Affiliate Marketing or Multi level Marketing?

Ask an amateur marketer or a business entrepreneur about terms such as network marketing, affiliate marketing, direct marketing, and multilevel marketing and there will arise a point of confusion. The situation arises when new terms are being coined every now and then by companies only in order to make a distinct mark among their competitors, though, in fact, many of these terms are similar in meaning. Similarly, the repercussions in the long run include misconception and wrong use of these terms that keeps businesses wondering as to where they had gone wrong in the first place.

In order to help marketers avoid the blunders of incorporating wrong promotional strategies into their marketing plans and business models, we will unravel the exact differences between affiliate marketing and MLM marketing so they know which string to pull first.

Concept – Affiliate Marketing vs. MLM Marketing

Affiliate marketing is basically a marketing plan run using the platform of internet. Here, the business pays the marketer for conducting different marketing activities such as sales, web visitors, clicks, etc. The marketer is free to choose the mediums to promote a given idea, product or service; however, within the defined boundaries mentioned by the business. Restrictions mainly include competitive advertising and use of trademarks.

On the other hand, MLM marketing compensates the sales force not only for their self generated sales, but also for the sales generated by other salespeople recruited by them. The salespeople are mainly involved in selling goods to the customers directly through word of mouth marketing and relationship referrals. It is immensely useful to generate multiple levels of compensation. MLM is also known as network marketing.

Initialization costs

Basically, there are no costs involved to sign up to become an affiliate. However, it is assumed that you have bought the product, are aware of its features and benefits as well as vouch for its quality when dealing with customers. Conversely, with multilevel marketing, marketers must buy a starter kit along with sample products and marketing materials. Usually, the cost differs in every company; however, you can expect it to be at a scale of anywhere between $50 and $800.

Target

As an affiliate marketer, you are involved with promoting the product on your website with the target of selling it to a maximum number of customers.

The target of multilevel marketing professionals is to recruit more and more people into their sales team in order to optimize their marketing campaign and money earning potential. It is reiterated here that multilevel marketing offers compensation not only for the sales that you generate, but also for that generated by the sales people whom you recruit. To put it succinctly, recruiting more people helps you earn ‘passive’ income.

Consistency in Earnings

As an affiliate marketer, you will have to constantly convert visitors into customers in order to generate more sales, hence more income. The total income level depends on the amount of sales you generate for the company at regular intervals i.e. weeks, bi-weekly, and monthly. Hence, your income levels are variable according to your activity/sales levels.

On the contrary, as a multilevel marketing professional, you will be enjoying greater financial security comparatively. This will happen because many companies sell products that are sold like hot cakes i.e. their income generating products.  Hence, this will assure you a fixed monthly income besides the added ‘passive’ income. Failing to get new customers during any interval will not rob you off your minimum income, at least.

Platforms

Affiliate marketing is done using the platform of the internet. The blog and website of the marketer becomes the medium to address the potential customers about the company, brands, products, prices, offers, promotions, etc. At the same time, as a marketer you do not have a lot of restrictions besides a few. It is just akin to disseminating truthful information about a range of products while having the knack to substantiate your reasoning to the customers at the same time.

When it comes to multilevel marketing, many companies avoid being listed at their marketers’ websites. Also, many companies have strict reservations as to what you can do/say and what you cannot in your marketing activities. As far as the platforms of concerned, both offline and online activities are a part and parcel of the game.

Critical Comparison between Affiliate Marketing and Multilevel Marketing

  • Affiliate marketing revolves around converting web visitors into customers and then into returning customers. Hence, the more you convert, the more you earn. Multilevel marketing is a mass duplicating marketing technique that creates multifold sales force. The major emphasis is on recruiting more people rather than only on generating sales.

  • Affiliate marketing is comparatively convenient for people who are not proficient in face-to-face relationship management. All is said and done on the internet with the added benefit of running the entire campaign within the comfort of your office or home. Multilevel marketing involves coordinating with people using your strong human relation skills that help foster the sales team as well as recruit more people.

  • Affiliate marketing requires an internet connection and a solid web presence, whereas multilevel marketing requires more physical effort. It is an excellent source of generating passive income for part-time students, home-makers, and people without full-time jobs.

  • Affiliate marketing serves the benefit of saving time as you are working within a confined space or say, working while on the move using your laptop. With multilevel marketing, the marketers ought to have ample amount of time on their hands to expand and build relationship in order to recruit more people.

Conclusion

There is no one-size-fits-all technique and set-in-stone strategies in both affiliate and multilevel marketing. The key lies in exploring and employing the right marketing campaigns since many times the companies have to employ permutation of different strategies to get the desired results. As a professional marketer, one needs to develop the knack of being able to identify the marketing needs of its business while ensuring that it equates well with the company’s corporate plan.

 

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