Why is the MLM Failure Rate So High?
It’s generally accepted that approximately 97% of all MLM home business owners will spend more money than they make. This results in nothing more than a fairly expensive hobby, and ultimately results in MLM failure.
Why?
I posed this question to several of my colleagues in the home business industry and, to my surprise, there was an overwhelming similarity to their responses.
The NUMBER ONE reason that most experts gave for the high MLM failure rate?
UNREALISTIC EXPECTATIONS. People getting into the business for the wrong reasons, and expecting unrealistic results.
Who is to blame for these unrealistic expectations. I believe the fault lies with both the new business owner and the network marketing industry.
Many people start a home business NOT to build a long term source of income but to make money quickly. They need money to pay bills, to pay off debt, or for some unforeseen emergency.
They read the HYPE on the internet, or get caught up in the excitement of a presentation, and sign on the dotted line.
Next thing they know, they find out they have to spend more money to purchase more products or to get higher into the compensation plan to make the kind of income they need.
They soon find out that there are a whole set of skills they need to be truly successful, including sales, copywriting, and marketing skills that take most people years to acquire.
And they get frustrated.
What they really want is quick money, a lot of money is as little time as possible.
They did not sign up for the long term plan.
But that is what a home business really is. It’s NOT a get rich scheme, it’s a get rich slow scenario.
And we in the Network Marketing and MLM industry are also to blame. Because of the HYPE.
We set people up for their unrealistic expectations based on our “hypey” ads, our misleading sales pages, and our broken promises of full and complete training.
That’s the bad news.
The good news? There ARE companies out there that deliver what they promise in terms of training and support. There ARE companies that cut the learning curve down dramatically with their systems.
But even so, it still is going to take the inexperienced marketer some TIME to acquire the necessary skills to succeed in their home business.
That is why I make sure that all of my prospects UNDERSTAND UP FRONT that they will need to work at their business, to treat it like a business and not like a hobby, and to learn skills they may not have at the moment.
I make sure my prospects understand, REALLY UNDERSTAND our company compensation plan, so that they are not blindsided by any additional funds needed to get their business off the ground.
Do less people sign up with me because of this. UNDOUBTEDLY.
Does it bother me? NOT A BIT.
Why? Because the ones who don’t sign up are the ones who would drop out within 6 months anyway. They are not really looking for a home business. They are looking for extra cash. And most times they don’t really want to work all that hard to get it.
What am I left with? A team of serious entrepreneurs who understand that it takes time to attain success and that sometimes money has to be spent in order to generate more significant earnings later on.
And these people are HARD WORKERS. They are not looking for a free lunch.
They are my kind of people!
To Your Success!
Dr. Bob Clarke
September 30, 2008; Cresskill, NJ
Looking to Start a Home Based Business? Watch the Hype!
Enough is enough.
The HYPE in the network marketing industry is OUT OF CONTROL. The unsubstantiated income claims, the guarantees that can’t be met, the promises that can’t be kept. Enough already!
My wife Rosemary and I are network marketers, and up until recently pretty proud of this fact. But we are embarassed by the current state of online marketing. It seems that:
HYPE IS IN, INTEGRITY IS OUT.
Just today, I clicked on a website link for a friend of mine, one who I respect quite a bit. And up at the top of her site, I see these words…
“I guarantee that you’ll make $5000 your first week, or I’ll give you a free Flip camera!!!”
First of all, the claim is ridiculous. Unless you are an experienced network marketer with tons of marketing experience, or you are bringing a huge downline into a business opportunity with you, there is no way this will happen.
So what if it doesn’t and you call her on her promise? So she spends $125 bucks, gets you your FLIP camera, and pockets the remaining commission money she received when you signed on.
I call these types of claims misleading at best, unethical at worst. AND THEY ARE EVERYWHERE.
So what to do?
Well, I was lucky. I joined my current business opportunity on the advice of a very good business associate, someone who I trust and respect. And it turned out his advice was 100% correct.
But for the people who go into this blind, who have to place their trust in people making outrageous claims on the internet, I feel sorry for you.
How the hell are you supposed to trust people you don’t know?
It’s no wonder there is an atmosphere of mistrust, skepticism, and cynicism on the Internet these days.
It’s well placed and justified.
My wife Rosemary and I are doing well enough in our businesses that we don’t have to rely on hype.
We don’t need to exaggerate and we don’t need to mislead people to join us.
We market with integrity and we believe that we have to EARN people’s trust before they will join us.
It’s the way that resonates most with us, even if it takes us longer to make our millions than others.
At least we can sleep at night.
To your success!
Bob
Cresskill, NJ; September 15, 2008
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