What is Multilevel Marketing or the Network Marketing? Multilevel Marketing is a distribution system used by companies to promote their products to the market. Instead of putting some advertisements anywhere like in the newspaper, television, radio or just anywhere else they just use this system and pay the distributors commissions instead of paying the advertising companies. The company pays the distributors depending on the compensation plan and usually people are being paid for bringing in people to the company also or what they called direct referral commision. Aside from this the other earnings will depend on what compensation plan the company have.
There are different kinds of compensation plan in every mlm depending on the company. There is the binary system wherein you need to have 2 people in your front line. 1 on the right and 1 on the left side of your structure. In every compensation plan there is the advantage and disadvantage. In this binary system they said that its easy to earn from this as you only need to sponsor at least 2 people and the 2 will sponsor 2 each also and so on. So the duplication is easy. But the disadvantage is if the other person you sponsor did not get any people and the other side have a lot of people then you will still not make the most out of the earnings because your structure is not balance. So it needs to be balance for you to earn the full potential.
Another system is the multilevel system wherein you have to go thru many levels in order for you to earn. The advantage of this is you dont have a pair of groups to balance. It will be just 1 line but you just have to undergo certain levels for you to earn more aside from the direct refferal commissions.
There is also a matrix system wherein you have to cycle in a certain matrix for you to earn. An example in this is a 3 by 3 (3x3) matrix. In this kind of matrix you will need 3 people front line. Then this 3 people will need 3 each also in their frontlines. So now there is already 9 people in your team. This 9 people will need 3 each also in their frontlines giving you 27 people in total. So once the matrix is all filled up that is the time you will have a cycle and you will get the full potential of the income. Depending on the policy of the company this people can be your direct referrals or referals also of your sponsor. The speed of the cycle depends on how fast you can personally refer people or your sponsor or the team. So the income from this will still depend on how the marketing plan is. Aside from the cycles usually you still earn from personal referrals you bring to the company.