A Brief History Of MLM
By ERIK GIFFORD
Most of us will have heard of Multi Level Marketing at some point in time. If not, let me introduce you to it with a brief account of how it has developed throughout history, to become one of the foremost popular and successful business methods of the modern era. The roots of MLM are entrenched right back to the 1860′’s, when a few intelligent business people discovered a way to exponentially multiply their promotional effectiveness, whilst cutting back the hours which they worked.
Though these entrepreneurs wouldn”t have known it at the time, their actions from then on have shaped the modern corporate landscape. Let’’s take a further look at what it was that they did.
We all know the famous saying that time spent marketing is time wasted selling. This is the exact mindset that the historical entrepreneurs had when they devised their new plans for promotion and success. People such as Henry Heinz and Asa Candler actually employed others to take over the marketing of their products.
They were paid a commission for each sale, and were directly responsible for their own incomes. Throughout the later 1800′’s, this idea transformed and developed further, where these “sales employees” actually became their own bosses, and were able to employ other people below them to do the same job. Hence the term “multi-level” was coined.
This was the beginning of MLM as we know it. Obviously, throughout the 1900′’s, further refinements were made, and I take the company “Nutrilite” as a prime example. The founder of this company, Carl Rehnborg, decided to alter the payment system from a purely commission based programme, to something with even more of an incentive.
His logic followed that if people were successful at selling, and generated large quantity orders, they should be compensated more heavily than those who only put a half pie effort in to the business. From this, a fairly complex system of bonuses, levels, and matrices were born, and from 1945 onwards, this became the basis of the popular modern day MLM selling system.
The path for MLM however has been all but merry. Sure, there have been many successes, and top sellers have been earning hundreds of thousands of dollars each year - right to this very day. With success though, inevitably, comes failure.
Indeed, over time a link has formed between MLM programmes and pyramid schemes - the latter being illegal. One of the largest MLM companies was in fact caught up in this dangerous tie in 1975, when the FTC in America sued Amway International for the operation of a pyramid scheme. Even though this allegation was struck down years later in 1979, it certainly indicates that the MLM industry has grown to border on the ethical barrier between good and bad.
Today, the MLM scheme of selling is very much still alive. Networks of people currently work in each and every country - with the ultimate goal of pushing products on to consumers and making large quantity, fast transactions. Indeed, profits are still made by many people in the MLM business, however critics claim that anyone starting out for the first time is doomed to fail, because of the competition that is rife and active throughout our current communities.
As well as this, the public has developed somewhat of a grudge towards such enterprises, basing their skepticism on the pyramid scheme link that we discussed previously. Whatever your personal view however, you can be sure that the MLM industry will continue to evolve as a whole, with new products and ideas frequently surfacing to entice even more buyers than ever before.
About The Author
Anyone in a network marketing and MLM home business should have some knowledge about the history of MLM.Erik Gifford is a network marketing consultant and trainer.For free network marketing training,call 004722520239 and visit http://www.networkmarketing-guidance.com
