This question has came up quite a few times recently so I thought I would show you guys the differences in affiliate marketing vs MLM. I also want to share with you which is more profitable. As many of you who visit here frequently know that I am an affiliate marketer. I review many other programs to see if they are worth your hard earned money or not.
Many of these, are multi level marketing products(MLM). In this post, I’m going to explain these 2 marketing platforms, and show you which one is going to work better for you in the long run.
What Is Affiliate Marketing?
With affiliate marketing you will be taking something you are passionate about and learning how to turn it into a long term profitable business.
I will explain how this entire process works below:
People search on Google for stuff everyday. This varies from doing research on a particular product or service first, before they buy it, to doing research on a company to see if they’re legit or not. What’s the last thing you Googled recently?
If you are reading this now then you have likely typed a search term into Google looking for more information on MLM vs Affiliate marketing. Am I right?
- Have a website with information related to their search
- You are ranked on the first page
- they click on your website
- Read your content and want more information
- They click on your affiliate link for more information
- They make a purchase
- You make a commission
You can sign up to be an affiliate for many popular merchants like Amazon, Walmart, Best Buy, or Target just to name a few. You are simply helping these companies sell more products and you get a commission every time the people you refer buys something.
It’s one of the most lucrative and most legitimate business models out there, and it’s been around since 1996.
What are some of the pros of affiliate marketing?
- Unlimited supply of products- With access to millions of products you have a wide variety of products to choose from.
- Unlimited earning potential- It’s your business and you can build it out as much as you want. You can make as much money as your heart desires.
- No sales experience necessary- With the right training program you can be up and running minutes after you get started
- FREE to get started– No upfront costs and your starter package comes with everything you need to start making money
- Very low cost to maintain and run your business each month
- Once you get your business running smooth you can operate it on autopilot
- A great way to start building up your residual income and grow your network online
Here are some of the cons
- There’s a HUGE learning curve- Many people give up after their first few months because there’s so much you gotta learn to be successful.
- You will be putting in lots of hours without being paid- When you first get started it takes time to get established and start getting people interested in what you’re selling
What’s Multi Level Marketing (MLM)
Even though this business model shares some similarities to affiliate marketing it digs deeper and crosses into where it becomes associated with some well know pyramid schemes.
MLM is where you will be recruiting people to join your team. The more people you sign up, the more money you can make. Chances are, when you sign up you were likely recruited by someone else. It’s your job to recruit other people into the business and get them to join your team.
If this sounds like a pyramid scheme to you, that’s because it’s right on the borderline of being one. The only thing that keeps this legal, and from not being labeled as a pyramid is that the company usually has a product or service that they use to get you to join.
There’s no training on how to market the product and 99% of the money you make will be trying to get others to join under you and build the pyramid bigger.
You will make money when the people you recruited recruits more people, and when their people recruit more people into the company. Confused yet? You should be.
Take a look at this infographic below to get a clearer explanation of what I’m talking about
As you see above you are going to need to recruit a ton of people and hope that they don’t quit. In my experience with MLM over 95% have been borderline illegal and I ended up losing a whole lot more money than I ever made with them.
You are in NO way building a long term profitable business. You are relying on the other people that’s higher in the pyramid to do the selling for you. You will also constantly have to recruit other people and convince them to join under you.
What are some of the pros of MLM?
- There are a few reputable MLM programs out there like Avon and maybe a few others
- If you are a great salesman and are good at recruiting lots of people you can make some decent money
Here are some of the cons
- You won’t have any long term success with mlm IF any at all
- It’s set up to much like a pyramid scheme and is borderline illegal
- If you’re not comfortable with recruiting your friends or family then this isn’t going to be something you would enjoy doing
- You usually need to invest into higher levels to make more money
- It can be very expensive to get started and you can lose lots of money quickly
- usually only 1% of people who join really make good money
- Most of the time you will be required to do cold calling to get leads (People to join under you)
What similarities does these 2 business models share?
With affiliate marketing you promote products and services to others which is the same as MLM, but you don’t rely on your team or have to recruit people. Instead of creating a downline like you do in MLM, you will be creating a long term business that you can grow as big as you would like.
Also with affiliate marketing you can earn passive income just like you would in MLM. The only difference is that you would only be paid on a single level, not multiple ones. Now while you may be thinking that you could make more money this way. You need to invest more money to be able to get paid on multiple levels like I have mentioned above.
In the long run you will end up losing more money than you make on these other levels.
So which business model would I recommend as being the most profitable?
Affiliate marketing is one of the best ways to create a long term profitable business online today. It has been around for close to 20 years now and it’s a multi billion dollar industry and growing more each day.
It’s also one of the most cost efficient ways to get a business up and running with absolutely no prior experience in marketing. When you are involved in MLM, it’s your job to go out and find people interested in what you have to offer. Most of the time you are encouraged to do this using unethical and dishonest techniques.
I also want to point out that MLM also uses different terms like “network marketing” and “top tier marketing” to fool you into thinking you aren’t joining another MLM company.
With affiliate marketing there’s no selling involved and people actually come to you looking for more information. Since they are already interested, all you need to do is help them out by providing them with quality information and point them in the right direction.
I would suggest that anyone looking for an honest and legitimate way to get started online, and looking to get started for FREE to definitely check out Wealthy Affiliate. They’re the reason why I have been so successful online, and I would love to help you do the same thing.
I really hope this has helped everyone out and has cleared up any confusion you may have had about these 2 marketing platforms. If there was anything I wasn’t clear on or if you have any questions for me I would love to hear from you.
Please leave your questions, comments or anything else for me in the comments below.
I will get back to you A.S.A.P
Your Friend, Scott
Here are a few other MLM/Pyramid schemes I have reviewed.
Check them out below: