Top 10 Reasons Why People Fail in MLM Or Direct Sale Businesses

You have seen the TV clips or online ads where people proclaim “I made $37,000 last month alone and you can too”, “I followed this easy 3 step process and now I am retired”, or the multitude of other “catchy phrases” to grab your attention.  And while what these individuals say is true, why do 97% of the people who start a home based business fail?  Why do only a very small percentage of people succeed in network marketing and generate the residual income that all network marketers dream of?  There are many reasons for failure, but some are more common than others.  Here are the Top 10 reasons why people fail in their MLM or Direct Sale Business:

#10 – Promise things they cannot deliver

The lack of integrity will kill any business. You might get away for it for a while, but your lies and deceit will eventually catch up to you – look at Enron and Bernie Madoff. 

#9 – Looking and waiting for the magic bullet

People always look for the easy way out. They want to find the magic bullet that will solve all their problems. They fail to realize that network marketing is the gun and YOU are the magic bullet. YOU are the key to your success in network marketing and the sooner you realize that, the sooner you will be successful. 

#8 – Not setting goals or setting unrealistic goals

Every successful entrepreneur sets goals. It is a must and gives you a target to shoot for, something to aim towards. BUT make sure you are not setting unrealistic goals. Your goals should be challenging, but attainable. The sky is the limit but make sure you are not aiming for the sky on your very first shot.

#7 – Lack of proper training and mentoring

While everyone can join a network marketing opportunity, very few people have the skills right off the bat to succeed.  This is especially true when we start discussing how to use Web 2.0 techniques to market you and your opportunity. Additionally, you need several people you can talk to (mentors) who can guide you in the right direction and provide valuable feedback. Too many people join an opportunity and use their marketing system improperly and do not even realize it. Make sure you join a successful team with people who are willing to help you.  

#6 – Looking for instant money

A lot of people join a MLM or direct sales business looking for easy, instant money. It’s not going to happen and anything that promises you otherwise is either a scam or not being truthful to you (see #10). True residual income comes from YOUR effort.   Any successful venture you undertake will require YOU to put in some work. 

#5 – Try to convince/beg people to join their team..Not taking NO for an answer

I was guilty of this for a long time and believe me, it wasn’t pretty. People need to join your team because THEY want to, not because they felt sorry for you or felt pressured. If so, they will quit. So don’t pressure people. You give them the facts straight up, answer their questions, address their objections, and let them decide. Not everyone is going to say yes, so you might as well get used to it now.

#4 – Don’t further their education

Education is extremely important. The system you work with will provide you some education, and most of the time, it is very valuable. But you need educate yourself outside of the training system you are using. Ask your upline or mentors for suggestions.  You need to be known as an expert if you really want people to follow you. 

#3 – Not willing to go outside their comfort zone

There are many things you need to do to be successful in your network marketing business. Some will lie outside your comfort zone – example: calling leads. By performing tasks outside of your comfort zone, you actually get closer to putting those tasks inside your comfort zone. The more you put in your comfort zone, the more successful you will be.  

#2 – Not accepting of new technology

This goes with #3. Too many people are afraid of technology. I knew nothing of SEO, Google AdWords, Lenses, Hubpages, or any of the other Web 2.0 technology. It is here, and it will stay, but do you decide to take advantage of it or will you continue showing your business overview on a white board in someone’s home?

And the number one reason is:

#1 – Treat it like a hobby

People need to be consistent and persistent in their actions. Create a weekly to-do list, create a weekly schedule around that and stick to it. You go to your employer 40 hours every week with no excuses, so you NEED to take the same attitude with your OWN business. Too many people treat their MLM or Direct Sale business like a hobby yet don’t understand why they are not seeing any progress. 

There you have it – the top 10 reasons why people fail in their MLM or Direct Sale business. Be honest, how many of these reasons are causing your failure? And what will you do now to change that and become successful?

Internet Vs Offline Marketing – Does Your Business Need Both?

Would you like to make sure that your marketing efforts are more concentrated? Do you find yourself trying to find a delicate balance between offline and online marketing techniques and methods? We will state for the record that you should probably be doing both. There is no one size fits all answer here and a lot depends on your business and the goals you are trying to accomplish with your marketing. Answering this question will allow you to focus your advertising spend on the efforts that get the best return on investment (ROI).

Adding The Internet To Your Strategy
One of the best things you can find out and be conscious of is how does your business measure up to the competition? Knowing this answer means you can start to formulate a comprehensive plan of action. This will also depend largely on your specific niche market and geographical location. For example, if you are a relatively small business concern and located in a predominantly rural area then you may want to focus on direct mail,television, radio and print advertising. However, keep in mind that the Internet can be very advantageous as well. This is because most people will look online first to help them decide what they need, who to call and where to go. If they find your presence there you may have just effortlessly created another customer.

Online Advantages
If you are a business owner who has been using traditional marketing methods outside of direct response then you already know the difficulty of measuring the effectiveness of your marketing dollars. The Internet allows you to very easily measure your marketing spend (ROI) and total cost of ownership. You will also find in most cases that the results tend to have a greater sticking ability. This is usually a direct opposite to what happens in print marketing which can usually have a short shelf life.

Use A Comprehensive Approach
We are not for a moment suggesting you get rid of offline marketing methods that have worked for you in the past. We are suggesting that you embrace some of the newer online technologies so that you can take advantage of multiple mediums of information delivery. Everyone is not reading magazines, or listening to the radio or watching TV at the same time. This is why it’s important to take advantage of having a presence where people are already getting information. This can mean using social marketing, blogging, press releases, article marketing, search engine optimization (SEO), direct mail, print advertising and even email marketing to name just a few. By using this group of online and offline methods you can increase the ROI of your marketing dollars in an efficient and very measurable manner.

Of course if you are not sure where to get started with this or don’t have the time to learn it or implement the named strategies then you should think about using a consultant. In most cases they will be able to assist you with both of these methods or maybe just with the newer online strategies where you may not have that much experience.

Don’t Make An Ass Of Yourself With Marketing

No matter how advanced or innovative your offer, your dreams of growth may go unrealized by way of assumption.

Why? As entrepreneurs we’re often so eager to start selling our innovations, we jump right to promotion and advertising with a set of killer assumptions. Our marketing often flounders or fails as a result.

We Assume Consumer Relevance

We make the mistake that potential clients understand the value we represent and how they will benefit from our products and services. As a result, we start our marketing conversations with descriptions and explanations rather than with stories that show benefits. The result is irrelevance, disinterest and financial loss.

We Assume Profitable Sales

We make the mistake of assuming profits when we default to using forms of marketing that have little hope of ever generating a profit, even in a best case scenario. The results are unprofitable sales at best and more likely we experience mounting losses.

We Assume Blue Skies

We make the mistake of assuming that fortune will favor the bold. We believe our untested creative concepts, messaging and design will engage and inspire people on its debut performance. The results are unnecessary risk taking and unrealistic expectations.

We Assume Staff / Supplier Leadership

We make the mistake that marketing leadership can be delegated to others without any meaningful terms of reference. We simply hope our suppliers know what they are doing and then we pay the penalty in poor performance. We end up redoing our marketing over and over as we move closer to our undocumented objectives.

The Sad Truth About Marketing

The results of our assumptions are flashy designs and flowery product descriptions held together with hopes, prayers and our discretionary income. What’s missing are the fundamentals that shape and give meaning and direction to our writing, design and sales forecasts. Missing is our customers’ perspectives and the stories that engage and enroll hearts, minds and wallets.

Why Do We Assume, When Our Risks Are So High?

Impatience and inexperience are the usual culprits, but there is also a gap in the marketing knowledge base at work. The majority of books and articles on sales and marketing offer only bits of insights, out of context with an overall process. Most books seem to assume you are a consumer products marketer, as well. If you’re not (like many of us), what you learn may be inappropriate.

The Bottom Line

If you want your marketing done right, you need to direct the process yourself. This does not mean “do it yourself”.

Directing means:

defining your core values and value proposition
defining your audience and building personas
establishing your core purpose and competitive positioning
detailing constraints and setting targets
committing to a strategic direction and plan
defining reporting requirements
creating budgets and timelines
These are the foundation stones that you build on and grow into.

Where Can Entrepreneurs Learn Marketing Leadership?

The leading institution appears to be The School Of Hard Knocks. However, if you look hard enough you can find mentors, a marketing coach or a Fractional Director of Marketing, ideally with a program to follow. Otherwise your options are limited to market accelerators that typically focus on high-tech consumer product companies. If you don’t fit the consumer products mold, your options are limited.

Ready To Step Up And Lead?

Don’t get caught in the assumption trap with most of your peers. Don’t assume your consultants and staff took care of everything for you; they can’t do it without your leadership. Now is the time, to step up and lead your own charge. It’s time to build your “platform for earnings growth” instead of just designing cool graphics and websites.