I might lose a few readers with this one…
I KNOW network marketing is popular.
I also know it’s a kissing cousin of direct response — largely because both speak to the same human desires, and are both marketed as very similar business opportunities.
But I have such a strong dislike for network marketing.
So when I get a question like the below that is pretty clearly asking about network marketing (without mentioning it by name)…
Well, I have to respond HONESTLY.
Because that’s what I’d hope you’d do for me, if our roles were reversed.
This is your weekly Mailbox Monday issue…
Where I answer YOUR questions about marketing, copywriting, selling, business-building, career-building, and more.
To have your question answered in an upcoming Mailbox Monday issue, click here.
Here’s today’s question…
Enjoy your e-mail news.
Question: Referring to online marketing.
How do we break the vicious circle of members that cannot recruit….and then recruiting people who also cannot recruit.
I’ll give you four answers to this, and you may not like any of them…
But first I will give one big caveat to everything I’m about to say.
I believe the vast majority of network marketing, or MLM (or whatever you want to call it today because regulators cracked down on the last thing you were calling it), businesses are about as close to scams as you can be without being shut down.
They sell a big shiny dream of riches with no work.
But they pretty much never deliver.
The success stories are often lies. Sometimes outright. But more often, it goes something like this…
You see someone being a big success, and winning all the awards. And their sales make it look like they are. But those aren’t really sales. They’re products they purchased and stockpiled in their garage. So they could be the winner and get the awards.
They don’t know how they’re going to pay for the products. Much less make a living. Because even though they had a tiny amount of success selling to a few friends before those friends got sick of being sold to… They haven’t sustained any kind of scalable sales results.
They don’t know how to sell to strangers.
The best thing they’ve got going is a recruitment pyramid scheme. Where everybody’s recruiting everybody. Selling the dream. But not selling anything substantial.
Everybody has this seemingly infinite downline. But little if any results.
What’s the caveat?
There are a few businesses that are a little better. The products are more useful, and of a higher quality. People actually like buying them. And some people are good at selling them. So a tiny percentage of the people make up a disproportionately huge percentage of actual sales. (Of course, this is predicted by 80/20 Sales & Marketing by my friend Perry Marshall.) But for those people, this is actually a decent side gig, or even full-time career.
If you are the exception (and no, you’re probably not), I don’t hate you or your network marketing business. But that’s really because you probably operate a whole lot more like a real business than an MLM.
With this context, here are my four answers to the question above…
ANSWER 1: You can’t change human nature, especially the kind of humans that respond to lazy dreamer network marketing pitches…
I really hate to say this. Because you probably are recruiting people that you like or at least get along with well.
But those people are lazy dreamers, and you are unlikely to get out of the “vicious circle” because you’re using a pitch that appeals to lazy dreamers.
The thing about a setup like this is that nobody wants to admit that they’re lazy dreamers.
So the company behind it creates a fantastical sales pitch that really hits all the lazy dreamer hot buttons. The people who respond pay some money to sign up, so the company gets paid.
Then, the lazy dreamers do nothing, thinking the mere act of buying would make their dream come true.
But because they don’t want to admit to others that they’re lazy dreamers (and even feel a little shame about it), they don’t raise a stink. They’re out whatever they invested up front, and simply move on to the next opportunity pitched at lazy dreamers.
The company got money. The person who did the recruiting got a tiny share. Any upline got a few cents. And there are no complaints, even though nobody besides the company got much benefit.
You’d have to change EVERYTHING about this to break the vicious circle. Because the vicious circle is part of the business model.
ANSWER 2: Assume failure and play the numbers game…
All of this said, let’s assume that there’s some sliver of benefit to the people who are really active in this.
Let’s assume there’s some decent product actually changing hands at some point, and you’re not just dealing with a huge shell game or Ponzi scheme waiting to come crumbling down.
If there’s a legitimate exchange of value that some people can achieve with this, and a legitimate opportunity somewhere in the mess of the network marketing business…
And you want to benefit from that…
You should start with the assumption that the vast majority of people you recruit will still fail.
Let’s go with an easy-to-math 90/10 ratio.
90% of the people you recruit really do nothing.
10% do something.
Of those 10%, 90% really don’t do much.
10% are what you might consider B players or above.
Of those 10%, 90% are B players.
10% are A players.
And of the A players, 90% are A or A-.
10% are A+ superstars.
Going backwards through that, it means for every A+ superstar you want to recruit…
… You need to recruit 10 A players…
… Which will take recruiting 100 B or above players…
… Which will take recruiting 1,000 people who do something, anything…
… Which will take 10,000 total recruits to find.
So, you want an A+ player on your team? Assume you’re going to have to recruit 10,000 people, 9,000 of which who won’t do much.
Want a team of 10 A+ players so you’re not over-reliant on one or a couple? Recruit 100,000.
Affiliate marketing works the same way, by the way, because they’re pretty much the same thing.
People who treat it like a numbers game tend to do pretty well. But it takes some serious work — in fact, it’s pretty much like building any real business, if you want it to be successful. But you’re building your business in someone else’s backyard, which comes with a whole laundry list of dangers.
Stop selling the dream, sell the work…
Again, I’ll assume there’s some real value in the product the end user gets here.
So we’re not just recruiting to recruit.
If you want better percentages than the above example, you have to stop selling magic pill solutions.
Magic pill solutions get a lot of people who expect their problems to be solved automatically. Which are the exact kind of people you’re complaining about.
If you want better percentages, you have to sell cold, hard reality.
Sell the hard work. Sell the difficulty. Sell honesty. Sell the brutal truth.
You’ll watch all those people who were interested in magic pill solutions scatter like cockroaches.
Because they want to be lazy, and they want the dream.
But if anyone sticks around after you promise cold, hard reality, those are the type of people who will work for the results.
They’ll sell the valuable product to people who will get that value out of it.
They’ll recruit others with the same attitude.
They’ll build your downline, slowly.
You’ll NEVER match the front-end recruiting numbers of someone who sells magic pills. Because magic pill solutions will always attract more lazy dreamers.
But the people who you do recruit will be among the few solid people in the bigger network marketing universe.
ANSWER 4: Build a real business…
This is really the same conclusion I come to when people ask me about being an affiliate marketer.
You’re much better off building a real business than getting involved with network marketing.
Even if it’s a side gig on Etsy, or something like that. Or writing how-to books you self-publish. Or, whatever.
Create a product or service people value.
Ideally it should be either high-priced, or something you can create in a leveraged way (it doesn’t take much more of your time to sell 100 units versus 10), or both.
Make sure that the price you can sell it for gives you a sufficient margin over your cost to deliver it.
And put your energy into selling that!
Then put that effort you’re putting into recruiting into one of two new directions:
— Either actually marketing your offer directly to buyers…
— Or recruiting actual salespeople you will have to manage and supervise to sell on your behalf.
Then you’ll have a different recruiting problem.
But if you do all of the above and you have this new recruiting problem, send in another question and I’ll answer it in another Mailbox Monday.
Yours for bigger breakthroughs,
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