Network marketing is a marketing paradigm wherein the interconnection of the market actors and the transactions are greatly stressed. The terminology networking marketing in popular usage is a synonym for multi-level marketing or MLM. Sometimes, it is also mistakenly considered as the pyramid scheme.
Many are enticed with the promises of network marketing. Who would not be? The idea of making instant money and not requiring any special skill or any form of investment is very appealing especially to those who are with an immediate need for it. However, there is also a down side in this kind of business model. A short list follows just to give you an idea of the dark side of network marketing.
Network marketing or multi-level marketing are doomed by design.
If you consider that there is a possibility of succeeding by believing that the product is saleable without a doubt. Then once again, you are mistaken. All products and even services will only have partial market penetration. Not everyone would want to drink filtered water, or wear a particular shoe style, or avail of a service or product. In the real world of business, there is no such thing as an infinite market need for any product.
After all, if the MLM product is such a hit, is it not questionable that it is not sold in the customary marketing system as known by human society for over a thousand years now? It would not need any special kind of marketing scheme like the MLM. That is something to really think about.
Looking at the MLM design on a mathematical perspective, you will see the very obvious geometric flaw in the entire setup. Multi-level marketing works through geometric expansion. It is one vicious cycle of people recruiting people recruiting more people. This kind of business model leads to market saturation and it is inevitable. And sadly, the unfortunate person at the bottom of the chain ends up as the loser. It is because all that is generated are false hopes and money is lost in a senseless manner.
The organizational issue of a pyramid structure is