What is Multiple Level Marketing and How it Works

When I had about multilevel marketing mlm, it was just in abbreviated form and I kept wondering what it meant. The good thing about me is that I never feel stupid when I come across to something that is totally new. This is because I know that all of us were born without knowing a single thing.

This is to mean that our brains were totally blank at the beginning then bit by bit we started feeding them with information. It is like a computer, when you buy a new one its hard disk is totally blank. Gradually, you start storing the necessary data and programs which you require.

So, the multilevel marketing mlm thing was part of day’s problems till the time I got hold of the mouse and clicked on a page that had the exact words ‘Multi Level Marketing’ and from there I was totally absorbed by it with the aim of knowing every detail about it.

If you are just the same way I was, I am sure you will be knowledgeable about it after reading this content. This is nothing complicated and you can define it since its name has already given you a hint.

Multilevel marketing mlm is defined as system on which there are many levels which are composed of people (sales representatives) who are marketing a company’s product to consumers in reward of commissions.

These levels are created by the company which trains the first sales representative on how to get customers who in turn trains the second sales representative. After acquiring the necessary skills, the second sales representative trains the third one and this process goes on and on.


In each level, each sales representative is a manager of his own by that I mean he can recruit his own sales representative. The multiple level companies do not pay salaries to the sales representatives. Instead, they pay them commissions based on the number of customers they have acquired.

This seems to be a smart marketing strategy because the company is not having expenses which are associated with employing salesmen on a permanent basis. If there are no customers acquired, then there are no commissions paid.

The good thing about it again is that the company is able to expand its market. It is able to distribute its products in a wide market if only more sales representative are acquired and if they are allocated in different regions.

Do you remember Charles Ponzi scheme? Oh…yah! Many people regard it to be a multilevel marketing mlm. This is not true since his scheme was based on a banking idea. It is whereby he collected deposits from the public without investing it in any business venture.  He collected a deposit from an investor to pay returns to another investor (the second investor's deposit was used to pay returns to the first investor.)