Multi Level Marketing & Persuasion Tools

What is multi level marketing?

"Multi-level marketing (MLM) is a marketing strategy in which the sales force is compensated not only for sales they personally generate, but also for the sales of the other salespeople that they recruit. This recruited sales force is referred to as the participant's down-line, and can provide multiple levels of compensation." A legitimate business is sustained by a solid base of repeat customers or clients, while a pyramid scheme requires constant recruitment.The fraudulent nature of MLM lies in the pay plan and business model.

what is multi level marketing

When profit depends primarily upon building a down-line, rather than on retail selling to end-user, the latest recruits having to buy the products themselves relying on their salesmanship and ability to recruit in order to ensure sales of the product.In a recruitment-based business (one in which the primary means of making a profit requires recruiting other sales people) the people at the upper layers of the pyramid get most of the commissions from the work of those at the bottom the ones who are the last to be recruited. The majority of people who make a profit do it from overrides on the purchases or sales of their down-line rather than from their own retails sales to their own retail customers, which spells fraud.

What tools of persuasion are used in it?

Followings are the tools of persuasion used to recruit new people & sell the products in MLM:

1. Selective Revelation:

Instead of revealing the business plan outright, the prospective recruits are only given buzzwords and emotionally prepped for the cause of a "New business opportunity which can change their lives". Getting the recruits hyped up emotionally first and excited leads them to not evaluate the system too logically or practically. This is accomplished by taking the recruit to a meeting consisting of motivational speeches, emotionalism, enthusiasm, inspiration, etc. all in a group setting to maximize the chances of persuasion. Thereby effective surges leads the decision making of the target instead of cognitive processes.

2. Group Settings:

The group setting of the atmosphere also serves as a strong reinforcement to the hype, since one naturally conforms to the group by instinct, which in this case is cheering and agreeing with everything the speaker says. Furthermore, these meetings also serve the double purpose of keeping the current distributors motivated and "high".

3. Persuasion to Counter objections:

All objections to MLM by the target arises from a psychological standpoint stem from two things: one is Natural Defense Mechanisms and second is Lack of perceived Value.

Counter Objection Persuasive Techniques

These are overcome by following counter objection persuasive techniques: 
  • Creating a sense of ownership (Sincerely asking the target's input and thoughts on how to improve and taking notes)
  • Edify the target's accomplishments and transfer that feeling to the presentation of the MLM model.(For appealing directly to the targets personal sphere and raising their self worth.)
  • Giving the target to perceived sense of choice of opportunity and boosting their self worth by seemingly valuing their views. (Saying "I don't know whether this is for you or not, it may not be. But I simply wanted to share some ideas and maybe get your insights.")
  • Showing concern for the target's well being, while not directly pushing them towards a decision, conditions the target's mind to link his aspirations with the MLM scheme to be the means to achieve his/her desires.(Empathizing statements like- "All I want is what is right for you and your family, and this may not be a fit. But if it is, I truly don't want you to miss it.").

Thus a fear of missing out on 'a lucky opportunity presented by a well-wisher' is perceived by the mind which culminates in the recruitment of the target. To sell the products & keep the flock together tactics based on liking (i.e Ingratiation); based on commitment & consistency (like foot in the door), based on reciprocity (like door in the face & that's not all) & tactics based on scarcity (like playing it hard to get & deadline techniques) are also used.

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