History repeats again as iLearningGlobal turns its back on MLM - By: Wayne Wu

iLearningGlobal, was the second major MLM company to terminate it's pay plan and all of its distributors in 2010. On March 17, iLG announced to its independent representatives that it was no longer a network marketing company.

This article is not written to condemn the company, but to help those who are considering a career in network marketing gain a better understanding of the industry and allow them to make better long term decisions.

The decision to cease its MLM operations out of left field would have shocked those who believed in the future of such an innovative company. The sad stories to come out of this also diminishes the reputation of the entire network marketing industry.

It's uncanny that the fledgling company suffered the same fate as the majority of startups. It did not survive the first two years.

As its name suggests, its product was knowledge and education, not consumables like conventional MLM's. In their open letter to representatives, they stated the main reason for shutting down its network marketing operations was its inability to compete with how cheaply the same knowledge and education could be delivered over the internet.

Yes, unfortunately it is pretty hard to sell something when people are readily offering it on the internet for free.

The company's decision was traumatic for its independent reps. However, it had every right to do it. The company said they could in their policies and procedures.

The policies and procedures clearly stated that the company had the right to terminate all agreements with their independent representatives with a 30 day written notice if it decided to go out of business or stop doing direct sales. And that's exactly what they did in March of 2010 - stop doing direct sales through MLM.

For anybody who thinks the policies and procedures document is no big deal, you are mistaken - it is a legally binding agreement between you and the company.

With this easy exit clause, it was clear the company had thought about drastic future changes to its business model.

The reps should have learned a lesson from history. iLearningGlobal was not the first company of its type, selling education and knowledge. Several had come before it. They've all gone out of business.

In the late 1990's, The People's Network (TPN) merged with Pre-Paid Legal. For had it not merged, TPN would have failed and dissolved as a company, and the hard work of all distributors who built the company would have vanished overnight.

At BetterNetworker.com, Daegan Smith tells his story about how the two personal development MLM companies that he had built to the top level, Financial Freedom Society and Success University, failed under similar circumstances. Daegan paints a very clear mental picture of how his 3 years of hard work vanished right before his eyes.

Personal development is an important part of your growth as an entrepreneur. However, it doesn't stand up well as an MLM product by itself. History as shown us that.

Time and time again consumable product MLM's have proven themselves as the mainstay of the network marketing industry. They may be a bit mundane, not so glamorous, not so slick, but people will buy consumable products like shampoos, soaps and nutritionals for the foreseeable future.

About the Author

If all you ever learned from iLearningGlobal's failure in MLM is to read your contract, I've done my job. Looking for success in network marketing? I struggled for 2 years before stumbling upon the right answers. Let me freely share them with you.

Article Directory Source: http://www.articlerich.com/profile/Wayne-Wu/66115

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