What is Network Marketing and How Does it Work? - YouTube

What is network marketing and how does it work? Is it a pyramid scheme? Is it a scam?

Is it illegal? I get a lot of questions about network marketing on this channel.

And in this video, I'm going to address exactly how it works.

How you get paid, what it is, what it's not and I'm going to go over 3 specific

tactics that you can use to blow up your network marketing business, automate it

and make tons of money. Let's get it. Okay, so this is a big pyramid. And this is the

compensation structure of network marketing. "Doesn't that mean it's a

pyramid scheme?" Okay, hold on, hold on. This is a pyramid and this is the

compensation structure for any company in existence today. Okay? Any company

works with the compensation structure where the people at top get paid more

than the people working at the cash register, okay? Every single company I've

ever seen in my existence. The person who owns amazon.com makes way more money

than the person who you know, the executives running Amazon. And the

executives running Amazon in Seattle make way more money than the drivers

actually delivering the product to your doorstep. So, just to kind of get rid of

this idea, everything's a pyramid scheme people. Donald Trump is one of the

richest people in America. He's also the most powerful person at top. Look at any

world leader. They're generally richer. Most world leaders are richer than the

common folk. So, everything is a pyramid scheme by that. The second thing you have

to understand what network marketing is not. It is not taking advantage of

friends and family if you have whatever most people have like 5 friends. If

you have 5 friends you get all of them become customers and you make $100

each, your business is done then. You aren't going to make any extra money. What

network marketing is not is... It's you know, it needs to be a sustainable

business out and it you have to go outside of your friends and families. So,

selling to friends and family is not even a question. It's not even the way

you should do network marketing. It's a tactic but it's not a sustainable tactic.

Now, the third thing that work marketing is not. It is not get rich quick, okay? You

can get rich quick but generally speaking, this is a business. This is a

self-employed business where you have to work hard to sign up people to buy

the product or the opportunity. I'm going to go into compensation structure

in just a second here. Okay, so in network marketing, you can make money 1 of 2

different ways, okay? On one hand, you can sell the product. For instance, Herbalife.

You're selling protein powder and supplements. Other companies you can sell

skincare. Whatever it is. On the other hand, you could sell the opportunity. And

selling the opportunity is getting other distributors, is what they're called or

other people signed up to sell products for you, okay? You're creating a team just

like any company has a manager and they have employees under them. So, you're

creating your own little business.Iit's one of the fastest ways to create your

own little business. Now, before I get too deep into things. If you do network

marketing, type in the company you work for or you did work for in the comments

below. And if you did work for a company or tried it, let me know how many years

ago you worked for that company. You know, there are a lot of companies out there.

And an interested to know if any of you have done it before. And if so, what

companies you worked for. Now, let's say you're up here and you sell...

You get 2 customers that buy the product from you, okay? So, you get a

customer right here that buys the product and then you get a another

customer who's more interested in starting their own home business selling

the opportunity, okay? So, either way, you get 50....

Generally speaking the compensation plan looks like 50%. So, you earn 50%.

So, let's just say... Let's make the numbers easy or $50, okay? Every month

from this person. Now, with the second person, you're selling the opportunity.

You'll make $50 a month. You know, you're making 50%. But let's say

they also signed up to people under them, right? Now, you are making 25% of whatever

these people make. So, in essence, this one customer, you're earning $50 a month plus

$25 a month times 2. So, you're earning $100 a month off of this one person. Now,

here's where it gets a little crazy is if those 2 people sign up, if those 2

people decide to start their own teens and bring people under them to start

selling the product, then you make a percentage. Something like 5% of

those customers. Now, this is what it looks like when you add like a 3rd tier

or something like that is that you start making money from those people you sold.

But then you start making money from the people they sold and then you start

making money. People built teams under them. So in essence, you know, I just did

some quick math here. But you would make $50 from the top person whereas

you made from the one customer who bought the product whereas you make

$130 a month from the person who's selling the

opportunity. And from that person selling the opportunity, they're signing up more

people. So they're expanding. And that's where the forms of leverage of network

marketing come about is that you can sign up a lot of people and it will

continue to grow even if you're doing nothing. That's the dream. Now, this is

starting to look a little a pyramid-shaped, right? It's just people

selling people selling people selling people. Now, where network marketing

companies become pyramid schemes is when all they have is an opportunity? They

don't have an actual product that is being sold. So, if you are only selling... If

all the company does is have an opportunity rather than an actual

fundament of... You know, whatever that's education or a physical product or

something to... You know that... That's the real thing they're selling. Then it's

just a money game

and that's a pyramid scheme now the other thing you'll notice is this is not affiliate marketing

although network marketers, shame on you if you're calling it affiliate marketing.

It is not affiliate marketing because affiliate marketing doesn't have

multiple tiers of referrals. Generally speaking, affiliate marketing,

you only get paid if somebody buys the product. Some companies have a second

tier where they pay the people who refer the affiliates like me, okay? Because I

refer a lot of affiliates to a lot of companies. But that's where it stops.

Affiliate marketing and network marketing are different because network

marketing has so many different layers whereas affiliate marketing, 95% of the

time it stops at one layer. Oh, sorry. Did I just get a phone call that you want to

learn the 3 ways to start getting customers in your network marketing

business, okay. Okay, I'll get to that right now. Here, let me get to that. Okay.

So, let's get to the 3 ways that you can examples of how you can sell and get

customers to your network marketing business. Okay, but first there's a quote

from John Rockefeller which is I would rather earn 1% of

100 people's efforts rather than a 100% of only my own efforts.

This is an interesting quote. And the richest man who ever lived in the world

said this. And the reason is is because if something happens to you, you get sick,

your mom gets sick and you want to visit her. Your car breaks down, you just

feeling low-energy you're exhausted at a particular day. You're hungover. You feel

like going shopping. There could be a million reasons why you don't want to

work. When you have other people working for you, you continue making money no

matter what. A network marketing is the fastest way to build teams, to build your

company and have people working for you. Let's move onwards. Okay, so now we see...

Check this video out and now this is a girl. You can see she has a YouTube

channel. Her name is Amy Darlie or that's what she says her name is on YouTube.

And she's 68 thousand subscribers and she is selling the product. She works for

a company called Rodan and fields. And you'll see here, she is talking she is

showing her actual skincare routine. She's showing how the product works, why

it's better. She's showing how she applies it. She's

teaching how she uses it and she even scrolls through and shows you the

ingredients and what other people are saying about the product. So, this is a

good way of selling the product. And again she's doing it through YouTube

because people want to see how something is applied when they're buying skincare

products. Let's move to the second example of how you can sell network

marketing by selling the opportunity. If you saw the math that I just did, you

would have seen that you actually end up making more money if you sell the

opportunity than if you sell the product. And it's because you're building a team

and you're utilizing leverage. So, you can make almost three times as much selling

the opportunity which is why many people sell the opportunity. And also, we're part

of a growing trend. A wave that is going to continue taking over where people

want to work for themselves. People want to go back to being in control of their

life. And if you are committed to taking back control of your time from the fake

news media, from the social media and from the corporate world who wants you

to be a slave, write in the comments "take back control" #takebackcontrol

because this is a serious much bigger discussion we should all be having but

this is one of the methods that you can. Let's go into how to sell the

opportunity. Okay, so here we are in a video for again Rodan and fields and

it's a video by Sarah Robbins. Notice it's opening with nice cars showing

luxury items and because it's selling the opportunity. And here is one of I

guess one of the top network marketers in the world.

Sarah Robyn showing how great this company is Rodan and fields and talking

about how it's changed her life and how it can

for you too. One quick note about network marketing which is kind of interesting

is that there's more women that tend to be in network marketing because I think

women are better at social media, they're better at networking. I

don't know why. Sorry I'm generalizing but it is something you tend to see. Now,

she's selling the lifestyle and the opportunity, that's great. YouTube's great.

Let's go on to the third method that you can sell network marketing and get

customers. But this time I'm going to look at a man at Instagram and his name is

Brandon Tieger, okay? Right there Brandon Tieger. Asian guy from Australia. And you

see... What do you think he's selling? Do you think he's selling the opportunity

here or do you think he's selling the product? I don't even know what the

product is in this. It looks like there's two cute blonde girls. You know, I don't

think he could sell those. So, he's selling the opportunity and he's selling

the lifestyle. And you can see, he likes fancy cars, expensive sneakers and good

lifestyle, palm trees and all that jazz. The way to sell the opportunity is to

show off the lifestyle. You want to show the money that people can make with the

company if you're going to sell it correctly. No, I don't sell network

marketing but I would be good, I think. It's selling it. If I like, if I were to

get into it. Boom baby! So, that's how it's done. You saw a couple examples. You learn

the compensation structure. You learn most importantly what network marketing

is not. Now, if you enjoyed this video, make sure you subscribe, hit that

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part of it. And also I asked you one favor is if you could, in the top comment,

you'll see instructions. But if you could message Tony Robbins for me, send him a

direct message on Twitter and say, "That you should feature this guy in your next

video, okay?" Just do this for me. First off, that is your homework and

that's going to help you and it's going to help me. And I'd love to move this

community to the top. So, I'll talk to you soon. Make sure to subscribe. Excited to

help you make money and once again, if you're committed taking back control of

your life type in "take back control" because we're gonna do this, baby.

Let's get it.