Industry standards for MLM sales and recruiting success rates are not as well known or as predictable as the mail order response rate. On average, I can expect to make a sale if I share the benefits of my product with 18 people. That’s a little over a 5% response rate. In practical terms, 5 out of every 100 people I meet in a business context will become my customers. Not a lot, but enough to build a business.
This is why successful companies and successful network marketers value their customers and work hard to keep them. In network marketing your advantage over the department store or Internet website, is personal service, tailored to the specific needs of your customer. Don’t shortchange your customers. Serve them and keep them. Regular customers are your bread and butter.
To increase sales you must prospect for new customers. Knowing that 95% of the people you approach will turn you down helps keep it all in perspective. You have to be willing to sort through 100 people to find the 5 that want to be your customer. How many new customers do you want by the end of this month?
1 new customer: talk to 18 people.
5 new customers: talk to 100 people.
10 new customers: talk to 200 people.
5 new customers: talk to 100 people.
10 new customers: talk to 200 people.
If you only talked to one person per day, you could expect to grow your business by 1-2 new customers per month. By the end of your first year in the business, you could have 12-24 regular customers, and customers = income opportunity.
Many network marketers choose to stop recruiting customers when they achieve the personal sales volume necessary to achieve a certain commission rate or distributor rank. In my opinion, this is silly. Satisfied customers are your best source of potential recruits. Continue to add to your customer base. You will always need new people for your sales team.
Ron’s Recommendation: Never miss an opportunity to share the benefits of your product or service. Two new customers per month, added to your existing base of regular customers, is a booming business.
Newbie Trap: Failure to share the benefits of your product or service with others on a consistent basis. Consistent means day after day, week after week, until it takes a computer to keep track of your customer list.
MLM Factoid: Personal and group sales volume are key indicators of success in network marketing. Higher sales volume = higher commission rates = bigger checks. Personally, I’m looking for checks the size of billboards. Puny checks are for little people with dime-sized dreams. You can do better. The fact you are reading this book proves that.
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