Cooperative Marketing Business Model Vs Traditional Network Marketing Business Model

For clarity, I will refer to Cooperative Marketing Business Model (CM) as it is set up in the business that I’m in. Actually I can’t say with 100% certainty, but I have never came across this business model with any other business. It assures that you can join as a business partner today and have buying customers tomorrow. That can’t be said with traditional network marketing business’s.

Here’s a quick overview of how the cooperative marketing model works. The company that your affiliated with spends its own money on TV, radio, print, internet advertising…, to acquire customers for its product(s). Additionally, it back ends those customers which have bought products. That is, they service, educate, promote, provide special buying incentives… all in effort to retain their customers. The company allows its personal business affiliates like myself, the right to acquire(purchase) the lifetime purchasing rights of those customers. thereby allowing yourself to build a long lasting residual income.

These are real customers and you don’t have to process their orders. IN FACT, YOU DO NOT SELL, STOCK OR SHIP PRODUCT! The cooperative marketing business model provides systems in place to take the pressure off of you for selling or marketing products. Of course you can market and acquire your own customers to earn an even higher income.

Consequently, some people simply buy customers, as the monies earned on their customers orders provides the income they want. However, this is extremely passive and means you have to keep buying more customers until you average the income you want.

Other business affiliates understand the power of this CM model and couple this with the leveraging power of the network marketing aspect and market to attract other like minded business associates because they understand that their new business associates will also have their own buying customers. Since business associates have a customer base from day one, there’s no reason for your associates to get discouraged and drop out or jump to another program – they’d be leaving money on the table because the customers are staying. The customers which have bought products, bought them solely for the benefit of the product and not for the business opportunity. This alone is huge because many network type business’s customer base is build primarily from business associates buying product rather than true product customers. It the typical network marketing business model, business associates jump ship quickly looking for the next best thing. This problem is alleviated with the cooperative marketing business model, as business associates don’t won’t to loose their customer base earnings.

The company is successful because it is a real company, with real products, and real paying customers buying consumable products month after month. It’s called supply and demand and is how real business is done. A solid customer base, acquired through great product, rather than a company built by business associates being the base of product consumption which will eventually collapse when the hype of the quick get rich commission structure or the promise of the automatic turn key business promise doesn’t quite pan out like one would hope. Most people fall prey to buying into hopes and dreams rather than a real business.

Here’s the bottom line.

Would you benefit from a company that does everything from acquiring its customers, fulfilling their orders, providing impeccable service, following up and offering incentives for further purchases and offering you lifetime rights to a percentage of their future purchases by allowing you the ability to purchase their customers? Its a no brainer, of course you would benefit.

Would you benefit if the business associates you brought in also had a buying customer base the day after they started? Would that solve half of your problems with traditional business models? People quitting?

Don’t get me wrong. The cooperative business marketing model isn’t a get rich quick scheme. What it is, is a 21st century business model which is a vast improvement over traditional network marketing business’s. The company that employs a cooperative marketing business model understands that the strength of the company resides in a strong customer base. Consequently, it has one end of the company that spends the monies needed to advertise and acquire customers in a manner that you and I individually couldn’t afford to. The important thing to understand is that these customers are buying solely for the product, actually their not even aware that their is another part of the company that offers a business partnering opportunity to individuals like you and me.

This again is a strong shift from many traditional network marketing companies, whereby its customer base is primarily its business associates buying product. I don’t know how many times I’ve been on business opportunity calls where I heard almost nothing about the companies product but all emphasis was on the business opportunities get rich quick propaganda.

In my view, I not only can’t see any weak link in the cooperative marketing business model, I think its the next generation in network marketing type business’s.

The 5 Criteria and Conditions of a Successful Network Marketing and Multi-Level Marketing Business

The description of the 5 Criteria of a successful network Marketing as written below, is a result of analyzing 200 Network marketing Companies from the inside, by an expert in Network Marketing, who has build a successful Network Marketing Business.

The main question is:

Why some companies make it, and Why some Businesses do not make it?

The General answer is:

A: Because of Greed and Ego most Network Marketing Companies fail.

B: Business Models drives the behaviour in the Field.

When the Business model is not set up right and correct for a Network Marketing Company it is doomed to fail.

The 5 Criteria and Conditions of Success that a Successful Network Marketing or Multi level Marketing Company absolutely has to have:

1. The Company Management has to be with integrity and with experiences in Network Marketing.

First to question is: Did they build successful a down line?

Mostly they do not have that experience. They do not know even how to spell MLM or Network Marketing!

When yes, then they respect you and you have not more as 5 pages in the policies and procedures.

Checking the Company Management

To find out the integrity of the company management,

A. Do a Google search and just put in simply their name and look what is written, also under how many companies of them already failed. Check the listings in the commercial registers with the name of the company owner(s) and directors, and / or managers. You can also do a Google search on the company owner together with the word scam.

B. Go to eBay and see how many of these products are sold on eBay. When the products are sold on eBay, there is absolutely no credibility.

You are not going to have a good marketing position when you are offering the products at retail sale price X, and on eBay you can find the same product for half the price X.

C. Does the company charge you for a ready build take orders Website?.

Does the company charge you for any training?

When the company charge you for those two simple things; the company management does not have integrity, and the company will have an to high overhead, which affects sales and earnings.

Your personal company Website and the training should be for free.

2. Policies and procedures

The policies and procedures do not have to be more as 5 pages. The more pages in the policies and procedures, the more is the overhead of a company which almost certain will have an effect on the product prices, and more: the company wants to steal your pay cheque. There are many examples that when a independent distributor earn a big bonus cheque like $35000 a month, the company try to terminate this distributor or do not renewal the contract on the renewal anniversary.

The company with high overhead intend or makes changes to the compensation plan which is most of the time with less earnings for the independent distributor (Network Marketer).

Red flag has to be set at:

Termination: Can the company terminate you every time for every or no reason?

Renewals: The company may not renew your contract on its anniversary day, at any time and for no reason.

The last happens very often when a distributor earns more as $40000 per month. There are many examples and proof for that.

3. Timing of the company and timing of a product in the Industry.

You do not ever want to be in the start of a company !!

Many make huge hype of being the first in pre-launch phase. Many of them do not come up with a product but sell the names and email addresses for large amounts of money.

If the company and product is good enough they will be still there in 2 years from the start.

Fact is: The most businesses fail in their first 2 years.

4. The product has to be consumable and be outstanding and remarkable in quality.

When a product is not consumable, when it last forever, then there has to be all the times new sales with new costumers. This is an enormous work.

But when you have an consumable product with outstanding quality, the satisfied consumer want the product again all the time.

Checking the Product

1. The very most important thing is that there has to be an physical touchable product that you buy or sell. When there is no such physical touchable product; When you pay for air, a position, or something you cannot touch with your both hands; flush it, forget about it. It is a scam.

2. If you can pay for your product (to your up line) only through an money order or bank wire transfer, then run the other way. The most secure is credit card payment. The most important is that you have to come on a check out page, with the listing of the product, with product number and transaction number, together with the price, and name plus address and contact information like email address of the seller / company

3.The product has to be consumable, and not last for ever.

4. The product has to be priced reasonable. Ask yourself: would you buy the product if there was no compensation plan attached to it. When the answer is yes, then the price of the product is OK for you.

Then you have to check if the price is reasonable for your costumers. When it is OK for them you can start selling the product. But when the price is very high and the Business Model offers 30% off the price signing up as an independent distributor, then know that people only join your business to have the product for less. But they are never going to build the business.

The minimum difference between wholesale price and retail price has to be 25%.

Know that in every normal business the product is been sold at double the wholesale price. Retail = (2 X) Wholesale.

In Network Marketing the things are slight different because the independent distributor does not have to take care about the research, manufacturing, documentation and brochures, set up costs and administration etc. So a difference between wholesale price and retail price of 25% or more is OK.

5. Check if you have competition with your product or if you have an unique exclusive product. First thing to check is if the product is being sold on eBay. The easiest way to check this is to go to the Website of eBay, and first give in the company name. In this way it is easier to find the products, because many listings have other titles and make it more difficult to find them.

When you find that the products that you sell at retail price X, and on eBay the same product has a strong reduced price, the company and its business model and the product have no credibility. The company has the wrong business model and have priced the products to high due to an to high overhead of costs. This high overhead of costs will also lead to having much more as 5 pages in the policies and procedures of the company that bind the independent distributor.

4. Compensation plan.

A. You need an compensation plan that pays good the part-time working person.

B. The people who are at the bottom of the compensation plan have to earn the most from the product sales or consuming these products. Otherwise the compensation plan is not good for a Network Marketing.

Especially when high percentages are paid to the upper level, or immediate big down lines are set up in very short time; this is a sign that deals are going on at the top levels. The rest of the down line does not know about these deals and do not earn a dime with building a Network Marketing Business with that particular company.

In general: The best compensation plan is the compensation plan that pays the most, with the less amount of people in your down line, for the average part-time working Network Marketer or distributor.

You have to look what the average guy with part-time work earns in a compensation plan.

The superstar space commander bonuses that are only earned by 3 % of the people, are not interested.

Analyzing a Compensation plan

Analyzing a Compensation plan can be done by doing Mathematics and simply calculating the numbers with just a calculator:

The general calculation that has to be done is:

How much volume do you need in a month to earn $10000 and divide that with the people / distributors that has to be in your down line.

5. Leads generation / Prospects generation / Duplicate able System

Network Marketers need prospects for their Business. Most of them are buying list of leads and prospects.

After they find out that those leads are not responsive and there fore worthless.

If your Up line tells you to buy leads or make an names list; run the other way.

This is not duplicate able!

You have to understand that the only thing that you have to promote is you! People join people. They do not join Businesses. Network Marketing is not a sales Business. It is a relationships Business.

You need an Proven Duplicate able System. This means that the System Duplicates itself when you quit. (And after you quit you earn an residual income).

This is where our free support coaching and mentoring comes in with an Proven Duplicate able System (for over 26 years);

All the persons who download the free Report in form of an eBook are those people who want to be in Business with you.

So it is extremely important for you to have access to such Proven Duplicate able System.

You can get this System of your own signing up through at the bottom of the site:

It is your Decision with your Vision to have what you want out of live, which will attract this and comes into reality. Your Thought, Vision and Decision for Success.

Five Steps to Increase Your Leads and Network Marketing Business

In a network marketing business, we need a proven system in place that is designed to generate great customers that will consistently invest in our products and services. In addition, it must be made to nurture those clients to come back for more. Hence, I have come out with a five steps system that will do the magic.

Step 1 – Define the goal of your business and develop a plan

It is important to identify the general purpose of your business and what you aim to achieve. Why? Because this is the life blood of your business and by realizing your vision and goal, it helps to reinforce your belief and this will propel you forward even in disappointments and setbacks that you may encountered in the business. Therefore, when you know the purpose of your business, it enables you to develop a successful plan to achieve your goals. So the key fundamental here is to make a plan of what you want to accomplish and how you are going to attain it. Be specific.

Step 2 – Identify targeted and hot potential prospects

As a business owner, it is important to outline what defines a potential prospect. Your perception on a good customers and partners will affect who you will approach to or share your business with. Therefore, the quality of your business leads lies in this identification of your market and the people that you should make contact with often. Consider carefully and differentiate your prospects into hot leads, warm leads and cold leads. The hot leads are those that you consider who are likely to become your committed business partners, while warm leads are those that may be your partners but lack the drive or ability to share your vision. Cold leads belong to those with least chances of being your partners but are highly become the customers of your product. They are not necessary interested in your business. With this, start focusing on the hot leads while less time on the other two.

Step 3 – Design your contact strategy

Identify why people should buy from you and why they should join you in the network marketing business. Most network marketers use only word of mouth marketing to establish their business. However by limiting themselves to one method of contact strategy is to restrict them of the possibility of success. Hence, develop more strategies and monitor the result. This will greatly improve your chances of getting more business.

Step 4 – Train your business partners or associates

For many network marketers, one of the frustrating challenges can be the lack of performance from their downlines. Most of the challenges are due to the lack of training, structure, systems and support to assist them.

The solution here is train them properly. To improve the performance of your business partners, there needs to be consistent training in specific skills sets that are vital in network marketing. First, you can conduct regular training to inform of the benefits of the product. In addition, conduct training in communication and relationship skills to help build rapport with prospects and customers.

Step 5 – cultivate, teach and retain

You need to continually teach your prospective associates as well as to nurture your relationship with them. This will enable you to retain your profitable partners and customers for as long as possible.

The key here is to find ways of adding value to your prospects and customers by helping them to either get more benefits from dealing with you and to exploit your selling opportunity. This can be done by making them aware of all the products and services you offer.