The Product Life Cycle of Network Marketing: The Four Stages of Building a Downline
Most products, whether they are tangible goods or intangible services, go through predictable stages during their natural life. This is usually referred to, in marketing circles, as The Product Life Cycle. These stages are (1) Product Development, (2) Introduction, (3) Growth, (4) Maturity, and (5) Decline.
Your network marketing business will behave in a similar fashion, that is, it will go through various stages as you work toward achieving your financial goals. Since I’d like to take a positive view, I won’t consider the possibility of “Decline.” Instead, I offer four stages that your downline will go through as you build it for success, what I call the Product Life Cycle of Network Marketing: (1) Introduction, (2) Development, (3) Growth, and (4) Maturity.
1) Introduction. This first stage is when you are new to the business and have not yet developed the skill set needed to be successful in MLM. You may not have developed the “intestinal fortitude” needed to get beyond some initial setbacks. If you have not been involved in a network marketing program before, you’re probably making mistakes and, hopefully, realizing you have a lot to learn. You also need to beware of those well-meaning people who will tell you that you won’t succeed, particularly family, friends, and co-workers.
During Introduction, you’re trying to develop a track record of success that you can fall back on when you encounter some resistance. A lot of new networkers quit because they listen to all the naysayers instead of keeping that burning desire to move through the hard times and stay on course.
If your sponsor hasn’t worked with you to arm you for success, then it’s up to you to arm yourself. Listen to the advice of some of the giants in this industry – David Butler, Jim Rohn, Bob Schmidt, Sherman Unkefer, to name a few. They’ll teach you the skills you need so you’ll have the confidence to push forward.
2) Development. Congratulations. You’ve gotten past the first stage and are building a downline. Now, be a good sponsor by showing your downline how to be successful. Here your goal is to help them recruit their downline. If you’ve done it right, you should begin to see the business builders emerge. Hopefully, you’ve got a few who share your vision, and you can begin working with them consistently to build momentum.
In the Development stage, you should see people entering your downline that you do not know. This is your personally sponsored distributors bringing in THEIR personally sponsored distributors. Now is the time to make sure your people are teaching their people how to be successful, i.e. that they, too, are being good sponsors. At this point, you should get the feeling that the business is starting to take shape, that it has a chance to grow on its own.
You must guard against complacency, however. This is the most important time because you need to build an organization that can grow on its own. The vast majority of people who exit network marketing do so during the first two stages, so don’t quit on your downline. Keep working with your builders so that they don’t leave the business.
3) Growth. In this stage, your checks should start looking a lot bigger. Your builders are growing their downline, and you may have several successful legs emerging. You may have hundreds, or even thousands, of distributors in your downline, and your business builders are also earning bigger paychecks.
Congratulations, again. If you’re in this stage, you’ve shown that you have the ability to teach business builders how to recruit and develop business builders of their own, and the downline has definitely taken on a life of its own. You’re feeling pretty good about yourself, and you have every right to.
Here again, however, you must guard against complacency. You can make a good living in the growth stage but you’re not home free yet. You’ve got to push forward to the next stage if you really want to create wealth.
4) Maturity. Your organization has reached Maturity when you no longer have to shepherd its growth. In other words, no matter what you do, you can’t stop it from growing. It has taken on a life of its own, and even if you were to walk away from active involvement in the business, you can depend on a steady stream of passive residual income for the rest of your life.
Isn’t that why you got into this business in the first place?
Reaching Maturity is rare. Many downlines get close to this stage, but fail because the leader quit too soon. Remember, if you do not nurture your downline, if you do not give them a track to run on, if you do not build their confidence and arm them for success, you will not reach the Maturity stage. Rather, your organization will probably fizzle out somewhere between the Development and Growth stages, and reaching the Maturity stage will be nothing more than a pipe dream.
Make it your goal to have your downline reach all four stages. When your personally sponsored distributors believe they’ve reached the Maturity stage, then you can feel confident that you’ve reached that stage. Otherwise, your organization may never reach its full potential.
To your success!
Bruce Bailey, Ph.D.