Why don't Multi Level Marketing programs (MLM's) work?
- 1 decade agoFavorite Answer
A majority of MLM s are product based business, that require to varying degrees, knowlege of marketing, and are run by people with absolutely no knowlege of marketing. Or knowlege of business, or maybe they're missing a "backbone", to tell thier upline to shut-up (all this comeing from a MLM'er) the attrition rate is staggering to say the least, around 95%. and I would say that most of this can be attributed to several reasons.
One - The up-line management totally mis construed the business, or purposefully side stepped the issue of 'work', in light of high returns and good times, leading the prospect to focus on the wrong element so when the time comes to start the business venture, they don't know what to do, panic, and try to save face by buying themselves into a bracket.
Two - the up line doesn't support thier downline by giving any knowlege, because some uplines may want thier downline to sell, or buy, but not enough to get a bonus, because thier bonus comes out of thier uplines bonus, so let them buy, to boost the uplines bonus check.(Im reading alot about this topic here)
Also its totally posible that the upline themselves dont know how to work the business, so they "fake it till they make it", and really dont know how to help out thier down-line, and may be they would if they could.?
Two they just don't want it bad enough. (or bad enough to put the amount of time required to achieve the amount of success they want)- or are going about things in a poor way.ie. if they lack confidence, they will fail. Are you gonna start a business with anyone who appears to have a negative display bout theyre business? Even if they talk a good game, body language can be noticed by anyone, and percieved as a "scam alert" even if it's a perfectly legitamate business (like a 6th sense).
Bottom line: Don't expect to set the world on fire if your kindling is all wet.Source(s): MLM firepower,pro-sumer power,Mark of a millionaire,Think and Grow Rich, How to Win Friends and Influence People, Magnetic Sponsoreing
- 1 decade ago
A better question would probably be why do you think MLM's don't work? There are many examples of large companies using this structure. Most that fail put too much wight on the earnings that can potentially be made rather than a decent product/service.
Money has to come from somewhere. If the product is no good then the MLM structure will not help it.
- 1 decade ago
They do many times, but they are limited by what I call the saturation factor. Especially when they are based around a solid product or offering. Tupperware and Amway are two examples. They worked quite well, but at some point, as the joke goes, whenever a group of people gathered half of them were trying to sell products to the other half. That is when the multilevel part starts to not be so attractive, but it sold a ton of product for a long time.
- 1 decade ago
MLM work if you business good. And your product is high Quality and not too expensive.
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- Anonymous1 decade ago
Because they sell crappy products at inflated prices.
Like $20 for a knock-off version of a perfume, that barely smells anything like it, and cost $1.50 to make.
That's why everyone quits, because after they screw over their friends and family and get them to buy the stuff, guilt sets in when they realize it was all garbage.