Network Marketing Trials & Tribulations in the Far East

This blog relates facts, figures & rants to educate truths, debunk myths & assist newbie/seasoned readers who are sieving the myriad of deceit concocted by people wishing to close deals in a quicker fashion. Looking for: 1) the right company, 2) a viable compensation plan, 3) good co-workers, 4) a simple duplicable system with dependable support & resources…goes a long way in making it easier (& safer) to build a network based on the right principles. If "Nobodies" can make it, YOU can too.

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Wednesday, April 22, 2009

The crux of matrix plans & spillovers.

Putting on your business caps...
we all know that any traditional revenue-generating business achieves its regular business revenues from only a proportion of its full customer-base.

e.g. not all coca-cola drinkers consume coca-cola regularly.

Of course, generally speaking, there might be X number of loyal customers who might consume "ABC" brand daily but that's an ideal situation and besides the point -- lets talk big picture in reality!

Which leads us to networking... where it is the same as any traditional biz, company "DEF" can claim it has XXX,XXX numbers of distributors / consumers. It is always the case, that only a % of the distributor / consumer base are actively buying &/or promoting product on a regular basis.

In terms of matrix compensation plans, it does not matter how big your upline claims his team / organisation is -- & how it will spillover into your own downline "by default" which will generate "business for you" even if you did not refer anybody to the business / product.
Do you realise it is actually how many direct-linked uplines that are active in the business that will contribute to the actual spillover in your downline organisation.
Not forgetting, if YOU are contemplating registering a membership position and "sitting there" for spillovers without doing any work, imagine how many others are relishing that situation too? LOL.

The main post discussing matrix plans is here.

Take a pen & paper. Draw an imaginary line from you (dot #1), to your sponsor (dot #2), to his/her upline sponsor... all the way to the master distributor who sits at the top of the organisation.
i.e. the first guy in the business who the company put in charge of the entire network.
(You may throw in a couple dots in between each dot you drew earlier, if & only if every dot is a "capable recruiter" who brings consistent business throughout his career with the company. In reality we know most networkers cannot, or will not. Also in matrix compensations there are 3 or more legs in which to spillover additional new members -- which dilutes the situation exponentially.)

In real life, perhaps 30% of an average organisation is actually buying / promoting product. Lets be generous and say 50%!
That means you are left with only half (or less!) of the dots you drew earlier -- who will contribute in "building your downline" for you.

To cut the long story short, no matter how massive a company says its distributor/consumer database is (e.g. 300,000), it could very well be 10 dots or LESS (who contribute to spillover) linking you to the distributor who is above everyone in the organisation tree. This is just how business dynamics is in real life.

In comparison, modified-binary plans can truly let you "stop at 2" personally sponsored downlines, thereafter you benefit from FULL comp plan benefits while the business expands. Keyword being "can", because 90% of binaries / modified-binaries still come with many unseen conditions that require you to keep recruiting beyond 2. (Do your research and you might chance upon such a generous organisation -- hopefully this post can help you in that respect.)

Of course, the most taxing pay plans remain to be unilevel / stair-step, where your business building success almost entirely lie in your own hands. i.e. each & every sponsored downline in your organisation has to start from your effort. Meaning you have to bring a "frontline" of personal downlines, and from there they help you (& themselves) expand the organisation in the same way. No spillovers. In some old-school payplans like these, some uplines resort to "giving" downlines a few leads to personally sponsor (sort of like a spillover but only out of goodwill), BUT note that this opens up a can of worms policy-wise where the distributor is liable to be terminated.
Especially when networking is a human-to-human business, and a very primal human instinct is still involved -- jealousy! Rival teams or unhappy peers / crosslines may report such activities to your company's compliance department.

In conclusion, spillovers are great. But by making that fateful decision to be a part/full-time networker, you must be professional -- be responsible and do your minimum to drive a successful business for yourself.
The minimum? Sponsoring and recruiting, of course!

Once you are expending minimum effort, you will be growing an organisation no matter if its a matrix / modified-binary plan.



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Find a niche & the market will come to you!

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