The world of business is changing. Just like any other industry, the methods of selling goods and services is shifting towards online marketing and community building.
As the landscape changes, so does the legal framework which protects entrepreneurs. In the past, the big question for any business was “how can I grow my company?” Aspiring entrepreneurs needed to find the right answers to this question in order to succeed. With the establishment of various legal entities, trademark protection, and the rise of the sharing economy, the right answer is now “I can create a network marketing business and raise funds for my business through a network marketing company.”
What is a network marketing business?
According to the Network Marketing Association, a ‘network marketing business’ is one that:
- isn’t registered as a business or limited liability company;
- markets products or services to independent distributors (referred to as ‘independent contractors’, ‘independent salespeople’, ‘independent agents’, or ‘professional marketers’) or company owners and executives (referred to as ‘downlines’);
- generates income from the sale of products or services to customers (generally by attracting new customers through network marketing strategies);
- is operated and controlled by individuals who are not registered as professional service providers or business managers (most often referred to as ‘steerers’ or ‘middlemen’).
There is certainly no one-size-fits-all approach when it comes to starting a business. What works for one company might not work for another. That is why you need to understand the specifics of your industry and what is working (and not working) for you, before you can effectively make adjustments.
Why Are Online Marketers Popular?
The rise of the sharing economy has made online marketing much more attractive to companies and entrepreneurs. As the world becomes more digital, customers have become more comfortable shopping and working online.
E-commerce sales were just over $14 trillion in 2022 and are predicted to hit $26.9 trillion by 2027. That is an increase of 64% in just five years. Digital marketing and social media have also become popular as businesses shift to new platforms.
Shoppers have also grown more comfortable asking questions and getting answers quickly. The ease of using online marketplaces and social media has driven a rise in customer support via live chat and online research.
In addition, the internet allows companies to easily create massive communities of buyers and sellers, which can help businesses grow and thrive.
How to Start a Network Marketing Business
If you intend to start a network marketing business, it’s important to consider the legal structures that exist in your industry. Just like any other business, you will need to register your business with the state and federal governments, as well as ensure that you are complying with all relevant regulations. It is also important to seek legal counsel to ensure that your new business is structured appropriately and that you are not operating in violation of any state or federal laws.
Choose A Niche
The first step in establishing your network marketing business is to select a niche. You want to pick a field that you are passionate about that also happens to be a successful field. For example, if you are passionate about helping people get in shape, but also realize that there is a lot of competition in this space, you might decide to become a personal trainer for women and children.
The reason that this is an important consideration is that you want to stand out from the crowd by being the best at what you do. If you can, find a way to innovate and be the first to offer a new service in your industry. Being first to market can lead to significant growth and profitability. For example, the Lyft ride-sharing app began as a safe and affordable way for people to get home after a night out. Now their market share has grown to 45.8% with plans to surpass traditional taxi services. As much as 80% of the population uses taxis regularly, but also feels that the service is unreliable, unsafe, and expensive. Lyft was able to solve these problems and created a new market segment, which is now a viable source of revenue.
Establish A Professional Appearance
In addition to picking a niche, you also want to establish a professional appearance for your business. You can do this in a number of ways. First, you can create a website for your business. If possible, establish a separate email address for your company and ensure that everything on your website is relevant, clean, and well-written. You should also look into buying or leasing office space, either in your home or on-line. Establishing a professional appearance for your business will help you gain credibility with customers and establish trustworthiness. Customers are more likely to purchase from or engage with a business that they think is reliable and highly-introspective.
Choose A Professional Name
Once you have a website and social media accounts for your business, you can begin to establish yourself as a reputable, professional entity. One way to do this is to choose a business name that is unique and highly professional. Establishing a brand identity and making customers feel confident in connecting with you is an important step in building trust. If you are looking for a one-stop-shop to learn more about choosing a business name, check out this resource from the Small Business Administration (SBA).
Create A Clear Communications Plan
A clear communications plan is important in any new or existing business. This plan will lay out how you intend to market your business, what you will say to existing customers, and how you will respond to customer inquiries. It is also a good idea to create a clear Sales Funnel, which will map out the different stages that a potential customer might go through before making a purchase. A sales funnel helps you plan out the various touchpoints that a customer might have with your business. This way you can be sure that you are not missing out on anyone. It also helps you see where you are falling short and what you can do to change things.
Determine Your Product Or Service
When selecting products or services to offer, you need to decide whether you will sell a physical product or provide a service. For instance, if you are planning on establishing a fitness business, you might decide to create a course that teaches customers how to cook healthy meals or offers them a weekly workout routine with a personal trainer. Another example might be a hair-styling business that offers customers a different hair-styling option each month.
If you are selling a physical product, you will want to determine what that product is and how you intend to sell it. If you are providing a service, you will have to decide how you intend to provide that service and what it will cost.
In addition to deciding what products or services to offer, you also need to do some market research. This is where you will find out what is currently popular and how much demand there is for your product or service.
Depending on your chosen niche, you might want to explore what is popular in your niche and then decide whether or not to offer products or services in that area. For example, if you are an accountant and you decide to start a business that helps people with their tax returns, you might want to explore what services people in your area are looking for and if there is enough interest for you to establish your business. You can also check out niche websites and online forums that are dedicated to helping people with their taxes.
Set Up Your On-line Presence
Now that you have a general idea of how to start a network marketing business, it’s time to set up your on-line presence. This includes creating a business website, social media accounts, and email marketing lists. In order to make your website valuable, you will want to include a blog on your site. The blog will not only serve as a source of information for potential customers, but a place that you can continually update with helpful content.
You might also want to create videos and snapchat stories to communicate with potential customers. In addition to these platforms, you can also use social media to connect with people in your area, as well as industry experts that can become valuable resources for potential and existing customers.
You should also look into getting a virtual assistant to help you with social media and email marketing. For those that are looking for a simple way to get more leads, they can also become a valuable asset to your business.