Fast question. How much is your monthly marketing budget for your MLM business? What is that you say? Don’t have a monthly marketing budget? Well let me put it another way. Since the beginning of your network marketing career, what is the total amount of money you have spent on the following?
- registration fee for your network marketing business
- initial product order
- prospecting for cd’s and dvd’s
- prospecting brochures
- company cards
- compensation plan flipchart
- pens, pencils, paper, and other writing supplies
- drop cards
- fuel and tolls for travel to local meetings and one-on-one appointments
- pay per click advertising
- prospectuses and genealogical lists
- cloakroom and dry cleaning for business related attractions
- web hosting
- Web-page design
- Internet service
- cell phone bill
- weekly meeting dealer rates
- registration of regional/national conventions, airfare, hotel and food
- coffee at Starbucks for your one-on-one meetings with prospects
- classified ads
- team logo design
- training materials for you and your downline
- network marketing books
- full page and half page ads
- check processing fee
- thank you cards and postage
- frills
- product-literature
- product orders for samples and for personal use or consumption
- monthly autoship
Oh yeah, you forgot about those expenses. Well guess what, those are your marketing and promotional expenses. Next question. How many months have you been in business with your network marketing company? If you add up the total of the above expenses, plus any other you may have left over, and divide by the total number of months you’ve been in business, the result is your monthly marketing budget.
As an example, let’s say the total you’ve spent on expenses since launching your network marketing business is $1500 and you’ve been in business for 5 months. A quick calculation shows that your marketing budget is $300/month. Now here is the most important question:
Where does that $300/mo come from?
If this money is deducted from the income of your network marketing check, that is, you are making more than $300/month from your business, then congratulations, you are in a positive cash flow situation (a good thing). However, if you still don’t earn at least $300 a month from your business, then you have negative cash flow; you are in a situation of monthly deficit (this is bad). You are spending more than the business is making. Most likely, you are covering the balance of these expenses with your personal savings (this is very bad). Your personal savings account is now like a private investor in your business. Unless you start showing your “investor” some positive returns and dividends, you’ll soon have a disgruntled investor who can close the cash pipeline. In other words, it is imperative that your marketing expenses are covered by your business, and soon, otherwise you will be out of business!
Q: How does a funded proposal turn a negative cash flow situation into a positive cash flow situation that can be used to cover your monthly marketing expenses so you don’t deplete your personal savings account?
A: Providing you with an additional stream of income that you can promote to get paid today, while building your long-term residual check from the growth of your downline in your network marketing company.
For those of you unfamiliar with the term “funded proposal,” here’s a quick definition:
A funded proposition is a low-cost introductory product that you promote as part of your business model. The purpose of promoting the product of the funded proposal is to immediately raise cash to cover expenses (for example, marketing and promotional costs) associated with running your business. Typically, the funded proposition product is related in some way to your main product, so people who buy your funded proposition product today may also have an interest in your main product in the future. Because of your marketing and relationship-building efforts, customers who bought the product from your funded proposal will be more receptive to buying your main product in the future than if you had promoted your main product to them first.
In your case, as a representative of your network marketing company, your main product is your business opportunity. One of your immediate goals is to grow your MLM business by building a strong base of representatives who have the right skills, training, and work ethic to build a large and stable organization of representatives and customers. A target market for good potential candidates to fill these positions are people currently in the network marketing industry who are dissatisfied with their current company, their current product, or the training and support they have received from their upline.
An example of a good funded proposition product that could market to this group could be a how-to manual, video series, or audio series titled “How to Build a Great Network Marketing Downline, Even If You Don’t Have a Warm Market” where Live and your upline sucks!” Let’s say you do your research and find that a good price for such an instruction manual is $47. If you sell 7 of these how-to manuals per month, using various free marketing methods, you’ve just raised $329 that can be funneled back into your marketing campaign. It could be used to pay for your monthly web hosting, phone bill, marketing materials, fuel, etc., so you’re no longer pulling money out of savings to fund your marketing.
By promoting this product to struggling network marketers, you are performing three tasks simultaneously.
1) You are building a list of qualified prospects (generating leads) to whom you can then market your MLM business opportunity and
2) You are raising the funds needed to keep your business afloat while growing your MLM downline. (More leads and more cash flow)
3) In the event that they do partner with you in the future in your network marketing business, you are training them, through your instruction manual, to be the type of distributor you want on your front line.
Now if you have the time and experience to create such a product this would be a great product for you to promote to the type of people you would like to sponsor into your business i.e. networked people. Marketing experience that can be difficult and open to switching to a new company. However, if you don’t have the time and expertise to create such a product, there are marketing systems that provide many great products that you can promote as an affiliate and earn money upfront through affiliate commissions to fund your marketing efforts. .
Some systems have over twenty different income streams that you can set up in about an hour and promote without interfering with your main network marketing business to fund your marketing budget. Plus, as a member of many of these marketing systems, you are given all the tools and training to drive traffic, build a list, market funded proposition products to your list to pay for your marketing, and sponsor more distributors into your marketing business. MLM. .