Multi-level marketing is the cornerstone of network marketing. It has become an industry with revenue in billions of dollars in the last couple of decades globally. What started as a brilliant marketing idea became a marketing strategy that is now followed by hundreds and thousands of companies worldwide to boost their sales, revenue, and outreach. A company with limited awareness and sales can witness exponential business growth with the MLM business model. However, to achieve such an increase, the right MLM plan that suits your business structure, revenue, and marketing model must be selected.
Numerous MLM plans have been tried and tested over the years, and while they all have the same foundational principles of growing the business network, the internal structures are different. Here we would some of the MLM plans that are well-known in the MLM industry.
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It is one of the most widely popular MLM plans in the industry today and follows a two-leg structure. The downline members join either the right leg or the left leg, depending on the vacancy and upline’s discretion. The MLM plan offers equal benefits to both the legs as the tree structure of this MLM plan continues to grow. Unlimited numbers of members can join this system due to its tree-based marketing structure that continues to grow as more and more members join. It’s a growth-based multi-level marketing model followed by the majority of the MLM companies in India.
Also known as a Ladder Plan or Forced Matrix Plan, it consists of fixed width as well as depth matrix for its downline structure. In Binary MLM Plan, an infinite number of members can be recruited due to its ever-expanding tree-based marketing structure. However, in this plan, only a limited number of members can be drafted for the width front.The Matrix MLM plan is based on upline deriving more sales from the downline. The cycle continues in a linear yet ladder pattern that is horizontally limited and vertically infinite. The upline can diversify the network chain to enhance profitability, and a bonus level can be added to lure more customers, downline members, and revenue.
Considered the most basic MLM plan, it enables you to bring in as many affiliates as you want to the first line. The members have direct and total control over their distributors with no control managed by the upline. The MLM structure continues to grow horizontally as the width increases as more members join the business. The MLM companies choose this plan to attract the affiliates who wants to have total control over their downline or distributors. The MLM companies can make this plan look attractive by offering incentives, rewards, and other types of bonuses after the frontline depth reaches a particular level.
Straight-Line MLM Compensation Plans
It is yet another basic MLM plan that is practiced in many network marketing companies. It follows a linear pattern with one member under the other, and the downward string continues to grow in the same fashion. The members earn residually from every new member that joins the downward chain. So, it is in the members’ best interest to
continue to add more members to this MLM structure. The straight-line MLM compensation plans depend on the member joining the MLM model’s timestamp as it is on the first-come, first-serve basis. So, the member at the top of the structure enjoys more profits than the one below.
It is one of the most complex yet flexible MLM plans that has gained acceptance globally in the MLM industry and followed by some of the top leading MLM networks. It is also known as the Revolving Matrix Plan. It starts with the company recruiting some affiliates to form a team, also known in this plan as the board. Once the board is full, a new board is formed as per the company’s regulatory protocols. The company’s owner or management decides the size of the board as per the business model, strategy, vision, revenue, and projected growth. Every member joining this plan can determine the size of their board and which members would be joining the new board that is formed when the earlier one is full. The
income and bonus are decided as per the income plan arrangement.
Generation Plan is also known in the MLM Industry as the Gap Commission Plan or the Repurchase Plan. The members joining this MLM plan have to sell products to get higher commissions and incentives. Companies manufacturing consumer products often choose this plan as it is highly actionable and generates results. The more the members sell, the more they earn, and it mutually helps the company as well. The marketing in this plan is personalized and relies on word-of-mouth marketing, which continues to be one of the most influential forms of marketing to date.
It is a unique MLM plan amongst all other methods as here the selling, endorsing, promotion, and marketing of the product happens through a social event. The host organizes a social event, party or a get-together of friends, family, neighbors,colleagues, and leads generated through social media, and other platforms, and invites them to a venue where the selling and promotion occurs. It is a simple and straightforward method in which the host regularly holds social events to display the products and sell them to the invitees. It does have a limitation in terms of outreach but is highly result-oriented.
In this MLM plan, the volume of the sales decides the fate of the member and how fast they grow in the MLM hierarchy. Each member is given a sales target, and upon achieving it, there is an advance that occurs in the chain. Achieving goals is rewarded with incentives and bonuses, which acts as a motivating factor for the members to achieve their targets. Achieving sales targets regularly would promote the members and the affiliates to a higher position in the MLM hierarchy. The income grows as the members go high up the hierarchy.
To understand this MLM plan, we first have to follow the Binary MLM compensation plan. In the binary plan, only two downline members could join, and there is no possibility to add more members. It limits the growth and sales, and only the sales made by the two downline members push the sales figure. In the Spillover Binary MLM compensation plan, there is a possibility to add the third member to the weaker side to maintain the balance and consistent growth in sales and revenue. If any of the downline members are not performing well or driving sales, a third member can be added. It allows the sponsor to tweak the marketing strategy in case the existing one doesn’t perform as expected.
It is a marketing-oriented MLM plan, where the possibility to increase sales volume and incentives depend on how active the downline members are. Both the downline members have to be active to ensure that the sponsors, as well as the downline members, enjoy higher perks like bonuses and incentives. It acts as the motivating factor for all the parties involved to increase their sales volume as well as stay active. The role of sponsors plays a pivotal role here to ensure that the downline members stay motivated and get the help needed to not only stay active but to increase the volume of their sales figures gradually.
It is the combination of the Uni-Level Compensation Plan and the Binary Compensation Plan. It doesn’t have any supervisor to keep track or check the chain as each team consisting of affiliate members working collaboratively to increase sales. When the individuals are self-motivated and contribute to the team’s success, every member gains. It is the model that is well-known to boost the sales figure as well as help with word-of-mouth marketing.
It is a kind of gift and donation plan where you have to provide help to receive the same. Only the members who have helped others to get the necessary funds can request the funds from the system when needed. Only the users who have contributed to the system’s fund and helped others get the funds are eligible to receive funds, and no other user can join the network. The help seeker and the help provider have to update each others’ details in the system so that they can avail the benefits offered, if and whenever needed, in the future.
It is an extension of the Binary compensation plan where apart from the two downline members, it has a third leg as well.It helps in enhancing the marketing and the compensation possibilities of the MLM plan. The third leg is added at all levels and helps in increasing the output considerably. These are the top MLM plans that exist in the network marketing industry and continue to provide self-employment opportunities to millions of people worldwide. Each of these MLM plans has its characteristics, and the companies and businesses integrate the MLM plan that best fits their business strategy and marketing model.