A while back a friend of mine was all fired up to tell me about a travel related network marketing company he was involved with. He had my attention because I looked at the concept of having my own travel business before. In fact, I set up a travel concept for a company I used to work for several years ago.
It sounds great right... get your own travel credentials, get paid commissions on your travel and get all the perks that come with being in the travel business. So, I was pretty much sold on the concept. But I wasn't sold on getting involved in an MLM. I had tried network marketing twice before, and had not had any success.
A few days after that I had lunch with my friend and the director who sponsored him. They told me how the travel industry is changing and how the Internet and travel was a great business model. He laid out the compensation plan and told me all about the company, and how we would change the travel industry forever.
Honestly, I didn't get a warm and fuzzy. I knew that the travel industry was changing. Anyone could see that. It was clear the Internet was taking over the travel industry, and I knew that travel was the largest industry in the world. That made sense to me, but I still had something in the back of my mind saying are you crazy, you've been here before.
Yah, well I should have listened to that little voice. Several months later after I burned through my "warm market" and made my friends mad, I realized what I wasn't willing to admit to myself from the beginning.
The people I was talking to weren't interested in hearing what I had to say. Think about that for a minute. How in the world can an intelligent person who has any business acumen at all expect to have any success targeting prospects who never asked to talk to them in the first place.
Well, it happens obviously since myself and countless millions have tried on the network marketing hat over the past fifty years.
That's always been the story in the network marketing industry unfortunately. And that's why the industry has such a sleazy reputation.
The reason I am telling you all of this is to illustrate a point. My experiences are what they are... my experiences. But it's these experiences that leave me scratching my head because of the Decisions YTB is considering.
And my experience with network marketing is not the exception it's the norm. Industry statistics show that 97% of all network marketers quit within the first 90 days, and less than one percent of network marketers will make money.
So What Is YTB Doing?
Before I get into the reasons for the companies decision to make the change to a franchise model, let me say this. While I don't know Lloyd or Scott Tomer personally, I have heard them speak on numerous occasions and have been in a private meeting with them and a small group of RTA's. From that interaction as limited as it might be, I believe I have a decent read on them as people.
I believe that they both are men of integrity, based on my observation. And I think when Lloyd Tomer says he wants to create 10,000 millionaires he is sincere. In other words I believe they genuinely care about everyone in the YTB community. If they didn't the people that work at the home office would not love working there so much.
Now, about the changes...
As I see it there are three reasons the company is making the move to a franchise model, and a possible fourth reason that is a rumor regarding increased compensation, and I won't comment on that.
Here is a statement form a July 17, 2008 letter to directors. I have highlighted areas for emphasis.
"We believe a franchise model of our existing business will be easier to comprehend and more readily accepted by the general public. Since franchising is recognized as a traditional business model in virtually all developed countries, YTB's timeline for global expansion will be accelerated. Additionally, franchising will allow us to rapidly diversify the products and services offered by our franchisees. This will enable YTB to more quickly attain our goal of becoming a major distribution channel for products and services sold in the U.S. and abroad."
Based on this statement it's pretty clear that YTB recognizes that there is a perception problem with the public about the existing network marketing business model. It's no secret that network marketing is a dirty word to many people in the U.S.
It has been estimated by industry experts that one in five family members will have some type of experience with network marketing. Considering the dismal success rate and the number of people having been exposed to the MLM business model, it's not surprising that that YTB is looking to a franchise model to meet their growth objectives.
Scott Tomer says that the company is committed to continuing the use of the network marketing system for the reps. I'm not sure how that will shake out with a franchise effort.
My experience tells me that in order to even get a franchise approved there has to be extensive training and documentation for the franchisee. Everything has to be paint by the numbers with no loose ends of ambiguity. It will be challenging to pull that off and keep out of hot water, considering the opportunity of misrepresentation by more than 250,000 reps.
Second, YTB has a desire to expand into foreign markets, and the network marketing distribution model will definitely create problems in many foreign countries. In fact network marketing is not allowed in many countries.
Third, the company wants to further diversify their product offerings outside of the travel industry, and they believe the franchise model will help them do that.
So, what do we make of all this?
My gut reaction would be if anyone can do it, Lloyd Tomer can. He has a history of asking "what if" and then making it happen. Honestly though, I can't understand it. My greatest source of frustration with this company has been their unwillingness to get rid of the network marketing business model.
I don't understand how a principled man like Lloyd Tomer can sit back and allow the perpetuation of what I call "the network marketing myth". When such a small number of people have become financially independent as YTB RTA's and Reps, I would have thought that they would dump the MLM business model.
On the other hand, as a business owner I can understand the lure of the MLM model. The overhead is low and the potential growth rate is impressive. Personally I could not sleep at night knowing that so many people have bought into the "dream" that their down line is pushing.
The company might say that they make no promise of the potential to earn a decent living selling the YTB opportunity or travel related services, much less become independently wealthy. But all of the down lines do create this belief. It's part of the culture of every network marketing company.
They trot out the "diamonds", the million dollar earner and give the impression to everyone that achieving that level of success is possible recruiting from your "warm market". Well, let me tell you it's not.
It load, plain and simple. After I flamed out I started doing some serious digging. I wanted to know how the "diamonds" were able to make it. Are they that much better than me? Is their commitment level that much higher?
Well, what I found is that there is a sub-culture in network marketing circles. I discovered that the vast majority of network marketers move from opportunity to opportunity, and they take a large number of their down-line with them.
Don't get me wrong. The folks that can build a large down line deserve credit. But these people have skills that the vast majority of us don't, and it isn't something that you can teach. You are either born with it or you are not.
So perpetuating this myth that anyone can make it in network marketing, as long as they have a "big enough why" is garbage. Are you kidding me! If desire were the only thing holding people back there would be a whole lot more success stories in network marketing.
Here's what I decided to do
I got off my but and started doing some more digging. I knew there had to be a way to find prospects that wanted to hear what I had to say. People that actually wanted to talk to me, not uninterested zombies who didn't want to hear what I had to say in the first place.
I discovered that I needed a marketing system where I could attract prospect to me rather than chasing them down. Highly targeted prospects that were looking for information. And what I found is called Attraction Marketing.
In this business model I learned how to crate a web of content on the Internet, and brand myself. What I learned is if you don't have a marketing system, you are fighting a loosing battle.
That's why it's so amazing to me that YTB continues down the MLM path. Lloyd Tomer can't possible realize his dream of 10,000 millionaires in his lifetime using network marketing, and I think he knows it.
The company is six years old, and according to the 2007 Income Disclosure Statement, there were less than 50 people in that category. You do the math...
Attraction marketing is a business model that can and does work for the average person. I am living proof of that. There are more than 50,000 people a day who get involved in network marketing some where in the world, and the vast majority of them end up frustrated and disappointed.
There is a huge groundswell of network marketers on the Internet who are successfully implementing Attraction Marketing and having success. Over the next few years there will be millions of the folks looking for help and guidance.
I encourage you to Connect with me to find out if this new marketing model is right for you.
About the Author
After struggling with the "old School" techniques trying to build a network marketing business, David discovered that the solution to his problems was in learning how to attract prospects to him. Theses techniques proved to be so powerful that David spends his time coaching and mentoring others in this new business model.
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