Network marketing or multilevel marketing also is associated often falsely in Germany with the so-called Ponzi or pyramid scheme. In times of rising unemployment advertise many job ads with slogans like \”Flexible working from home.\” Specified behind the phone number hides a networker often, acquired in this way new distributor. Network marketing or multilevel marketing also is associated often falsely in Germany with the so-called Ponzi or pyramid scheme. Actually it is a form of direct sales. The end user or reseller refers to its goods directly from the manufacturer and operates legally independently of the company. He buys for their own needs, can also sell the goods.
A distributor enlists a second, he gets Commission on its shopping. In network marketing, no bounty bonuses will be paid. The network companies spend virtually no money for advertising, this budget flows as income to their distribution partners and in the development of products. At the Goods are usually consumer goods which are ordered consecutively. As a satisfied customer, purchasing power is rarely lost. Customer loyalty in network marketing is extremely high, 83 per cent of customers are continuous or regular customers, so the direct marketing consultant, Prof.
Michael Zacharias of the Fachhochschule worms. More than a quarter of new customers win NetWorker through the recommendation of their existing customers. Network marketing is called also referral marketing. The success can be explained by three factors: the advice in the classic retail increasingly declines, and the large groups of trade sell the same products everywhere. \”Who wants to be successful in network marketing, must a company look, which sold products, of which one is even enthusiastic\”, advises Zacharias. \”The main motivation is to choose the network marketing to create an extra income as well as to work in the free schedule and the possibility of home\”, so Zacharias. (Source: Credit Accelerator). The start up costs are usually low, the Distributor acquires a so-called \”Starter Kit\” that includes catalogs and forms for 15 to 100 euro.