Where the REAL Money in MLM is Made and
Why Your “Negative Friends” Are Right About Your Business… Kinda

“Everyone wants to believe they already know something about what you are talking about. It’s an ego thing to fill the void ignorance creates. Therefore, know that everyone you talk to probably already made up their minds long before you opened your mouth about what you do.”

Almost 1 1/2 years ago, my friend Eric and I had returned from a night out on the town and were hanging out at my place in L.A. and we got into a heated exchange at about 5am at my house, after he looked in my kitchen and noticed a fresh shipment of my company’s products (for my personal use).

Eric is what most of us in the industry would label a “negative person”. To say he has contempt for the MLM industry would be an understatement. He’s seen loved ones and acquaintences get chewed up and spit out by this industry and lose money in the process. (Nothing new, right?)

Over the course of my time in MLM, I’ve learned to block out negative feedback and for the most part, keep myself from being around people who are critical about a business I take very seriously.

Except there’s something you need to know about Eric. He’s probably one of the most intelligent people I’ve ever known. He was my roommate and fraternity brother at MIT. He and I got along really well during my time there and I looked up to Eric for many reasons — he’s a NO B.S. type of guy, very knowledgeable about just about anything, a computer/electronics whiz, he helped me immensely during my growth as an individual in college and the dude knows how to have fun.

The only thing that ever bothered me about Eric was that when he believes he is right and you are in a debate with him, the only acceptable outcome for him was to make you believe he is right and destroy any trace of self-confidence you had…. even if he was actually wrong the entire time.

He was a master at doing exactly that and he’s actually made people cry after an argument with him. He’s definitely intense!

Similar was his goal that night in my house as he proceeded to tear apart the MLM industry and how he believed the money is actually made.

The arguments were nothing new. All you need to do is do a few Google searches on subjects related to MLM and company names and the conspiracy theories are available for anyone to read.

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Fun “Fact”: Did you know that the Republican party is in cahoots with the Amway corporation to takeover the world? Interesting.
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But there was one thing that Eric stated, which did have a lot truth to it. It’s something that’s hard to deny, because well….. it’s true… sort of.

What is it?

He said “the real money in MLM is made through tools — books, seminars, tapes, etc.”

This is a hangup which many people get stuck on when criticizing the industry, but the truth of the matter is that selling tools and training is NOT something that is exclusive to this industry.

In fact, the idea of training someone to become a professional in a certain discipline is not rare at all. On the most fundamental level, anyone who payed $160,000 for an MIT education was sold information and training, without any guarantee that they would make that money back or enjoy their career.

If I had actually paid for it, I would feel kinda jipped. (Thank God for financial aid.)

But let’s assume that a college education doesn’t count as an information marketing business.

There are plenty of situations in a multitude of other industries where professionals will pay un-accredited companies for education in sales training, marketing, personal development, business systems, etc.

My Chiropractor is a Walking Talking Sales Letter

One of the coolest things about my chiropractor, Dr. G, has nothing to do with his ability to heal. He’s one of the most talented sales people I’ve ever met in my life. In fact, the only reason why I walked into his office was because my officemate was one of his patients and had mentioned his powerful ability to persuade people to become his patient.

Being that I was in MLM and doing sales, I was curious about his sales process. Long story short, he sold me big time on the benefits of chiropractic care and I’ve been a loyal patient since.

Over the course of the past couple of years, I came to discover that Dr. G has invested thousands of dollars in books, CDs, and seminars on how to improve his practice, keep his revenue up and personal development.

I once asked him if he had developed the sales process himself and he replied, “Fernando, do you honestly think I’m smart enough to come up with this stuff myself? Nope. I learned this process from Dr. David Singer and other trainers.”

For those of you who don’t know, Dr. David Singer is a former chiropractor who now makes millions teaching chiropractors how to market and promote their practices via books, CDs, DVDs and seminars.

If this is the case, would it be right of me to say that the real money in chiropractic is in selling tools, tapes, seminars, etc.? Not really, because Dr. Singer is no longer a chiropractor.

He is a marketing consultant.

Dr. G is the chiropractor and he’s very happy with what he’s learned from Dr. Singer. I’ve even suggested to Dr. G that as he gets older, he should go into consulting since he is so knowledgeable about the industry. But he’s perfectly content at his practice making a 6-figure income as a chiropractor, while paying Dr. Singer to keep him up to date about the latest marketing and sales methods.

Recently, Raymond became a patient for Dr. G. The first comment from Raymond after having his first consultation with Dr. G was “Dude, Dr. G is a walking talking sales letter!”

LOL. Indeed.

What the Critics are Missing

Now bringing this back to the MLM world. The mistake that most critics of the industry make is that they fail to distinguish the MLM business from the training business.

The fact of the matter is that someone like Mike Dillard as CEO of Magnetic Sponsoring is a marketing consultant for MLM.

When it comes to his network marketing business, he is a distributor and upline to thousands, while Magnetic Sponsoring has a potential market of millions.

The training business and his distributorship are two separate things.

Now the beauty of it all and something that is unique to MLM, is that once you are recognized as a world-class trainer and marketing consultant, it becomes very easy to sponsor new people into your business, because you are trusted by so many network marketers.

Your leadership and skills are proven and people will naturally want your mentorship. It’s your reward for having invested in yourself and implemented what you learned.

It would be silly for Mike to limit his training to only people in his downline. By making his Magnetic Sponsoring system available to the industry as a whole, his market share as a trainer goes from a few thousand in his downline with one company to potentially millions of network marketers across many companies.

Not to mentioned having impacted the lives of people like myself and Raymond, who are NOT part of his downline.

The Real Money in MLM is the Tools?

Now, would you still say that the “real money” in MLM is in the tools?

Not quite. At least I don’t think so.

The truth of the matter is when you are selling training to network marketers, whether it is to your downline or to other network marketers, you are a sales and marketing consultant.

That business is not MLM at all. It’s consulting. And you need experience and strong skill sets to be successful at it. (There are many who have tried and failed at this also. )

When you are promoting your opportunity or it’s products, you are a network marketing distributor. When you are personally mentoring your downline on what they should be doing, that is part of being a MLM distributor. When you hold meetings or conference calls for your downline, you are operating your distributorship.

When personally mentoring my downline, I’m never paid a dime for my efforts. My reward would come from them moving product, growing their downline and creating volume, thus increasing my sales volume and profits.

I mean the choice for anyone considering joining my team is pretty compelling — become a paying client or get personally mentored as a team member?

Hmmm…. tough one.

When I provide consulting via a workshop, course or audio, I’m a sales and marketing consultant. The proof of that is we’ve been able to apply the same marketing and sales techniques for small business owners and other online businesses, in industries having nothing to do with MLM.

Is there more potential providing training to the MLM industry or business world as a whole? Well, the answer to that is pretty obvious isn’t it?

Of course there is!

In building an network marketing business, your income is limited by the company compensation plan and your own personal efforts as an upline.

As the CEO of the Attraction Marketing Formula, I can add value to people outside my downline and grow a business, which in turn comes back to help my downline recruit, because they can say that they use AMF and Magnetic Sponsoring as the foundation for their training.

Since one of the biggest problems in recruitment is creating that relationship and trust with your prospect, when someone is already familiar with your training system and is satisfied with it, having them join your downline becomes a very easy sell.

In fact, it’s not selling — it’s attraction! It’s what the Attraction Marketing Formula course is all about… replacing the hype with REAL skill sets in marketing, lead generation, SEO, etc.

The Price I Had To Pay…

So going back to my friend Eric… well, the truth is that he wasn’t the only one in my circle of influence, who tried to “save me”. I remembered having many heated exchanges with co-workers and other people.

(Engineers are a tough and stubborn breed if you haven’t noticed.)

It’s never pleasant when you have to distance yourself from friends, to give your mind an opportunity to conduct business with clarity.

Like Mike Dillard once wrote, “[Succesful people] know that a person’s mindset is fluid. It’s always changing with the ideas and interactions it comes into contact with on a daily basis.“

When I would expose myself to the criticism, the only thing that would come as a result of it was a dip in my performance, procrastination and stress.

The price I was willing to pay for my freedom was the distance I purposely created between some of my friends and I. And with no disrespect to any of my friends, it was absolutely necessary.

I have no regrets. I have my freedom.

My girlfriend is just starting out a business and wants to market it online.

And guess who’s the lucky guy that gets to help her with the marketing front? That’s right, you guessed it, ME!

When we first started out, all she could think about was making a “pretty website“. She wanted to learn HTML and all that “flash” jazz so she could make an impressive website. This is very typical of those just starting out their online marketing venture. After some coaxing and my explaining how much time and effort it would take for her to really learn the skills necessary to make a razzle-dazzle website, she agreed to take a canned template and run with that.

Of course… after we put together the template for her she immediately transitioned her attention to the logo design. She spent a few days tweaking the logo and trying to get it to be “perfect“.

Again, I had to do some coaxing before she finally stopped tweaking her logo.

And then there’s that darned font selection and how “boring” the Verdana font looks.

It seemed like everywhere we turned there was a distraction of some sort that captured her attention.

Now, you may be asking yourself, what’s so bad about creating a nice looking website?

Nothing.

What’s so bad about creating a kick-arse logo?

Nothing.

What’s wrong with wanting to pick a pretty font?

Nothing really…

That is, nothing except you are focusing your effort on the wrong things!

It’s like your house is burning down and you are focusing on fixing your A/C… Having a functional A/C is nice and dandy, but only AFTER you put out the fire.

All Too Familiar

This is the same problem that I had when I first got started and I am sure many of you can relate. I would convince myself that what I was focusing was critical and important; however, when I became honest with myself, those things, while useful, really weren’t even remotely close on the priority list.

Truth be told, I chose to do them because they were more “fun” than the other things. Or perhaps they were “easier” and flashier. The bottom line is, I found excuses to NOT do the things that had the highest priority (and of the greatest importance).

I ask you this, are you doing the same thing? Are you avoiding doing things that could have a drastic impact on your business in favor of things that have little impact?

If so, you need to familiarize yourself with the MLM Pareto principle , which states that 80% of your results will come from 20% of your efforts and 20% of your results will come from 80% of your effort. What this means is that there are some things you can do that will produce drastic results and there are loads of little things (that take a lot of time) that may produce little results in comparison.

The secret is to always do the things that get you the “best bang for the buck” before you do the others.

What are YOU Doing?

This concept can be applied to your MLM business in just every aspect. When prospecting, are you spending too much time on the tire-kickers and looky-loos? You know who I am talking about, the ones that have 5 gazillion pessimistic questions and negative remarks for you - and you find yourself spending hours on end defending yourself and your business.

Or are you spending time with the movers and shakers who are interested in just “getting it done“.

Are you spending all your time reinventing the wheel because the canned software available just isn’t “good enough” or are you making do with what’s available now and moving on to something more meaningful like creating powerful content?

Stop missing the forest for the trees.

At every step of the way in building your business, always check your priority list and ask yourself if you what you are doing warrants your immediate attention and would produce the most drastic positive result for your business than the other action items on your list.

If so, great, carry on. If not, perhaps you should refocus.

With this in mind, my girlfriend and I were able to focus our efforts. In a matter of a few days, we had a few capture pages up (for split testing), 150 ad groups in AdWords each with 2 or 3 ads for split testing.

And now, I am having her contract out the logo and website design while focusing on reading and creating content for her business. This sure beats banging our heads against the wall figuring out just how much we suck at logo and website design…

To Affinity and Beyond,

Raymond Fong

When Everyone Else Is Focused on Opportunity Leads, Learn How To Sneak In Under the Radar and Generate Rabid Customer Leads

Egotist, n.:
A person of low taste, more interested in himself than me.
– Ambrose Bierce, “The Devil’s Dictionary”

About a year and a half ago, Raymond and I sat in front of our Martial Arts Master (a Yellow Belt and White Belt, respectively) in his office and offered to build a funded proposal for his martial arts school for FREE.

Why?

Because we wanted to test what we had learned from Mike Dillard with a “REAL Business” and see if these techniques would work.

So after a few conversations, Master Lee agreed to this experiment and so began our internet marketing consulting careers.

The result of it I think you are already familiar with — Master Lee’s recruitment sky rocketed, he became a media mogul on YouTube (search for “Hwa Rang Do”) and the “experiment” has evolved into a business partnership with one of the world’s top martial artists.

Something important we learned out of the funded proposal “experiment” for Hwa Rang Do, was how to actually market products and services, instead of just a business opportunity like we are taught in the MLM world.

Who is Susan and Why Does She Want to Talk to Me?

I didn’t quite realize how valuable this experience for us had been until a woman named Susan sent me an email yesterday and asked to speak to me.

You see, Susan purchased tickets for our MLM Traffic Formula LIVE in Austin, TX next month.

She had some questions about the focus of the system she wants to create next month at the event, and she wanted to do some prep work before the event. She politely requested to have a brief conversation with me, because she was serious about making the most out of that weekend.

So I agreed to speak with her and scheduled a time to talk.

Trouble Recruiting for an Old MLM…

She called and told me that she wanted to create a product-based lead system for her Herbalife Business. She said she had trouble recruiting people into Herbalife, because it’s such a well recognized brand and people immediately make assumptions before she has an opportunity to present her business opportunity properly.

Therefore, she very wisely has chosen to lead with her products.

The reason this is a good idea is because most people generally want to believe that they know something about what you are talking about.

If they have any previous experience or knowledge of what you are presenting to them (no matter how inaccurate), they immediately draw from those experiences and make decisions based on that, NOT what you presented to them, (i.e. their listening is off.)

So leading with your opportunity when you are involved in older companies like Amway, Herbalife, USANA, NuSkin, etc is usually not the best approach.

Leading with Your Products

Aside from stability, the big benefit that these big MLM companies offer is that they are constantly producing new products for their distributors to sell.

So while the opportunity brand may be old and stale, you can still lead with a novel new breakthrough product.

In speaking to Susan, I suggested that she focus on one great product, with a nice profit margin and which can produce immediate effects for her customers. She immediately knew what product that would be.

I then advised her to come up with the top benefits of this product — what pain does it relieve? what problem does it solve? what immediate results can people expect? What kind of person would need this product?

She would then use this information to craft her capture page at the workshop.

Writing Newsletters that Sell Product

Next I asked her if she was knowledgable about health and wellness and if she would feel comfortable writing about it? She said yes, she was.

So I suggested she write a few newsletters providing free and valuable information on health and wellness.

But what I suggested she write her first few newsletters on was on how to solve or provide the benefits of her lead product, without them needing to buy the product.

“Huh?”

This might seem a bit counterintuitive, but that is exactly what I told her to do.

I explained that her email newsletters and lead system need to stand alone as valuable content and information. If you do this you’ll accomplish three things:

When you deliver on your promises and blow people away with the value you have provided them, you become their new best friend and they will be more open than ever to any product recommendations you will make.

So the newsletter format I advised her to use for all her emails is as follows:

Some MLM companies may prohibit you from having sales copy or links on any website or email promoting a product (especially a nutritional product), so in that case, you may want to skip #2 and make product recommendations part of your personal health consultation.

The important thing to remember here is that your goal is to become an authority/expert first! Avoid the temptation to pitch your product right off the bat.

Ideally, what you want to do is create a business relationship with them even before they’ve purchased any of your MLM products. This could be some kind of info product or affiliate promotion.

If someone is willing to give you money for advice, then they will definitely be willing to give you money for a product you recommend, which can potentially solve their problems.

I expect big things out of Susan and I want the same for you.