Network Marketing

The workplace is increasingly leaving the office and becoming more diverse. Many Americans have decided to become self-employed, while others have started their own small businesses. Others choose to do the work of a typical office from the comfort of their own home, and still others prefer to work with franchise opportunities in order to be their own boss and have the security of a large corporation backing their investment.


But these options are supplemented by another, powerful option: network marketing, sometimes called multi-level marketing. Much like a franchise opportunity, these employment opportunities are obtained at the hands of a large corporate parent and then overseen by the enterprising individual who sought them out. Those who participate in network marketing can even have their own “employees” — sort of. And the work force they employ will even impact how much they can earn from their direct marketing position.

So, what is direct marketing? How does it work? And why are companies increasingly turning to direct marketing as a way of generating revenue and promoting their brand?

Networking Marketing Defined and Explained

So, here’s how networking works: an individual contacts a company who has positions open for a network marketing associate, often called a salesperson, agent, consultant, or distributor. These companies then charge this individual with selling the company’s product — anything from beauty and cosmetic products to insurance and liability policies. For selling the company’s product on their own, they earn a certain commission — perhaps 25 percent of gross sales each month.

In addition to selling the product on their own, this individual can hire a sales force of their own to do the dirty work for them. This is the next “level” of marketing, and it can be quite lucrative for the original salesperson. They’ll get the same commission cut on their sales the they’ve always been getting, but they’ll also get a sizable commission — perhaps between 10 and 20 percent — on the sales that each of their agents makes. Of course, each of their own agents will make a commission as well.

And, if they recruit a certain number of sales agents — perhaps 5, perhaps 25, they’ll get a commission bonus each month. In essence, the company which develops the product hires salespeople, and those salespeople hire their own force. And, if that force is successful, they may hire their own team to help them sell the product as well. The levels of marketing simply keep multiplying, and the company’s message is repeated to more and more clients and customers. And with each new level of marketing, every previous (higher) level gets a commission bonus.

The truly enterprising sales and marketing professional can turn this multi-level marketing opportunity into a salary that rivals anything they would have made at a traditional office job. The difference, of course, is that they are essentially working by themselves and running their own enterprise. A network marketing professional gets to be their own boss, but still get paid by a large corporation that has a sizable budget dedicated solely to the many levels of marketing they’ve engaged around the country.

An Increasingly Popular Option for Many Companies

Multi-level marketing has been around for at least 70 years, and perhaps the most popular brands to engage in this practice are Tupperware and the Avon cosmetics company. But it’s important to remember that every insurance company around the country engages essentially in multi-level marketing that employs a network of offices, agents, and brokers. It’s not often thought of as a network marketing scheme, but it’s one of the most sophisticated such environments in America.

And why? Because network marketing is extremely effective. Going to a customer’s home and arranging to have them see the product or, in the case of insurance companies, talking with them one-on-one about their options, increases the likelihood that they’ll buy the company’s products. Typically, those companies which engage in multi-level marketing are the ones who do not have their own retails stores or agreement with existing stores to have their products sold outside of websites and catalogs.

With multi-level marketing, their products get to leap off the pages of mail-order catalogs and online marketplaces. People can talk about them, try them out, and get purchasing advice from a real person who lives in their neighborhood and knows them well. They trust this individual, and that increases sales for the company overall.

And these company also get to appeal to American instinct that leans toward being one’s own boss. They don’t micromanage and they rarely set minimum sales goals. The income a person can offer is based solely on how hard they work and how good they are at making a sales pitch to new customers and returning clients.

Network Marketing is Here for the Long Term

As more and more companies become online-only enterprises — and as more companies are founded strictly online — the necessity of network marketing will only increase. People need to touch, see, and relate when they make a purchase. That cannot be done online, but it can be done with a network of sales representatives who are motivated, compensated, and incentivized. And that’s exactly what network marketing provides for.

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