Network Marketing Scams | What You Need To Know

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Network Marketing

Are you tired of your job and want to have the freedom of running your own business and making millions in the process?

If so, you’ve probably come across the idea of network marketing or multi level marketing.

You’ve seen their ads or success stories and are interested in learning more.

You may have even had a friend or acquaintance try to get you to buy some products from an MLM or network marketing company.

Regardless of how you were exposed to the concept, you want to know more.

Network marketing opportunities present themselves as a way to earn some extra cash, or even become your primary career.

Often times, the offers and promises seem incredible, maybe even too good to be true.

You may have heard some big-time success stories, but also heard warnings and bad reviews.

This guide will tell you all you need to know about the world of network marketing and multi level marketing companies.

By the end, you will know what it takes to succeed and how to spot network marketing scams and multi level marketing scams.

Your Ultimate Guide To Network Marketing And MLMs

What Is Network Marketing?

Let’s start with the basic definition of network marketing.

A network marketing model is where a company allows people to directly sell their products and services to customers.

It’s very similar to franchising, the model for many restaurants.

In restaurant franchising, take McDonald’s as an example, the Franchisee is a person who pays McDonald’s an up front fee plus a cut of the profits.

In return, McDonald’s allows that person to open a restaurant using their brand.

McDonald’s provides them with the recipes and food, national advertising, as well as other forms of corporate support.

This is the same way that network marketing companies work, just on a smaller scale.

In fact, some people refer to network marketing as ‘mini-franchising’.

Let’s say a network marketing company sells beauty supplies.

Their business model works like this. They try to recruit people to become members of their organization.

A person usually has to pay some amount of money up-front. It’s typically in the range of $50-$300, depending on business.

Sometimes, that up-front payment purchases product for that person. Other times, buying products costs extra.

Regardless, once a person joins the network marketing company as a member, they are now able to sell those beauty supplies to anyone they can find to buy them.

The member can start selling door to door, on Facebook, at fundraising events, etc.

They can go wherever they think they will have buyers for the beauty products they are selling.

Usually, a network marketing company will offer support, tips and guidance for their members.

They may offer to create a website for their members, and will send them promotional materials.

The company will often provide some form of sales training as well. They may hold seminars and meet-ups for their members.

The goal of a network marketing company is for the members to essentially act as their sales force.

Rather than having to spend money on advertising campaigns to raise brand awareness, their members go out into the world and raise awareness by word-of-mouth.

Instead of having to give retail stores a cut of their profits to put their beauty products on the shelves, they give a cut of the profits to their members in exchange for finding customers.

The bottom line is that network marketing companies are reliant on their members to drive sales.

And to incentivize sales, they offer a number of benefits, rewards and other inducements.

The Basic Profit Model

profit model

The way network marketing opportunities are set up, members will earn a percentage of the sales volume they do.

In other words, you’re getting a cut of the gross revenue.

For example, if you sell $100 worth of products, as a member you might earn a 10% commission, or $10.

Often, network marketing companies will set up structures that reward high sales volumes.

For instance, they might say that if you sell $100 or less, you’ll earn 10% of the volume. If you sell more than $100 but less than $500, you earn 15% of the volume.

And if you sell more than $500 in product, you earn 20% of the volume.

Generally, the markup that network marketing companies make on their products is pretty high.

They very much want their members to sell as much as they can, and they set up a system that rewards their best performers.

That’s the basic network marketing model. Sign up members, the members sell their products and earn a percentage of the sales volume.

However, nearly all network marketing companies employ a second tier of rewards.

Recruiting New Members and Multi Level Marketing Companies

multi level marketing companies recruitment

Most network marketing companies allow members to earn rewards and money in another way, by convincing other people to sign up as members.

This makes a lot of sense when considering the overall network marketing model.

The more members there are, the more salespeople are effectively working for the company.

In order to convince members to recruit others, the company makes it profitable.

This happens in two ways.

The first is quite straightforward. Many network marketing companies offer a bonus for each recruit you convince to sign up.

The more people you bring in, the more money you make, simple enough.

The second way they incentivize recruiting people is a bit more complicated.

And it’s also at the heart of much of the appeal that many network marketing companies offer.

The core concept is that you as the recruiter earn a small percentage of the sales volume that your recruits generate.

In other words, you’re able to make money without doing any work, as long as your recruits are working.

For instance, let’s say you receive 5% of any sales volume your recruits earn. You’ve recruited five members, and their combined sales volume for a month is $10,000.

You would receive $500 without having to lift a finger.

This is the dream that many MLMs sell. Recruit a big enough network of members and you’ll be sitting back while passive income pours in.

It’s a great situation. Who doesn’t like making money without having to work?

Network marketing companies go even further with their recruitment bonus systems.

In most, you can make money not only from your recruits, but from the recruits your recruits bring in, and from those recruits’ recruits.

You can imagine a gradually growing tree of members branching out. Five direct recruits. Twenty recruits from those recruits. Seventy five from those 20 recruits.

The idea is that all these members are making you at the top a little bit of money with each sale they make.

The Truth About Network Marketing

Here’s the reality about most network marketing opportunities. You probably won’t even make your initial investment back.

In fact, a study done by the Federal Trade Commission shows 99% of network marketing businesses fail.

There are a variety of reasons for this.

Some have to do with the way individual companies are set up. Some have to do with the nature of the business itself.

If you even want to think about succeeding in the field of network marketing, it’s important to understand the way the industry works.

Only once you understand this will you be able to assess your own situation and decide whether you’ve got what it takes to make it.

Company Specific Problems

There are a number of attributes which characterize bad network marketing companies. The first are the ones that are outright network marketing scams.

Some of these companies are set up to harvest those membership fees. They want people to join and pay them the initial fee for joining.

They make vague promises about products and services, and emphasize that members should recruit other members to make money.

In the end, there’s no real product. It’s all just a tactic to take those fees.

Usually, these flat-out scam companies don’t last long.

The house of cards falls down as people start to realize there’s no substance to what the company is offering.

The next class of bad network marketing companies is a little bit more of a shade of gray.

These are the companies which do offer a product or service but are not really interested in making money by selling it.

In effect, these companies end up functioning pretty similarly to the scams we discussed just before.

They collect an often-high membership fee.

They emphasize recruitment, and their reward structures heavily incentivize making money by recruiting rather than by selling products or services.

Because there’s a real product or service, this company may be able to stay on the good side of the law.

But the product or service is probably not very good. It will likely be drastically overpriced, and might rely on junk science or claims that don’t hold up.

These companies don’t really care about their products and services, and it shows.

As a result, it’s going to be nearly impossible to sell much product. Even if you’re the greatest salesperson in the world, it’s not easy selling garbage to people.

The final main class of bad network marketing companies are those that might have good intentions but bad execution.

This may include companies whose products and services are inferior not because they don’t care, but because it’s simply not high quality.

Like with any sales-related job, it’s very difficult to succeed if the product is inferior.

But frequently, the way certain network marketing companies fail their members is by not putting them in a position to succeed.

Companies like Amway and Avon have developed time-tested strategies for their members.

Love Amway or hate them, the fact is that they have built a blueprint for someone to find success if they’re diligent and also skilled at sales.

Many companies just throw their members to the wolves.

There may be very little guidance or sales strategies. This is especially poor because most people who join network marketing companies aren’t salespeople by profession.

They could use all the help they can get.

If a company doesn’t give their members tools to succeed, it makes it far, far more likely that you’ll struggle with such an opportunity.

Industry Specific Problems

Let’s say you managed to weed through all the shady and poorly constructed network marketing companies and find a good one.

They do definitely exist.

The odds still say that you have a pretty decent chance of failing.

The reason this is true is that the network marketing industry isn’t as easy as people think it is. It’s not some get-rich-quick scheme.

It’s a job that requires both skills and hard work. And not only that, but it can require resources that most people don’t have.

Any veteran salesperson knows the importance of leads.

Sales leads are the lifeblood of any sales-related job. You can be the greatest salesperson in the world, but if you don’t have any leads, you’ve got no one to sell anything to.

Most people signing up for a network marketing opportunity don’t know how to generate a consistent stream of leads.

They naively think that they will be able to sustain their business with their friends, family and acquaintances.

Unfortunately, they blow through those contacts, probably selling less than they anticipated.

Now where do they turn?

There are ways to solve this problem. Some network marketing companies will even help you with it.

But this is one of the biggest reasons people don’t succeed even with good opportunities.

Beyond the difficulty with leads, succeeding with a network marketing company takes a lot of effort and sales ability.

Many people view them as easy part-time jobs, but those people are likely to experience frustration and failure and quickly quit.

And let’s face it, some people just aren’t cut out for a sales job.

Sales involves getting out of your comfort zone, creating empathy with people and seeing the world through their eyes.

On top of that, it requires excellent communication skills.

Naturally having all those attributes is a rare package. You can learn to be a better salesperson, but it’s not easy.

All in all, network marketing companies are similar to many other jobs.

It takes skills and a lot of hard work to prosper. If you go into one thinking you don’t need the skills or work ethic, you’ll likely end up disliking the experience quite a bit.

MLM vs. Pyramid Scheme

MLM vs Pyramid Scheme

One of the most common charges people make about network marketing multi level marketing companies is that they’re pyramid schemes.

This can be true sometimes, but is definitely not always so.

It’s important to understand just what a pyramid scheme is so you can distinguish it from legitimate multi level marketing companies.

The central concept of a pyramid scheme is the idea that a person or company recruits other members, who pay them an up-front fee.

Those new members now try to recruit other new members, who pay an up-front fee divided between the founder and the member recruiting the new member.

It goes on and on like that, with the money always flowing higher within the structure.

The reason they’re called pyramid schemes is that they can be visualized like a pyramid.

The founder is at the top, and as the recruits branch out, there are more and more of them and the ‘base’ grows wider as it goes down.

If that sounds kind of similar to an MLM, you’re right.

A pyramid scheme has the same kind of basic structure as an MLM network.

What separates a pyramid scheme from multi level marketing companies is the fact that real goods and services are legitimately being sold in the case of an MLM.

The pyramid structure might sound kind of unfair in favor of the people higher in the chain.

And while this is true, there’s nothing illegal about it.

Nearly every business is set up so that executives and shareholders reap more of the profit than entry level workers.

As long as the company is legitimately selling a product that has a customer base, the company is considered a legal MLM.

The problem comes in when a company begins emphasizing recruitment to the exclusion of all other considerations, including sales.

Now, all the ‘value’ this company is generating comes from entry fees being paid by new members.

At this point, it’s a pyramid scheme, not an MLM.

Some instances of a pyramid scheme are obvious. Some instances of a legitimate MLM company are similarly obvious.

Many times, though, it can be more of a shade of gray. It can be tough to spot a multi level marketing scam if you don’t know what to look for.

How To Spot A Network Marketing Scam

Network Marketing Scams

The biggest way to distinguish network marketing scams from a legitimate opportunity is to focus on the product.

Not only is this a good move for weeding out the scams, but it’s good advice in general.

You are going to succeed or fail in large part based on what you’re selling.

Companies which have a questionable or poorly explained product should be red flags.

If an opportunity seems far more enthusiastic about offering your lucrative incentives for creating your network of recruits than about selling the product or service, something might be wrong.

When evaluating a network marketing opportunity, ask yourself this: Can I envision myself being successful by selling this product to people?

If the answer is either no or it’s unclear, either it’s not the right opportunity for you or it’s a scam.

If you’re worried about whether an opportunity you’re considering is a pyramid scheme, consider the following:

  • Does the opportunity ask you for a significant amount of money up front?
  • When you take a look at the incentives for participating in the program, are all the best ones tied to recruiting new members?
  • Does the company seem to really care about their products or services, or does that seem to be somewhat of an afterthought?
  • Do they offer to reimburse you for any inventory you buy from them if you’re unable to sell it?

If any of those considerations point more toward a pyramid scheme than a network marketing opportunity, be cautious.

Another good idea to spot network marketing schemes is to periodically check on any network marketing companies you participate in on the internet.

You can use search engines to see if they’re popping up in the news for any negative reasons. This can give you some warning if something isn’t right with it.

One note about this, though. As you research a network marketing company online, you will doubtless find online reviews.

For just about any network marketing company in existence, you’ll find both horrible negative reviews and glowing positive ones.

A good rule of thumb is to be wary about both.

The glowing reviews are frequently written by current members who are looking to recruit more members into their network.

They directly profit by signing you up. Of course many of them are going to play up the plusses and gloss over the minuses.

When evaluating positive reviews, if it sounds too good to be true, it probably is.

Many negative online reviews say that the company is a scam, has stolen from them, is worthless, and so on.

While some of these reviews are true, some are simply from people who tried the program and failed.

That in itself can be a red flag for the company, but there are a lot more multi level marketing companies being accused of being scams than actually are fraudulent.

At the end of the day, you have to do your research to determine if a company you are considering is running a network marketing scheme or not.

And in some cases, you need to listen to your gut because there will simply be too much conflicting information out there.

How To Make Money In Network Marketing

making money

There are two crucial factors when it comes to making money in network marketing.

The first one is picking the right company to join.

The second one is making sure that the industry of network marketing matches your skillset and natural abilities.

Picking The Right Company

First of all, if you pick a shady, fraudulent or incompetent network marketing company, you’re almost guaranteed to be doomed to failure.

The products will be bad and hard to sell, the company won’t support you properly, and you’ll have all kinds of trouble getting anywhere.

You’ll likely grind away for a little while, get frustrated as you realize it’s not all that was promised, and take your loss and quit.

Do your homework and look into many network marketing companies before you settle on one.

First of all, you’re looking for a company that’s above-the-board and legit.

But also, you’re looking for a product or service that matches your passion and experience.

If you’re a 40 year old man who has never used makeup in his life, chances are you’re not going to do well with Avon.

If you’re someone who hates exercise and isn’t very athletic, you’ll probably struggle in a network marketing company based on fitness supplements.

You want to choose a company with product or service suite that fits into the person you are and the experiences you have.

If you have always loved traveling, a company offering travel packages might be up your alley.

If you battled weight problems for years before getting yourself fitter, your story would probably work well with company based on weight loss.

If you can align the network marketing company’s products or services with your own personal narrative, experiences and the person you are, it makes being an effective salesperson ten times easier.

Having The Right Attributes

You may find a company offering products you can believe in. But are you the right type of person to thrive in a network marketing setting?

First of all, sales skill is a must.

You’re going to grow or fail based on how well you can sell your products and services.

If the thought of trying to convince people to buy a product makes you uncomfortable, this might not be the career for you.

Another aspect of network marketing is that it’s a very independent, highly unstructured type of work.

It’s far from clocking in at a certain time and working as part of a team or workforce under the direction of a boss or manager.

No one is checking up with you. No one is telling you what to do. That can be wonderful and freeing.

But some people get lost in the lack of structure. Are you the type of person who does well in an unstructured environment?

And the bottom line with network marketing is that it’s hard work.

You’re going to have to put in effort to succeed.

If you’re a naturally outgoing person, it can be enjoyable work, even rewarding.

But you’re going to have to pound the pavement, so to speak.

Even when times are tough, you’ve got to push through and keep working if you’re in the network marketing business.

To sum it up, you can make money with a network marketing career if you choose a reputable company that’s a good fit for you.

But you also need the skills and mindset to succeed in this line of work.

Frequently Asked Questions

Frequently Asked Questions

Here are the most common questions I am asked on network marketing and MLM companies as well if they are scams.

Is network marketing a good career?

For most people, the answer to this is no.

The reason network marketing is not worth it and a poor career choice for many people is that you need a varied set of skills, abilities and opportunities to make it work.

And on top of that, you need an incredibly strong work ethic and a powerful determination to get through the inevitable struggles and bad times you’ll experience when starting out.

First of all, succeeding at network marketing requires access to a steady stream of leads for new sales and recruitment.

Many people get involved with network marketing believing that they’ll be able to create a lucrative business by tapping into their friends, family members and acquaintances.

They figure it will be easy to convince people who already like and trust them to join up.

There are two problems with this.

First of all, it’s not as easy as you imagine to sell your friends and family on costly products which sometimes aren’t obviously better than their alternatives.

In fact, some people end up straining the relationships in their lives by being overzealous trying to sell to or recruit people close to them.

The second problem is that even if you manage to be very successful in convincing a good percentage of your friends and family to join, you’ll run out of people.

And now what do you do?

It’s not possible to sustain a network off a small, fixed group of people in most cases. You’ll need to find additional leads to keep growing and sustaining your business.

Most people simply aren’t equipped to generate consistent sales leads.

If you can’t find leads, you will find it incredibly difficult to succeed in this field.

Beyond generating leads, many people aren’t ready for the sales aspect of network marketing.

The people who do succeed at network marketing are excellent salespeople.

They have to be. After all, when you break it down, network marketing is sales. That’s your job. You’re a salesperson.

For all discussion about how this or that product sells itself, the reality is that people are usually cautious with their money.

In order to consistently find sales and recruits, you need to be a skilled salesperson.

Some lucky few are born with natural sales skills.

It’s also possible to learn to be a good salesperson if you’re not naturally gifted in that way.

But through one way or the other, it’s necessary to be a good salesperson to succeed at network marketing.

If you’re not a good salesperson and aren’t willing to commit the work to becoming one, it’s not the field for you.

Finally, succeeding at network marketing requires a great deal of hard work and tenacity in the face of disappointments and setbacks.

Almost everyone starts out not knowing exactly what they’re doing.

As a result, beginners make mistakes.

They struggle with results, and it’s easy to get discouraged.

Anyone who has succeeded with network marketing will be able to look back at their own story and see a time early on when it seemed hopeless.

Those who succeeded pushed on through the disappointment and managed to figure out better ways of generating leads and closing sales.

If you have a tendency to get discouraged or stop when things are getting tough, network marketing is probably not the right option for you.

That’s not to say that you have nothing you could be good at. It’s just that network marketing is a demanding and often times thankless career.

Especially in the early days, working a network marketing career will involve putting in more hours than a standard 9-to-5.

You’ll chase down leads and work to set up websites, create promotional materials, attend conferences and study sales strategies.

It’s far from an easy gig.

Is network marketing legal?

Most network marketing companies are legal. Although some skirt the edges of legality.

In order to understand why an MLM or network marketing company is legal or illegal, it goes back to the distinction between a network marketing opportunity vs. a pyramid scheme.

If you want to get a more in-depth explanation of this distinction, go back to the earlier section where we discuss this distinction.

The short summary is that a pyramid scheme is concerned with signing more and more people up as members.

There’s always a sizeable up-front cost, and the incentive for new members become finding still more members.

A network marketing company, in contrast, has an emphasis on having their members sell products or services to the public at large.

The concern of a legitimate network marketing company is sales, not recruitment.

However, even legitimate network marketing companies will still incentivize recruitment.

Does network marketing really work?

Network marketing can work.

There are definitely real people out there who have created lucrative careers out of network marketing opportunities.

Others have managed to make enough money for network marketing to represent a side-hustle or secondary income source.

Good network marketing companies are selling legitimate products and services.

It’s rare that a network marketing company is selling products or services that are so much better than any competition.

If it was that great, they’d focus only on selling the product or service, not the network marketing aspect.

But these products and services may be right for some people.

And if you can find happy customers, you can create a thriving network marketing opportunity for yourself.

However, it’s important to understand that just because these people have succeeded doesn’t mean everyone will.

Network marketing is a tough business if you don’t have the right skillset and opportunities.

In order to succeed at network marketing, you’ll need to have tenacity, sales skills, a strong work ethic, and the knowledge to create a steady stream of leads to generate new business and grow your network.

If you have all those attributes, or you’re committed to developing them, you could be a success story for network marketing.

Just realize that many people have tried network marketing and been unable to even get back to the break-even point.

Is network marketing the same as MLM?

When people use the terms network marketing and MLM, they often mean them to be the same thing.

So, in casual conversation, you might hear someone use the two terms interchangeably.

Technically, though, they aren’t the same in every respect.

Network marketing refers to a way of selling and distributing a product or service.

A product or service sold through network marketing relies on the customers to directly buy the product or service from the supplier, with no middle man.

Companies use network marketing in order to avoid having to pay a percentage of their profits to stores or other retailers, as well as paying for middlemen to transport and distribute their products.

Network marketing strategies also save money that would normally be used for advertising, as a network marketing-based company doesn’t spend big sums of money on ads.

MLM, which stands for multi level marketing, is a concept which uses network marketing. The key to understanding MLM is the levels.

An MLM company offers tiers within their networks.

In order words, a person at higher tier within an MLM can potentially reap some form of passive income from multiple tiers within the network.

These tiers usually take the form of chains of recruits.

If I recruit you, then you recruit someone else, that represents three levels within the network.

If I recruit 3 people, and those 3 people recruit 15 combined, then the first level is me, the second level are my three recruits, and the third level are those 15 my recruits brought in.

A network marketing-based company does not need to be an MLM.

Multi level marketing companies can only be called that if they consist of a structure where networks have multiple levels.

In practice, almost all network marketing companies do offer the multi-level structure.

So, from that standpoint, most of the time when you’re talking about a network marketing-based company it’s also an MLM.

Will joining an MLM ruin my life?

It’s unlikely that joining an MLM will ruin your life.

It’s very possible that it could set you back a little bit financially. You might look back on the experience with regret about time and money wasted.

But you will likely be okay in the long run if you join an MLM.

Probably the worst consequences you could suffer from joining an MLM are ending up in debt and harming the relationships in your life.

If you join an MLM, most require some up-front purchase or membership fee.

These often range anywhere from $100 to several hundred dollars.

On top of that, many multi level marketing companies encourage you to buy and use their products, many of which are expensive.

If you end up using credit cards to sign up or buy, it’s very possible you won’t recoup your investment.

Also, if you don’t have another source of income while trying to make an MLM work, you may accrue debt for living expenses.

When joining an MLM, one of the common tactics they suggest is recruiting your friends and family.

In some cases, this can cause rifts in your life with those loved ones and friends.

Some people may find your sales pitches too pushy. They may feel pressured by your existing relationship. Resentment could build up.

None of that should be beyond repair over the long term. But you may damage the closeness and connection you feel with some people in your life.

Neither getting in debt nor harming your relationships qualifies as ruining your life. Both of them are problems you can easily live through and solve.

You don’t have to worry about being arrested or going to jail, even if the MLM you signed up for turns out to be a scam.

The people running the MLM will face the consequences, if any.

Is Herbalife an MLM?

Herbalife is an MLM. In fact, it’s one of the biggest MLM companies out there, along with Amway, Avon and a few others.

Herbalife has been dogged by accusations that it’s a pyramid scheme, and famously agreed to a settlement and fine with the US Federal Trade Commission in 2016.

At the time, Herbalife was accused of spending too much of its energies toward recruiting new members and not enough on selling its products.

Herbalife’s main products are dietary supplements, weight loss supplements and other nutritional items.

While the company isn’t perfect, that fact that it is still allowed to operate shows that there’s some legitimacy to Herbalife.

In any case, Herbalife falls squarely into the MLM category.

It uses a network marketing system in which people sign up as members to sell products. Members are able to recruit new members to create a network.

The networks can have multiple tiers, with generations of recruits.

By any definition, Herbalife is both a network marketing-based company and an MLM company.

How do you succeed at network marketing?

To succeed at network marketing, you need to have skills and a good work ethic.

But from the start, you need to understand one thing. This is not a get rich quick business.

You will have to put in many hours before you make a sale or have a recurring stream of income.

Additionally, you need to have an outgoing personality. Remember, you will be selling with this job.

You can’t hide behind your computer all of the time. While you can make online sales, you still need to network with others to sustain long term success.

In the next section I share some tools that will help guide you to long term success with network marketing.

Finally, you are encouraged to find a mentor. Not someone from within the network marketing company you are interested in, but a successful salesperson.

Having a mentor will give you real life insights that no book can teach you.

What are the top 10 network marketing companies?

The list of the top 10 network marketing companies worldwide is ever changing as companies move up and down the list annually.

You will also find various top 10 lists showing different companies if you do an online search.

Many times, these lists are simply used to get a name out there in hopes of recruiting more people to join the team.

We are providing 2 lists of the top 10 network marketing companies.

The first is the top 10 network marketing companies based on annual sales.

Biggest Network Marketing Companies 2019 (Revenue)

wdt_ID Company Name Revenue (in billions)

The second is the top 10 network marketing companies based on growth rate.

Biggest Network Marketing Companies 2019 (Growth)

wdt_ID Company Name Growth (%)

As you can see, each list has many different companies.

When you are searching for multi level marketing companies or network marketing companies, known how and why the list is ranking the companies.

Tips For Network Marketing Success

As mentioned earlier, there are a few things you need in order to have success with network marketing.

First, you need a solid work ethic. This is not a get rich quick solution. In order to make money from network marketing, you need to put in a lot of work.

Don’t get mislead by people telling you this isn’t true.

While one or two people might get lucky and succeed fast, the majority of people need to put in more work than they typically would at a 9-to-5 job.

And most people telling you otherwise, are trying to sell you some product they created on how to be successful fast.

You have to step back and ask yourself, if they are so successful at network marketing, why are they selling books about it? Shouldn’t they be sitting back enjoying the high life?

The next thing you need is to understand people. You need to get in front of people and talk to them.

You have to understand what makes them unique. When you do this, you can then sell to them.

Some people are born with this skill. Others are not.

If you don’t have this skill, you can learn it.

Here are some of the best books I’ve found on understanding people, selling, and multi level marketing success.

Best Books On Selling And Network Marketing

Thinkertoys by Michael Michalko

How to Win Friends and Influence People by Dale Carnegie

Think and Grow Rich by Napoleon Hill

The First 90 Days by Michael Watkins

The 7 Habits of Highly Effective People by Stephen Covey

The Psychology of Selling by Brian Tracy

Mach II With Your Hair on Fire by Richard Brooke

The Greatest Networker in the World by John Milton Fogg

Your First Year in Network Marketing by Mark Yarnell

The more you learn and understand the subject, the greater success you will have.

Wrapping Up

At the end of the day, not all network marketing and multi level marketing companies are scams.

Many are legitimate businesses selling products. But they get a bad rap because of the stigma associated with them.

Most people go into these companies thinking they will be able to make fast money and do very little work.

When reality hits them that this is not the case, they scream scam.

But it’s not all their fault.

I’ve been to recruiting sessions and these companies sell the dream and overlook the hard work part of the business.

So the final verdict is there are good, high quality network marketing and multi level marketing companies out there.

You just have to put in the work to find the honest ones that you can partner with long term, and not the ones out there looking to make a quick buck selling you an impossible dream.

3 thoughts on “Network Marketing Scams | What You Need To Know”

  1. While it certainly takes a certain type of person to do well with network marketing, it is a great thing to try at least for a year if you are an entrepenueral type at all. Network Marketing companies are a prime business model of success built on the concept of the power in numbers and OTHER. You are using Other peoples Time, Other Peoples money and building a large number of people in your network where success is shared. Then if you have a consumable excellent product you can stand behind ( Amway comes to mind with high quality) it is all good. 🙂

    Being able to handle rejection is a must in network marketing though! LOL

  2. Hi Ed,

    Good points here and a lot I agree with. I feel that Amway gave network marketing a bad taste in a lot of people’s mouth and it will always be there. Like you, I hate to sell and always said I couldn’t sell a rosary to a nun…:-) I have looked at several companies but usually felt their products cost too much for most people to continue to buy but I did do home parties for one company here in Canada for a while that I felt was the best I’d seen. The majority of their products were under $10, they were healthy and reduced the amount of salt you ingested and because they made food, it was a consumable product that pretty well assured it would provide repeat customers. The best party was the products were really good and they pretty well sold themselves. It fit with me well as I loved to cook and trade recipes but then found that I lost a lot of that desire when my husband passed away and I didn’t feel I did the products justice because I didn’t use them every day like before.

    Like anything out there, you have to weigh all the pros and cons with each individual company but if you feel you can honestly represent the products, then it could be a good fit for you. I wouldn’t sell anything to anyone that I didn’t use and love myself and if you can’t do that then it’s definitely not the right fit for you.

    Mary

  3. Learn from the uplines in your network marketing organization, especially the successful ones. They have walked in your shoes and have come out ahead. They are a valuable resource from which to learn the ins an outs of the company. Ask questions and share concerns to become an effective salesperson and recruiter.

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