New trends in the industry

(EDITOR'S NOTE: This article is a follow-up to a previous article which you can read by clicking HERE.)

Okay. Last time I was kind of hard on the multilevel marketing industry, so I think I'd better make something clear before I go on. I love this business. My intention is not to "re-invent" multilevel marketing, but to try to see the trends within it. None of us can afford to miss them, really. Just because it is working the way it is now, doesn't necessarily mean it is working as well as it could, or that it isn't changing. Remember, IBM misread the microcomputer market and lost most of it to "clone" companies.. then they misread the home computer market TWICE, and it cost them. IBM was and is big enough to survive these and many more mistakes... but I'm not. Remember that the big Detroit auto makers misread the kind of cars Americans wanted, and lost big time to the import market. Even so, I note that during the time we were all buying four cylinder Datsuns, Cadillac and Rolls Royce did not go out of business. Ford still sold Lincolns... the old auto industry didn't die, it adapted and expanded. So I don't think Amway is going to die of old age, alright? I don't think we are to the "adapt or die" stage yet, maybe not even close.

One thing that I have consistently avoided in this forum is hype, or anything remotely like it. Besides my obvious goal of trying to maintain my credibility, I also like to keep my words "tasteful" in case I have to eat them later. In this particular case, it is difficult to maintain my objectivity. I am intensely excited about what I believe to be an important new trend in our industry. Please cut me some slack in this regard.

There. That should cover the disclaimers.

Obviously, I have more to say on the subject. The problems I outlined last issue are real, and I see some exciting trends that appear to be aimed dead at them. The easiest way to explain them is to give some examples, now that there are some. At the risk of writing some thinly disguised company profiles, I do want to point out some interesting things about the companies.

One company has recently started up where the marketing plan was developed by a man completely unfamiliar with the MLM industry. All he saw were the problems. His own problem was this: He wanted to put his product, a nutritional supplement, into as many hands as possible as quickly as possible, but the non profit foundation that he headed could not do it without violating FDA labelling laws. After some research, he determined that MLM was the best way to do that. He consulted with the legendary "big guns" and, to use his words, "Never met so many rogues and scoundrels" in his life. Yet, he liked the concept. The main thing he didn't like was the high price. He was told by these big guns that he would have to charge $30.00 for his product to be able to pay commissions that would motivate rapid growth. He didn't buy that. He started his own MLM, charging $7.95 retail for the product, 35% less for wholesale. The commission is a whopping $0.33 per bottle, or 6.7% of wholesale. This company is a startup, with no track record other than this.. in less than 4 months they have gone from nothing to over four thousand distributors. Something worth watching is going on here.

Another new concept is an MLM formed to distribute a catalog of computer products. The catalog comes complete with a $250 credit line with no credit check... a pretty easy sell. To distribute it (and get it) runs you ten bucks. 99% of that is paid out for 11 levels. Is that unusual? The entire purpose of the company is to replace the normal distribution methods. Just the kind of thing we have been claiming MLM did. This particular company, the MLM portion of it, started up with a four million dollar a year computer company backing it up. The company will make no money from MLM... it is purely to distribute the catalog. Distributors make no commission on sales FROM the catalog, just from distributing it. However, as your downline increases, so does your credit limit. I've not seen anything like either one of these companies before.

The big difference with each of them is that the goal was distribution and nothing else. The price is low, making them easy to sell, and the compensation plan is utterly simple. Three levels deep with unlimited width in the nutritional company, forced 3 X 11 matrix with the catalog company. I believe these are companies that can work even for people who have previously been unable to make other MLMs work.

Again, I make no judgement here about value v. cost, concentration, or quality. What is undeniable is that it is easier to get a prospect to part with ten bucks than with a hundred and ten. It will be easier for the prospect to do it as well. If it's easier to do, it's easier to duplicate, it seems to me. If it's easier to duplicate, the kind of volume necessary to generate substantial revenue is within anyone's reach... anyone willing to do something easy. Simple.

The commissions are low, the prices are low. All of these companies are relatively new, and one of them at least is in it's infancy. The risks associated with startups, especially MLM startups are there with each of them. So is the opportunity.

I don't think these will be the last such companies. I would be very interested in hearing about any other, similar companies. I have left the names of the companies out in keeping with the generic nature of I'm In... , however, if you are interested in finding out more about these companies or this trend, I will send it via Email. I will also make any information I am sent about other companies that fit this trend available.