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Affiliate Marketing Versus Network Marketing (MLM): Income Formula Revealed!

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By Evelyn

Please consider this free-reprint article written by: Evelyn ----------- IMPORTANT - Publication/Reprint Terms - You have permission to publish this article electronically in free-only publications such as a website or an ezine as long as the bylines are included. - You are not allowed to use this article for commercial purposes. - You are not allowed to use this article in UCE (Unsolicited Commercial Email) or SPAM. This article MUST be distributed in an opt-in email list only. - If you distribute this article in an ezine or newsletter, we ask that you send a copy of the newsletter or ezine that contains the article to evelyn@e-bizmap.com - If you post this article in a website/forum/blog, ALL links MUST be set to hyperlinks and we ask that you send a copy of the URL where the article is posted to evelyn@e-bizmap.com - We request that you ask permission from the author if you want to publish this article in print. The role of iSnare.com is only to distribute this article as part of its Article Distribution feature ( www.isnare.com/distribution.php ). iSnare.com does NOT own this article, please respect the author's copyright and this publication/reprint terms. If you do not agree to any of these terms, please do not reprint or publish this article. ----------- Article Title: Affiliate Marketing Versus Network Marketing (MLM): Income Formula Revealed! Author: Evelyn Category: Internet Word Count: 846 Article URL: www.isnare.com/?id=2310&ca=Internet Format: 64cpl Author's Email Address: evelyn@e-bizmap.com Article Source: www.isnare.com Online Publisher Tool: www.isnare.com/html.php?id=2310 ------------------ ARTICLE START ------------------ Both affiliate marketing and network marketing pay people for referring a product or service. What then is the difference between affiliate marketing and network marketing? The difference is best explained in terms of the way compensation is structured to pay for performance. Because of the many hybrid forms of compensation payments available now on the internet, to a newbie scouting for business opportunities, it is easy to get confused over the many terms and definitions used. In evaluating compensation plans, it is essential to understand the subtle difference between the two models. Ultimately, you want to understand…which model yields more income? What is affiliate marketing? Affiliate marketing is usually done online. In its simplest form, affiliate marketers are compensated on a one time transaction only. Unlike products offered in a MLM business, affiliate products are often ones that a customer would only need to purchase one time. Thus, the more the affiliate marketer sell, the more they make. This is quite akin to direct sales albeit made via the internet. Affiliate marketing has a compensation plan based on performance measures. For instance, if the affiliate marketer is successful in the form of sales, clicks, registrations, etc, he/she gets rewarded. The desired action as a means of compensation is already pre-agreed upon by the affiliate merchant and him/her. In a short space of time, the affiliate marketing model has also evolved to a 2 level (or in some cases, up to 5 levels) compensation plan. In the popular 2-tier version, for instance, you (as an affiliate of a particular e-book merchant) will earn commission when you sell a book to person A and if person A signs up to be an affiliate and manages to sell to person A1, you get compensated too, in addition to person A. Let’s now go on to talk about what network marketing is. In the network marketing model, the compensation plan works in a similar fashion, except that compensation by the sponsoring company can be paid up to several, several or unlimited levels. The number of levels and restrictions in terms of payout is very much dependent on the arrangement offered. As arrangements can vary from one company to the next, this makes comparisons of the various compensation plans available out there difficult. So be sure to read all the fine print! At any level, a network marketer has the potential to earn a direct referral fee for directly recommending someone and a leverage fee when one of his/her “downlines” is successful for referring friends to the same network. In the popular binary plan adopted by many network marketing companies, each person in the network has two “legs” or “downlines”. If more people get referred to the network, they automatically go below the “legs”. Ongoing customer use is what creates the real residual income in network marketing. The MLM business can generate earnings for a very long time even after the initial years of hard work and investment. With a solid network, residual income is assured at each renewal period of a “downline”. If the product or service involved in is one that has to be reordered at each renewal period, income should just keep coming in like clock work. How does the difference in affiliate marketing and network marketing translate into in terms of building your customer relationships and your earnings power? In the network marketing model, to ensure that your “downlines” renew at each period, you must ensure that you build up a good relationship with them. It is essentially a people-build-people and a leader-build-leader business. The ability to generate huge sums of money is increased exponentially when the network grows. The potential to make huge sums of money is thus greater here if you can employ the efforts of others to help grow the business vis-à-vis the affiliate marketing model. In affiliate marketing, your earnings ability is limited by your own direct sales plus an additional of 1, 2 or up to 5 levels of leveraging efforts. Having described the above, it would seem that to maximise your income, it is best to join online network marketing programs as opposed to affiliate programs. Nope...I don't think that's really the case either. Affiliate marketing is best described as an entry to online network marketing. Affiliate products are easier to sell, likely to involve one rather than an array of products and therefore, less expensive. For instance, an e-book is likely to have an associated affiliate program while access to a membership site of digital products is more likely to pay for recurrent renewals of membership. In conclusion, there is always no harm in joining different programs whether affiliate or network marketing ones. Just be sure that you understand how you are paid and channel your efforts accordingly. Afterall, your goal is to build multiple sources of income. You have a choice to represent what or which combination of products/programs work best for yourself.

About The Author: Evelyn Lim is an online business entrepreneur. She publishes a free weekly newsletter "Mapping You to Success" for aspiring e-biz owners. The aim of her publication is to equip readers with the skills to acquire multiple sources of online income. To subscribe, please visit www.e-BizMap.com . ------------------ ARTICLE END ------------------ For more free-reprint articles by Evelyn please visit: www.isnare.com/?s=author&a=Evelyn ######################################################## Looking For Quality Content? The Syndicator provides free, quality syndicated articles for your website that are automatically updated each week. Syndication feeds include: Business/Sales Internet Marketing/Promotion Web Design/Development Biz Tips Web Design Tips Home & Family Matters Dinner Ideas Health & Fitness Horoscopes AngelVoice Headlines and more... www.web-source.net/syndicator.htm

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