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Monthly Archives: March 2012

Three topics most people avoid: Religion, Politics, and…

There’s little question that nothing draws such extremely polarised views and opinions as politics, religion and network marketing (in that order); and yet of the three, only one is usually the result of misinformation, ignorance or misunderstanding.

Network Marketing

Why have some of the most successful business entrepreneurs, including, Robert Allen, Warren Buffett, Donald Trump and Robert Kiyosaki, not only advocated network marketing, but actually invested time and resources into the development of network marketing organisations?

Perhaps it’s because they are actually savvy enough to know the difference between a “pyramid” or Ponzi scheme and network marketing, and have not allowed ignorance to cloud their rational minds enough to see that network marketing is much more like the structure used in insurance and real estate marketing than it is like pyramid or Ponzi schemes.

Perhaps it’s because these business giants take the time to do their due diligence, so that they do not get swindled by the unethical fly-by-night schemes that pop-up, masquerading as legitimate network marketing opportunities. And perhaps it’s just that they are not in a position of financial desperation, so their minds are a bit more relaxed, when evaluating opportunities that present themselves.

At the end of the day, the biggest problem is not with network marketing, but with the people it often attracts — both in the corporate management of companies, and in the recruiting/distributor force.  These are the two biggest reasons many people will not even consider a network marketing opportunity, after generations of companies that attempted to convince people to spend hundreds (or thousands) of dollars on overpriced products, only to be swindled into agreeing to monthly minimum purchase requirements, recruiting quotas, and other BAD INVESTMENT PRACTICES, just in order to “buy a piece of the dream.”

Over the past 29 years, I’ve enjoyed the privilege of being among the top five percent of income earners in the network marketing and internet marketing fields for eighteen of those years. And I can briefly share why I enjoyed that level of success:

  • I never encouraged people to invest in products they did not personally need or want.
  • I never offered products that were not an excellent value for their price.
  • I did not “garage qualify” folks, or try to convince them to carry inventory, under any circumstances.
  • I never promoted a business that would require them to go deeper into debt, with the promise of “future wealth”. If the program could not put a minimum of $500 income in their pockets the first month, I was not interested in promoting it.
  • I never promoted a business that would require an initial start-up of more than $500, or a monthly maintenance (including advertising) of more than $150.

But in the time that has passed between when I earned my first six-figure income, in 1982 and today, the industry has dramatically changed. And nothing has been more responsible for that change than the Internet.

The Internet has leveled the playing field, making it possible to get better and more accurate information more quickly than ever before. It allows customers and business builders alike to research the ingredients, product claims, and competitors within minutes, and expands the marketing reach of their dollar to include a global marketplace.

Weeks before I became involved with our current program, I was ready to announce that I was walking away from the industry. I’m not someone who pretends that things are going well, when they are not. And I don’t ever withhold information from my sales consultants. So it would have been no surprise for them to hear that I simply do not believe that traditional direct sales and network marketing companies represent a viable, sound or reasonable investment in today’s marketplace.

The Days of Traditional MLM are Numbered

And here are the reasons I say that:

  • Nutrition companies have begun to lose their viability because the global marketplace continues to impose further regulations and limitations on the kinds of alternative healthcare products that are permitted to be sold, as Big Pharma tightens its stranglehold on the welfare of the global community, in an effort to keep people just sick enough to keep needing their prescription drugs.
  • Even those nutrition companies that still exist and continue to thrive are suffering the effects of the consumer’s access to thousands of competing products at better prices on the Internet. I do not believe it’s reasonable to invest time and money into a company that will pit me against my local health food stores and grocery outlets. That’s unfair competition, and pricing I know I cannot beat.
  • The “just switch store” companies are run by backward thinking, religious fundamentalists and hatemongers that I refuse to support. Their efforts to push an ultraconservative religious agenda is not as bad as their reputation for misleading the public, and their own distributors, with cleverly worded jargon than pretends they have an extraordinary retention rate, or which even lies about who founded their company. As much as I like their compensation plan and products, I am unwilling to compromise my values and principles to support such a business.
  • In today’s economy, I believe it is unreasonable to expect people to have to take on the added expense of high-priced autoshipments for products they don’t really want or need, and which are not value-priced.
  • The concept of those companies based on doing home parties is not only an out-dated, provincial and ineffective means of growing a network marketing company, but it also brings with it the need to carry inventory, deliver products, collect payments, maintain a merchant account, and for most of those companies, it means you have to keep working forever, if you want to keep getting a cheque. Those little cosmetic companies, cookware and candle party deals just weren’t created by people with network marketing savvy. It’s 1980s marketing, and that’s not my cup of tea in 2012. Perfect for the little Suzie Homemaker, or Billy Beautician, who want to supplement their income by adding a new service to their existing daily activities. And a great way for those folks to earn an extra $400-$1200 easily in a month, but there is no long-term leveraging of income, effort or investment.

But is there a viable solution for the aspiring entrepreneur?

We all know that most people are not in a position financially to invest $500,000 to $1 Million in a franchise, and if most network marketing programs are becoming saturated, and the home party deals are not for the serious business person, then what’s an aspiring entrepreneur to do?

Well, that was the question I asked, when I was about the point that I was ready to just walk away. After all, I’d had a terrific run, and the industry had been very good to me. But now the terms of my exit strategy seemed to be coming to fruition. And there were no companies out there that seemed able to meet the criteria I’d set for businesses we would consider adding to our portfolio.

Then my friends Susan and RS gave me a call…

“Would it be reasonable to say that you probably take a week’s vacation every 12-24 months, Gianmichael?” Susan asked. Sure it would. In fact, I am approaching the time in my life, when I plan to take a week off every six months or so.  Quality of life is so very important, and because I am living with the challenges of Parkinson’s Disease, it’s essential to me that I not work like a maniac, and miss the opportunities to slow down and smell the roses!

“Would it also be reasonable to assume that you probably know two people who take vacations, who might like to have an extra $800 in their pocket this month?” my friend R.S. pitched in.

Naturally. In fact, I know that most of my friends and colleagues around the world actually get four to six weeks paid holiday every year. Only in the United States does it seem that we value our employees so little as to only offer one week paid vacation (if that).  And in this economy, I would be hard pressed to think of anyone who would say, “No” to an extra $800 spendable cash.

“One final question,” RS added, “I’m guessing then, that you would probably say it’s also reasonable to expect that those two people likewise know two people who vacation and would love to make an extra $800? Am I right?”

Now it was my turn…

“Sure, ladies, but before you even go there, let me tell you that I am all too familiar with those travel company scams — companies like YTB, which was shut down by the Feds, and all of these scams that claim to be selling you a travel search engine, or am IATA travel agent card, but which are either offering vapourware, and sure to be shut down, or which have such pathetic compensation plans that the only cash flow you’ll see is the $150 a month going out of your chequing account to pad the pockets of such notorious scam artists as Phil Piccolo, Chuck Hansen and others.”

I was definitely not interested in one of those “travel companies”.

rsmalloryAnd then I listened as GTN Founding Member, RS Mallory, who has served as a member of the Board of Directors for the Distributor Rights Association (now known as the Association of Network Marketing Professionals) – a non-profit organisation dedicated to advocacy, distributor rights mediation, and  a commitment to positively impact, serve, educate, standardize, preserve, and unite network marketing associates and those who develop and create businesses within the network marketing community – as she explained how this company was not even remotely like those travel scams.

For starters, the company, now three years-old and debt free, is not selling “referral travel agent” packages, IATA cards, or search engines. They are a legitimate and respected VIP Travel Membership company, with one of the industry’s most progressive, fair and generous referral compensation plans I’ve ever seen. There are no distributor kits to buy, because there are no distributors. Every one involved in the company is a member, and it is purely the member’s option, whether or not they choose to participate in the referral marketing program.

WINNING FACTOR #1 – A PRODUCT PEOPLE WOULD BUY WITHOUT ANY COMPENSATION PLAN

For seventeen years, many of my readers have heard me tell them that the first test of a legitimate business opportunity is to ask yourself if the product would stand on its own and sell successfully if there were no business opportunity attached.

This product – an exclusive VIP Membership in a travel program, which gives the member access to over one million resorts, condos, hotels and destination vacation locations, at discount prices as low as $299 for eight days and seven nights, is a steal. I’d immediately decided, without thinking about it, “Hey, even if I don’t like the comp plan, I will buy a membership, because that’s something my family can get a lot of use out of!” (And we already have… saving $700 on our first booked vacation alone!)

The VIP Membership is around $300, so even if a person stayed at a resort that was only $600 for a week, and got it for $299, the membership paid for itself in one vacation. VALUE BASED. Check!

WINNING FACTOR #2 – NO COSTS FOR WEBSITES, MARKETING KITS, OR ANY OTHER HIDDEN FEES

Next, I discovered that there were no hidden fees. No add-on costs for my marketing website. As I already said, no “distributor kits” to buy for $29 or $49 (a technique devised by MLM companies to pad their pockets with added profit, even if the new rep did nothing). Everything was included at no cost, including access to training and recruiting calls, and everything I would need to get started.  Another CHECK on my criteria!

WINNING FACTOR #3 – THE MOST FAIR AND REASONABLE RECRUITING REQUIREMENTS EVER!

There’s no such thing as a free lunch, and so I automatically ignore companies that tell me how they’re going to build my business for me, because, well, that’s bullshit. And we all pretty much know that.

But I also know that the past fifty-seven years of MLM history shows that the average network marketing distributor will successfully recruit about 3-4 people in their first sixty days in the business, and will not recruit more than eight in their entire career. So compensation plans that set the minimum recruiting qualifications to make more than a pittance commission at eight, ten, eighteen, or twenty people are clearly interested in one thing, and that is KEEPING THE MAJORITY OF THE PROFIT IN THEIR POCKETS, not the pockets of their sales force. In industry terms, it’s called “breakage” and it’s something built into every unethical marketing plan out there. So-called “Heavy Hitters” know what it is, and they hope you never figure it out.

(That’s the reason that so many of these supposed Network Marketing superstars, who especially flock to the binary comp plans out there, jump from one company to the next, moving entire organisations of people with them… because they know the only way to keep making money is to broker backroom deals, every so often, when the crowd starts getting restless, because they’re not making the money they were promised. So the leader pockets a nice little “bonus” for moving his people, and the crowd is duped for another 6-12 months, until it’s time to move onto the next new miracle juice or pill!)

This company, by stark contrast, set the recruiting requirement at TWO PERSONALLY ENROLLED MEMBERS, because they knew that EVERYONE could do that, and do it in their first month! What’s more, when you enroll two people, and help those two people to do the same thing – so you have a team of six members total in your group – not only do you earn your first $800 commission cheque, but YOU ARE QUALIFIED FOR COMMISSIONS FOR LIFE! You will never have to recruit another person, maintain any kind of monthly quotas, or “volume requirements”. You are commission qualified for the rest of your life.

ETHICAL AND FAIR RECRUITING REQUIREMENTS… Check!

WINNING FACTOR #4 – SHOW ME THE MONEY!

The compensation plan for this unique company is something I could probably spend hours going on-and-on about, because they have literally built-in features that no other compensation plan in the industry has ever offered. But the simplest way to explain it is to say that you start out with a 2×4 matrix (which means you have two frontline spots, and four under those) and when that matrix is filled, so long as you have your two personal enrollments, you get paid $800. Then a new matrix is created, and that’s where the magic begins, because you can actually begin earning $800 over and over again, every time the growth in your organisation. (I will spend time explaining that in greater detail to anyone who’s really interested because it’s truly mind boggling, and BIGGER than anything you could imagine at first glance.)

FAIR AND GENEROUS COMPENSATION PLAN… Check!

WINNING FACTOR #5 – HELPING OTHER ENTEPRENEURS

The fifth winning factor actually has little to do with the company or its objectives at all. It’s about my personal commitment to empowering others and helping them to cultivate Primary Greatness.

You see, I know that many of my friends are emotionally attached to their companies. Some of them have invested three, five, ten years or more into growing their organisation, and they know that I might be right about the industry growth slowing down, but they cannot afford to walk away from an income of $4,000, $6,000 or $25K or more each month. Understandably!

Now I personally don’t believe in becoming emotionally attached to a business or a piece of real estate. It’s just not good business. But it happens. In fact, one of the companies I will likely always be involved in is a company whose compensation plan is among the five worst plans in the world, in my professional opinion, but I happen to think they make the best products in their niche, and so I maintain a membership to buy what I need for my family and friends.

Other friends are actually enjoying their businesses with other companies, and have begun to look at what I am doing as a chance to buy something that they can use to reward their downline, who never have to even know that they are involved in the company! You see, these network marketing pros join our company just to get the VIP Membership, and then they book luxury vacations as “give aways” for people on their teams, who meet certain recruiting challenges.

One friend sells hair and beauty products, and she became a member to be able to do just that. Whenever one of her ladies are on their way to whatever the next step is toward that coveted pink Cadillac, she rewards them with a week at a Disney area resort for their family. It only costs her $299, and her commission on the volume those consultants generate in her beauty business is $500, so she’s essentially reinvesting $300 of that back into creating loyal beauty-ladies! Pretty smart!

And so this is a way I can not only help my friends reward their reps with amazing incentive packages, but also a way that some of my other friends, who are really struggling to keep their businesses going, can quietly enroll TWO of their leaders, who may be having an equally tough time, and then all of them can begin to earn a nice side income, that may make all the difference between whether they can keep their homes, or stay in their businesses.

SO WHAT’S THAT MEAN FOR YOU?

My friends and gentle readers, I don’t know if the timing is right for you to get started with a business that can literally change your life right now, only you can make that distinction, but I do know this…

Thirty days from now, you and I could be relaxing at our favourite vacation destinations, and enjoying a little Facetime on our iPhones, while you begin to ponder the enormous impact this business can have on your financial and personal life, and as you enjoy those weekly $800+ cheques coming in…

…or you could simply be thirty days older, thirty days more frustrated, thirty days further away from your dreams, your goals and your destiny.

It’s important that we know the limits of our business endeavors and recognise what is and is not working for us. Much like the sailor who must know the length of his line, so that when he drops anchor, he will be secure and safe, we have to know whether our present business vehicle will reach where we want to go.

John Locke put it well when he wrote, using this same analogy:

“It is of great use to the sailor, to know the length of his line, though he cannot with it fathom all the depths of the ocean. It is well he knows, that it is long enough to reach the bottom, at such places as are necessary to direct his voyage, and caution him against running upon shoals that may ruin him. Our business here is not to know all things, but those which concern our conduct. If we can find out those measures, whereby a rational creature, put in that state in which man is in this world, may and ought to govern his opinions, and actions depending thereon, we need not to be troubled that some other things escape our knowledge.”

I encourage you to ask yourself the difficult questions, and when the time is right, and you are ready to engage, to reach out and give me a call. I’ll look forward to the adventures that await us!

gms

Copyright © 2011-2012 Dr. F. Gianmichael Salvato, P.A. (Team VISION Global Consulting, S.A.) All rights reserved. No part of this article or material may be reproduced without written permission from the author. When written permission is obtained, full attribution, including this copyright must be included in any republication, broadcast or reproduction of this material. Address all inquires to: Dr. F. Gianmichael Salvato, P.A. (gianmichael.salvato@gmail.com) 407 Holly Hall, Middletown, PA 17057 USA.

 

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Want us to look at your opportunity?

We always appreciate it when someone cares enough to want to share their enthusiasm about a new or existing business opportunity with us. After 32 years in the direct sales and network marketing industry, having spent 18 years among the top five percent of income earners in that industry, I do have a very clear sense of the kinds of businesses that work, those which have begun to become less-than-relevant, and those which will decline over the next five to ten years.

My criteria for inclusion in my personal business portfolio is very specific, and in fact, would actually disqualify two of the companies that are in my portfolio at the present time, which will be completely phased-out and eliminated from the portfolio over the next two years. If you would like me to consider your company, please be sure that it meets all of the following criteria:

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