MLM or Multi Level Marketing is also known as network marketing is one method of entrepreneurial marketing by utilizing network system. This kind of marketing is also said to be network marketing because it is a marketing network in which there are a number of people who process the product or service marketing.
Multi-level marketing utilizes the consumer as a reseller directly. The price of goods which are offered to the consumer level is the price of production plus commission which is the right of the consumer because it has indirectly helped the smooth distribution and the best MLM company is the one that will be know how to attract more consumers to join the company.
In general, MLM is a method of alternative business related to marketing and distribution is done through many levels or tiers which are commonly known as upline or upper level and downline or lower level; people who will be called upline are the ones that already have downline.
Promoter or upline is a member who has gained membership right first, while subordinate or downline is a new member who registers or is recruited by a promoter. However, on some systems, this membership level may vary according to certain payment or purchase conditions. The core of this MLM business is driven by a network, either a vertical top-down or horizontal left-right or can also be a combination of both.
Commissions given in tiered marketing are calculated based on the number of automated distribution services that occur when a subordinate makes a purchase of goods. Promoters will get a certain commission as a form of remuneration for subordinate recruitment. However, there are also some MLMs that do not provide any bonuses on recruitment services, as recruitment bonuses include prohibited bonuses.
Thus, it can be concluded that MLM is a business that prioritizes the network of a number of people in the form of levels or tiers aimed to market goods or services.