Analysis of network marketing world experience as one of the form of business organization in Kazakhstan

The most fundamental fact of life in our world today is change. As a rule, people are reluctant to change. We resist it, we like to stay within our comfort zone of what is known and accepted by most. This is human nature.

But it's true that what you resist will persist, especially when you resist a method whose time has come. In almost every field of endeavor, the arts, sciences, medicine, and business, most new ideas have always met with resistance and rejection at first. The more unique and revolutionary ideas are, the louder and stronger is the opposition to it. People have always been afraid and even ignorant about ideas and methods that may result in change. Fear of change caused ridicule of Christopher Columbus, Louis Pasteur, Thomas Edison and Albert Einstein. There are other examples of how fear of change had effects on progress.

We hear about it. We read about it. What is it really? Network marketing, simply put, is drawing upon the strength of others to build wealth for you and for them. It is not labor-intensive. So it doesn’t matter if you get up and go to work somewhere. It doesn’t depend upon your labor. It has a life of it’s own — similar to a business with employees.

The difference is you don’t worry about bookkeeping or payroll. You do not have to sell something or work on an assembly line or anything else you don’t want to do.

If you do network marketing the right way you will have a steady fast-growing income whether you put in a lot of hours or not! There is simply no other way to have this sort of freedom. With network marketing you have the benefits of owning your own business without any problems.

Network marketing is simply building a network, or downline, and drawing a steady, passive income from that network. The network, much like a web, grows in size and strength. As a result, your income increases. And it’s not dependent upon your efforts.

However, we must emphasize that in the beginning you will have to put in hours and effort in order to build your downline. This may take one or two years. It may take more or less time. But we will give you some tips on how to shorten that time period so you can cut down on the work or cut the work out entirely in a very short time [1, 23].

Just don’t get the idea that network marketing will make you rich overnight. It won’t. And don’t get the idea that there is no work involved. There is.

In network marketing you “clone” yourself — you recruit others to do what you do. And they do the same. These people are your downline. The people who recruited you and are above you in the chain of recruitment are called the upline.

Network Marketing is an industry that is the ultimate business opportunity for anyone who wants time freedom and financial independence. It is for people of any age, sex or race. It has every single component you might want in a business.

It is the growth industry of the 21st century. Did you know that Mary Kay, the cosmetic company that uses network marketing, has made more women millionaires than any other single company in America? [2, 8]

In the U.S. alone over 10 billion dollars in goods and services are moved each year through network marketing! Simply put, network marketing is a form of distribution that uses word of mouth to educate people on the benefits of a product.

All of us use a form of network marketing daily. Have you ever recommended a good dinner theater to a friend? Wouldn’t it be wonderful if that establishment paid you a percentage of your friend’s meal and entertainment price because your recommendation got him to go to the dinner theater? [2, 84]. That’s what happens in network marketing. You get a commission for recommending products to others and getting others to do the same.

Let’s go back to our dinner theater. Let’s say the average cost of a meal and entertainment is 5,000 tenge. Let’s say that you recommend that establishment to just five other people. And those five recommend it to five each and each of those recommend to five more and those five recommend to five. That’s five, times five, times five, times five or a total of 780 people who went to the dinner theater because of your initial recommendation to the original five people.

At 5,000 tenge per average order, that’s 390,000 tenge in business you generated for the dinner theater. If the owner paid you only 10% of that because you increased her business by 390,000 tenge you would earn 39,000 tenge!

Now, what if each time these people went back to the establishment you were paid another 10% again and again — each time they went back to eat and be entertained? Wouldn’t that be great?

That’s exactly how network marketing works. And that’s why people are getting so excited about it. The insurance business uses a form of network marketing. Say a general agent has ten agents. He gets paid commissions for up to ten years on not only his own production (a sale he made only once) but he also gets paid an override on each sale his agents made for as long as that business stays on the books.

People who write books get a residual income called royalties. One form of residual income is income from stocks and bonds, usually in the form of dividends and interest.

While people should indeed have this sort of income it does take a lot of investing to build up enough income to provide you with security for many years. It also takes, in most cases, many years of investing.

Residual income — income that is not labor intensive — is the key to wealth. Network marketing companies pay residual income by eliminating the cost of advertising. Rather than advertise, they pay you a commission for “referring” new customers to them. These companies only pay for results. They only pay a commission when a referral customer places an order. This way they eliminate the risk of advertising and instead pay that money to you [3, 16]. Isn’t that an astounding idea?

But wait, it gets better! Not only will they pay you on your own referrals but they will also pay you on the referrals your referrals make and on the referrals they make! The network, much like a web, grows. It increases in size and strength. Consequently, your income increases. And it’s not dependent upon your efforts — not labor-intensive once you establish your downline those people working under you. This is a form of cloning yourself — a very powerful network marketing concept.

That’s why it doesn’t matter how much or how little time you have to devote to network marketing. Once you get started in it and begin your downline it takes on a life of it’s own — independent of you!

Because the company handles all the inventory, shipping and billing, you’re free to enjoy the things you love to do. Once you have made a referral you will continue to receive an income each time the customer reorders. It’s this concept of earning a residual income from a one-time sale that makes this opportunity so powerful and this type of business so exciting and significant.

Then, no matter what happens in your life you have an income. You have money to pay your bills. You have money for the finer things of life. Money for whatever makes you happy. Does all this sound too good to be true? Well, it is true. People are doing it every day. And so can you!

We want you to know the downside of network marketing — not just the many benefits. According to recent figures there are currently over 30,000 people participating in this type of marketing in Kazakhstan. Most of these people never earn money at all.

Only a small percentage earn 50,000 tenge, 100,000 tenge even 1,000.000 tenge a month or more. But that sort of income is being earned! The key to financial independence today comes down to one thing — your ability to market. The word “market” as we use it here is simply to sell your product or service or to recruit others to do it for you.

Most people fail in network marketing because they don’t know how to market their business. They contact friends and relatives. That usually just makes people angry. That isn’t good business. Once you run out of family and friends you run out of people to refer.

That’s not doing real business and it’s one reason why people fail. Some people mail a postcard, sales letter, or place an ad. Again without success. So what’s missing? Why don’t they succeed?

Look at the letters you get in the mail each day trying to get you involved in some opportunity. Did you ever notice how amateurish many of them are? Well, in a bit we’ll talk about letters and how you can make your letters winners. Building a Network Marketing business is now much faster and easier than ever before. But it takes know-how. And you do have to take the time to learn or to let a professional assist you.

With the advance of new technologies it’s entirely possible to earn 20,000 tenge, 40,000 tenge even 60,000 tenge profit your first month in business. Some people even earn those figures in a week! You don’t need a lot of money to get into network marketing. Usually a small investment will get you started. You don’t need a college degree or special education or background. You can begin from wherever you are in life.

There are doctors and attorneys who have quit their practices to go into network marketing after discovering it offered a less stressful life while, at the same time, providing as much or more money than they made while in practice. Many network market and keep their practices.

There are also people who worked at low paying dead end jobs who turned to network marketing and became millionaires. It is truly the great equalizer.

The three big secrets to success in network marketing are:

1) find the company or companies that are right for you;

2) learn to market your products;

3) learn to recruit the right people to get you in a profitable position fast. The people who fail in network marketing fail because they don’t follow the above rules. These rules are written in stone. Break any of them and you will fail! But follow the rules and you will succeed. Period.

For now, we’ll assume you are either investigating some companies or already have one or two you’re involved with. You should to do it and we help you with your chose.

The company for which you distribute is critical to your success. Do not waste your time, energy and money on a company that does not have a good compensation plan or valuable, desirable and consumable products. Learn how to select companies that are worthy of you. And learn about compensation plans. They can be complicated and some are unfair and hard to achieve any real income under. Don’t wait until you join a company and begin to build a downline to find this out!

Very often a single person generates over 90% of a company’s business in his or her downline! This is the person you should try to recruit into your own downline. This person is a proven asset. These people don’t just grow on trees, you will have to develop those with potential them into real leaders.

There are all kinds of people who go into network marketing just like in any other business. There are, for example, MLM junkies. These are people who move from one company to another looking for that elusive pot of gold. They are not especially good prospects for you because, just as they might sign up with you, they will soon sign up with someone else and move on [4, 21].

Then there are the novices. They can turn out to be excellent distributors and profit centers for you in time. But they have to be trained and this takes time. Fortunately, Wave Three network marketing of today we have many tools available to us that make training simple and fun and less labor-intensive. Be sure your company has these materials available to you. If they don’t, look to another company.

You want to shoot for the big game — those folks who know the ropes and already have large downlines but for some reason either want a new opportunity or want to add another company to their primary company. These people will bring with them lots of experience and a ready-made downline of other experienced and productive people! How to bag these heavy hitters is the subject for another time. But suffice it to say here that these people represent your best bet to get a fast start at building a big powerful business.

However, you should not ignore others who may be a real asset to your business. But the heavy hitters will bring you faster results. You will want to cultivate them and keep them in your downline. That’s why it’s so important to use the techniques you are about to learn. The big game won’t respond to amateurs.

In the short space we have here we certainly can’t give a course in advertising. Because “Doing business without advertising is like winking at a girl in the dark. You know what you are doing, but nobody else does.” Stewart Henderson Britt.

But we want to touch on some of the most important ways you can reach out and prospect; how we have discovered through trial and error the ways that work..For example: Advertising In The Print Media.

Everyone loves the classifieds. We all love to read them, to look for a real opportunity. And everyone who is in network marketing frequently needs to run classified or display ads to get new business. One Watkins senior distributor only recruits with a classified in several national publications. But most people use them to supplement other forms of marketing. Classified ads are cheap compared to many other forms of marketing.

They reach lots of people. Unfortunately, they are not tightly targeted like a mailing list should be. You get more of a shot-gun effect unless you put your ad in a very targeted publication. And that’s what we suggest you do. Classified and display ads really do work. They work, that is, if they are well-written. If they are not they just cost you money. It’s that simple. Classified ads need not be long.

The selection of the words is the most important thing in writing copy for your ad. Each word should have a purpose. It should be a word that sells. It should be a powerful word — a powerful combination of words. Let’s dissect a result-getting ad. [1, 67]

The best-kept secret in network marketing. How to recruit more top-quality heavy hitters. Get the best leads money can buy and you will get these big guns! Our state-of-the-art leads can make you successful. Call our toll-free number now for full free details. Now, let’s see what makes it successful.

“The best-kept secret in network marketing” We tell the reader exactly what our ad is about. We don’t lead him or her on. We only want people who are interested in network marketing to respond to our ad. Anyone else is wasting our time. And we can not afford to waste time [2, 89]. How to recruit more top-quality heavy hitters?

Here we tell the reader exactly what we will give him. We make sure it’s something we really do intend to give him. Make no promise you can’t keep! How could a reader not want to recruit top-quality heavy hitters? This is becoming must-have information! All network marketers want to know how to recruit the heavy hitters. They want good leads, qualified leads. Our state-of-the-art leads can make you successful.

This is the coup ‘de grace. We use another get ‘em term — “state-of-the-art techniques.” Everyone today wants to be state-of-the-art. Furthermore, anyone who reads this ad wants to be successful. And we can help them achieve that. So we tell the reader that we can indeed help make her successful. A reader who wants to be successful would be remiss if he or she didn’t respond to our ad! /3, 19 p./ Call our toll-free number now for full free details.

There it is. This is what we want the reader to do. Of course, we provide the phone number in bold lettering. A toll-free number is preferable but it doesn’t have to be toll-free. If people are genuinely interested they will call. Plain and simple. We want him to give us his name and address. That goes into our database. We want her to take action now so we can get full information out to her ASAP. And, by the way, the word “free” is always a hot word. So use it whenever you can.

That’s it. That’s the ad. And it not only pays for itself but it will make you a lot of money. It is, of course, merely an example. You should use several ads and test. It takes more than one ad to see which one will do the best job for you. So don’t expect red-hot results the first time out. If you hit, that’s great! But if you don’t, that’s normal. Sometimes, to save space in classified ads, you can delete conjunctions such as “and,” “for,” “with,” or “from.” There are some words that can be abbreviated such as Company. But make sure people will know what the letters stand for!

You should have four or five well-written ads. Try them in different publications. And make sure you key them. Keying simply means using a code that allows you to know where the person saw your ad. You’ll want to keep good records so you’ll know where to put your money.

You must test your ad. You can try magazines, newspapers, card decks and the online services, including CompuServe, America Online and, of course, the Internet.

Don’t be quick to drop a publication or online service. If an ad isn’t pulling don’t worry too much at first. It usually takes repetition. People need to see the ad frequently. Often it actually takes two to four months or up to six insertions for an ad to start pulling.

Classified ads are money makers. You may not have to spend a lot of money on advertising if you learn how to use classifieds. They can bring you lots of business. If you don’t feel comfortable writing the ad yourself, hire a professional. It will be well worth the extra expense to get good results.

Network Marketing is the new way to financial freedom. You'll never create residual income and freedom from the traditional job. Even professionals are trading their time for money; if they are not seeing clients or patients, they are not getting paid. Most income is temporary and it is easy to determine if your income is temporary - just stop working for 90 days. If your income stops or slows down, you have temporary income.

In network marketing you can stop trading time for money. Once you develop a solid network of sales representatives, you will create ongoing residual income. This can give you the freedom to do what you want when you want to. It's interesting how resistant we are to change. We want to stay in our comfort zones even when we're miserable.

It's been said network marketing is the next step in the evolution of free enterprise. But there is one thing we can always be assured of: the most fundamental fact of life in our world today is that change is inevitable.

REFERENCES

1. David Barber “Just What Is Network Marketing?” - Insight Publishing; New Ed edition (Oct 1996), - 362 pages.

2. Richard Poe “The Wave 4 Way to Building Your Downline” – Three Rivers Press (September 28, 2000) – 210 pages.

3. Andre Vatke “How to Build a Lifetime Residual Income Through Network Marketing” – © 1997 Target Media Group, Inc./Leaders Club – 23 pages.

4. Don Failla “The 45 Second Presentation That Will Change Your Life” – Authorhouse (November 2000) – 112 pages.