What’s the Difference Between MLM and Affiliate Marketing?
Do you want to know what the difference between MLM (multi level marketing) and affiliate marketing is? Then you should read this article.
First of all, MLM has been around for a lot longer than affiliate marketing. It is kind of build like a pyramid scheme – although it is a bit different from these schemes. In fact, pyramid schemes are illegal in many countries, whereas MLM is not.
In MLM you promote a product or a service and sell it to consumers. But to make real money, you will need to create what is called a downline. A downline is basically a group of people who signed up as marketers for the very same product or service, but they signed up through you. That’s why from everything they sell, you get a certain percentage of the commission.
In MLM, the earlier you get into the game, the better it is for you, because if you can build a good downline, you as long as the people in your downline make enough sales, your percentage is enough to live comfortably.
The truth however is that in most cases, the people who sign up for MLM companies never make a decent amount of money, and many in fact lose money, because they are required to pay for a starter package when they sign up.
With affiliate marketing, you also promote a product or service and sell it to consumers. But there is no such thing as a downline. One example of an affiliate program is the Amazon.com affiliate program. You can sign up for their affiliate or partner program and then get a commission every time you refer a customer to their website who makes a purchase.
The only thing that may kind of resemble the downline of MLM are tiered affiliate programs – these are programs where you can earn a percentage of the sales that are generated by affiliates who sign up through your links. However, the vast majority of affiliates makes the most money from direct sales, rather than tiered affiliate commissions, which is very different from the world of MLM.