comes from the English MLM, which stands for "multilevel marketing". That is multi-level marketing. Marketing, in essence,is the management of the organization. And this concept includes product policy, pricing, advertising, demand research, public relations and much more. That is, it turns out that MLM is one of the ways to manage a business. And its essence is that distributors here not only sell the goods of their company, but also attract new distributors for this. At the same time, MLM "networkers" do this not for free. They receive a percentage of their personal sales and bonuses from the turnover of the team they invited.

And if you "dig deeper", referring to history, you can find out how the MLM industry was born, what kind of business it is. It all started in 1927, when Carl Rehnborg created nutritional supplements based on alfalfa. And information about them began to spread quite quickly only thanks to word of mouth. That is, Rehnborg talked about his supplements to acquaintances and friends, who, in turn, shared information with their acquaintances. And this whole process came to the point that Karl simply no longer had time to respond to the applications of everyone who wanted to purchase his goods. And then he had a brilliant idea. He suggested that his acquaintances not only tell people about these supplements, but also sell them, while receiving his commission. Then he decided to pay for the next lines of distributors, while building the first ever MLM network.

What kind of business it is and what benefits it brings, other people soon realized. Rehnborg himself in 1934 founded a company called "California Vitamins", which in 1939became Nutrilite Products. And it had employees like Jay Van Endela and Rich De Vosa. And they, having gained experience, in 1959 organized their own brand, calling it "American Way Corporation" or "AMWAY". And now it is one of the largest and most prosperous network companies.

But in our time, many scammers are turning their scams under the brand of MLM. What does it give them? Yes, a legal cover for their dishonest activities. And many people, having lost their money and time here, are disappointed in network marketing in general. And to avoid this, you need to choose the right MLM company. And for this, the Direct Selling Association was created, which includes only proven ones. This association has its own website, and information about its members is available to everyone. Therefore, before making a choice of a network company, it is worth visiting it. Then the chances of success in the MLM business will increase significantly.