Which Is Better, Affiliate Marketing Or Network Marketing?

by Marty Bradfield

Network Marketing Articles

Published on this site: December 20th, 2010 - See more articles from this month

Network marketing is often treated as the redheaded stepchild of the "make money online" community... You may be surprised at the number of online publishers and forum communities that prohibit the discussion of MLM and network marketing opportunities...

There are two primary reasons why mainstream online marketers do not want to talk about either one...

1. Many people still believe MLM systems to be illegal; and
   
   
2. A low success rate for participating members.

In this article, we are going to look at both of these arguments... With an eye towards the truth...

Is Network Marketing An Illegal Pyramid Scheme?

Since the 1970s, many people have believed that all MLM opportunities meet the legal description of a Ponzi Scheme, also known as an illegal pyramid scheme... For at least two decades, Amway wrestled with the incorrect public perception that its company was an illegal pyramid scheme...

The Ponzi Scheme derived its name from Charles Ponzi in 1920... Ponzi did not invent the fraudulent activity that bears his name... The first public description of the investing scheme was actually made in a Charles Dickens book, written in 1857, titled "Little Dorrit"...

A Ponzi scheme is a "fraudulent investment system that actually pays supposed returns to separate investors from their own money or money paid by subsequent investors, rather than from any actual profit earned from the investment."

Ponzi did not create this system, but he did make it famous... It is suspected that he raked in millions in his scheme, in 1920 dollars... Ponzi promised his investors a 50% return on their money in 45 days... People were lining up to give him their life savings so that he could invest it for them... At one point, Ponzi was taking in $250,000 per day...

When it all came tumbling down, people began to realize that they had lost everything...

The difference between an illegal pyramid and a legitimate MLM or network marketing system is defined by how the money is earned...

If the MLM or network marketing company pays their membership for recruiting new members, then the system is at risk of being an illegal business model... (I am not an attorney, nor do I pretend to be one on the Internet. If in doubt, please consult with an attorney.)

However, if the business pays commissions on the sale of products only, the business model is within the legal guidelines for operating a business in the United States...

If you compare the Amway compensation plan to the previous paragraph, you will quickly realize that Amway is NOT an illegal pyramid scheme...

A Low Perceived Success Rate

The second reason why mainstream online marketers do not like to talk about MLM or network marketing opportunities is because they have a notoriously low success rate...

But, if all online companies had to publish their number of registered affiliates next to the number of affiliates who actually make money online, affiliate marketing companies may have a lower success rate than network marketing companies...

According to network marketing industry statistics, only 3% of all network marketers ever make money with network marketing companies... That means that 97% of all network marketers will never make money with network marketing...

Since we do not know any numbers for affiliate marketing companies, we can only speculate as to their success rates...

Recently, I had seen an article that suggested that the ClickBank affiliate network generates a success rate for its members at a rate that is at least 100 times worse than network marketing... But I was only able to locate one source for those numbers, so I don't feel confident in sharing this information as fact...

But, if true, network marketing participants are more likely to make money online than ClickBank affiliates...

Those Who Make Money Online Are Those Who Decide To Do So...

We have all heard the old adage that says, "You can lead a horse to water, but you cannot make him drink..."

The truth is that if we are talking about making money online, the more accurate adage would be, "You cannot make a donkey go anywhere he doesn't want to go..." LOL

Or a real adage, "You cannot push a rope..."

Whether we are talking about Affiliate Marketing or Network Marketing, most people simply choose to never try, rather than to risk failure or success...

Most people signup to these programs, with the expectation that they will never actually need to do much of anything to make money... If they ever start doing anything that will lead to success, they typically "try it out" for a week, then quit...

p.s. If the sales copy says that you do not have to work to make money, someone is lying to you... And if you believed them, you were lying to yourself...

For the person who makes a commitment to his or her success, success is much more likely, although not guaranteed...

Even Obama will only guarantee you an income for a few months, before you will have to go get another job and go back to work... WINK

Common Reasons Why People Fail With Network Marketing and Online Marketing

1. Not starting;
   
   
2. Not trying very hard;
   
   
3. Giving up after one week to try something else -- an unwillingness to make a real commitment;
   
   
4. Not making a commitment to Get Educated about how to successfully market the business;
   
   
5. Not investing any time or money into their business, to ensure its success;
   
   
6. Giving up too soon...
   
   
7. More interested in finding someone else to blame for failure, rather than to do what is required to be successful...

If you have ever signed up to participate in a making money online opportunity and quit before making any money with it, and if you are honest with yourself, you likely failed for one or more of the above stated reasons...

I am not better than you... I failed for the same reasons for my first 3-1/2 years online...

After failing for several years, I decided to get educated... Once I attained my education, I started making a few dollars here and there...

Then I increased my education, and I began to make consistent money...

I continued to invest in my own education... As I write this, I have made my entire living online for more than five years...

So do you think that you might want to consider getting a real marketing education?

Or are you happy keeping your job until you retire?

Marty Bradfield teaches the Basics of online marketing and Cutting Edge Techniques used by online marketers, to develop lead generation systems for new businesses. He recommends the 80-page report that outlines 35 Proven Traffic Generation Techniques used by professional marketers to build their online businesses:
http://thephantomwriters.com/ebooks/multiple-traffic-streams.html