Is Network Marketing a Scam?

Are you ever tempted to click on one of those links?  You know, the ones that say, “(fill in your company) is a SCAM!”  If you do, you are likely to find one of two things–someone trying to sell you something to help you build your business or someone who absolutely hates network marketing trying to tell you that network marketing is only for liars and cheats and no one makes any money doing it.

CREDIBILITY

Unfortunately for these latter folks, the truth is that network marketing is anything but a scam.  When you have people like Donald Trump and Robert Kiyosaki, well known for their financial genius, telling people that network marketing is a great way to build wealth and buying/supporting network marketing companies themselves, that adds tremendous credibility to the profession.  Not to mention the fact that many well-known corporations, like Nestle, are creating their own networking companies to sell their products.  If network marketing truly were a ‘scam,’ it is unlikely that these folks would invest in the system.

Check the credibility of the folks running these sites insisting that network marketing companies are scams–are they multi-millionaires with a track record of building residual income and financial freedom for themselves?  Probably not.

WHAT ABOUT THE 95%?

What about the 95%?  You know, the 95% who supposedly “fail” at network marketing?  It is true that many people don’t make much money in network marketing.  There are actually several reasons for this.  First, many people just give up too soon!  Maybe they get discouraged quickly.  Maybe they have life events that compel them to focus their attention elsewhere.  Or maybe they find the grass greener somewhere else and jump from company to company, never giving themselves a chance to succeed.

Second, many people who do not make a profit with their company never joined to build a business, anyway!  I recently signed up as a distributor in an old friend’s company.  I NEVER PLAN TO BUILD A BUSINESS OR RECRUIT ANYONE FOR THIS COMPANY!  Is that a surprise to you?  Why would I sign up as a distributor if I don’t plan to build a business?

1) It cost me the same amount to be a distributor as a customer, so this helps my friend out.

2)  I get a little bit of extra money back on my purchases as a distributor.  It’s always nice to get a little money back, right?

3) You never know…I might someday find someone who wants to use these products, too–I do think they are pretty awesome.  I have a company that I am committed to, so I’m not looking for another opportunity. (People who divide their focus between multiple opportunities are less likely to be successful!)

4) I would much rather buy products from my friend and help her earn a little extra cash than from Wal-Mart, especially when the products are much better and save me money!

Finally, while there aren’t many people making 5 figures or more a month, millions are making a few hundred dollars a month.  Is working a few hours a week worth a couple extra hundred dollars a month for you?  It is to me.  That $200-500 a month can pay for groceries and gas, a car payment, etc.  Lots of people are just looking for a way to make a little extra money to make it through a tough time or to save for a vacation or new car.  While they may not be considered a success by others, they are pretty happy with their results!  (and it sure beats putting in hours at a fast food restaurant!)

Bottom line, when you see that “everyone fails” statistic, be aware of the reasons that those people don’t succeed and the reality that not everyone is in network marketing to make a fortune. In legitimate companies, everyone has a chance for success–but many choose not to make the most of this opportunity.  Case in point:  I recently heard a story of a woman who brought in one new rep in a skin care company.  She decided that it was too much work and quit.  That one recruit ended up building a multi-million dollar business–and that woman lost out on earning hundreds of thousands of dollars–because she decided to quit too soon!

THE TRUTH

The truth is that studies have shown that people who join a network marketing company and stick with it, using and sharing their product consistently, achieve success.  In fact, 95% of people who stick with one company for 10 years achieve success beyond their wildest dreams.  Were they ‘on the top’?  No.  Were they extra special?  No.  The key component to success for 95% of people is simply sticking with it.

So, yes, 95% of people ‘fail’ in network marketing.  BUT I like the odds for every single person out there who is willing to commit to 10 years with a company that they love, sharing a product they love with people they know and meet along the way.  Is it easy?  No.  But 95% SUCCEED if they are willing to do just one simple thing–STICK WITH IT!

PS  Looking for info on those “pyramid schemes”?  I’ll tackle that misconception in another post. 🙂

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