A while back, I was talking to a friend of mine who was very frustrated about a large group of distributors who had left his network marketing company because they had found a better commission plan, whatever that means. It is an old story—distributors jumping from one company to another because they have found the hot new product or the next greatest commission plan ever. What can companies do to prevent this? I have observed that distributors join because of a great product and/or commission plan, but they stay long term because the company provides great training programs and other services to help make them successful.
There are many companies with great products, and if you have a really great product, other companies will work night and day to create a similar product. There will almost always be a competitor out there. And, if you create the greatest commission plan the world has ever seen, any other company is free to duplicate it. So, if a company tries to create distributor loyalty solely on its product or commission plan, there is always a company who can pay out 1% more or create a competitive edge in some other way.
What do successful companies do about this? They create training programs. They implement personal growth and development programs. They put systems into place to help distributors build their businesses, including programs to find and keep retail customers. And they make sure these programs and systems are not easy to duplicate.
These intangibles become the little ties that bind distributors to a company because they make distributors’ jobs easier. Do they replace a great product and a well-designed commission plan? No, but they make it more difficult for another company to raid their organization.
If all your distributors’ training, tools, and techniques comes from your company, you are no longer just the supplier of their product—you are their full business partner! If other companies try to recruit them, most of them will think long and hard before giving that up.
Does this philosophy work? Look at companies that have been successful for many years and you will see they use this three-part strategy:
- Successful product.
- Well-designed commission plan.
- Services to help their distributors.
It is the tried and true strategy in the MLM industry.