Affiliate programs are great and can make you some good money. I like to think of affiliate programs as network marketing “lite”. Most affiliate programs only pay 1 or 2 levels deep and more often than not relied more on my personal efforts. What they are missing is “leverage”. You know, OPE (other people’s efforts) and OPM (other people’s money). As I understood this better, it was natural for me to graduate to Network Marketing.

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Along with the explosive growth of the Web has come explosive growth in Internet fraud and “get-rich-quick” schemes. Beware of such claims! Educate yourself about the differences between what constitutes a legitimate business opportunity and Pyramid Schemes, Ponzi Schemes, and Related Frauds.

Multi-Level Marketing
Multi-Level Marketing or Network Marketing has long been associated with fraudulent “get-rich-quick” schemes. Certainly any economic endeavor will attract those looking for the fast buck and those unscrupulous ones who are determined to separate your from your money. What’s new about that? You even find those folks on Wall Street and in Washington, D.C. The trick is to separate the frauds from the legitimate opportunities. And, there are legitimate opportunities!

A long standing principle in the Free Enterprise system is “buyer beware.” It is the buyers responsibility to educate themselves so they can make an informed buying decision.

Corporate Cover-Up
The truth is, ALL businesses are structured as a “pyramid.” You have the owners, CEO’s, and other executives at the top of the pyramid with the management people in the middle and the workers at the bottom.

The difference between this corporate pyramid structure and legitimate network marketing companies is that in the corporate environment, those at the top have a vested interest in protecting their elevated positions at the expense of those below them. In network marketing, ALL those in the business have an EQUAL opportunity to share in the overall success of the business. Indeed, it is not uncommon for someone to enter towards the bottom of the pyramid structure only to rise in a short time to a top level position in the company. You WILL NOT find that sort of opportunity in the corporate pyramid.

There has been a long standing conspiracy in our society perpetrated by corporations, labor unions, government officials, attorneys, educators, and others to protect the corporate pyramids and the wealth they assimilate. In fact, we are all involved in network marketing every day of our lives. We recommend movies, restaurants, books, music, stores, services, and the whole gamut of business. But, rarely are the ones who are making those recommendations rewarded for doing so. In multi-level marketing, all those along the chain who recommends products and services are rewarded for their efforts. In the corporate environment, or “single-level” marketing when you make a recommendation the company keeps the rewards for themselves.

The corporate pyramids indeed have an economic interest in maintaining their single-level marketing system and keeping the truth about multi-level marketing from the public.

In more recent years Network Marketing has been gaining in acceptance and popularity. It is proving itself to be an effective, professional, and rewarding business model. Witness the growth of “Affiliate Programs” on the Internet. Affiliate programs ARE multi-level marketing. Nearly all business that market on the Internet now have an affiliate program to reward others for recommending their services.

I’m sure you’ve heard of Amazon.com. That is network marketing. Amazon.com has not grown to be the company they are by adhering to old business practices. No! They offer their network of thousands of affiliates (network marketers) commissions for recommending books and other products.

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In the search for the quickest way to get rich, many people fall prey with promise of easy money. One example is the idea of multi-level marketing (MLM). Multi-level marketing (MLM) is also known as network marketing and referral marketing. MLM is easy enough to understand. Imagine you have a product to sell. A common MLM product is a vitamin or mineral supplement. You could do what most businesses do: either sell it directly to consumers or find others who will buy your product from you and sell it to other people. MLM schemes require that you recruit people not only to buy and sell your product, but who will also recruit people who will not only buy and sell your product but also recruit people thus perpetuating a never-ending cycle. Only there is an end to the supposed self-sustaining business practice of MLM.

If MLM sounds too good to be true, then maybe it is. Most traditional business people would never consider such a venture. Why would you recruit people to compete with you? Isn’t that what you are doing when you recruit people to sell the same products you are selling? The MLM lure will convince you that it is reasonable to recruit competitors because they won’t really be competitors since you will get a cut of their profits. This will take your mind off the fact that no matter how big your town or market, your possible recruits will never be exhausted. But the well will go dry soon enough.

Multi-level marketing (MLM) is system of marketing which puts more emphasis upon the recruiting of distributors than on the selling of products. MLM is very attractive, however, because it sells hope and appears to be outside the mainstream of business as usual. It promises wealth and independence to all. Unfortunately, no matter what the product, MLM is doomed to produce more failures than successes. For every MLM distributor who makes a decent living or even a decent supplemental income, there are at least ten who do little more than buy products and promotional materials, costing them much more than they will ever earn as an MLM agent. There will always be some MLM distributors who will make money in an MLM scheme. The majority, however, will fail due to the nature of all pyramid schemes.

A pyramid scheme is a fraudulent system of making money, which requires an endless stream of recruits for success. Recruits (a) give money to recruiters and (b) enlist fresh recruits to give them money. A pyramid scheme is called a pyramid scheme because of the shape of a pyramid: a three dimensional triangle. If a pyramid were started by a human being at the top with just 10 people beneath him, and 100 beneath them, and 1000 beneath them, etc., the pyramid would involve everyone on earth in just ten layers of people with one con man on top. The difference between a pyramid scheme and MLM marketing is that the latter is a legal business practice. A pyramid scheme does not sell any product and only requires a monetary investment from the down line for them to succeed.

MLM only benefits the company because the more recruits they get, the more money they receive from their share of the down line’s recruits. Aside from that, the costs that these recruits spend on are not covered by the MLM company. In the end, they lose more money than earn it.

Article written by Michael Sanford

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