Voodoo MLM Economics

Mentor Ben Drake 

The following is from Success in 10 steps by Micahel Dlouhy, a wonderful post on retention within Network Marketing and MLM.

Voodoo MLM Economics

Companies say, “We Keep 93% of Our People!”

They lie.

Truth: There was a phone company a few years back that had to publicize their retention rate, because they were publicly traded.

Take a guess. Out of every 100 people they signed up, how many were still in the business a year later?

50%? HAH!

25%? As they say in the Hertz commercial, “Not exactly!”

10%? You’re getting warm …

The public record showed 6% to 7% retention. That’s not 67% … it’s 6 to 7% retention. So you build your business for a year, you buy advertising, you do 3-way calls, you go to meetings, you talk to all your friends & relatives, and you wind up recruiting 100 people! Yippee! You’re almost rich.

Well, not exactly. Why? Because what you have left is 6 to 7 people out of 100 (!) still building the business.

Ooops … wait … that’s not all you’ve got. You also have smashed dreams, maxed-out credit cards, and probably a LARGE bunch of people who hide when they see you coming.

Whatever you do in network marketing must be duplicatable for the masses. Six to 7% retention is not smart business.

That brings up the next big lie.

From Success in 10 Steps by Michael Dlouhy,

Become a success in Network Marketing

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