In the excitement to recruit, many network marketers wonder why their commission checks seldom cover their expenses.
The answer is simple.
Companies don’t pay you to recruit. They pay you to sell their product or service. And although it is certainly admirable to have a battalion of distributors in your downline, the truth is, until there is a sale, there is no commission. Therefore, in conjunction with your recruiting goals, you must incorporate sales volume goals.
Follow the steps below to build organizational sales volume:
a. Use the product
It seems hard to believe, but some people do not like or use the product they market. If this is the case for you, find a different company. In the network marketing business, people buy from you because they are responding to your heart felt enthusiasm for the product. People will trust you, but they are also perceptive. If you are unfamiliar with the product, or do not use it regularly, they will notice.
Before asking a potential customer to get excited about a product and open their wallet to spill out hard earned dollars, you must first have the conviction to honestly say: “This is a good product. You will get your money’s worth. I guarantee it. ” How can you do this if you don’t even use the product yourself? If you want to be a charlatan and operate on the edge of incredulity, find another line. Don’t soil the industry for the rest of us.
b. Encourage your downline to use the product
Using the product applies to your downline also. Encourage them to buy and use the product, and have samples of the product available for all opportunity meetings. I’ll discuss this in more detail below.
c. Never miss an opportunity to sell
One of the best times to secure a sell, and possibly find a repeat customer, is immediately after a prospect turns the opportunity down. During the course of your presentation of the plan they have been exposed to the product, and although resistant to the idea of getting into business, may be interested in using the product. Never leave a prospect without at least asking for an order.
Throughout the day, whether you realize it or not, you pass up several opportunities to market your product and possibly share the dream. Wherever you meet people by chance, overhear conversations, or conduct business with an individual, you have an opening to mention your product. If people ask what you do for a living, hand them your business card and say, “I market a unique home cleaning product, give me a call if you want to learn more about it. ” Don’t flood them with information at this point. Wait for them to ask something like, “Oh, what kind of cleaning products do you carry?” At this point, you better be reaching for your samples and order pad.
d. Ask for the order
Amazingly, many salespersons will demonstrate a product, convince the customer it is the right product for their needs, then fail to ask for the order. You’re not being paid by the hour, so what’s the use of standing around like a teenager working in a hamburger stand? Ask for the order. When you complete your demonstration, ask the customer, “Would you like the traditional or heavy duty cleanser. ” Or, “Which do you prefer, the automatic re-order plan, or the single purchase option?”
When they make a choice, fill out the order form. Although you have to guard against being openly arrogant, it is important as a salesperson that you go into the demonstration assuming the sale is a done deal. All you need to do is educate the customer about the product and fill in the order form.
e. Qualify the prospect
Asking for the order, as described above, may make the process sound too simple. But, if you adhere to this important principle of sales, it will be.
Don’t waste your time attempting to sell the product or opportunity to people who have neither the funds, nor the inclination to get involved.
What a colossal waste.
The efficient and effective use of your time demands that you pre-qualify your prospects, to the point that it does not cause you to prejudge a person’s ability to succeed in the business as a distributor. If you’re selling a health product a simple question like “are you concerned about your health?” will tell you if you have a responsive prospect or a dead beat. If you sell soap, you may want to ask, “would you be interested in learning about a revolutionary cleanser that will simplify your housework?” Again, their answer will tell you whether to proceed with the presentation, or walk away.
f. Find regular customers before recruiting
In some organizations, new distributors are encouraged to market the product and develop a regular clientele of repeat customers before even attempting to recruit. Often times, consumers of your product come to you, asking how they can get involved as distributors. This may be the best way to build a network marketing business-sell the product, then recruit your customers.
Like any successful business endeavor, you need to play a numbers game to get ahead. Mail order entrepreneurs know that response rates for direct marketing pieces (what you may call “junk mail”) averages around 2-3%. That translates into about 20 to 30 sales out of every 1,000 pieces mailed. It doesn’t sound like much, but an entire industry has been built on these numbers.
Industry standards for MLM sales and recruiting success rates are not as well known or as predictable as the mail order response rate. On average, I can expect to make a sale if I share the benefits of my product with 18 people. That’s a little over a 5% response rate. In practical terms, 5 out of every 100 people I meet in a business context will become my customers. Not a lot, but enough to build a business.
This is why successful companies and successful network marketers value their customers and work hard to keep them. In network marketing your advantage over the department store or Internet website, is personal service, tailored to the specific needs of your customer. Don’t shortchange your customers. Serve them and keep them. Regular customers are your bread and butter.
To increase sales you must prospect for new customers. Knowing that 95% of the people you approach will turn you down helps keep it all in perspective. You have to be willing to sort through 100 people to find the 5 that want to be your customer. How many new customers do you want by the end of this month?
1 new customer: talk to 18 people.
5 new customers: talk to 100 people.
10 new customers: talk to 200 people.
If you only talked to one person per day, you could expect to grow your business by 1-2 new customers per month. By the end of your first year in the business, you could have 12-24 regular customers, and customers mean regular commission checks.
Many network marketers choose to stop recruiting customers when they achieve the personal sales volume necessary to achieve a certain commission rate or distributor rank. In my opinion, this is silly. Satisfied customers are your best source of potential recruits. Continue to add to your customer base. You will always need new people for your sales team.
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Phillip Collinsworth is the author of several books available on Amazon. He hosts a website offering free information on wealth building, and finding income opportunties through Internet marketing. Visit: