Motivational factors in multilevel marketing business: A confirmatory approach

Perception of Financial Variants of Multilevel Marketing Strategy And Growth of Network Marketing Companies in Nigeria

“…By implication, the entry fee accounted for only about 6.9% of variations in growth of NMOs. Similar to this findings is the work of Jain et al (2015) that discovered that low investment alongside factors such as product quality, ease entry, extra money, freedom are the most effective variables that convince people to be a part of MLM.…”

“…Direct selling is a very old model of doing business and is considered a "vehicle for marketing to consumers or end buyers" (Keun, 2004, p.11). Jain, Singla, and Shashi (2015) pointed out that direct selling comprises single level marketing and multilevel marketing. The term MLM is also known as network marketing (Failla, 1996;Oksanen, 1999;Koehn, 2001;Akinyi, 2008;Yen, Chen and Chen, 2008;Koroth and Sarada, 2012;Bogdan and Aron---Axel, 2013;Aggarwal and Kumar, 2014;Keep and Vander Nat, 2014); multi---layer marketing (Rezvani et al, 2017).…”

“…There is however wide consensus as to MLM being a form of direct selling (Oksanen, 1999;Vander Nat and Keep, 2002;Constantin, 2009;Charoenrungsirri and Oonsuphab, 2010;Keep and Vander Nat, 2014;Jain et al, 2015;Franco and Gonzalez---perez, 2016), though, Failla (1996) and Bogdan and Aron---Axel (2013) argue that viewing MLM as a form of direct selling is a misinterpretation. The basis of their argument was that direct selling requires the marketer to be employed as a representative of the company whose product he is selling unlike in MLM where the entrepreneur is independent and not legally employed by the company.…”

“…The MLM phenomenon has been captured from different perspectives by different scholars. To Oksanen (1999), MLM is a legitimate retail selling through social network contact; network of independent sales representatives selling products and services (Koehn, 2001;Tamang, 2008); moving product through independent entrepreneurs (Koroth, 2011); a form of consumer marketing and compensation (Albaum and Peterson, 2011); method of distributing products (Koroth and Sarada, 2012;Aggarwal and Kumar, 2014); a franchise and hybrid method of distributing products and building sales network (Bogdan and Aron---Axel, 2013); business opportunity (Keep and Vander Nat, 2014); alternative to massive media advertising and sales promotion (Arya and Arya, 2014); alternative means of distribution (Gbadeyan and Olorunleke, 2014); network of master entrepreneurs recruiting other entrepreneurs into the network (Basil, Sunday, Anyadighibe, and Edward, 2014); a subset of the Direct Selling Industry (DSI) (Effiom and Effiong, 2015); revolves around recruiting theory and selling (Jain et al, 2015); a profession (Worre, 2015).…”

“…The study found that the small amount required to start the program was a major motivating factor to entrepreneurs in GNLD and forever living expressed that the start---up capital was a major difficulty that demotivates them from joining the program. Albaum and Peterson (2011) pointed out in their qualitative study that legitimate MLMs do not charge typically high entry fees however, Jain et al (2015) discovered in a study on "motivational factors in MLM business: a confirmatory approach" that low investment alongside factors such as product quality, ease entry, extra money, freedom are the most effective variables that convince people to be a part of MLM. The study did not however emphasize the entry cost as an integral component of MLM which could have significant effect on prospects as well as entrepreneurs.…”