Affiliate Marketing vs MLM: Which is Better? Who Wins the Battle?
This trivial battle has been going on for years now, so let’s help you to decide…should you do affiliate marketing vs MLM? Today you’ll learn the ups and
downs of affiliate marketing and MLM (also known as network marketing or direct sales) so you can make a decision about which is better to start with, and if course to profit with.
So I’ll start with affiliate marketing. Affiliate marketing typically has a higher commission percentage; I’ve been an affiliate of companies where the payout to sell someone else’s product has been as high as 95%!
This is quite incredible considering you haven’t had to create any products, deal with customer support or hiring staff. Most affiliate companies are digital and promote Internet based services such as video trainings or membership sites so that companies can pay out more, due to there being no shipping and handling required.
A lot of affiliate companies also don’t mind you promoting multiple offers, and some of these offers typically won’t conflict with anything else. For example, it’s possible to be an affiliate of AWeber who provide email marketing solutions to help you contact and organise your leads, and also be in a health/fitness MLM.
You can also use affiliate marketing to cover business costs such as paid advertising, graphics design and attending conferences. So affiliate marketing in my view is much more flexible and you can be an affiliate of hundreds of companies if you wanted.
You could even be an affiliate of Amazon…it’s not like you’re working for them as an employee. The relationship between the person promoting it and the company is less rigid, in my view, than some MLM companies.
The drawback with affiliate marketing is waiting a long time for your commissions (sometimes up to 6 weeks from the date when you made the sale). Also if you’re international like me, payments can take longer to reach you and can carry some small fees. It’s just part of the deal…at least the fees you pay are a tax deduction!
Now with MLM, you are able to make money from commissions that other people who you bring in as distributors, and can do it multiple levels down. So for example you sponsor a guy, who goes and recruits 4 people, you could potentially earn commissions from all 5 of those people as they’re in your team.
This is something you probably know as residual income, which you don’t get in affiliate marketing as these usually don’t have compensation plans the same way as a network marketing business does. Although in affiliate marketing you can earn monthly revenue if someone is buying a subscription based service and is a repeat customer.
The drawback with MLM is also waiting for your commissions, same as with affiliate marketing. There are some companies that pay weekly though, but you still have to wait a minimum of 4 weeks in some cases even if it’s paid weekly. Also the commission rates can be quite low if you’re not meeting any particular quotas or hitting a bonus, or at a particular rank. They can be as low as 5-15% of the sale.
Another issue you might come across is the attrition rates in network marketing; the lifespan of a rep is less than 60 days. So whilst balancing keeping your existing team active you need to focus on recruiting more people. The best way to keep people active is to offer them so much value that they feel obliged to stay on with you.
Finally, be aware that with MLM the company has control over the comp plan and can change this at any time. In a lot of cases companies have made changes to how their reps are paid, and this could affect your residual income.
Also consider, what if the company owner gets ill and can’t run the business anymore? What if the MLM business is investigated and shut down by the government for months? Side note: this recently happened to a billion dollar company.
What’s the outcome of affiliate marketing vs MLM?
Ultimately it’s up to you, I’ve laid out the facts but it’s your decision to make. Personally I have used affiliate marketing to have multiple 3 figure days online without relying on a team.
There’s still some huge advances to MLM though, such as being around some inspiring people and getting some personal development or education under your belt to use in other areas. So when looking at affiliate marketing vs MLM in some cases, if you’re promoting offers that don’t conflict, you can even get away with doing both.
As for me personally, I’m currently working with a ‘hybrid’ program that is a mix of affiliate marketing vs MLM. You can earn 100% commissions which is instantly paid with no waiting, and although you can build a team to help your business grow, you can also recruit on your own and not have to rely on a downline to get results to make money yourself. If you want to more about this, message me on Facebook or visit this website.
If you found this affiliate marketing vs MLM comparison useful, here’s some related blog posts on step by step affiliate marketing training and how to succeed in network marketing fast.
-Seb Brantigan
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Skype: seb.brantigan
