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Dec
1

What is Network Marketing?

in Network Marketing, Renee Q & A

by Renee Wittrock

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What is Network Marketing?

Network marketing is widely known to be a type of direct selling. But, in March of 2010 at a national convention of a top rated direct selling organization, the keynote speaker, Neal Offen, President and CEO of the Direct Selling Association (DSA) said that network marketing is a compensation system within direct selling. So, to properly answer this question, I think we should first find out how direct selling is defined.

According to the DSA, direct selling is:

“sale of a consumer product or service, in a person to person manner, away from a fixed retail location, where the company offers opportunities to an independent contractor sales force.”

The DSA defines Network Marketing/Multi-level Marketing as:

“a compensation system within direct selling, where a distributor/salesperson can earn money not only on their own personal sales, and not only on the sales of a person personally recruited by them, but also on the sales of persons recruited by their personal recruits.”

That is the formal definition, and if you want more formal information you can check out this link directselling411.com.

The layman’s definition

I really think that Network Marketing is a home based business where you can provide a company’s goods and services to someone that you know and get paid in a predetermined way for your own sales and those that you bring into the network marketing business. Sometimes, you can make money from people they bring into the business as well. Pretty simple, huh? Well, not really because you need to…

…Ask your real question: “isn’t network marketing really just a bunch of multi level marketing pyramid schemes?”

To that question, I have to answer sometimes. You have to be very careful. According to what I hear from Mr. Offen, pyramids are not illegal in every state so you need to make sure you know what you are coming up against if you plan to join a network marketing or multi-level marketing company. The best way to research a company is to go to the DSA website and make sure that they are a member in good standing.

How would you define Network Marketing?

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