For the record, I dislike MLM or network marketing or whatever...
... but this is an interesting post with some good points. Especially about using a correct skew strategy for leads. A deep skew network has fewer redundancies than a shallow skew network. Therefore, a deep skew network is less fault tolerant. Any change to a small network has vastly more effect on the network than the same change to a large network... This is best embodied by the old saw "sell to the masses, live with the classes". Here on SUN there is a lot of general discussion about why a broad customer base is good, but little discussion of why, and even less discussion of strategies to build that base.
One the other hand, this post misses an extremely important point about why network marketing so often fails for the participant. It`s about behavior. Network marketing proponents believe that the prospect has to undergo very little change to use their services. But time and again, prospects demonstrate their unwillingness to change. I mean soft drink manufacturers spend billions of dollars trying to get consumers to change their behavior... and yet here I am drinking water or Diet Coke. I don`t drink Pepsi no matter how many advertisements I see.
Network marketing is a big failure for most people because the average participant has little sales experience and they certainly don`t have the budget to engage an intiative designed to change consumer behavior. I don`t want to buy stuff from MLM and get laundry detergent or toilet paper in the mail. That`s really where MLM fails.
MLM also fails because it has lottery-like odds of success. Even simple mathematics shows this to be true. However, MLM is marketed as an "easy" way to make it big, while the almost insurmountable task of changing consumer behavior is rarely discussed. I can agree that MLM proponents are often clear about the amount of work required - a lot - but they fail to disclose that the participant would actually have to work more hours than God has made to get people to buy even one item from a catalog. Couple that with the lack of sales experience, and often negative messages from MLM marketers [ ex: "rich people aren`t afraid to promote themselves" or "you`ll never get rich working a day job" ... and both of these statements are OUTRIGHT lies... ] and I can see many reasons why network marketing often fails in the execution space. Of course it fails most of the time ... it fails because most people don`t want to sell for a living... regardless of whether or not their prospect skew model is properly engineered.