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What is MLM?

What does MLM Mean?

MLM mean Multi-Level Marketing

There are other names that are given to MLM such as Network Marketing, Referral Marketing and pyramid selling.

What is an MLM Business?

MLM is a marketing strategy for selling products and or services.

The selling of these products and or services are carried out by people that will sell and earn commission for each product and or service that they sell.

One of the reasons why it is called pyramid selling is because of the way that they compensation commission is structured.


Rep Rep Rep Rep Rep

It would look something like this.

However each MLM Company will have their own compensation plan for paying their reps earning but typically they offer two potential income streams plans for paying their reps.

The first way of earning commission is from the sales made from selling direct to retail customers.

The second way is based on the sales from other reps positioned in your downline.

What is a Downline?

A downline is a group of people that have been invited into an MLM business program.

For example, say you are a rep of an MLM company and you invite 6 people to join you.  You will now have a team of 6 other people.  In MLM these 6 people will be position below you and will now be your downline.

Any sales that they make will filter up to you, without you having to do any selling yourself.

Your downline will still get their commissions and you will get a percentage of their commissions, because you introduced them into the MLM business, they are now your downline.

What Does a MLM Sales Person Do?

As an MLM sales representative you will be expected to sell products and or services directly to the end-user (retail consumer).

The way that this is normally carried out is by building relationships, getting referrals, word of mouth marketing.

You will also need to build a team of people who will do the same. You will invite / introduce people to the MLM business and the company will train them about the business and the product and or service that they are offering, the same way that you would have been trained.

The trainings are normally carried out by attending seminars, webinars, video training and or e-learning.


What the Studies Show

Studies have shown that in there research of 350 MLMs, that at least 99% of people who join MLM companies lose money. (Federal Trade Commission’s Website).

“However they also state that many MLM companies continue to function because the downline participant are encourage to hold onto the belief that they can make large sums of money whilst the stats say otherwise.”

My Thoughts

I have met a lot of people over the years that are involved in MLM businesses and they are very wealthy.  They have also informed me that they would not use another method of making full-time income.

I would always say to anyone that if you are going to get involved in any business, MLM or Affiliate Marketing, to Window clean, fashion industry or Travel industry.

Do your own research and make sure that you are comfortable in getting involved before you do so.

Because to make any business venture work and to see the full potential of any business you are going to have to work hard and put the time and effort that it needs to become fruitful.

You may also be interested in my…

Book Review – Go Pro 7 steps to becoming a Network Marketing Professional.

If you want to take a look at a MLM Company, then you can take a look at the one that I am currently a part of.

By taking a look I am not asking you to join, that choice I leave totally up to you.

You can also see my review of this MLM Company HERE.

PlanNet Marketing

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