http://www.bestmarketingaffiliate.com Some of the terms and definitions found in network marketing / mlm can be confusing to understand. Here is a list of some of the more common terms.
If while during your research you find a new term on a companies
web site please use our contact form and send it to us.
We will do our research on it and add it to the list here.
Achievement Level: A rank or title
that is achieved by moving a certain amount of product per month
and / or recruiting
a certain number of distributors who themselves have attained a
certain designated achievement level.
Affiliate Program: An Internet business, such as Richdad.com,
that allows people to become affiliates simply by providing a link
on their Web sites to a corporate home page, and pays affiliates
a commission on all sales made through that link.
Autoresponder: A Web site or a service Aweber
that e-mails information automatically to anyone
who clicks on the responder.
Binary: A type of compensation plan that limits your frontline
to two people and pays out weekly on one of the two legs of your
organization.
Breakage: Sales volume generated by you or your downline
for which you receive no compensation.
Breakaway: An abbreviation for "stairstep
/ breakaway," one
of the four major types of compensation plan. It can also refer
to a distributor in your downline who has met certain minimum
monthly qualifications and has consequently "broken away" from
your group.
Breakaway Leg: The organization or downline of a breakaway distributor.
Bonus Pool: A special fund set aside by a network
marketing / mlm company, from its profits, and distributed as a
special incentive to qualified sales leaders.
Bonus Volume: See BV.
Business Builder: A distributor who is actively
prospecting and gathering customers, as opposed to one who is simply
buying product at wholesale for personal use.
Buy-Back Policy: The money-back guarantee offered by all reputable
MLM companies to distributors. Generally, companies will pay 70
to 100 percent of the wholesale price on any product that a distributor
purchases, but then decides to return, for whatever reason.
BV (Bonus Volume): An alternate expression for
point volume (PV) or business volume (BV). It is a value used by
MLM / Network Marketing companies to calculate overrides and commissions,
based upon the wholesale price of the items for which overrides
and commissions are being paid.
Circle of Influence: The people who are closest to you and who
constitute your warm market. Also, those who might be easily influenced
by you because of your reputation in a particular profession or
community.
Cold Market: Prospects outside your circle of friends, family,
and associates.
Commission: The percentage you earn from the sales volume of your
organization.
Commissionable Volume (CV): An alternate term
for bonus volume.
Compressed Plan: A pay plan that stacks or "compresses" the
bulk of its commissions on the front end.
Compression: When a distributor quits or is terminated, his downline
moves up one level, thus filling the empty space he left, and "compressing" the
company's downline by one level.
Depth: The number of levels in your MLM / Network
Marketing organization.
Direct Selling: A form of selling whereby
independent MLM / Network Marketing representatives, working on
commission, sell face-to-face outside of an established retail
location.
Distributor: A person who contracts independently
to sell products or services for an MLM / Network Marketing company.
Downline: All the people recruited as distributors
into a network marketing / MLM company constitute that company's
downline. Your downline consists of everyone whom you recruit,
who is recruited by your recruits, and so on.
Drop-Shipping: The practice of shipping product
directly to customers from the company warehouse, rather than through
an independent distributor.
Duplicatability: The extent to which an MLM /
Network Marketing opportunity
can be easily mastered by new recruits.
Duplication: The process of replicating business builders in your
downline.
Group Volume: The total volume of wholesale
purchases
made by your personal group in a given month.
Heavy Hitter: A top sales leader in an MLM company.
Home Meeting: An opportunity meeting held in a distributor's home.
Hotel Meeting: An opportunity meeting held in a rented hotel conference
room.
Infinite Bonus: A feature that theoretically
creates infinite depth in a pay plan.
Infinite Depth: A feature of some compensation
plans allowing distributors to draw earnings from deeper levels,
below their ordinary pay range.
Leader: A top achiever in an MLM / Network Marketing
downline.
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