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What is MLM? A Complete Guide on Multi-Level Marketing


What is MLM? A Complete Guide on Multi-Level Marketing

Multi-level marketing is one of the most successful and popular business norms of the time. The strategy is tried and tested for selling goods and services. The MLM members of the MLM network advertise and sell their products and attracts new members to the firm. Multi-level marketing is also known as direct selling, network selling and pyramid selling. The adoption of the MLM plans quite rose in different domains. Every MLM company applies different rules to reach its target audience. The goal behind every company is the same, building a larger group to establish relationships and make a profit.

So let’s get into details. What is multi-level marketing? How does it work?


What is Multi-Level Marketing?


MLM is a feasible business strategy that relies on sales for income generation purposes. It is an effective way form used to sell products to customers. MLM schemes, unlike traditional sales, lean on various networks to make sales and acquire new members. As a result, network marketing is another common term used to describe this trade instance. 

This method of trade has aided companies and customers for a long time. Companies incentivize customers to promote their products and services to friends and family- potential customers who are further in the network. With the evolution in blockchain technology and widespread integration of smart contracts within several industries, the MLM business has risen again. The MLM has overcome the previous allegation and drawbacks. 

The money-making opportunities and evolution of business with MLM have significantly amplified showing, development and potential. 


Different types of MLM Plans

A wide variety of plans are implemented by multi-level marketing companies all over. The earnings and chances of growth increase depending upon the type of plan you join in an MLM company. 


Binary MLM Plan

The binary plan is the most used. Individuals, as well as companies, benefit same from the plan. The binary MLM plan uses a two-leg system. These legs become profit legs based on the activity. An individual who enters the network will be adjusted either on the left or right leg.

Matrix MLM Plan

The matrix MLM plan is also known as the ladder plan or forced matrix plan. A limited number of people are eligible for width front and can earn rewards up to some levels because the width of the plan is fixed. The upline of the plan is dependent on the downline for sale. 

Unilevel MLM Plan

The most basic MLM plan. It allows you to add new members giving you direct control over the distributors. You can add an endless number of people to this plan. Multi-level marketing organisations add rewards and incentives for achieving goals. The MLM plan is quite impressive to produce results for distributors. 

Generation MLM Plan

Product sales are the essential aspect of the plan. The cohort must sell the products to earn rewards. Marketing is essential to most businesses. This method, on the other hand, is based on words & mouth to mouth marketing which gives the marketing a personalised feel. 


How is multi-level marketing different from traditional marketing?

Multi-level and traditional marketing are two of many methods to do business today. Both these are popular and help manage the business in many ways. Here’s how they both differ from each other. Let’s have a look:



Conventional marketing involves a longer supply chain cycle. A product passes from distributor to wholesale. The wholesaler departs it to the retailer, who sells it to the customer. 

An MLM company processes directly selling to the customer. They also shorten the supply chain and thus can save costs to the customers.  


Companies employ various social media platforms to advertise and market their products. MLM companies use their recruits to publicise their products. These companies also tend to hold aggressive recruitment drives.


Pros and Cons of Multi-Level Marketing

Just like any other business, MLM has some pros and cons. This business is subjected to criticism and yet appreciated by many. So let us explore.


Pros of MLM

Easy way to kick start your business.

MLM allows individuals to work on a different business model with freedom with less investment. You can become a distributor or can let others join your network and expand your network and start earning from it. 

Passive Income Growth.

In MLM business, you can earn as much as you keep putting effort into the work. The income keeps increasing as you recruit new distributors and sell products online. 

Collaboration With Established Business.

The Sales team can collaborate with an established business that has already gained acceptance in the market with its excellent work, labels and industry-leading techniques. By working with an established business, your chances of seeing success increase significantly. 


MLM provides you with an opportunity to work at your convenience. It completely depends on how much time you want to invest in your business.


Cons of MLM

Fear of Scams.

There are a large number of MLM companies available in the market, and some of them are involved in fraudulent activities. People are often afraid of being exposed to such scams and try to stay away.

Slow Growth Rate.

It takes to be successful. The process is quite time-consuming as you require a lot of time making presentations and inspiring people to invest.

Low Income.

The MLM business requires a lot of patience and effort. It is not a scheme that can help you become rich overnight. 



Multi-Level marketing businesses continue to remain successful and popular. Today, they are subjected to far more rules and regulations than they ever were. They are legitimate and ethical as of today. Like any other business, an MLM business requires hard work and forbearance. Rewards are sure if people do not desire success overnight and are keen to commit to the cause.

We at Blockcoders, are an MLM development company. We offer a varied scope of blockchain solutions. Our MLM platform development solutions are white-label, customizable, and scalable.

We specialize in designing and establishing powerful and capable MLM platforms on top blockchain networks. We integrate into our developmental process,

  • Total decentralization
  • Firm and transparent smart contracts
  • Risk-free platform 
  • P2P trades

Contact us so that we can begin working as per your business requirements on launching your MLM platform on various blockchain networks.


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