Big Al's
Fortune Now Newsletter
For Aggressive Network Marketing Leaders
P.O. Box 890084, Houston, TX 77289 • Tel: (281) 280-9800 • FAX: (281) 486-0549 E-mail: bigalnews@tntmag.com • Web Site: http://www.fortunenow.com
July 29, 1998
How to make your prospects want to join your business . . . even before you give your presentation.
Dear Fortune-Building Friend and Subscriber, In May, 1989 a very ordinary thing happened. I met two new distributors. One new distributor's name was Tom (great name if I do say so myself). The other new distributor's name was Ed. (Actually, Ed wasn't his real
name, but I changed it for this newsletter so he won't come by and break my car windows.)
Both new distributors wanted something different from the corporate world. They decided that multilevel marketing could give them freedom and money. Ed's story. Ed joined a coin program. Simple concept. Send money, recruit others, get some coins. Ed sent money, recruited others, but never got the coins. Seems that the ground floor opportunity never made enough cash flow to continue. The good news is that Ed's mailings brought in some pretty good distributors. The bad news is that nobody got paid.
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Six months later the New Products Co-op launched. What a hot concept. New products for the public introduced via MLM. Forget the Pet Rock, the Hula Hoop, or the Cabbage Patch Doll. Ed's mailings did pretty well. This opportunity was going to be the big one. It was big for two months, but the company ran out of money. No products shipped, no more bonus checks. A new coin company and the Rising Cookie program were really taking off by now. Ed joined them and put together a terrific mailing co-op. He would do the master mailings for his downline, they could follow up the leads. No reason to worry here, these were big companies with big volumes. Ed should have worried. The printing and postage invested brought in many hot leads. Unfortunately the companies really were disappearing when the hot leads came in. The next few companies Ed joined are gone. Ed's savings account is gone. Great mailing pieces, a lot of postage, and a lot of labor . . . wasted. What does the prospect think? Ed stopped mailing to his prospects and distributors. Why? Ed says, "I've promised them that my mailing brought a super financial opportunity. Then, the following month I would be telling them to drop the last great opportunity and to join this new opportunity. Then, the new opportunity would fail. After four or five mailings like this, the recipients could see a trend." People who received Ed's mailings didn't want to join a leader who didn't know where he was going. Ed didn't personally fail, his companies failed him. Every couple of months Ed would re-invest in starter kits, company literature, and mailings to build a new opportunity. Just about the time he could break even, the company stopped paying. There's no money in being first, being on the ground floor, or finding the next "maybe" great opportunity. Where the real money is. The real money in MLM doesn't come right away. It takes a couple of months to invest in a downline, do the personal prospecting or mailings, get trained and to break even. It's what happens after the first couple of months that brings in the profits.
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The really successful people in MLM are not the "heavy hitters" who are always announcing the next "maybe" great MLM opportunity. In fact, many of these so-called "heavy hitters" are on the financial edge, desperately looking for a hot deal to pay last month's mortgage. Who are the real money winners in MLM? They are the steady, quiet, blue-collar leaders who work the same company month after month, year after year. You see, they only have the one-time start-up cost. Then, every month they cash their profits. Every bit of work they do accumulates on top of their present MLM business - each check growing even stronger. It makes sense. Use every bit of effort to add to your profits instead of using every bit of effort to fund a new start up every few months. Hmmmm. It doesn't take a Harvard MBA to see the real picture. Tom got lucky -- or smart. Ed and Tom took two different routes. Ed looked for a "socalled" hot opportunity. He figured that the opportunity is what made people rich. The truth? An opportunity can't make you rich. Your work with a stable, long-term opportunity will make you rich. Work creates bonus checks. So instead of looking for a "so-called" hot opportunity, Tom looked for an experienced MLM mentor who could tell him the real story on how to make money and keep money in multilevel marketing. Was Tom lucky that he found a mentor? Was he smart? I don't know. But it worked. His mentor said, "There are a lot of good, solid, long-term opportunities in multilevel. Invest your prospecting, postage and printing in one of these opportunities. Work the same opportunity year after year. Cash your monthly bonus checks." So, Tom picked a long-term opportunity that fit his personal preference.
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Then Tom went to work. All his money and time were invested in one company, one focus, one accumulating business. Month three showed a $1,000 check. Month four showed a $3,400 check. Not only did he break even, but he gained a substantial profit. Month four through today, nine years later, Tom collects continuing profits. Frequency vs. reach. People like doing business with people they are familiar with. Don’t you? Would you rather join a friend or a casual acquaintance in networking . . . or would you want to trust and join with a complete stranger? Somebody you've met for the first time just minutes ago? If you do direct mail, consider this. A one-time mail piece to 100,000 people reaches a lot of people, but do they know anything about you? Are you stable? Will you ask them to throw away their investment in the last defunct MLM program you recommended? Will you be doing another ground floor, hot MLM program three or six months from now? Prospects can't tell from your one-time mail piece. Frequency is the key. Instead, why not concentrate your mailings to only 250, 500, or 1,000 prospects? Then, each month send them your progress report, your group newsletter, or just a reminder that you and your opportunity are still around. You won't get nearly as many prospects to enroll with the frequency approach. However, you'll get motivated, sincere, longterm distributors and leaders. These prospects aren't dumb. They see the hundreds of programs that come and go. When they get tired of that kind of no-earn, no-win rat race, they'll be ready to commit and earn some real money in MLM. They may even ask you, "Hey, what's the real secret to making money in MLM?" So, instead of attracting temporary distributors, use frequency to attract long-term distributors and leaders. Then your mailings become an investment with dividends for years to
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come. With reach (lots of one time mailings to reach the maximum amount of prospects), your mailings will only be an expense. Ed and I are still great friends. Ed loves the adrenaline rush of new ground-floor opportunities. I guess it's the chase that's exciting for Ed, not the money. Everyone has to make a choice whether to prospect and mail for the adrenaline or to prospect and mail for profit. I like to think of network marketing like this: Profits = Frequency + Frequency + Frequency Expense = Reach + Reach + Reach. Test this for yourself. Use reach. Talk to 20 complete strangers. Log your results. Then talk to five people whom you have some relationship with. And talk to them on four different occasions! That's a total of 20 presentations also. You might sign up a few more complete strangers in your 20 separate presentations. But how long will they stay? Now this is the point of this entire article! Ask yourself this very, very important question: "Will these new distributors join a different program when another complete stranger gives them a presentation next week?" Now think of the five people who waited for at least four separate contacts or presentations before deciding on an MLM career. Ask yourself: "Will they join another program after a one-time presentation from a complete stranger?" Probably not. Because they are cautious and want to know who they are dealing with, they wait for multiple contacts before making a decision to join. Is this a benefit to you? Yes! Because your competition is lazy! Your competition won't bother to make four repeat contacts, so your downline investment is secure.
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What's the most important concept to fast growth in network marketing? Hint: It's not OPM.
You’ve heard the term “Other People’s Money” – or “OPM”. Smart entrepreneurs use “other people's money” because it's a great way to leverage their efforts with someone else's resources. For instance, when you purchase a home, you make a down payment of 10% or 20% of the purchase price. Then, you use the bank's money to finance the balance. You are using other people's money to acquire a much larger home than what you could purchase with just your own money. Selling stock is the same basic principle of OPM. Companies may have a unique skill or product, but they need more money to do advertising, hire more employees or a hundred other things to build their business. Again, other people's money makes growth and increased profits possible. Smart entrepreneurs use OPM whenever they can. It conserves their personal cash. Plus, with OPM, entrepreneurs can expand and build their business much further than with their own personal funds. Do people use OPM in network marketing? All the time! Here are some examples. When things go wrong. There is a sweet lady in Texas who uses her money to help leaders in trouble. Let's say a network marketing company goes out of business. Last month's (and maybe previous months') bonus checks have not been paid. The MLM leader and his or her downline are now suffering from an acute cash flow crisis. They use this lady's money to get started again with a new company. The MLM group has the organization, but use other people's money to get off to a fast start with the new company. So instead of worrying and scrambling to take care of last month's bills, this group can now concentrate 100% on building its new business. What does this Texas lady get in return? A downline. She has an instant organization. So it's a win-win partnership. The Texas lady gets a new business income and the leader and his downline get financing for a fresh start.
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Trading time for money - and money for time. A veteran networker from California has made an interesting observation. Often this man will run into people with money to burn, but not enough time to devote to a network marketing business. In the same meeting he'll find just as many people who have a burning desire, an amazing energy, a super human dedication, but barely have enough money to buy a distributor kit! So what does he do? Team them up! The one with the money sponsors the person bringing sweat equity to the project. Or if there are more investors than workers, the investors are put front line to the person providing the time and energy and all the new recruits are placed beneath the investors. Trading time for advertising. Let's say that you can write and design a great ad. Plus, you have plenty of time on your hands to answer telephone inquiries, send out prospecting packages, and to follow-up or forward the prospects from the ad. The only problem is that you don't have enough money to run the ads. So, you put together an advertising co-op for your group. Your group could also include your upline or even people who are not affiliated with your company. Let's say that five people join your co-op and invest the money for the ads. Since you don't have any money to invest, you invest your ad writing expertise and offer to answer the telephones and distribute the leads. This way you earn your share of the co-op with your services. Since there are now six shares in the co-op (five investors and one worker -- you), you will get one-sixth of all the leads from the advertising. You are using other people's money to get new leads for your business. Okay, so what's the catch to using OPM in network marketing? It's hard to get their money. Whenever there is business -- there is risk. Sometimes people lose some of their money . . . and sometimes all of their money.
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If your advertising bombed and only attracted a few, miserable, unqualified leads, all the investors would lose their money. They hate that. That's why people are very cautious about where they put their money . . . whether it’s investing in real estate, stocks, or an MLM business. You’re probably thinking, “Why would anybody let me use their money to build a downline since I really can’t guarantee what will happen?” Good question. And the answer is: They probably won’t let you near their money. (That’s why they still have money!) If you can't get financing from someone else, what's the next best thing? Or better yet . . . What's even better than OPM? What many networkers don't realize is that there is something much more important in building a big business than OPM, other people's money. What is more important that OPM? OPE. And guess what? You can use OPE from the first day in your networking career. You can use OPE even though your upline doesn't know you exist. And you can use OPE even if nobody is willing to lend you a dime to start your business! You can use OPE it if you're rich. You can use OPE if you're poor. You can use OPE if you've just walked out the courtroom where you declared bankruptcy. So what is OPE and how do you use it?
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OPE is “Other People's Experience”. Instead of using people's money directly, you're using their money indirectly. Someone else has performed the trial and error work of network marketing before you . . . and now you're just reaping the benefits of his wisdom. Instead of spending money on trial and error projects of your own, you’re using the hard-earned (or rather “hard-paid-for”) experience of other network marketers. What's in it for them? Why would people share OPE? In network marketing, OPE is even more highly leveraged than junk bonds on Wall Street. Let's say that you team up with an experienced upline leader to start some "breakfast clubs" to get more prospects. Your leader systematically walks you through the steps for setting up your local breakfast club. What happens if your breakfast club fails because no one wanted to join, or because the members sent you unqualified prospects? Your upline leader only lost a little bit of his time in training you. He didn't lose any money. Most people are willing to risk and lose a little bit of time. Most people hate to lose money. So it's easy to get experienced leaders to risk investing in you, as long as they are investing their experience -- not money. Here is the big payoff. If the breakfast club (or whatever project you chose) is a success, you win! You could be earning thousands of dollars a month from the mentoring and experience of your upline leader. Other people's experience gives you the maximum chance for a huge payoff. For example, what if just one tip from your upline leader showed you how to save $100 on your opportunity meetings? If you give one opportunity meeting a week, that’s a $5,200 payoff in just one year. Or a $52,000 payoff in ten years! That's what I call leverage. Now, what does the upline leader get in return for his investment in you? Remember, he invested his OPE and some time to teach you how to start your own breakfast club or other sponsoring project.
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Your upline leader gets a bigger bonus check. This is what motivates your upline leader to share with you every experience, every test, and every new promotion. Maybe your upline leader spent thousands of dollars running ads that don't work. However, one ad did work. Your upline leader will be sure to share those results with you . . . If you listen! For some strange, really strange reason, most new distributors won't listen to their upline leader's advice. Here is their chance to get the ultimate leverage, the ultimate payoff, and they blow it! They insist on performing and paying for all the same expensive experiments their upline leader did, and they insist on investing in this duplicate waste of time. Pretty sorry, isn't it? Time and money leverage. That's important. You can't do it all yourself. And you don't have enough time in your lifetime to learn everything by trial and error. Want another example of using other people's experience (OPE)? For 15 years I wasted time, money, and patience attempting to help distributors become leaders. A few of my protegees actually became leaders. Most didn't. At first I couldn't tell who would become leaders. I listened to what they said, and then made my decision whether or not to invest in their careers. Bad method. All the time I invested in unmotivated, non-loyal and easily distracted distributors was stolen from the time I could have given to the people who really wanted to become leaders. I didn't want to misappropriate my time. I just didn't know in advance who to spend my time with. Then, I got some great advice from Tom Paredes. He told me about his experiences with the same problem -- and how he solved it! Wow!!! He introduced me to a simple test that immediately separated the talkers from the doers. (Just loan the distributor a tape or
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a book, or give the distributor a simple project to accomplish -and observe his performance.) So, for the past 10 years, I'm enjoying network marketing more and more, because I'm only working with distributors who really want to be leaders. His experiences were worth thousands and thousands of dollars to me -- plus all the time and frustration I've saved over the past 10 years. Pretty valuable, eh? The other people's experience (OPE) choice. Everyone of us in network marketing has to make a choice. We could re-invent the wheel. We go out and do it our way. This could easily take five years and thousands of dollars of our own cash to learn the inside secrets. The big advantage to this is that if we succeed, and that's a big if, we can then say that we did it our way. The downside to this method is that it's expensive -- very expensive. And it takes a long time. We could starve or quit network marketing long before we see any financial results. But most networkers choose this expensive trial-and-error route. They think this path will save them money. Or, they just don't understand there is a better way. It seems that some people would rather fuel their ego than fill their bank account. After all, taking time to learn from somebody else is rather humbling. Human nature is funny. I'm often asked: "If using other people's experience is so smart, then why don't most people do it?" I don’t know the answer. I guess that's why most people aren't financially independent. But there is another way - OPE. Smart networkers use this ultimate tool for time leverage and money leverage -- OPE. You simply find a successful mentor who has succeeded during the past few years. This leader has already spent thousands of dollars to find out the answers and methods you need now to become successful.
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Where are you going to find mentorship? 1. Try your upline. These people have a vested interest in your success. They earn more when you earn more. 2. Find the books, tapes, or newsletters that will give you the exact information you need to take your business to the next step. 3. Locate company trainings and generic trainings in your area. 4. Find someone in a related industry with related experiences. It all boils down to using some common sense. If you had to walk through a mine field, would you rather have someone go ahead of you and then step in that person's footprints? Or would you rather be the first one across? How to make your advertising work. How much time and money would you save on advertising if you found someone who ran advertising for 52 weeks? What if this person ran a different ad each week and of all those 52 ads, only one ad pulled magnificently and the 51 other ads bombed? Isn’t this person's advertising experience worth hundreds or thousands of dollars to you? Wouldn't you like to know which ad sponsored the best distributors? Or, would you rather spend money on 52 of your own ads and wait one full year to find out which ad will be the winner? How to make your opportunity meetings work. What if you found one leader in your company who has conducted opportunity meetings for the last five years? Maybe she learned which products to feature, what words to say to relax the prospects, and what benefits got prospects excited. Do you want to learn this on your own? Do you want to give meetings for five years yourself and risk all the money you’d spend on mailings, hotel rooms, refreshments, and samples? Or do you want the answers now so you can get on with making money?
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It should be pretty obvious now that: You want to build your business using "Other People's Experience." Hmmm, so the OPE principle is another way you can pick potential leaders, eh? If you’re already an experienced leader, you need to learn how to focus your energies on . . . distributors who want to become leaders. You want to work with those focused individuals who want to make the most of your business opportunity, don’t you? There’s no box on the distributor application that says: “Check here if you’re a dead beat.” (And if there were a box and somebody checked it, you’d probably faint.) So you have to use other observation methods to locate which distributors who would not only talk about leadership, but aggressively act and seek leadership skills. When you sponsor distributors, watch and observe their business pattern. If they insist on delaying their progress by using the trial-and-error method, you know that you're going to have a long process to get them to be leaders. How do you know you’ve got a “slow learner” on your hands? ♦ ♦ ♦ ♦ If he watches cable television all day instead of getting trained. If he won't go to the company convention where he'd learn a lot of new ideas. If he says the book on your top selling product costs too much, but spends that much money on beer. If he can’t take time to get on your conference call to learn what’s new at the company because he “keeps forgetting the time,” but he can remember to get up to watch Mongolian Mud Wrestling at 1:45 AM on Friday night. If he laughs at the stupidity and ineptitude of leaders making big bucks, but he’s never making any money himself.
♦
If you find someone who really wants to learn how to become a leader, well, life gets to be a lot more fun. Your potential leader's progress may be slower, but as long as he is learning and making progress, your job is to stay with him through this development phase.
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Here are some clues to identify your potential leader. ♦ ♦ ♦ ♦ ♦ ♦ He buys (and reads) the books that will help him grow in your business. He buys (and listens to) the tapes that can help him improve. He attends training sessions. He stays after meetings to pick up extra tips and ideas from leaders. He asks to spend quality time with you to learn what you know. He continues to learn and build his business -- even if you aren't there to remind him.
So there you have it. Other people's experience is the fast track way to build your downline. Will you use it? Will your downline use it? It's up to you. You'll have to make a serious, conscious effort to use this principle if you want it to work for you.
Take 30 minutes to ponder this point-of-view.
Are you hooked on buying advertising, sending prospecting offers through the mail, or investing in other prospecting methods? Why not ask yourself this question? What would happen if I invested the money I was going to spend on prospecting in such a way that prospects would come to me pre-sold? For instance, let's say you sold long distance service. If you ran a $100 ad in the newspaper, and you sold 20 new customers from that ad, your marketing cost was $5 per customer. Instead of running that ad, could you simply bribe new customers to your long distance service by giving them $5 to sign up?
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Or, could you use that same $5 to buy your customers something of value that you could use as a premium when they sign up for your long distance service? Implausible? No. I saw an offer from Sprint that I could get up to 20 boxes of Cheerios free by simply changing my long distance to them. This was especially tempting since Cheerios is my favorite breakfast cereal. Now, I don't know how much Sprint will pay for those boxes of Cheerios, but I'm sure they will be spending a lot less than their television commercials that no one watches. So ask yourself: Is it cheaper to give away a three-day supply of your diet plan than advertise for prospects? Is it cheaper to buy your prospects dinner at a nice restaurant than to pay for an expensive hotel meeting room? Can I pay for a babysitter and movie to entice a couple to come to a brief opportunity meeting? What if I gave away books on how to become wealthy and followed up with the recipients? Could I get a free press release if I offered to give away free samples or products to the publication's readers? Instead of paying for radio advertising, could I become a guest on the local radio talk show? Could I pay influential people to become "testers" of my product and hope they refer others because of their personal experience? Just something to think about while you are building your network marketing business.
Gift giving mistakes.
During a SuperSponsoring Workshop in Philadelphia, a distributor approached me and told an interesting story.
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This distributor prospected by using the mail. Instead of sending a sales letter or a brochure, he sent a series of ten small gifts. The strategy was to bond with the prospect so that the prospect would be more receptive to a recruiting presentation. Here is what happened. Through a small administrative error, some prospects received gift #2 first. Their letter said: "Enclosed is gift #2. I hope you enjoyed gift #1 that I sent you a couple weeks ago." Three prospects instantly called the distributor to say that they really enjoyed gift #2, but that they hadn't received gift #1 in the mail. This led to a conversation and a relationship was quickly built. So instead of waiting for four or five mailings before making the initial call to the prospect, this distributor was elated because the prospects were calling him right away! Sometimes your mistakes just work out okay.
See you next issue!
P.S. Please read the enclosed update letter. It has some important news about the new home study option for the SuperSponsoring Workshops. P.P.S. Attention one-year and two-year subscribers. Don't forget your special area at http://www.fortunenow.com.
Fortune Now is available by subscription only. Subscriptions are $97 per year. Fortune Now is published ten times a year by KAAS Publishing, P.O. Box 890084, Houston, TX 77289, (281) 280-9800. Copyright 1998 by KAAS Publishing. All rights reserved. Please contact KAAS Publishing for permission to reproduce or copy specific articles. 7/98
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