What is an MLM feeder program? What it does and how can help a network marketer whether seasoned or just beginning?
To take it from the start this feeder programs started as a necessity and a clever way by some marketers to get more value from their advertising and don’t lose their prospects. Those networkers were already involved in an MLM business in which they were concentrated and put most of their effort. The problem was that some of the companies had a high entry cost that most of the prospects couldn’t afford or didn’t want to pay. This resulted to low conversion rates and as a result a high ratio of advertising dollars per new customer or member.
In order to solve this problem and don’t lose their prospects for ever they started using other programs with low entry cost to offer to them if they were unable to join their first opportunity. Some of them would find the second proposal interesting and become part of it.
What this network marketers accomplished was to keep communication with the people that joined the second company and have the chance in the future to also make them distributors for their primary business. What’s more was that they were able to build a second stream of income, at the company they used as a feeder, with the same budget. As you can understand soon this method took of and many of the top network marketers started using it.
That feeder method wasn’t immune to side-effects and for sure it created some problems. First, the distributors who used this method no matter how little time they spent on the feeder program they have to pay attention at two programs that at some extent it was diluting their efforts. Second, they were helping someone to succeed in one business with the end result being moving him later to similar or not so similar one which could ruin all the work he might have done in the feeder program.
Today things are better in this field. Although many people still use the method mention above these days many companies create their own feeder programs. By doing that they help people who can’t afford the initial cost to join to do it at a fraction of that within the same company so to solve the above problems. That way they keep their distributors focused while giving more choices to their prospects without the need to sidetrack them to other opportunities. As you can understand this is a win-win situation that benefits all the involved parties and increases the success rate of the company’s members and the future success of the company as a whole.
More than that there is even independent companies who are created by their founders with the purpose to serve as feeder program for another company. Those two companies have no other connection other than the owners of the feeder are usually distributors for the ‘parent’ one.
The concept of the MLM feeder program is on the rise and the number of companies that use a feeder though small today it will increase in the future. Where we see the most growth today is in independent businesses that run as a feeder for another company and they come to fill a void as many distributors want to utilize them in their marketing efforts.
