MLM Software in Lucknow

Best MLM Software company in Lucknow

Multi-level marketing is a strategy that some direct sales companies use to encourage their existing distributors to recruit new distributors by paying the existing distributors a percentage of their recruits' sales; the recruits are known as a distributor's "down-line." All distributors also make money through direct sales of products to customers. Amway is an example of a well-known direct-sales company that uses multi-level marketing.

Multi-level marketing is a legitimate business strategy, though it is controversial. One problem is pyramid schemes, which use money from new recruits to pay the people at the top, often take advantage of people by pretending to be engaged in legitimate multi-level marketing. Pyramid schemes can sometimes be spotted by their greater focus on recruitment than on product sales.

MLM Software in Lucknow

An issue in determining the legitimacy of a multi-level marketing company is whether its products are sold primarily to consumers or to its members who must recruit new members to buy their products. If it is the former, the company is deemed a legitimate multi-level marketer. If it is the latter, it could be operating a pyramid scheme, which is illegal. According to industry data, there are 90 million members worldwide, but relatively few earn meaningful income from their efforts. To some observers, that reflects the characteristics of a pyramid scheme.

An example of a high profile multi-level marketing company to defend its practices is Herbalife Ltd., a manufacturer and distributor of weight-loss and nutritional products with more than 500,000 distributors. Although the FTC had been investigating Herbalife, it was activist investor William Ackman who shed a national spotlight on the company by shorting $1 billion of the company’s stock in 2013. Ackman accused the company of operating a pyramid scheme and backed his allegations with a bet the company’s stock price would fall under the weight of the scam.  

Although MLM is most commonly associated with direct-selling distributorships and/or party planning companies, some major financial/insurance companies also employ this strategy, including Primerica and World Financial Group (WFG). Although party plan consultants will certainly gain valuable grass-roots marketing experience, the college-educated marketer will seek positions within these larger financial companies, or at the corporate level of an MLM company. Because of its relational aspect, the products usually involved, and the gender of the consultants themselves, women are the predominant target for MLM strategies. However, the gender proportion shifts significantly in the case of financial and/or insurance companies. When it’s time to develop a financial portfolio or consider a term life-insurance policy, it’s usually a joint decision made by husband and wife, or by the head of the household regardless of gender.

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In terms of economic background, MLM customers profile according to the products or services being offered, but generally trend toward a middle-class audience. Most people can afford to purchase Tupperware or Mary Kay, and may want attend a party to check out the products regardless.

However, a Pampered Chef demonstration or Creative Memories scrapbooking party (which often requires a fee for basic supplies) will appeal to demographics with a more disposable money, but not an audience with luxury tastes.