This post covers various aspects of network marketing – direct marketing, affiliate marketing and multi-level marketing and making comparisons with direct sales.
This term is truly related to the distribution system. This is the marketing and sales of direct products to consumers from fixed retail locations namely brick and mortar. The longest form of this sale is actually peddling! Modern direct sales include sales carried out through one-on-one demonstration, party plans, other personal contact arrangements such as home parties and internet sales. The definition of textbooks is ‘direct personal presentation, demonstration, and sales of products and services to consumers, usually in their homes or at their work’.
According to WFDAS (World Federation of Direct Sales Association), consumers benefit from direct sales due to the comfort and services provided, including personal demonstrations and product explanations, home delivery and guarantee of generous satisfaction. Costs for individuals to start independent direct sales business are usually very low, in relation to franchises, with little or no inventory needed or other cash commitments to start.
Direct sales differ from direct marketing because this is about individual sales agents that reach and deal directly with customers. Direct marketing is about business organizations that are looking for relationships with their customers without going through agents / consultants or retail outlets. Direct sales, often but not always, use multi-level marketing.
The largest direct sales company based on revenue in 2010, according to direct sales news is:
Avon Products, Amway, Natura, Vorwerk, Herbalife and Mary Kay
Difference between network marketing and multi-level marketing
Multi-level marketing is where sales power is paid for sales and for sales made by the people he has recruited himself or sponsored than a single level marketing where salesperson is only paid for sales. This marketing strategy is where the power of sales is compensated not only for the sales they produce personally, but also for the sale of other people they recruited, creating distributors and hyierarchies of various levels of compensation. Other provisions for MLM include sales of pyramids, network marketing and reference marketing.
The usual course is that sales power is expected to sell products directly to consumers through relationship references and marketing by word of mouth. Some people use the term ‘direct sales’ as the real name for MLM, even though MLM is only one type of direct sale.
The MLM company has often become a subject of criticism and the target of lawsuits. Criticism has focused on their similarities with illegal pyramid schemes, installation of product prices, high initial costs, encouraging if they do not require people to buy and use company products and place emphasis on recruitment on the recruitment of tiered sales power. Often these companies have complex compensation schemes and sometimes excessive and a little integrity when it comes to dealing with members and their people in general!
Difference between network marketing marketing and marketing
Affiliate marketing is marketing practice where business businesses are one or more affiliates for each visitor or customer brought by its own affiliate marketing efforts. Examples include gifts, sites where users are valued with cash or gifts; For resolving offers, and other people’s references to the site. The industry has four main players: traders (also known as ‘brands’ or ‘retailers’), networks (which contain offers for affiliates to be selected and also handle payments), publishers (also known as ‘affiliates’) and customers. The market has grown in complexity to guarantee the level of secondary players, at
