Network Marketing — Is It a Pyramid?

One question I am frequently asked when I share my network marketing opportunity with friends, family members, and co-workers is “Is this a pyramid?” — Or the statement “This sounds like a pyramid.”

Case in point — six months ago, I shared my network marketing opportunity with one of my retired friends who were looking for additional income.   After reviewing my DVD business presentation, my friend told me that my opportunity sounded like a pyramid, and he threatened to report it to appropriate authorities.   I was shocked and appalled that my friend was so misinformed, but even more about this visceral negative reaction.

At that point I told him that it was definitely NOT a pyramid ….. and chalked up his negativity to the fact that maybe he had previously had a bad experience with a network marketing company.  Furthermore, I knew he was operating out of ignorance and maybe just didn’t want to be bothered – even though he needed money.

[youtube]http://www.youtube.com/watch?v=g81WaqTx6KI[/youtube]

Based on this reaction from my friend, I decided to do “due diligence” on the “pyramid” question to find the real answer to this question……so this blog post clarifies the differences between network marketing and a “pyramid.”

What is a Pyramid?

A pyramid is a scheme where normally, there’s no product involved at all, just money changing hands — or if there is a product, it’s clearly there just to support a money game.

Pyramids are strictly a money game and have no basis in real commerce.  For example, pyramids are programs similar to chain letters where people just invest money based on the promise that other people will put in money that will filter back to each person that participate and somehow, they’ll get rich.  In short, it is a get-rich-quick scheme.   Just remember, if to looks too good to be true – it IS too good to be true.

There are many such programs in circulation today — so be careful when you are introduced to such a program — chances are it IS a Pyramid scheme!

What is Network Marketing?

Network marketing is a business model that is based on providing people with real, legitimate products they need and want at a fair price.  In network marketing a person buys into the concept of the product(s) offered, sponsor other people and teach those people how to sell the company product and those people sponsor others who duplicate the process.

This concept is called “leverage”…..  You can leverage your time and increase the number of hours of work effort on which you can be paid by sponsoring other people and earning income on their efforts, while at the same time they get paid for sponsoring and leveraging the efforts of others.  This is a win-win for all involved.

J. Paul Getty, who created one of the world’s greatest fortunes, said “I would rather make 1 percent on the efforts of 100 people than 100 percent on my own efforts.” This very basic concept is the cornerstone of network marketing.

By helping the people you personally sponsor to sponsor others, you duplicate yourself.  As this process continues, you create compound growth that can lead to hundreds or even thousands of people coming into your business.

Network marketing has proven itself as part of the new economy and is becoming a preferred way to do business here and around the world.  It is highly endorsed by Robert Kiyosaki and Donald Trump, Bill Clinton, and others as the new business model of the future.

Network marketing isn’t about taking advantage of friends and relatives. The primary goal is to share excellent products, services, and opportunities with people you know — family, friends and loved ones to help them improve their lives and future.

Sharing the products or services and the opportunity with people you know is still the basic foundation of the business, although today we see more people using sophisticated marketing techniques such as the Internet, conference calling and other long-distance sponsoring techniques to extend their network across the country.

In Summary ………

Don’t let questions about whether your network marketing opportunity is a pyramid cause you concern about whether your network marketing opportunity is legitimate.  Remember, if you have a solid product or service that customers might need or want your network marketing company is legitimate.

Please give me your comments and feedback on the “pyramid” question.  How do YOU respond to it? I look forward to hearing about your experiences.   If you found this information helpful, share it with your friends and colleagues on Facebook, Twitter and other media sources.

To Your Massive Success,