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The Myths of Network Marketing

Myths are a unique phenomena. They begin with a seed of truth and mushroom into a story of grand fictional proportion. Homer's Ulysses. The Loch Ness monster. Almost any myth you choose to explore has at least a kernel of truth. However, the truth becomes barely discernible or completely lost in the fabric of the story surrounding it.

Network marketing has its own set of myths, most of them destructive, that can at times obscure the essence of the possibilities inherent in network marketing. In this article, we explore the most common myths surrounding network marketing. You'll recognize once again why network marketing, of which you are an important part, is such a terrific business system.



Myth: It's A Pyramid Scheme

Truth: It's A Network Marketing Business Model

Alarms go off. Lights flash. "Warning! Warning! Get-rich-quick scheme approaching!" The association of pyramid schemes with network marketing is one of the most common and most damaging myths defacing the industry's image today.

Do pyramid schemes exist? Yes. According to the Direct Selling Association (DSA), pyramid schemes are growing in number. This is the kernel of truth. Are all network marketing opportunities to one degree or another pyramid schemes? No. This is where the fiction begins.

A true network marketing business model involves the following:
  • A quality product 
  • Compensation for sale of product (not sponsorship of others) 
  • Sponsorship of others into the business to create a network of distributors 
  • A direct-selling format (people to people) 
  • An opportunity in which every person in the network can rise to the top of the compensation plan
This is not the case in a pyramid scheme. The following three factors distinguish a pyramid scheme from true network marketing:
  • Lack of a viable product 
  • Financial reward solely for recruiting others 
  • An opportunity in which only those in the program at the beginning truly make the "big bucks"

Pyramids often require a significant outlay of cash with no viable product in return. The cash is then distributed among those at the top of the pyramid and there is none left for those at the bottom. In true network marketing, the opportunity remains the same for those at the top and at the bottom. The amount you earn depends on productive effort.

How can you distinguish a true network marketing opportunity from a pyramid scheme?

Leonard W. Clements in his book, "Inside Network Marketing", uses three questions to make the distinction:
  • Would anyone realistically ever purchase the product or service without participating in the income opportunity? 
  • If all recruiting stopped today, would the company be able to pay monthly commissions in the months ahead? 
  • Can the most recent person to join the company still make money?
Some companies claim to be network marketing companies, but are actually pyramid schemes thinly veiled by a flimsy product, a one-time-only purchase, or even the claim that "everyone gets rich." In truth, the final tiers of participants in these schemes never see a return for their investment, no matter how hard they work or how much they invest.

Is this the norm in network marketing? Absolutely not. In fact, organizations like the DSA work hard to monitor the industry, promote true network marketing, and expose those schemes that would destroy the reputation of direct sellers. The DSA has joined with the Federal Trade Commission and with the states’ attorneys general to crack down on such schemes.

Meanwhile, there are hundreds of valid, reputable network marketing companies. As our industry works toward self-regulation, pyramid schemes are exposed more rapidly, and genuine network marketing opportunities are seen more favorably. You will have no trouble presenting the AIM business opportunity to others, as its integrity is based in a true network marketing business model.




Myth: You Will Offend Family and Lose Your Friends in Network Marketing

Truth: Network Marketing Is a Great Way To Build Relationships

Have you ever talked with someone about the AIM business opportunity, only to be rebuffed with, "I don't want to lose my friends"?

Where did that concept come from?

The myth that network marketing is in and of itself offensive actually began in the early days of network marketing. A strategy was adopted in which network marketing became your life and anyone who didn't join you in the program was in your way. You just had to ignore them. No wonder people - friends, family, even strangers - became offended. The principle of focusing your efforts was misused and the myth grew.

Networking is all about building relationships. It does require you spend your time wisely and not focus your efforts on people who are not interested. But it also includes maintaining strong, caring relationships with those who are in your downline, as well as with those who do not choose to join you in your business or even use your products.

The most successful network marketers in the industry today build relationships and teach this important aspect to their downlines. The late John Kalench was a tremendous example of this principle. A successful network marketer and gifted trainer in the field, John said his goal in network marketing was "to make a million friends before I die."

Not only was he successful in business, but as he struggled with cancer, he received cards, letters, and support from thousands of friends the world over. He was truly wealthy.

You have a choice in how you network with people. Network marketing does not cause offense, the presentation does. If you present yourself and everything you offer with genuine care and respect for the person with whom you are talking and are willing to accept "no" for an answer - and stay friends - you will discover a reward this myth has covered up.




Myth: Network Marketing Is a Numbers Game

Truth: Network Marketing Is About Making Each Person Count

This myth is closely tied to the previous myth. When people began running through their friends, rejecting anyone who didn't show interest, network marketing did become a numbers game. You had to go through thousands of people to find the few who were so motivated that they popped right out at you.

The seed of truth in this myth is that, yes, you do have to talk with people all the time if you want to grow. The myth is that if you "play the numbers," you'll "strike it rich."

The way to truly "strike it rich" in network marketing is to make each person count for you. Instead of running through the crowd like an out-of-control cement truck, leaving body bags in their wake, true network marketers value every person they contact. They learn the neds of people and focus on meeting those needs. If a person is not interested, they have at least won a friendship.


Myth: Network Marketing Is Only Good For The First People Who Join The Company

Truth: Network Marketing Provides Equal Opportunity For Everyone

In a true network marketing opportunity, every single person from the first person to sign up to the millionth person to sign up, has the same opportunity to move up in the compensation plan and earn substantial income.

If only the first folks can succeed, you are not looking at a network marketing opportunity; you are looking at a pyramid scheme.




Myth: Network Marketing is Easy Money 

Truth: Network Marketing is Hard Work

This is perhaps the most diabolical of all network marketing myths. The seed of truth here is that when you love what you do, work hardly seems like work. The reality of network marketing is that you must have a plan and work that plan diligently to see the rewards network marketing can offer. Network marketing is hard work!

So why is this a diabolical myth? The idea of easy money comes from those devastating pyramids. When people enter network marketing with the expectation that “it’s easy money,” they are soon disillusioned to learn that they must make contacts, present the products to people and sell them, follow up with customers, and train their leaders. If this isn’t what they expected, they become soured on the whole concept and feel deceived.

There is no free lunch in true network marketing. While it is one of the most rewarding and incredibly powerful business systems on earth, you earn every reward you receive. Help debunk this myth by letting people know up front not only the unlimited potential, but also what it takes to build a business.

The beauty that you uncover by unraveling this myth is that the hard work of network marketing is all about making a difference in people’s lives, the most rewarding work you'll ever do.

The most important weapon you have in dispelling these myths is truth, and the greatest truth of all regarding network marketing is that network marketing is what you make it.

P.S. To read the story of The AIM Companies™, based out of Nampa, Idaho, Click Here.