Standard Network Marketing Definitions And Explanations

Many people are confused about the exact nature of network marketing. In this article, we will present a network marketing definition that should clarify matters and help you make good choices when it comes to pursuing a career in network marketing. Read on to learn more.
Network Marketing Definition

Generally speaking, network marketing is a type of business that is dependent upon a strong network of team members and or distributors who are constantly on the move to recruit more team members and distributors to keep the business growing. There are three basic strategies for setting up a good network marketing system.

The most popular and familiar network marketing definition is the one outlined briefly above. It involves the concept of lead generation. Following this model, team members follow leads to recruit new prospects. Good leads should always result in a customer or a team member added to the process. This type of network marketing involves direct interaction with team members and customers because there is quite a bit of education, training, motivation and management involved.

Other network marketing definitions include single-tier, two-tier and multi-level network marketing. Single-tier marketing is a time honored concept and one used by door-to-door type companies such as Avon. In this type of network marketing plan, a potential distributor signs up with a company as an affiliate and sets out to sell the products and services of the company. No recruiting or management of other team members is necessary. The goal is simply to build a customer base and sell the product for a commission.

Another type of affiliate network marketing appears in online venues. In this scenario, a person signs up as an affiliate for a website and sets out to post links to the website on blogs, message boards, social media pages, in e-mails and so on. This type of affiliate program may be a pay per lead (PPL) program or a pay per click (PPC) program. In this instance, the affiliate is paid based on the number of clicks or leads posted links generate. This, too is a single-tier program.

The two tier model of network marketing involves the affiliate receiving payment for direct sales and/or website traffic. In this model, an affiliate would not only make sales and post links to drive traffic to the parent website, he or she would also recruit other affiliates whose sales and traffic generation would generate income for the initial affiliate. In this way, an affiliate can make income from two sources.

Multilevel marketing (MLM) is a network marketing definition that has gotten some bad press. With this model, the original affiliate has a team of affiliates who each have teams of affiliates who each have teams of affiliates. The tiers of income potential can run five or six levels deep. As long as the product being sold is genuine and customers are getting something of true value from this sort of arrangement, there is no problem with this. The bad reputation of MLM comes from the tendency for this sort of arrangement to become a Ponzi scheme in which lots of money changes hands but no real product is offered.

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