What to look for in a Network Marketing Products or services

Troy Rocavert

I recently heard a conversation between a distributor and a prospect from un-named company where upon being asked 'why these network marketing products' of this company 'were so much better than what you can buy in a retail store'? The answer from the distributor confused me greatly, "the product is virtually the same as what you can buy in a retail store, but we have got a great pay plan that rewards you from buying through your own business and signing up new distributors."

I felt like informing this particular distributor that it did not matter how good their compensation plan was for rewarding business growth and distributor's personal consumption of their company's goods and services. For long-term viability in their business they needed to be attached to a product or service that provided a point of difference from what was available from a retail outlet. The point of difference had to be more then offering a product or service that was based on price, as price is too easy to be undercut by a fellow competitor. By providing a point of difference based on quality, niche or a superior customer experience it is more difficult for a competitor to be able to match or out compete based on these aforementioned criteria. Additionally, a compensation plan can be the best within the industry but if there is little demand for the products or services offered by the network marketing company there is little real opportunity to benefit from the pay plan.

So let's look in greater detail at what to look for in a network marketing products or service. Firstly, the product or service needs to be aligned to current or emerging economic trends. It is in capitalising upon these trends that lays both potential demand and potentially a lucrative business opportunity. At any given time there are several emerging business trends in society. In particular, if we were to single out one of the driving forces behind many of the economic trends over the past the 60 years it would have to be that of the baby boomers. Since the time they were born they contributed to the rapid increase in sales of baby food and nappies back in the 50s, schools and education in 60s, car sales in the 70s, the real estate boom in the 80s and the fast food chains and mega supermarkets in the 90s. Leading economic forecasters have used these trends to predict where not just the baby boomers, but all demographics and generations will spend their money. At present those in the know are forecasting the current emerging business trends in the areas of Health and Wellness, Financial Services industries, Aged-Care service and product orientated industries and finally Green Technology or Environmentally-Friendly based products and services industries.

A new wave of entrepreneurs coupled with advances in technology has lead to a changing business environment. For example, the telephone has been a primary source of communication for over a century, but utilising our telephones to trade stocks, to send and receive photos and to surf the internet, is a new business trend that is a result of synergistic technologies. Although the elements of these trends have been around for years, the trends themselves emerge when the timing is right and when several factors come together. The health and wellness industry for example, has been with us for centuries, but it took the convergence of the aging baby boomers, with advancements in medical science, to create the critical mass of this emerging trend.

Modern day consumers want speed, variety, quality, customerisation (tailored to the customer's needs) and choice. As the products that we consume become more sophisticated and complex, consumers are demanding a quality relationship with the provider of these goods and services. They want the products to deliver what the advertising promises. Educated consumers are now choosing to go direct, building a relationship directly with the parent company, which is fundamentally a different concept from the way we have done business in the past.

Secondly, the product or service should be unique to some extent (quality or niche focussed). Remember if your network marketing product or service is the same or similar in quality or function and not differentiated from what is available in retail or commercial outlets; then you maybe competing on price alone. Let me give you two examples to reinforce this point. Example 1 is from the Cosmetic Industry.
Let's take company A (a large public company using traditional retail distribution) and company B (direct distribution via network marketing) both have similar facial cleanser they are in direct market competition based on price and convenience of purchasing that product. Company B should be able to provide better education and on-going support via educational marketing. However, if company A's product is cheaper and easier to purchase, the customer may choose that product at least 75% of the time.

Example 2 is from the Nutritional and Health Supplement Industry.
Let's take company A (a large public company using traditional retail distribution) and company B (direct distribution via network marketing) and they both manufacturer a multi-vitamin supplement. Company B's product uses higher potency ingredients and higher standard of manufacturing than that of Company A (the large public company using traditional retail distribution). Now they are in indirect market competition as a company B's product while being slightly more expensive is far superior on quality and value to the consumer price; therefore price and convenience may no longer be the major factors in purchasing that product. Company B should again be able to provide better education and on-going support via educational marketing. The customer may choose Company B's product at least 50% of the time, effectively taking away market share from company A and potentially giving you a new customer.

When referring to market niche, it is important to differentiate this from mere novelty. Generally a product or service that meets a market niche can be sustained much longer than a product or service that is novelty. History has shown novelty to wear off quickly and to be replaced by another short-term novelty product or service. In looking at a product or service to partner with you are looking for sustainability and endurance.

"Follow sound business trends, not fashion trends" - Janice Dickinson

Other factors when looking at a product include how easily consumable it is (i.e. vacuum cleaners and cars are not really easily consumed). Regular consumption is essential to developing long-term residual income, as the customer has to regularly purchase that product or service from you rather than just getting the benefit from a one-off sale. Ideally, four week cycles provide the customer with the opportunity to purchase regularly without feeling like they 'constantly have their hand in their pocket'.

Finally, the products or service should provide value for money to consumers and not be at the price point where you are likely to lose customers to another product or service that is far cheaper but of a similar quality. Value can be reinforced through network marketing by providing a great customer experience by those using network marketing products and services. A customer care program is essential to providing value to customers, but also to create long-term consumption. These factors when aligned contribute to the development of a life-long passive income stream.

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Troy Rocavert is the CEO and Head of the Advisory team behind this Network Marketing Business School website. He is a recognised speaker, trainer and author in the field of network marketing expertise and is well respected amongst the network marketing community for his vision and passion for the industry and helping others to succeed.

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