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?

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.

The New, All-in-One Brand Marketing Model

Imagine a marketing and branding concept that provides a completely holistic approach to the brand experience, based on a deep knowledge of the consumer. While this makes perfect sense to a person with any business savvy today, the message was not such an easy sell just 5 years ago. Then, an approach so simple and clear sounded like a foreign language.The conversation would go something like this:Client: “We have an advertising agency of record that handles our branding and marketing needs.”Agency: “So your ad agency completely understands your consumers, develops brand insights, and manages your internet, in-store marketing, direct, customer intimacy, store design, viral, sales, special events, sponsorships, product placements, and PR strategies along with all the other brand touch points?”Client: “Hell no! We have different agencies and different internal decision-makers for each of those areas.”Agency: “So your agency of record (AOR) defined the brand and manages all those firms to ensure brand consistency?”Client: “No way. One firm can’t do all that.”Agency: “Then who owns the total brand experience?”Client: “I guess our CEO is ultimately responsible for that.”Agency: “Oh, so he/she works with all the firms to make sure everything is on track?”Client: “He/she doesn’t have time for that. He/she mostly deals with financial decisions, acquisitions, Wall Street and stuff like that.”Well times have changed haven’t they? The fact is the traditional agency model has completely fallen apart. If an agency does not propose an integrated branding and marketing model in today’s day and age, what chance would they have to get a gig? And who is the AOR anymore? Is it the media agency, advertising agency (now often separate), the digital agency, the retail design group or a brand consultancy?Today’s business world demands a clearer and simpler approach from agencies. Marketing and branding plans must be explained clearly, executed quickly and measured precisely. It also helps that they are wildly successful. So how can a marketing / branding agency accomplish what was once the job of as many as five separate agencies?A good idea is to start with the concept that your best customers own and drive all great brands. These are the people who are already excited and fired up about your brand. These “brand warriors” come in many different types and can be found all over the place, especially online: Twitter followers, Facebook fans, etc. These people are valuable because they provide insight into what aspects of your current branding are desirable and are creating a positive impact on your target audience – essentially, free market research. The 80-20 rule is still as solid today as when it was first identified.The point is, you might as well understand this cult customer subculture and their relationship with your brand. Once you do, you can go out and attempt to clone the behavior. Before you know it, your small cult of followers and brand warriors is growing. Make sense?