Where the Real Money in MLM is Made and Why Your Negative Friends Are Right About Your Business... Sort of ;)
"Everyone wants to believe they already know something about what you are talking about. It's an ego thing to fill the void ignorance creates. Therefore, know that most people have probably already made up their minds about what you do long before you opened your mouth."
by Ferny Ceballos
Almost 1 1/2 years ago, my friend Eric and I had returned from a night out on the town and were hanging out at my place in L.A. and we got into a heated exchange at about 5am at my house, after he looked in my kitchen and noticed a fresh shipment of my company's products (for my personal use).
Eric is what most of us in the industry would label a "negative person". To say he has contempt for the MLM industry would be an understatement. He's seen loved ones and acquaintences get chewed up and spit out by this industry and lose money in the process. (Nothing new, right?)
Over the course of my time in MLM, I've learned to block out negative feedback and for the most part, keep myself from being around people who are critical about a business I take very seriously.
Except there's something you need to know about Eric. He's probably one of the most intelligent people I've ever known. He was my roommate and fraternity brother at MIT. He and I got along really well during my time there and I looked up to Eric for many reasons -- he's a NO B.S. type of guy, very knowledgeable about just about anything, a computer/electronics whiz, he helped me immensely during my growth as an individual in college and the dude knows how to have fun.
The only thing that ever bothered me about Eric was that when he believes he is right and you are in a debate with him, the only acceptable outcome for him was to make you believe he is right and destroy any trace of self-confidence you had.... even if he was actually wrong the entire time.
He was a master at doing exactly that and he's actually made people cry after an argument with him. He's definitely intense!
Similar was his goal that night in my house as he proceeded to tear apart the MLM industry and how he believed the money is actually made.
The arguments were nothing new. All you need to do is do a few Google searches on subjects related to MLM and company names and the conspiracy theories are available for anyone to read.
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Fun "Fact": Did you know that the Republican party is in cahoots with the Amway corporation to takeover the world? Interesting. :P
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But there was one thing that Eric stated, which did have a lot truth to it. It's something that's hard to deny, because well..... it's true... sort of.
What is it?
He said "the real money in MLM is made through tools -- books, seminars, tapes, etc."
This is a hangup which many people get stuck on when criticizing the industry, but the truth of the matter is that selling tools and training is NOT something that is exclusive to this industry.
In fact, the idea of training someone to become a professional in a certain discipline is not rare at all. On the most fundamental level, anyone who payed $160,000 for an MIT education was sold information and training, without any guarantee that they would make that money back or enjoy their career.
If I had actually paid for it, I would feel kinda jipped. (Thank God for financial aid.)
But let's assume that a college education doesn't count as an information marketing business.
There are plenty of situations in a multitude of other industries where professionals will pay un-accredited companies for education in sales training, marketing, personal development, business systems, etc.
My Chiropractor is a Walking Talking Sales Letter
One of the coolest things about my chiropractor, Dr. G, has nothing to do with his ability to heal. He's one of the most talented sales people I've ever met in my life. In fact, the only reason why I walked into his office was because my officemate was one of his patients and had mentioned his powerful ability to persuade people to become his patient.
Being that I was in MLM and doing sales, I was curious about his sales process. Long story short, he sold me big time on the benefits of chiropractic care and I've been a loyal patient since.
Over the course of the past couple of years, I came to discover that Dr. G has invested thousands of dollars in books, CDs, and seminars on how to improve his practice, keep his revenue up and personal development.
I once asked him if he had developed the sales process himself and he replied, "Fernando, do you honestly think I'm smart enough to come up with this stuff myself? Nope. I learned this process from Dr. David Singer and other trainers."
For those of you who don't know, Dr. David Singer is a former chiropractor who now makes millions teaching chiropractors how to market and promote their practices via books, CDs, DVDs and seminars.
If this is the case, would it be right of me to say that the real money in chiropractic is in selling tools, tapes, seminars, etc.? Not really, because Dr. Singer is no longer a chiropractor.
He is a marketing consultant.
Dr. G is the chiropractor and he's very happy with what he's learned from Dr. Singer. I've even suggested to Dr. G that as he gets older, he should go into consulting since he is so knowledgeable about the industry. But he's perfectly content at his practice making a 6-figure income as a chiropractor, while paying Dr. Singer to keep him up to date about the latest marketing and sales methods.
Recently, Raymond became a patient for Dr. G. The first comment from Raymond after having his first consultation with Dr. G was "Dude, Dr. G is a walking talking sales letter!"
LOL. Indeed.
What the Critics are Missing
Now bringing this back to the MLM world. The mistake that most critics of the industry make is that they fail to distinguish the MLM business from the training business.
The fact of the matter is that someone like Mike Dillard as CEO of Magnetic Sponsoring is a marketing consultant for MLM.
When it comes to his network marketing business, he is a distributor and upline to thousands, while Magnetic Sponsoring has a potential market of millions.
The training business and his distributorship are two separate things.
Now the beauty of it all and something that is unique to MLM, is that once you are recognized as a world-class trainer and marketing consultant, it becomes very easy to sponsor new people into your business, because you are trusted by so many network marketers.
Your leadership and skills are proven and people will naturally want your mentorship. It's your reward for having invested in yourself and implemented what you learned.
It would be silly for Mike to limit his training to only people in his downline. By making his Magnetic Sponsoring system available to the industry as a whole, his market share as a trainer goes from a few thousand in his downline with one company to potentially millions of network marketers across many companies.
Not to mentioned having impacted the lives of people like myself and Raymond, who are NOT part of his downline.
The Real Money in MLM is the Tools?
Now, would you still say that the "real money" in MLM is in the tools?
Not quite. At least I don't think so.
The truth of the matter is when you are selling training to network marketers, whether it is to your downline or to other network marketers, you are a sales and marketing consultant.
That business is not MLM at all. It's consulting. And you need experience and strong skill sets to be successful at it. (There are many who have tried and failed at this also. )
When you are promoting your opportunity or it's products, you are a network marketing distributor. When you are personally mentoring your downline on what they should be doing, that is part of being a MLM distributor. When you hold meetings or conference calls for your downline, you are operating your distributorship.
When personally mentoring my downline, I'm never paid a dime for my efforts. My reward would come from them moving product, growing their downline and creating volume, thus increasing my sales volume and profits.
I mean the choice for anyone considering joining my team is pretty compelling -- become a paying client or get personally mentored as a team member?
Hmmm.... tough one. ;)
When I provide consulting via a workshop, course or audio, I'm a sales and marketing consultant. The proof of that is we've been able to apply the same marketing and sales techniques for small business owners and other online businesses, in industries having nothing to do with MLM.
Is there more potential providing training to the MLM industry or business world as a whole? Well, the answer to that is pretty obvious isn't it?
Of course there is!
In building an network marketing business, your income is limited by the company compensation plan and your own personal efforts as an upline.
As the CEO of the Attraction Marketing Formula, I can add value to people outside my downline and grow a business, which in turn comes back to help my downline recruit, because they can say that they use AMF and Magnetic Sponsoring as the foundation for their training.
Since one of the biggest problems in recruitment is creating that relationship and trust with your prospect, when someone is already familiar with your training system and is satisfied with it, having them join your downline becomes a very easy sell.
In fact, it's not selling -- it's attraction! It's what the Attraction Marketing Formula course is all about... replacing the hype with REAL skill sets in marketing, lead generation, SEO, etc.
The Price I Had To Pay...
So going back to my friend Eric... well, the truth is that he wasn't the only one in my circle of influence, who tried to "save me". I remembered having many heated exchanges with co-workers and other people.
(Engineers are a tough and stubborn breed if you haven't noticed.)
It's never pleasant when you have to distance yourself from friends, to give your mind an opportunity to conduct business with clarity.
Like Mike Dillard once wrote, "[Succesful people] know that a person's mindset is fluid. It's always changing with the ideas and interactions it comes into contact with on a daily basis."
When I would expose myself to the criticism, the only thing that would come as a result of it was a dip in my performance, procrastination and stress.
The price I was willing to pay for my freedom was the distance I purposely created between some of my friends and I. And with no disrespect to any of my friends, it was absolutely necessary.
I have no regrets. I have my freedom.
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Who are Ferny Ceballos & Ray Fong? Ferny & Ray are former aerospace engineers turned internet network marketers. Despite holding degrees from MIT & Harvey Mudd, respectively, and both having earned graduate degrees from USC, Ferny and Ray decided to turn their backs on engineering and jump into the vast and profitable world of online network marketing in 2006. |
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