The differences between MLM and a 2 Tier Affiliate Business

There are many MLM companies and many affiliate companies. Some things are similar, but they also have some things that are very different.  

One thing they have in common is they sell their products through people who promote their products. And they pay them some % for doing that. This is the way they are marketing the products they sell. They very rarely promote products on television, in magazines, or other media. 

If you are an affiliate in a company and want to sell their products,  you can sign in as an affiliate in a company you like, and most of the time this is for free. Or you have a choice to do it for free. Some companies offer you to be a customer too and if so you pay for that. 

There are so many affiliate programs/companies I can`t tell about all. But one very common is Amazon. Most Americans know this company very much I think. In Europe, it`s not so common, but many know it here too now. This company sells a lot of different products. 

Then we have another very common affiliate marketing company with the name Click Bank. They sell many digital products like e-books, courses, and more. I think they also sell some physical products now. Here you can get more paid than in Amazon. But they have some different payments, so you have to find what you like best if you want to do one of them. They have some products where you can get paid again and again from the same customer, for example, if you sell a membership. They may pay for the membership every month and you get paid % of that every month.

Then you have another kind of Affiliate payment. There are some companies that have a 2 tier pay plan. I have only seen one of them, but it`s possible there are some more. That means that if you sell for example a membership to a customer, and this member wants to do the same, you will get paid when this person sells to his or her customers. What does that mean?

That means that if you sell a product to 10 persons and you earn $20 on each of them you have earned $200.  If your 10 customers also sell to 10 customers each and you earn $20 on each of them too, you make  10x 10 = 100 customers x $20 = $2000. 

WOW!  And you have not made all those sales.  This way you made 1800 dollars more than if you didn`t get the 2 tier sales. 

So... why do the companies give you this opportunity? Are they not losing money?

No... because when they offer this to the affiliates they know that most of them will try to help their customers/affiliates to succeed too. So they train them, tell them how they can do it and so on. And the company gets a lot more sales. So it is a WIN / WIN situation.

Then you have MLM, which is a different business model.  MLM pay plans have many more levels you get paid from if you manage to build deep. 

There are many who don`t manage to build so deep that they get really good paid from this. But I believe the reason is they may not have good training on how to do this kind of marketing.  There are many who get paid much too. 

It`s important that the companies have good education, training, and support to the members/distributors so if a sponsor doesn`t know how to teach the new member, they will get help from the company and other leader-distributors in the company.  

Another thing that is very important is that the pay plan doesn`t have too many challenges. There are some pay- plans that look like the company tries to make it difficult for the distributors to reach the higher levels in the pay plan. They don`t want to pay so much.  

A company can manage to survive even though they do this because they can just move from one market to another (one country to another country), but a distributor will have big challenges. 

So it is very important to do research on the pay-plans in many companies before you decide which company you should choose to work in. I really believe in MLM as a fair business model, that is for everyone. But I know there are bad and good companies out there.  So just be careful and don`t quit at the first or second challenge you meet. You will get them, we do in affiliate and MLM businesses. Those who don`t cuit make money if they do the work. And they can make a lot of money.

If you would like to know what I am doing you are welcome to get in touch with me. I have a link to my affiliate company which is very good  CLICK HERE

And I have an MLM Business if you are Norwegian or understand Norwegian you can CLICK HERE, if not you can click the link and find my information inside there and send me a message. 

Looking forward to hear from you 

Bodil Tonnevold