Direct Sales Versus the MLM Business Model

A brief word about MLM

Regardless of your qualifications, MLM or Multi-Level Marketing companies offer business ownership opportunities to almost anyone who is willing to make a small investment in them. Most MLM companies offer certain benefits such as the ability to build a huge down-line and create a residual income. Additionally, MLM companies typically sell a wide variety of products to families and friends such as health supplements, household products, and vitamins to name a few.

What do we mean by direct sales?

Direct sales is a phrase that oftentimes referred to as multi-level marketing in that it is a channel for the distribution of retail products and services. The text book definition of direct sales is “the direct personal presentation, demonstration, and sale of products and services to consumers, usually in their homes or at their jobs” (Advertising and Promotion: An Integrated Marketing Communications Perspective by George and Michael Belch).

In the simplest of terms, direct selling can be defined as the marketing and selling of products directly to the consumer and away from a land-based retail location. In other words, you go to the customer – they don’t come to you. One-on-one demonstrations and other contact arrangements are the primary ways in which direct sales are conducted. Although a large percentage of direct sales companies employ some type of MLM compensation plan there are a few differences that distinguish one from the other.

The differences between each

Direct selling is about as straightforward a sales method as you can possibly imagine. The bottom line is that you have continually got to be selling in order to earn money. With MLM, you earn money by virtue of direct sales but you also earn residual income by virtue of that huge down-line that you have built. Direct selling also involves cold calling or going door-to-door to sell your products whereas MLM involves calling on people you know such as family and friends as well as benefiting from your downline doing the same thing.

Both sales models can be conducted online as well as offline but the principles remain the same in both venues as they do in the paragraph above. Most individuals are not really salespeople at heart. When this is the case, you will benefit more from engaging in MLM versus direct sales. In direct sales, you only have yourself to rely on for an income whereas you have a downline to help add to your earnings when you sell for an MLM company.

Another one of the key differences between direct sales, MLM, and other business ventures is the size of investment and the necessity to stock a product inventory. In the standard business venue, you need a number of things such as:

• a business acumen
• financial stability
• a larger amount of investment capital
• previous business experience
• product inventory

Although the above is not a hard and fast rule, the same does not hold true with direct selling and MLM. When you open your own land-based small business, you are going to have a considerably larger investment than if you were to get involved in either of these selling techniques. Just make sure that you do your homework before you decide on any business venture so that you do not throw your hard-earned money away.

Affiliate Success – Three Ultimate Internet Marketing Tips

Although many of the well-known methods of making money on the internet can be quite complex, when it comes to affiliate marketing, the process of setting up a business and earning money is something almost anyone is capable of doing. This is why joining an affiliate program is a productive way to learn the ins and outs of earning an income online. In order to be successful, Affiliates need to take the three tips below into consideration when they are setting up their enterprise. Getting the ball rolling is not difficult, as long as long as you learn from others, study marketing techniques and maintain your direction.

Seek guidance
As mentioned, the Internet is an inherently overwhelming place and even the most intelligent of individuals struggle during the early stages of setting up an Affiliate Marketing business. With the availability of specialized training and experienced mentors, there is no reason for an Affiliate to navigate these tricky waters alone. Training will teach you the most effective ways to make the most of your time, while a mentor is perfect for providing a sounding board and lending emotional support. For some people, intensive training coupled with having a mentor has proven lucrative.

Grasp effective marketing techniques
It is very important for Affiliate Marketers to not only learn the pros and cons of various marketing methods; they must also understand how to implement profitable promotional campaigns. Pay-per-click advertising is a tool utilized by many Marketers, but there is a learning curve with respect to this application. Those who fully understand pay-per-click programs are poised to make a lot of money with a business that virtually runs itself.

Take pride in your direction
To become a successful Affiliate Marketer, you must really become committed to your business. This means making efficient use of your time while always trying to stay one step ahead of the competition. Those who are proud of their efforts will tend to do a better job of maintaining their direction. If it is obvious to others – in real life or on the Internet – that you are serious about what you do, wealth will inevitably follow.

How to Pick the Right Direct Selling Company to Join

Ever wonder where that new neighbor got the money to build that new home in your neighborhood? Well my wife and I did. A few years ago we were driving around some neighborhoods in Salt Lake City, Utah looking for a place to move. We came across a hidden little neighborhood of brand new homes with new cars in many of the driveways. We were curious so we stopped a couple out walking their dog and asked them what everyone did to afford living in these nice homes.

To our surprise the couple said that the majority of their neighbors were self-employed and worked from home and half of them were already retired in their late 30′s to mid-40′s. What did they do for a living? The internet!

Shortly after that my wife and I had an opportunity to join a new direct sales company called Scentsy and it has been 5 years of work building a future, but here we are knocking on the door of early retirement.

We’ve tried a few direct marketing companies before so why did this one work for us? It took me a while to understand that it is a combination of opportunity, belief in the products, hard work, and yes just some dumb luck. I believe that there is plenty to share in the market so I want to help others understand what a career working from home with a direct marketing company can work for you too.

Opportunity:

No question that success in any business requires understanding of the opportunity. Basically this means will the business make money or not. With a direct sales opportunity you have to look to see if the parent company is still growing or is it in what they call a maintenance mode. Companies like Pampered Chef or Amway have been around a while so it is more challenging to grow fast compared to companies like Scentsy which are still relatively young.

But the age of the company is just one factor to consider. We have all worked for companies where we ended up hating what we did. So it is super important that you hook up with a direct sales company that helps you feel good about what you are doing.

Product:

Have you ever purchased something from a shopping channel or an infomercial on TV and later regretted the purchase because the product did not do what it advertised or was so cheaply built that it would break within days to weeks of the purchase?

I have. I’ve learned from those experiences two key things. First if you want to get in shape, hit the gym with a friend; secondly if you are going to be successful in a business over a long period of time you need to offer quality products and you have to feel good about selling and using them yourself.

One thing that made my wife and I love working as an independent consultant for Scentsy was the quality of their products. The flameless candle products are dependable, safe, decorative, and adds to our home. That last part is huge! We are not afraid to put the candle warmers out on display where our friends, family, and neighbors can see them.

Compare the feeling of confidence of a decorative item you are proud of to a weight loss shake, a bottle of some super anti-oxidant beverage, or an additive for your car. We actually have conversations started by visitors to your home about the products we are proud to represent in our business. This makes it much easier for us to be with the company for the long-haul.

Hard Work:

Not many people will come up with the magic numbers to win a power ball raffle. So your efforts towards financial freedom should be with an expectation that it is going to take some hard work to set up the finances for the rest of your life. But as others have said, if you love what you do, it really does not feel like work.

In the direct sales industry hard work covers three things. First it is putting yourself and the product in front of people to create the opportunity for success. Second it is providing the absolute best customer experience. Third is recognizing that along you cannot succeed, but that the success of the people you work for and the people you bring on board to work with you all add up to your long term success.

Les Miserable is a great example of a hard work and dedication. The authors of that wonderful musical totally flopped with their first release. They did not give up though. Instead they evaluated what went wrong and change the script and the music score and the result has been 25 years of fantastic fan reviews.

A bit of Luck:

Every success has a bit of luck involved. Luck in the direct sales industry occurs when the parent company has an explosion in the market right after you join; is evident when you sign up for someone that will help you grow your business, even if they are not your next door neighbor and best friend; occurs when you just happen to sign someone up from half way across your country or even a different country that becomes a rock star and explodes on their own.

One thing I have learned is that if you keep at something long enough the luck will find you. Eventually you build the success that will lead you to a financially independent lifestyle.