Description
Down the Rabbit Hole
Welcome to Network Marketing Structure – Part 2! Although this book is the second
part of a 2 part series, the content here is designed to be stand-alone and each book is
written with lessons applicable for every aspect in network marketing.
Let me just give you a few facts to ponder about:
Average network marketing companies today spend roughly a few hundred to a
thousand dollars on Compensation or Marketing Plan Training in just hall/training room
rental, speaker salaries and question and answer sessions! And to think that most
people assume that plans are all about numbers only.
If you plan to recruit professional networkers (people who do network marketing for a
living), and you hope to bring over their entire organization of maybe 50 – 2,000 people,
your chances of sponsoring them is close to zero unless you are an influential leader
yourself AND you know your company‟s marketing plan even better than the
company themselves!
These facts are definitely worth pondering. If I am running my own network marketing
company, imagine how much money I would save.
On the other hand, if I were building a network, I wouldn‟t want to lose my people to
networkers in other companies because of lack of training! If I am not careful, I
would lose up to tens of thousands of dollars!
In this book, we are taking a more in depth look at plan mechanics as well as
practical steps to boost your career. Learn the tips and tricks how to:
Avoid the various pitfalls of typical plans and how to use them to your advantage
Stay in control in spite of quotas and use them to drive your team to success
How to use products and create a cash flow generating machine
Work with the right people and the right plan to become a networking juggernaut
Learn other nifty secrets your upline might be too busy to teach you
In the words of THE MATRIX:
Those of you, who are ready to take the red pill in network marketing to get to the truth
behind the confusion, get ready to find out how far down the rabbit hole goes.
NOTE: Just like the first book, the applications of each chapter will once again be split
into 3 sections: Downline Building Strategies, Product Synergy, and Starting Your Own
6
Network Marketing Company.
7
Pros and Cons of Accumulation
What is accumulation?
In typical marketing plans, accumulation is a system of rewards that allows the
distributor to save up purchase products and accumulate the point value to reach the
next rank. For example: If I need 10,000 points to go from 5% to 10%, I can purchase
3,000 points in the first month, 2,000 in the second and the remainder 5,000 in the final
month so I would achieve the rank.
Advantages of Accumulation
It gives the distributor a longer time frame (sometimes no time frame) to move
from one rank to another giving them less pressure and less stress
Volume gained from sales in previous months doesn’t get flushed away.
Meaning, you can gather the volume, go away on a 3 month holiday, and you
can start immediately again as though you haven‟t left.
Protected against the effects of demotion (see later chapters)
Disadvantages of Accumulation
Encourages Front Loading and Buying Position (see later chapters)
No time frame means no pressure. No pressure means no incentive to go out
and look for sales so giving too much time frame also works both ways.
If there are no repeat sales in the business, you will have a hollow
organization. Most people stop buying or recruiting once they hit a new level in
an accumulation system. In other wards, since there are no quotas, you can have
10 Super Diamond Ambassadors in your organization who don’t buy anything.
Downline Building Strategies
To overcome the shortfalls of accumulation, educate your team to be good product
users. Emphasize on teaching them to buy stuff that has a high consumption and higher
repeat sales (like vitamins or skin care products). This way, you will not only have
income from recruiting opportunity seekers, when each downline has their own set of
customers and are consumers themselves; they will generate more volume from their
own purchases than from recruiting a new downline.
Remember: repeat sales are what keeps a business running long term.
Product Synergy
Just like a normal business, it is very important to have market demand. The reason why
the government has scrutinized the network marketing industry or has so many rules
and regulations is because most unscrupulous companies use the product as an excuse
to run a business. How do you spot one such company? Simple. The market will
saturate with many people accumulating lots of product but once there are no repeat
sales, the company will collapse and those former distributors will be left with tons of
8
stock that nobody wants. The litmus test would be this: If the company were to
disappear tomorrow, will you immediately think of how to get rid off or liquidate
your stocks, or find out where to get more of them tomorrow onwards?
Starting your Own Company
In addition to having good repeat sales, the company must also focus on enforcing an
80/20 or 70/30 rule where 70-80 percent of the products purchased by a distributor
should be sold to customers and the remainder 20-30 percent is used for personal
consumption. This will counteract the negative effects distributors accumulating products
only for the sole purpose of reaching the next rank faster
