What Is Network Marketing?


Quick Answer

Network marketing is a type of business model that requires a network of distributors to grow. Generating income through network marketing involves building up consumer interest toward a particular product or service, recruiting customers and business partners to the network and developing a method through which a person can manage, train and motivate recruits.

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Full Answer

Network marketing is a business model that is very popular amongst people looking for flexible opportunities. Programs that utilize network marketing typically require a small investment to procure a sample of the product that is later sold to others. Such programs also entail recruiting additional sales representatives, which end up comprising the "downline," which is when the people higher in the network generate income through the sales generated by those who are on the lower rungs.

There are three types of network marketing: single-tier, two-tier and multilevel marketing. Single-tier marketing involves signing up with an affiliate and generating income through the sale of products or services, and two-tier marketing adds the opportunity to generate additional income by recruiting affiliates and distributors. Multilevel marketing programs allow individuals to recruit multiple tiers of affiliates through whom they can generate income. When a person cannot generate a steady income solely by selling products or services, he can choose to increase his income by recruiting others into the company.

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