Friday, November 6, 2009
How many of you have decided to join a network marketing company after getting all excited about the compensation plan only to be let down after a few months of hard work and no results??? This seems to be an all too common occurrence within the network marketing industry and is one of the reasons network marketing is looked down upon as a whole. Our mission on the Green Light Business Team is to change all of that. We want to clear up all the myths and "gray areas" around network marketing companies and provide people with the knowledge needed to make an informed decision when deciding which Network Marketing company to work with.
THE FIVE PILLARS OF SUCCESS IN NETWORK MARKETING
As with anything you pursue in life, if you don't build up a solid foundation, you will never get the chance to truly see how high you can soar. Specifically with Network Marketing, there are 5 main pillars that hold up the foundation you will be looking to build off of. It is essential that all 5 pillars are present. Otherwise your foundation will not be as strong as you need it to be to truly maximize your potential in this industry:
Pillar #1: Company- When looking at a company, there are a few major questions you will want to ask. First you will want to know how old the company is. If the company has been around for a long time, you will want to check how much positive cash flow that company has annually ( I will cover this in more detail in the TIMING pillar). You also want to be looking at how the leadership is structured in the company, Is the CEO advised by a board and corporate staff or does he have the majority control of the company (this has led to the unfortunate re-structuring of many comp plans in companies with greedy CEOs). You will also want to find out if the company is publicly traded or not. If a company is publicly traded, they will have to follow even more ethics guidelines as "share holders" are involved.
Pillar #2: Product- When looking at a product, the first major question to ask is if the product is CONSUMABLE? Think about it, if a good product is consumable, people will want to keep ordering it every month. This is what creates the long term residual income. If the product is not consumable (i.e. pots and pans, knives, vacuums) then you become a salesperson constantly looking for more people to sell to. You then spend most of your time selling instead of helping your downline achieve their financial goals. Look for a product that will help people ( specifically in the health and wellness field. I will cover this in the TRENDS pillar as well) After finding a consumable product, check the uniqueness of that product. How many juices, super supplements, and special berries are there? I prefer to stay out of the juice wars and go for a more unique approach. It is also important to find a product that can stand behind its claims. The product should have either clinical trials or peer reviewed studies on the whole product (not just the individual ingredients). People don't trust third party validation.
Pillar #3: Trends- Over the past few years the health and wellness industry has exploded with interest. You cant walk down an isle in the grocery store without finding 20 items that are promoting the anti-aging or antioxidant properties found in that product. Economist Paul Zane Pilzer predicts that the health and wellness industry will be a TRILLION DOLLAR market by the year 2010. Why is this good news for the network marketing industry? In 2008 the first of over 75 million baby boomers began to retire. These "baby-boomers" spend 2 out of every 3 dollars in circulation in the US. People in this age group (40-60) are constantly looking for 2 things. 1 is better health and 2. is financial security after retirement. With the right network marketing company, you can offer them both.
Pillar #4: Timing- Most of you probably understand the importance of timing when it comes to network marketing. Yet I am still seeing people sign up with 20+ year old companies and wondering why they aren't making any money. Now I'm not saying that it isn't possible to be successful with an older company, but you do miss out on the explosive growth most companies go through within their first few years. As I mentioned earlier in the company pillar, if the company has been around for a few years, it is worth looking into their annual cash flow. Once a company reaches 50 million dollars a year in sales, which comes to about 4 million dollars a month, they tend to hit major exponential growth on what is known as the business "S" curve. this is when a large amount of the company's income and memberships grow in a really short rate of time. If you are able to position yourself "ahead of the S curve" in your business, you can experience something really special.
Pillar #5: Compensation- The compensation plan is what gets most people excited about network marketing. Yet notice how I have listed it last among the 5 pillars. Too many people get excited about the compensation plan and what they COULD make. So they sign up without really understanding the company they are joining or the product they are offering. That being said, If the company you are looking at getting involved in has passed up to this point, You may be on the right track. When looking at the various comp-plans out there, you should look for one that will reward you both short and long term. I mean one that will pay you weekly and monthly. Many companies do this with a fast start bonus and a monthly bonus pool. The comp plan should also have a unilevel payment. This is where your long term residual income will be coming from. One of the most important bonuses to look for is a matching bonus. In a matching bonus, you are paid a percentage of your downline's unilevel check ( this encourages everyone to help their downline) the deeper the matching bonus pays the better. I also recommend looking for a leadership bonus. This is where top distributors of the company can earn a percentage of company profits. Some of the publicly traded companies offer stock options as well. Other companies offer different rank rewards like vacations or cars. I would recommend going with a comp plan that includes at least five of these but definitely has the fast start bonus.
I hope this helps you analyze and determine which network marketing company to join. Or at least gives you some questions to ask at the next "opportunity meeting". Here at the Green Light Business Team, we are confident we have found the perfect sweet spot (see video below) in the network marketing business with LifeVantage. But don't just take my word for it. Test it out yourself and see how it fits into the "Five Pillars of Success In Network Marketing" system. Good luck to all of you!
Seize the Day!!
Richard A Hyatt IV
Co-Founder of the GreenLight Business Team