Network marketing has become the new buzzword in the business world. The concept has existed since well over a century now, but it is only now that people are realizing the full potential of this activity. In addition, the great amount of money that comes in with relatively little efforts is something that simply cannot be denied. The advent of the Internet has definitely made network marketing much easier and today people like Donald Trump and Robert Kiyosaki are pronouncing it as the best home based business activity to pursue.
So what is network marketing actually?
The idea behind network marketing is to build a team of people in a network who will all be selling the same product. The person who starts the network will have a product to sell. This person will try to look for more people who can sell the product too. The people who join in will become subscribers to the network. They may even pay a fee to the initiator of the network to be in it. At the same time, they are selling the products, for which they retain a commission. Now, these people will look for more people under them, with the same factors as are applicable to them. In this manner, the chain continues to grow. Each person in the chain sells the same product and keeps a commission. The commission will be higher for the members who are higher up in the chain.
Network marketing is also known as MLM, which is in fact a more popular name for the activity. MLM stands for Multi Level Marketing.
It can be easily understood that the greater the network grows to be, the higher is the profit for everyone involved. Therefore, the primary endeavor of everyone in the chain is to recruit as many people as possible. Simultaneously, they have to sell their product to as many people as possible too.
The money for any member will directly depend on the number of members in his or her downline. For that reason, people at top positions in the MLM networks take their roles as leaders very seriously. They hold several seminars and workshops for their downline members so that they can perform more effectively in recruiting new members and improving sales. These kinds of activities usually move throughout the downline.
Though network marketing is a typically online phenomenon nowadays, it is absolutely wrong to say that it is a very easy activity. There is always something to be done and usually it is about recruiting new people into the network.
You have to keep this point in mind if you are wishing to pursue an MLM activity. The business model is simple enough for anyone to understand it and begin their foray into it. However, to really succeed, you have to devote time, be a 'people's person' and constantly keep yourself updated about what's happening in your chosen niche.