What Does Information Giant WIKIPEDIA Say About MLM (Multi-Level-Marketing) and Network Marketing?

FOR IMMEDIATE RELEASE
(Free-Press-Release.com) June 29, 2011 -- “Multi-level marketing (MLM) is a marketing strategy in which the sales force is compensated not only for sales they personally generate, but also for the sales of others they recruit,” thus creating an organization of distributors and a hierarchy of multiple levels of compensation. Other terms for MLM include network marketing and referral marketing.”

“Most commonly, the salespeople sell products directly to consumers by means of relationship referrals and word of mouth marketing. Some people equate MLM with direct selling, although MLM is only one type of direct selling. MLM companies have been a frequent subject of criticism as well as the target of lawsuits. Criticism has mainly been focused on their similarity to illegal pyramid schemes, price-fixing of products, high initial start-up costs, emphasis on recruitment of lower-tiered salespeople over actual sales, encouraging salespeople to purchase and use the company’s products.” Xocai (Mxi Corp) is not a pyramid scheme. However, not all MLM companies operate the same way, and MLM groups have persistently denied that their sales techniques are anything but legitimate business practices. In contrast to MLM is single-level marketing. In single-level marketing, the salesperson is rewarded for selling the product, but not for recruiting or sponsoring other salespeople.

~Direct selling, Network Marketing, and Multi-level Marketing…

“Network Marketing and Multi-level Marketing are generally considered to be synonyms, and a subset of direct selling. While “direct selling” and “network marketing” refer primarily to the distribution system, the term “multi-level marketing” emphasizes the compensation plan more. Network Marketing tends to be modern preferred term, however many other terms are also used, including word-of-mouth marketing, interactive distribution, relationship marketing and others. Critics have argued that the use of different terms and “buzzwords” is an effort to distinguish multi-level marketing from illegal Ponzi schemes, chain letters, and consumer fraud scams.” Xocai (Mxi Corp) is not a pyramid scheme.

“The Direct Selling Association (DSA), a US industry body, reported that, in 1990, 25% of members used MLM, growing to 77.3 percent in 1999. Companies such as Avon, Electrolux, Tupperware, and Kirby all originally used single level marketing to sell their goods and later introduced multi-level compensation plans. By 2009, 94.2% of members were using MLM, accounting for 99.6% of sellers, and 97.1% of sales. The DSA has approximately 200 member (companies) while it is estimated there are over 1,000 firms using multi-level marketing in the US alone.”

~History…

“It’s generally accepted that the first multi-level marketing plan was introduced in 1945 by the California Vitamin Company (shortly afterwards to become Nutrilite). The plan allowed Nutrilite distributors with at least 25 regular customers to recruit new customers and draw a 3% commission from their sales. Unlike traditional direct selling, this was an ongoing payment whenever the customer re-ordered, allowing direct sellers to build a sales organization that could generate a residual-like income.” http://www.mxicorp.com/perfectcombination/ or CLICK HERE

~Setup…

“Independent, unsalaried salespeople of multi-level marketing, referred to as distributors (or associates, independent business owners, dealers, franchise owners, sales consultants, consultants, independent agents, etc.), represent the company that produces the products or provides the services they sell. They are awarded a commission based upon the volume of product sold through their own sales efforts as well as that of their organization. Independent distributors develop their organizations by either building an active customer base, who buy direct from the company, or by recruiting of independent distributors who also build a customer base, thereby expanding the overall organization. Additionally, distributors can also earn a profit by retailing products they purchased from the company at wholesale price.

~Legality and Legitimacy…

MLM businesses operate in the United States in all 50 states and in more than 100 other countries, and new businesses may use terms like “affiliate marketing” or “home-based business franchising.“ However, many pyramid schemes ALSO try to present themselves as legitimate MLM businesses. The FTC states: “Steer clear of … illegal pyramid schemes.” Xocai (Mxi Corp) is not a pyramid scheme. Pyramids are NOT MLM companies all the time – they are bad pretenders! Why is pyramiding dangerous? Because pyramid plans … inevitably collapse. How can you avoid a pyramid? Look for companies that have been in business at least 5 years – that’s your best measuring stick.

Adam Paul Green     direct selling     Healthy Dark Chocolate     mlm     Multi-Level Marketing     mxi corp     network marketing     Xocai