I’ve recently become a student of the network marketing business model. Why? Because aside from LIMBsimple, I also own a manufacturing company that makes soap from Pawpaw(Naturefeel), one other reason is my new knowledge of the interests of people like Warren Buffet, Windows(Microsoft), Robert Kiyosaki and Donald Trump in the subject. One other thing I noticed is people’s sort of hatred for the industry so I made it a point to try understanding this business model and sharing my knowledge. Here’s what I found out.
- First, their model is quite simple. Stop paying advert agencies, whole sellers, retailers and other middle men money and give all that money to consumers;
I found this to be quite interesting because as a manufacturer myself about 85% of the final retail cost of our product isn’t ours, we only get about 15%. 85% goes into adverts, markup by wholesalers retailers and other middlemen, so in short, wholesalers and the likes make more money than me, the manufacturer per unit cost. A popular Nigerian example of this would be the refer-a-friend promo of Swift 4GLTE. Instead of paying advert agencies(who are very overrated) they ask me, the satisfied customer to refer a friend and get 2months free internet service worth 14,000.
Hey, the A….Ing actually meant AMAZING!
- Secondly, their business model seem to be more measurable in terms of ROI(return on investment) for the company because you(the consumer) would have brought in a referral first before they compensate you. This is against dealing with advert agencies where you would have to spend billions and hope things work out. That’s perhaps why their compensation plans seem too generous most people consider it a scam or too good to be true.
- Thirdly, it seems to be a brilliant way of compensation for work done. As against people thinking it’s some kind of illegal pyramid scheme, I’ve found most of them to be quite the opposite. However, I’ve seen that in most cases people are compensated based on performance(referrals). So it doesn’t really matter when and how you get in, you and primarily you would only get what your performance deserves.
- Fourthly, it seemed somehow to have a huge promise of personal development. Some people I’ve interviewed seemed to think they’ve actually gotten to be better people by being involved in it. They seem to think(and for some it was plain obvious) that their presentation skills, business skills and so on has improved
- Lastly, I’ve met people who work in banks, own schools, doctors, lawyers business people who decided to get involved in it cos in their words whether we get paid for it or not we’re always referring someone for something everyday so why not get paid for doing it.These people have made a fortune and have gone ahead to build their dreams.
Truth be told, there is good and bad in everything. However, the best place to be is in the direction an economy is going. I think it’s going the network marketing way. I think in the near future a lot of the activities of BIG Advert agencies and other middlemen would be eroded by network marketing activities of everyday people and in the process billions would be made. Warren Buffet has made billions of network marketing, I think I would be stupid not to take a second objective look at it.