The Industry

What is Network Marketing?

Network Marketing is also known as Multi-Level-Marketing (MLM) or Referral Marketing.

Although it has been around since the early part of the last century, for many people, it is still unfamiliar territory and people are still confused as to what type of business Kleeneze is.

It is a very good way of starting a profitable, full-time business with little or no investment. It is also a good method of starting a second or part-time business to run alongside your existing business, career or lifestyle.

In most cases it involves selling a product or service which is produced and supplied by a 'mother' company. You take on the responsibilities of selling the products and introducing other people to the company. You get paid commission on the products / services sold by yourself and a smaller commission on the products / services sold by the people you have introduced to the company. In addition to this, you often get a percentage commission based on the sales of the people who 'the people you introduced' introduced.

Comments and advice

The 'Referral Marketing' industry is growing at a rapid rate. More and more companies are looking at it as a viable method of cutting advertising and distribution costs. It has enabled a huge amount of people to start earning substantial incomes with low financial investment and, therefore, low risk.

However, it is not a 'lazy man's' way of making money. In order to build a successful business, like any business, one must invest a great deal of time and effort into it. Many people have 'fallen by the wayside' because they have been misinformed (by over enthusiastic recruitment tactics) about the level of work that is required to generate a decent income.

Always check the credibility of the 'mother' company, some companies go beyond the bounds of fair recruitment practice and require start-up costs that can not be justified. Furthermore, these organisations may have little or no products / services beyond the recruitment process. This may not appear to be a bad thing, after all you can make substantial commissions from the initial investments paid by the (fully informed) people you introduce, and so can they. In some countries, however, this practice is illegal or may be frowned upon by the authorities, think hard before you invest your time and money into a business like this.

There is a wide variety of good quality Referral Marketing companies from all over the world to choose from. They offer products and services from a wide range of industries: health, telecommunications, household products, technology, e-commerce, adult industry etc. It would be advisable to choose a product or service that you are interested in because, when it comes to sales, nothing beats enthusiasm and confidence in the product.

Pros:

• Often uses a proven business formula.
• Low risk.
• A great deal of support and advice often given.
• Flexible -can be run on a full-time or part-time basis.
• Highly expandable - no restrictions on territory & most 'mother' companies can supply to many countries (great with the Internet).
• Business can be run from your own home.
• Builds your confidence and increases your communication skills.

Network Marketing is NOT the same as pyramid selling. It is firmly established in many countries as a respected means of achieving an income. Kleeneze is NOT a business that is involved with pyramid selling in any way, shape or form.

In the UK, Network Marketing is regulated by The Direct Selling Association (www.dsa.org.uk). The DSA aims to ‘protect, serve and promote the effectiveness of member companies and the independent direct sellers marketing their products and assure the highest level of business ethics and service to customers’.

Any company can choose to use Network Marketing to reach its customer base and any product or service can be sold this way. Network Marketing started in the USA and some of the longest-standing companies using this method include Amway, Ann Summers and Kleeneze. A more recent entrant is the award-winning Dorling Kindersley Family Learning (closed down by new owners Pearson in July 2000). Cabuchon is an example of a successful Network Marketing which subsequently got taken over by Kleeneze. As with any business, there are no guarantees of success and rational preliminary research is essential.

Not all DSA members use Network Marketing to expand their distributor base. Some are purely party plan, such as Tupperware, and others are purely person to person, such as Avon; others use a mix of all of these to sell their products.

Network Marketing is based on the concept of ‘networking’. We all have a circle of people we know through the circumstances of our daily lives and each of these people will have their own circle of acquaintances, colleagues, family and friends. Network Marketing involves tapping into these networks not only to sell product but also to offer the business opportunity to potential new distributors who then start the process of developing their own networks for selling and recruiting.

As the networks widen, so the individual leader benefits not only from their own sales but also a percentage of the sales from their network. As more people join a Kleeneze network, so passive income increases as well.

So, what is MLM (multi-level marketing)? This is network marketing which allows its distributors not only to network outwards in order to sell the product but also to benefit from their downline's downline, either to a limited depth or ad infinitum. However, the two terms tend to be used fairly indiscriminately.

As with any other home-based business, Kleeneze distributors need to work hard and have courage and determination. Finding a good sponsor is just as important as finding an interesting product and a good compensation plan which offers flexibility and just reward for effort. Contrary to expectation, a newcomer to Kleeneze has the same potential for success as the long-term sponsor provided that the necessary research and skills training takes place. It is not necessary to be ‘in at the beginning’ and in some cases it may prove more difficult and risky to join at the beginning than to join a plan which has reached a more mature phase. Network Marketing is particularly suited to married women with family commitments as it offers them an opportunity to start a business on a part time basis with very little capital. The opportunity now exists for enterprising women to use their talents and the skills gained from motherhood to build businesses based both on selling and on finding and supporting the efforts of others.

Network marketing businesses expand every year and still more product-based businesses are turning to network marketing as a means of getting their products out to their customers and cutting out the wholesalers and retailers. We are also finding lots of US companies crossing the Atlantic and bringing their products and greater razamatazz with them. Kleeneze is a low risk business but the rewards can be substantial. A lot will depend on you, but a lot will also depend on the business acumen, personalities and perhaps sheer luck of the people you're signing up to do business with.

As you attend the training courses provided by the parent company, you will probably find that the 'product' becomes a way of life – so choose carefully!

Network marketing

The term network marketing is used in two ways. In popular usage it is a synonym for multi-level marketing and often mistakenly considered the same as a pyramid scheme.

The concept of "network marketing" is often used to describe a marketing paradigm that stresses the interconnectedness of market actors and transactions and can be viewed as the application of systems thinking to marketing. According to network marketing theory other marketing paradigms see the discipline as consisting primarily of dyadic relationships (ie., one buyer and one seller). Network marketing wishes to overcome this limitation by looking at transactions and relationships from the viewpoint of all those involved.

This perspective originated in industrial marketing, also called b-2-b marketing, where multiple contact points are typical. It is not uncommon, for example, to have several decision makers in a company's "buying centre". Likewise, the marketer can be organized into a "selling team". With multiple actors on each side of the transaction, a complex network is created. This paradigm is further complicated by corollary actors like information gatekeepers, influencers, advertisers, and intermediaries. This network can expand over time as more people get involved.

The network marketing approach sees marketing as a system of social networks where the relations between each of the links must be understood, including potential feedback loops, while at the same time, the system must be comprehended as a whole.

Overview

In a typical network marketing or multi-level marketing arrangement, individuals associate with a parent company as an independent contractor and are compensated based on their sales of products or service (as well as the sales achieved by those they bring into the business).

In a legitimate MLM company, commissions are earned only on sales to the end-user, who is often also a distributor. No money may be earned from recruiting alone ("sign-up fees"). Some companies produce revenues primarily by attracting new participants or selling them marketing services, as opposed to selling actual products. One must analyse the compensation plan to determine whether participants are paid from actual sales to customers and not from new-recruit bonuses or business support sales.

Multi-level marketing has a recognized image problem due to the fact that it is often difficult to distinguish legitimate MLMs from such illegal scams as pyramid or Ponzi schemes. NM/MLM businesses do operate legitimately in all 50 U.S. states and more than 100 other countries, and new businesses may use terms like "affiliate marketing" or "home-based business franchising."

History

Amway in particular is a frequent target for critics for generating considerable revenues from selling instructional and motivational materials to its participants. The FTC filed a lawsuit against Amway in 1976. Amway's victory paved the way for companies to adopt a multi-level distribution system.

The 1980s saw a major shift as companies began managing the stocking and distribution of products as well as commission payments to their members. This allowed members to focus solely on marketing. Today, most MLM companies act as logistics companies that take orders, ship products and calculate and pay commissions.

Compensation plans

Companies have devised various MLM compensation plans over the decades.

Unilevel or Stairstep Breakaway plans are the oldest and most popular. They feature two types of distributors - managers and non-managers - and three types of pay:

Baseshop overrides are overrides of managers from their subordinate non-managers, collectively called a baseshop. This is the same as any other sales organisation.

Generational overrides are overrides of managers from the baseshop of managers who were previously their subordinate. Most plans compensate at least three generations of such managers.

Executive bonuses are commissions for managers who exceed a sales quota. For example, 2% of the total company sales revenue may go to a bonus pool that is shared monthly pro rata to managers who exceed $10,000 in that month.

Matrix Plans limit the width of each level in a distributor's group, forcing strong distributors to pile ("spillover") their recruits over people who did not sponsor them.

Binary plans limit the width of each level to two legs. Commissions are based on "cycles," where a distributor is paid a fixed amount whenever both legs achieve a certain number of sales units each. Commissions are paid incrementally when the sales volume in each leg matches.

Elevator or Matrix schemes feature a game board or a list on which each distributor pays in one or more product units to participate. When a certain number of units have been paid in, the structure splits and the earlier participant receives consideration. The Matrix scheme article discusses the legality of this plan. You must do your own research as with any other investment.

Fraud in MLM

Fraudulent MLM schemes can usually be identified by high entrance fees or requirements to purchase expensive inventories. They often collapse quickly when the merchandise cannot be resold, leaving all but those at the top of the pyramid with sometimes staggering financial losses.

The general public usually misunderstands the network marketing industry. When they hear of network marketing opportunities their biased perceptions of the industry can cause them to avoid these opportunities. This negative reputation has been brought about by information about organizations within this industry that are perceived as being unscrupulous and deceptive. And as we all know, negative word-of-mouth can travel quickly.

However, the public’s perceptions of network marketing are beginning to change. This is largely due to changes in behavior by the network marketers. Today, enlightened network marketers have made the subtle change in focus from building sales to building relationships. This new breed of network marketer is involved in building, not only relationships, but long-term relationships that are mutually beneficial to both parties.

In many cases network marketing has turned into a full-fledged mentoring system. When you take the risk to grow your own business channels the risk is greatly reduced when there is someone there to guide you and offer advice, making this is a true business relationship.

Enlightened network marketers will also acknowledge the psychological differences in people. For example, they are aware that some people are auditory while others are more visually oriented. Therefore their teaching tools will reflect an individual’s needs.

If you are researching network marketing opportunities look for those organizations that cater not only to your financial growth, but also to your personal development. Look for opportunities that are built on relationships as well as other types of rewards. Integrity is a major component of the enlightened network marketing organization.

The truth is that opportunities do exist and the rewards can be great. However, success often comes to those that are able to work within the system’s framework. And, as in other walks of life, the most successful network marketers are those that are highly motivated. Your success will be measured, not by your own achievements, but by the achievements of others within your organization.

Every new industry is faced with the challenge of establishing their collective identity and ethics. Network marketing has been no exception. However changes within the industry are occurring and people’s perceptions of the industry are changing.

This is reflected in the growing number of individuals from all walks of life who are embracing the concepts and rewards of network marketing.

How to Adjust to your Network Marketing Lifestyle
by Brent Payne

You are thinking of dropping your old career to work in the field of network marketing, but are you equipped to handle this lifestyle change?

A new network marketing lifestyle is an exciting and prosperous venture, although letting go of that old comfortable routine of going to work might take some adjustment. There are some things you should consider before taking that step.

How can you stay motivated to work for yourself, without the influence of bosses or co-workers to motivate you? You may be used to your boss telling you what you are doing wrong and how to fix your mistakes. There may be other employees that you are working with that you have trouble getting along with.

Presently you may wake up, go to work, and have an established routine. Your lifestyle revolves around your job. Perhaps you wake at 6 am to get in traffic with other people who also dislike being up so early. You only get so many holidays, so many paid vacations and sick days per year.

You have the advantage of getting paid regularly and receiving a paycheck every two weeks or so. For many people involved in making the move from a regular job to network marketing this takes some adjustment.

So what changes will happen in your new network marketing career?

First, enjoy the fact that you no longer are on a time schedule that is out with your control. You can work when you like and develop your own work and leisure schedule. Thanks to the internet and associated technologies, you don't always have to be in an office to do your work. You can determine your work schedule and still be successful.

If you have a product that is in demand you can work as much as you feel is needed. If you work only a couple of hours today and you achieve your goals then you can focus on the other things that are important to you such as your family or golf game.

You can also readjust how you work. You'll be able to directly see what works and what doesn't. You are no longer one part of a large organization where you play no part in the end result. Now you can see the results of your work immediately.

Finally, getting paid is no longer something you have to worry about. Just keep reminding yourself; once you settle into a rhythm with your network marketing opportunity, you'll be making more in less amount of time than you would at any job. You can control how much you make and in most cases, you can actually formulate your efforts and the results you want to achieve. You determine the level of your success.

Working for yourself does take some adjusting to and you do have to be consistent in your efforts. However it really does get easier as you start to work within the network. Most network marketing entrepreneurs will agree that being in control of their own lifestyle is more rewarding than any other career choice. As part of a community, if you are faced with a challenge or need motivational assistance, then help from other members of the community is always available. This means that the potential to grow into the lifestyle of your dreams is completely within your control.

What is Network Marketing
by Kevin Quigley

To begin with, the concept behind network marketing is simple. Sharing - through product or business philosophy - is the basis of network marketing.

Network marketing is a multi-billion pound industry involving millions of independent business people around the globe. Large companies like Gillette, Colgate-Palmolive, Kleeneze Europe, AT&T and others, have all turned to network marketing because of the very real edge it gives them in both domestic and international marketing.

Network marketing is a 'BIG' small business, which offers everyone, with or without business experience, the opportunity to start and run a home-based business that works. It is the last frontier where 'the little guy', (people like you and me) can make it BIG.

NETWORK MARKETING
Vs
TRADITIONAL MARKETING

The traditional way of marketing products is to move them from a manufacturer through a network of middlemen. National Wholesalers, regional wholesalers, Cash & Carry warehouses, retailers, - the 'middlemen' - all add their 'valueless' percentage to the price of the product.

By the time the product reaches you the end user, you're not only paying for the product, but a percentage of the price for each and every middleman in the network. In network marketing there are no middlemen. Instead of paying them, a network marketing company will pay you for whatever amount of product you cause to be 'moved'.

As a sole individual operating alone, the amount of product you could 'move' from your own efforts, would be relatively small. In network marketing however, the amount you 'caused' to be moved indirectly could be huge.

Here then is the essence of a network marketing compensation plan. For not only will you be compensated for the product you personally cause to be moved from your own direct efforts, you will also receive indirect compensation for product that your 'organisation' 'causes' to be moved.

YOUR 'ORGANISATION'

To be successful in network marketing you will need to build an 'organisation'. That is to say you will need to 'share' the benefits of both the products and the business opportunity with others. In network marketing this is referred to as your 'downline'.

The 'serious' money to be had in network marketing is to be had from what is termed as 'over-ride' commissions from the movement' of product from the 'downline' your 'sponsor' will help you to build.(In network marketing it is the responsibility of your introducing 'sponsor' to help you build your 'downline'.)

All you need to do initially to build a 'downline' is to share' with others the information about the products and the business opportunity.

Theoretically, if after 'sharing' the information with others and you subsequently attracted just five like-minded individuals who decided to join you in your network marketing business - for illustration purposes only - your 'downline' could equate to the following after five levels of geometric growth:

You

You sponsor just 5 people into your business.

Your level 1/ 5

They duplicate your efforts and each sponsor 5 people.

Your level 2/ 25

These 16 duplicate your efforts and each sponsor 5 people.

Your level 3/ 125

These 125 duplicate your efforts and each sponsor 5 people.

A little arithmetic will tell you that's theoretically a total of 3,906 people on your fifth level.

AN UNLIMITED INCOME POTENTIAL

Imagine the power of a business-building plan that would pay you an agreed 'over-ride' commission on each and every product moved' by each and every one of those 3,906 potential distributors in your downline. Network marketing then is about a LOT of people 'moving' a little product. The more people you introduce, the greater your income potential.

If you want to toss aside the potential earnings on offer as being ridiculous or impossible - DON'T. I personally have met people who are earning £5,000 to £50,000 per month (yes per month) from network marketing for part-time effort. Though the majority of networkers earn hundreds rather than many thousands per month, (most working part-time) it must be understood then that if you are to make serious income, you must put in serious effort. No free lunches here!

SO HOW DO YOU CONVINCE PEOPLE TO JOIN YOUR KLEENEZE BUSINESS?

The simple answer is you don't. You want those who convince themselves. If they are truly looking for a way to become successful, then they'll come to you to go after it. The key to achieving success in network marketing is not to be had by convincing people, but by helping those people who want to become successful themselves.

WHERE DO I FIND PEOPLE TO JOIN ME IN MY BUSINESS

As it has been estimated that 20% of the working population - that's approximately 6 million people - would be interested in starting their own business, the marketplace in the UK alone is truly enormous. With a recent MORI poll indicating that 50% of 16 - 25 year olds were interested in starting their own business, the marketplace is actually growing.

One of the most important things to recognise is that the most precious resource available to you is in the new blood - the millions of business opportunity seekers who are not presently involved in networking. For it is there that you will find the success stories of tomorrow for your downline organisation.

CHOOSE THE RIGHT COMPANY

In any successful business it is the quality of the product or service that is being offered that is the single most important aspect for its success.

The most lucrative compensation plan in the world will NOT provide you with an on-going passive income if the product or service doesn't provide tangible value and benefits for yourself and your customers.

Provide a product or service that people need, want, coupled with a business opportunity they are willing to tell their friends about and you can build yourself a business empire in network marketing!

TOP TIPS TO GET TO THE TOP OF KLEENEZE?

Tip #1: If you're already involved in a network marketing programme and you're being 'sold' primarily on the benefits of the compensation plan with the product or service being offered as a secondary consideration, then read the above paragraph again and MOVE to a company whose products or services 'move'.

Tip #2: Ask yourself this important question: Is the network marketing programme I'm considering joining one that I'm willing to share with my friends and family? The comment "I don't want my friends and family to know what I'm doing, l want to become successful first - then I'll introduce them!!" is almost legendary in network marketing. (A comment oftimes made by failed networkers who had no real belief in the company or the products they were promoting in the first place!) If you immediately feel comfortable with the prospect of letting your neighbours, your friends and your family know about the network programme you're considering joining, have belief in the company and its products, have confidence in your introducing sponsor, then you have probably chosen the right company to work with.

Tip #3: Don't be impatient by expecting things to happen overnight! Building a moderately productive downline in any network marketing programme takes time - at least 6 months.

Tip #4: Read tip 3 again and avoid like the plague any company which suggests otherwise or does not require you to invest in the development of a customer base. If your prospective sponsor in the network marketing programme you're being invited to join doesn't stipulate that it takes TIME to build a significantly productive downline then it's not a business your being invited to join but a game - and one you're bound to lose!

Tip #5: If you want to dine with the classes - deal in products or services wanted by the masses!

If you have tried Network Marketing before and failed, you probably chose the wrong company, the wrong sponsor, or the wrong product.

TO CONCLUDE

Network marketing isn't for everybody. While some people swear by network marketing, others simply swear! (Read tip No. 3 again to find out why). To succeed in network marketing you will need determination, commitment, enthusiasm and most importantly - a burning desire for success. If you believe you have those qualities get back to the person who provided you with this information TODAY