Multi-Level Marketing (MLM) companies have a very interesting model.  Perhaps you’re familiar with Avon and Mary Kay, both of which are very successful businesses.

But you may also have a sour feeling about other MLMs.  Amway developed such a bad reputation over the last thirty years that it almost killed the company.

I had a great discussion with some people this morning which may help to explain why MLMs struggle to take a great idea and scale it up to nationwide or international status.

I took a class last year from Ron Stickler of Prosperity Personality Recognition.  He uses a simple yet powerful model to help people improve sales through understanding of different personality types.

Here’s the basic model:

We won’t worry about the definitions so much here – if you want to learn about this, go check out Ron’s class.

The important observation is that MLMs typically attract people who like the products, and are attracted to the concept that being a part of a larger network will be safer than going out and starting their own company.  In this model, they’re classified as Craftsmen.

The problem is that their very desire for safety leads them to be reluctant to go out and sell products, to persuade people to buy the products and the MLM concept.  Those who are successful tend to be classified here as Persuader.  And in fact the people who started the MLM company originally will usually be strong in Persuader approaches.

But as the MLM grows, more and more they attract the Craftsman personality.  As a result, expansion of the network slows to a crawl.  That’s not necessarily a bad thing in itself, except that a core function of an MLM is to have everybody doing sales.  That’s tough with a Craftsman; it’s not their comfort zone.

A successful MLM like Mary Kay has added a lot of structure on top which allows even a Craftsman to succeed.  There’s strong brand-building at the national and international level.  There’s lots of internal support structures for people who aren’t comfortable in a sales role.  And, most important, they’re selling products which are more relationship-based than average.  So selling feels very much to a Craftsman like they’re creating a friendship, which makes them more comfortable.

If you’re looking to join an MLM, ask some tough questions:

  • Am I the type of person who feels comfortable going out there and selling all the time?
  • What will it feel like for me to be selling this product?
  • How extensive is the upfront training and ongoing training?
  • How complete is the week-to-week support for me meeting my sales goals?

I’ve found with my Small Fish franchise that the weekly coaching support is critical for staying on track.  Since I’m not naturally comfortable with the sales role, this has helped me to keep focused on meeting my goals.

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