You might have heard of one or the other. Just what on earth is affiliate or network marketing? Are they the same thing and if not what, how do they compare. In this article, I will break them down so that you may have a clear understanding of the two.
Marketing is broad and it has evolved quite a bit over the years. Years ago to be a marketer you had to go to school, study your marketing degree or diploma and then go out into the world and do your thing.
While the old ways of marketing still apply and are just as valid as they were, it all comes down to the fact that if you can convince or direct someone to buy something, then you are essentially a marketer.
As long as products exist there will always be marketers. The fruit vendor at the local market shouting at the top of his voice in an attempt to draw you to buy their products is a marketer. So is the lovely lady with a sweet voice at the other end of the line trying to sell you an insurance premium.
Marketing has a lot to do with not just selling products but helping people decide on whether to buy or not. With the growth of the internet, the marketing industry has revolutionized.
What is Network Marketing?
Network marketing, sometimes referred to as Multilevel marketing (MLM) is a business model that allows members often referred to as IBO’s (Independent business owners) to earn commissions on the sales from a company’s services or products.
Commissions are also paid from recruiting others to join the company. Those who join your team are referred to as your downlines while the person whose team you join is your upline.
The origins can be traced back to a California-based multi Vitamin company called Nutrilite in the 1920s which is now part of the Amway corporation.
How Does it Work?
To simplify things, think of your local supermarket where you buy all your groceries. You walk in, pick the products you go to the cashier, pay and go home.
Your supermarket will need to spend money on advertising and other overheads so that the community knows of their presence.
So, they decide why not make a deal with the customer. Become part owner of the supermarket. Whenever you buy products from us we will pay you a small commission.
Tell your friends about us and if they become customers you get a commission for the sales they generate.
If the friends of your friends join to customers as well, you still earn commissions for the sales they too generate. And the list goes on.
Early network marketing companies coined the word prosumer meaning product to the consumer. Technically you become a part owner of the organization.
Why All The Noise About Network Marketing Being a Scam?
If there is one thing that is difficult to escape is the controversy and misconceptions that surround the network marketing industry. I suppose it always comes down to who is succeeding and who is not.
I know for a fact that the majority of the people do not succeed.
An interesting and valid question asked by critics of the system is; So what happens when everybody joins in and there is no one else left to recruit?
The truth is, not everyone will join and even most of those who join will drop out along the way. In fact, probably 1 in 10 will join and there is no guarantee that they will stay or be active in the business. It’s hard to saturate a business with such a high dropout rate.
There is also the issue of those annoying Ponzi and Illegal pyramid schemes which are really what gives the industry a bad rep. The network marketing structure is easy to duplicate.
Some people have taken advantage of that and come up with companies that sell fictitious or downright useless products or services that offer no real value and in the process have ended up scheming millions of dollars from its members only for the top members to disappear when the structure finally crumbles
Ponzi schemes always fizzle out and unfortunately not without casualties.
Do People Succeed in Network Marketing?
Yes, they do.
In fact, there are millionaires in the network marketing industry. However, success in network marketing is no walk in the park. There are a few things you need to consider if you are looking to find success in network marketing.
- Depending on what company you join, you have to become part of a culture of your team. A lot of network marketing teams follow an almost religious devotion to the business.
- There are a lot of half-truths that are told in an effort to lure people into the business and will do everything to drag prospects to a meeting so that they may see the big picture as they put it.
- No one succeeds by reselling the products. The only way to succeed is by recruiting others who will, in turn, recruit others. That is why people start talking about the word pyramid scheme which is something that upsets many top level network marketers but the fact is the team you create below resembles a pyramid structure.
- Part of the reason is most people quit is they quickly realize that recruiting is not as easy as they may have been led to believe.
- It’s a numbers game. You will eat, sleep, walk, talk, the business when starting off before you can start seeing the money. It’s always a lot of work in the beginning with little returns but the long term results can be very lucrative.
- People who have built huge downlines, tend to take a more mentorship role and less recruiting in the business. Most of them travel to various parts of the world hosting meetings and conferences.
What is Affiliate Marketing
Affiliate marketing is the process where one is paid a commission for promoting another person’s or company’s products. There are four main players in the industry.
- The merchant –retailers or owners of the products
- The network– the platform (websites) where affiliates and Merchants handle the transactions.
- The affiliate or the publisher– produces the content that draws the customer to buy.
- The customer– The end buyer.
The affiliate normally uses the internet and other online tools to create websites that will draw customers to buy the products that they are promoting. This includes e-product display, search engine optimization (SEO), email marketing, content publishing (blogging) and even product reviews.
How Does it Work?
While network marketing is a numbers game, affiliate marketing is a big numbers game but in the mathematical sense. Affiliate marketers have the capacity to leverage the millions of people connected to the internet to drive their campaigns.
In affiliate marketing, you build a website that promotes products that are relevant to your interests. A website forms the launching pad for all your online campaigns.
Let us say, like me you love a good cup of coffee. Now if you wanted to promote coffee machines as an affiliate marketer, you would start by building a website that touches on topics that are associated or related to coffee.
You would also target a particular segment of the coffee machines market to try and zero in specific demographics.
If you did a search of coffee machines you would return results in the millions. Your website will obviously be competing against many others on the internet.
In affiliate marketing, to increase your chances of ranking well in search engines you need to target low competition keywords by using a keyword tool. There are many Keyword tools in the market but I would highly recommend using Jaaxy. It’s the most efficient keyword tool in the market.
Once, your site is up and running, and is generating traffic, meaning you have visitors coming to your site, the next step is to join affiliate programs that sell coffee machines. Joining affiliate programs is free. Their products will be displayed on your website and if somebody buys their product through your website you earn a commission from the sale.
Do People Succeed in Affiliate Marketing?
Yes, they do.
It does, however, take an immense amount of work before you can start making money. Some people have multiple websites that have taken years to build for them to start seeing results.
It also takes time and so you will not see results in a few weeks or even months. Not that it’s impossible but highly unlikely.
A very important aspect of affiliate marketing is content. As an affiliate marketer, there will be a lot of writing to do. People are always looking for information on products and services and if you can provide it then you can succeed.
Another thing you have to consider is training. You have to learn how to build websites and all the technicalities that come with that. You can’t simply hire someone to do it for you and expect results.
The internet is huge and diverse and so It’s constantly evolving hence the need to keep up to speed with new technologies. That’s why it’s important to plug yourself into a training program that can assist you in your journey as an affiliate marketer.
So, How Do the 2 Compare?
The only similarity between network marketing and affiliate marketing is that commissions are paid on sales.
However, the two models of marketing quite different in all other aspects.
Both systems of marketing have advantages and disadvantages to them and so whichever you choose depends on personal preference. For example, if you are the sort of guy who gets easily along with everyone network marketing could well work for you.
However, I know that most people are not. The biggest drawback in network marketing is recruiting. I feel that approaching strangers in shopping malls trying to drag them to a meeting so that they may see the ‘big picture’ is outdated.
Family members might forgive you for trying to lure them into your business. Friends, on the other hand, are hard to come by. When you send mass text messages in an effort to have them join your business so that you may benefit, that is just plain sleazy. There is a word for that. It’s called spamming and it’s ethically wrong!
I think despite all the hard work and effort that goes into affiliate marketing, it still is a solid and less stressful way to build passive income and is my preferred model.
Many thanks for reading my post. If you have a question or a comment, please leave it below. I would love to hear from you.
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