MLM Soft Online
 May 9 2022 12:08PM

What is Network Marketing?

Network marketing is a method of marketing through which individuals make efforts to grow networks for creating customers for a business or product. The networks are also used to generate leads and recruit customers or partners, usually implementing a training and mentorship process for recruits.

Types of Network Marketing

Here we have discussed the different types of network marketing to understand how they performed in different situations.

  • Direct Marketing

Direct marketing is also known as a direct form of sales. Under this single-tier marketing system, an individual register for a program to sell a product or service and are required to recruit other distributors and receive payment for the direct sales they make.

  • Affiliate Marketing

Affiliate marketing is a new form of network marketing by uses online affiliate marketing programs provided by other businesses. In this method website, owners and bloggers integrate links to specific products on their platforms. Visitors on the website when clicking on those links and purchasing products, the website owner is rewarded a referral fee. Amazon's affiliate program is one of the most well-known.

  • Multi-level marketing

Certain direct sales organizations employ multi-level marketing (MLM) which allows existing distributors to recruit new distributors in exchange for a portion of their recruits' sales. The recruits are the "downline" of the distributor. Distributors also profit from direct product sales to clients. Amway is one of the best examples of such kind of network marketing.

Benefits of Network Marketing

Get to learn with us advantages related to the Network Marketing below in the article:

  • There are absolutely no restrictions related to the size of the network marketing structure. A company can tie up with innumerable people to become distributors. Further, distributors can coordinate with other sub-distributors to expand the company's sales.
  • Due to a reliable and robust distribution network companies rely less on the advertising of products or services.
  • Companies do not bear the burden of profit margin for the retailers as the structure of distributors also reduces the profit margins of retailers.
  • Companies will require less to spend money for storage and distribution of the product because distributors bear these expenses.

Finally, this structure allows distributors to earn an unlimited income from their dealings with the company. They can earn an income from their profits as well as commissions.