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Many people get stumbled when they are asked this horrible question, “Is this a pyramid scheme” or “Is this one of those pyramid selling structures?”
When someone asks you this question, you must not fumble or stutter… in fact, you must be very happy that they ask this question because it shows genuine interest on the part of the prospect because better to have a passionate, negative prospect than a lukewarm person. A passionate, negative person can be turned into a passionate positive person who will go all out for your team, but only if you handle the pyramid objection intelligently.
Firstly, a pyramid scheme is often confused with network marketing or multi level marketing. People feel that the guy who starts FIRST is often the one who gets all the money while the downlines do all the work. Others would associate the MLM company as being illegal.
You see, MLM generally pays over a multi-tier compensation structure and you can earn money up to many levels deep. However, it doesn’t mean that the person on ‘top’ will generally earn more money than the downline.
Let’s take Amway for example. If you want to ‘Go Diamond’ you will need to build up 6 teams.
But if you want to go Double Diamond, you need to personally build up 9-12 teams (as an example). So if you build 6 teams only but your DOWNLINE, builds 9-12 teams, does it makes sense that your downline should earn more money than you? Sure your downline is part of your team and he is helping to expand your group, but since he put in more hard work in personally building a team, it makes sense that the downline Double Diamond earns DOUBLE of what you should make even though you are on top!
Next, if you consider that network marketing is a business about helping people, you can’t try and sponsor as ‘wide’ as possible (e.g. personally sponsoring 20 yourself) but you don’t help any of them succeed. You are no longer building a network but you are creating a recruiting job for yourself! And if they don’t succeed, you can bet your next commissions check that you will be sponsoring people over and over again for the next few years.
Most compensation plans pay you well only when your downlines succeed so unless you are prepared to HELP your people.
So in order to handle the objection, consider that – network marketing is a LEGAL network building business that MOVES PRODUCTS through many levels and the one who works the hardest will get paid the most (contrary to a corporate pyramid where the CEO might not necessarily work the hardest compared to the clerk, but the CEO gets paid the most nevertheless).
Jimmy,
You are right on, with this article! How often do we hear that “Pyramid” question…?! You address the issues very matter-of-factly. I have forwarded this to my entire downline, and RT it. Thanks for the valuable information!
~Donna