Analysis of MLM Network Marketing IndustryBy Ali Yasin
I am writing this analysis to review the Network Marketing Industry, my goal is to highlight the stage of growth of the MLM industry from its conception starting in 1959. I want to highlight, what is taking place to change the industry and what will change the industry to be a part of the main stream marketing leaders such as the franchise industry which started out with a negative image and today is the primary business model of small business. Network Marketing is on track to duplicate the franchise industry. The visionaries in this industry will become millionaire and create millionaire within their organization
Before I analysis the industry I will give an overview of what’s going to have a major positive effect on the industry and for those who can see the future, there will be many who will benefit financially with an incredible financial rewards.
This Stage, is important, I want to talk about is the third stage of Network Marketing, focusing on the compensation plan and structure and international growth.
The new an innovated concept is call a “straight line compensation” with a “Personal Group Uni-level “ with a profit sharing pools that allow distributors to participate in the profits of the company.
The third stage of network marketing is base on what I call “Corporate Profit Sharing” through sharing the wealth of profits of the company worldwide. “One Team One Dream One Mission” “The triple One’s” concepts is the third stage. Here is an overview of the concept and the company that is position to take this concept to the world. The company Angel Xyngular is part of this movement and is poise to build an international straight line with an unlevel system that will guarantee international residual income to the average person who wants to start a business and join this worldwide movement.
Three Stages Of Growth In Network Marketing
All industries passed through periods of growth and decline as they evolved from the early ideas and of innovative technologies of which they began to and accepted and mature position in society. MLM network marketing is today where franchises was 40 years ago although everybody seems to have heard of this relatively new phenomenon called Network Marketing few of us really understand it. There is a great deal of skepticism in the public mind caused by an unfortunate reputation of false claims such as illegal pyramid, schemes manipulative systems.
In marketing and industrial development, there is a growth and decline curve which describes three distinct phases of development of a product or service or idea the first phase is the innovative cycle; the second is the infrastructural cycle; and the third mature stage is diversification cycle.
The Innovative Cycle
This first stage of innovation has a high level of excitement experimentation and instability many companies start up with this excitement of ideas only to disappear within a year to 18 months. There have been thousands of MLM companies to start up and to go out of business and some of them with superior products and promotion and plans this startup always began as good news when the idea is unique or exceptional and ends with leaving a bad taste in the minds of new distributors in the network marketing industry there are several reasons why thousands of companies has failed in network marketing.
1. The product does not meet the expectation that is claim by the company or is enthusiastic distributors who sales the opportunity and does not really focused on product. The question become how important is a product how important is the compensation plan how important is the management of the company all three are equally important product, compensation and management. It is important to understand that all three are essential in selecting a successful company, but the one that stands out and all three being equally important would be the product.
A good example of this would be Amway which has superior products and has taking a simple product such as soap the two founders Jay Vandal and Richard Devious to a $500 investment and started Amway in a basement. Amway today has grown to a multi-billion-dollar empire an the number one leader in the industry. Amway does not have a lucrative or impressive compensation plan but by developing a superior product first and good management and training, Amway is one of the top leaders in the world today in network marketing. Their model is simple provide good products, and support for their distributors by providing leadership and education to his leaders the product, management and compensations gives Amway the foundation for it success
2. Overreacting from the government after hearing about $10,000 of thousands income and large investments of thousands of dollars to sign up as a distributor has shut down many companies in addition controversial products and ingredients and results is caught by the media which has put many companies out of business. Therefore throughout the past 10 years there've been many guide lines legislative laws passed by the Government to prevent taken advantage of new distributors to start a network marketing business. Today 90% of all start up cost to be a distributor in a Network Marketing company is under $500
3 The lack of capital required improvements to the companies supporting infrastructure
Only about 2% or less of the potential market is actually developed during this stage. This is because the majority of the distributor attracted to the Network Marketing industry is mainly those willing to give something a try. They are innovative and enthusiastic about the new idea and or products. They get emotionally involved during this stage but often like a strong commitment to the long-term efforts. Eventually, they either leave or stay in the Network as wholesalers consumers of the products. At this point the industry is supported by a small core of committed leaders who successfully process and developing viable organization to a few strong network marketing companies
Network marketing is in this stage today the second stage
Is supported by a small group of enthusiasts about 2% relative to the population and the market potential, and a high turnover of many new companies only one and several hundred startup companies and by the are many entrepreneurs who recognizes the potential of the network marketing industry they want to see how it works and they want to take the time to expand its ability in his application. Of many of the leaders are reluctant to become involved because of instability in the industry this overall poor image is in the mind of the public. And finally of course there is the toll of the skeptics who cannot see MLM or network marketing as a significant economy developments that the majority of the distributors who continue to use the products do not at the same time continue to Share the opportunity. In some cases this is because of the amount of time at work required to manage the business on a part-time basis. But more often, it is because of the image of the company or MLM which exist in the minds of their friends and relatives and colleagues; that is, there are potential" warm market – circle of influence" for the product and opportunity
The infrastructural cycle
The second phase is achieved by far fewer companies and fact there are usually only one or two clear leaders with generally improve service and infrastructure these do have adequate finances to develop the infrastructure and to educate and advertise in order to promote an understanding of the industry as a whole, as well as to create a favorable image for their particular company. There is more stability of growth going this cycle as a greater portion of the market is penetrated – estimated to be about 10 – 15%
The main participant in the second cycle are the real industry builders the apparatus on the basics of knowledge meeting the needs and wants of consumers – often through innovation the marketplace previous did not know it wanted or needed
The Diversification Cycle
The third cycle is characterized by product diversification and competition here one finds the majority of uses of all products and services
The Crucial Second Stage Growth
While innovation and experimentation highlights the first stage, improve service and education characterized the second stage. An interesting fact in the second stage is that every company starts out with the goal to be number one, no more than one company in a particular category will be number one and this company will be a recognized leader there's really only one which steps out to be in front.
there is Mike down those in franchising. Each company has become a household word
In MLM network marketing improvement service related not only to distributors but also to information technology.
Three common facts for industry leaders
There are three common facts was distinguished second stage leaders from first base card companies
1. Afforded development of infrastructure, which includes improving products, a service as well as comprehensive education ethic and advertising
2. Efficiency and the cost effectiveness of the products and services, to the extent that they are able to surpass all other comparable enterprises
3. Education and training program, which not only includes the professional training of distributors, but also government authorities the media and the academic community.
Conclusion history today has shown that the leaders of the first days of rarely if ever deleted at the second stays. Network marketing in the second stage would be seen as different from MLM TSS CB radio on radio telephones are distinguished from cell phones today the second phase of growth for our industry would be technology intensive driven by education and based on a complete new infrastructure
Very large number of people who have been exposed to MLM and have had a glance of the potential of this dynamic marketing concept. I have a, the experience of many of those so expose had been less than satisfactory, the competent they were associated with may not have survived in the marketplace; the students support system may have been an adequate Simpson: but it may have liked the knowledge and training to develop into viable business.
In many cases even with a good product and an attractive marketing compensation plan, growth may have been stopped by the lack of acceptance in the marketplace, often caused by negative press and generally general misinformation. The result is that these people have become discouraged and skeptical about the potential of any MLM company to sustain long-term growth.
Traditional MLM would attract this vast audience. Similarly, there is an equally large number of people who would be attracted to a network marketing company of this time once they understood how network marketing really works and who the real leaders are
Develop and attend the 10 – 15% mark it means needing the names of those consumer primary orientation is “knowledge and want” there world is one of busy careers, and income families and limited free time. These are the real part-timers who will, in chores, want to be involved for either income diversification or for the service – but would not likely display any passionate drive to development a large enough income in order to quit their existing jobs.
They will promote their warm market only “Join – the – club” basis; as long as the product and service are efficient and the company’s image is a positive one (this is what is now becoming known as ‘gravine marketing”
If a network marketing company can success successfully in this particular market, its growth could be explosive and sustainable. Image advertising is, therefore, important; but it must follow the development of the educated advertising as well as a conscious infrastructure of servers needed to support “gravine”
Example the internet was design not for the purpose we use it today The origin of the concept was put together by a research team it was initial commission by President Eisenhower to respond to Russia launching of a Satellite call Sputnik and This happen in the early 1950 a group of researcher and scientists working on a research project call ARPA this research team headed by three scientists who created a programming system to exchanging information call “packet switching” the system is still used today to transfer information the example here regarding the Internet, something you can related to I use the internet because we are all familiar with how the internet has change our live. Everything has a beginning stage; we talked about different stages of growth in Network Marketing. Going back to the 1960s and original stage as the Internet was being developed based on idea of exchanging information at this time the whole world look at the internet as a crazy idea, no one had an idea of the importance of this concept of exchanging information through a network could be or the impact it would have on future generation, however we have all seen the third phase of the fourth phase of the Internet technology how important this idea was back in 1960, so as in any business or industry there are stages first phase second phase that each idea has to go through just like in and today network marketing is coming of age to be just like the Internet as ability to have a ripple effect around the world the benefits that you can have to this phenomenon the Internet and network marketing couple together could create for you and your family over the last 50 years there've been stages and phases of growth in the industry and today just as the Internet was developed in the early 60s so was network marketing created in the early 1950s just as the Internet went through different phases so has network marketing the phase that we are now is new ideas innovated concepts of compensation plans up be in develop to broaden the financial benefits to the new numbers and distributors come in and to network marketing companies today
Al Gore did not invent the Internet. The Internet was invented in the United States during the late 1950s to the 1970s by a group of researchers and scientists at the newly formed Advanced Research Projects J. C. R. Licklider, the head of the Information Processing he thought up the idea of the Internet itself as a way of potentially unifying humans from around the United States (and the world) through a universal network. Lawrence Roberts. Roberts went on to lead the team which would eventually develop ARPANET (the early precursor to the Internet) in 1967. He was the scientist to finally utilize the proposed method of packet switching first created by Leonard Kleinrock. The Internet still uses packet switching as its primary way of transferring data. Lawrence Roberts. Roberts went on to lead the team which would eventually develop ARPANET (the early precursor to the Internet) in 1967. He was the scientist to finally utilize the proposed method of packet switching first created by Leonard Kleinrock. The Internet still uses packet switching as its primary way of transferring data. ARPANET was finally changed to the more easily pronounced Internet.
In the development of the auto industry, the automobile is often referred to as the “horseless carriage” or the mechanical bride because of the emotion involved of the enthusiasts who are mechanically inclined on the racer this The did not see it replaced and the horse all even be a widely use, because of the requirement flows smooth surface to drive it on as well as a requirement to carry adequate fuel for the trip and to provide mechanical support for the proper functioning of the vehicle new paragraph division who led the second stays with those who saw the potential for the industry with frozen highways and service station these were the committed leaders who developed the second stage