Promoting any business involves attracting the attention of the target audience. But nowadays, it's not enough to just sell something to a person; it's important to keep them engaged with the company, motivate them to buy again and again. Forming an emotional attachment and loyalty to the brand is one of the key objectives of network marketing, the methods of which have been adapted for almost universal use.

MLM Working Principle

To thoroughly understand the prospects of implementing multi-level marketing methods into the business processes of a young company, let's recall the history of the emergence of the concept of partner marketing.

In 1927, Carl Rehnborg created a series of dietary supplements to improve Americans' nutrition. Drowning in routine tasks during the company's development phase, Carl asked his friends to help with product sales. In addition to the classic sales commission, he incentivized his partners for recruiting other distributors. And that's how multi-level marketing emerged.

By investing a little in advertising and building the initial structure of independent partners, you can spread information about the product and the business itself to a relatively large number of people without any promotion costs. Members of the partner structure are personally interested in a quality product presentation, increasing sales volume, and involving other people in cooperation, as their earnings depend on it.

How Network Marketing Methods Are Used

Despite the fact that the principles of network business have remained unchanged since its inception, they have been translated into the virtual space and adapted for use in the business processes of traditional companies. Consumers are attracted and retained through various loyalty programs, exchanging brand loyalty for bonuses and gifts.

If you are considering implementing new customer retention methods, familiarize yourself with the multi-level marketing methods that have proven their progressiveness in practice and inspired representatives of traditional businesses:

Accumulative Bonus Program

The loyalty accumulation program has become one of the most popular both in online retail and offline. Its conditions are simple: the buyer makes a purchase and receives points for it. After accumulating a certain amount of points, the customer exchanges them for some material benefit.

Some companies allow points to be used for goods, while others offer a gift, discount, or access to limited offers, etc.

For example, when paying with a PrivatBank card at program partner establishments, a portion of the money spent goes to a separate "Bonus Plus" account. After accumulating the required amount of money, the customer can use them to pay for other purchases at participating stores.

This customer retention method can be integrated into almost any B2C business. However, in practice, it shows better results in businesses where people make regular and small purchases.

Advice from FlawlessMLM specialists: when implementing any loyalty program, stick to the rule of simplicity. Some companies, in their desire to increase the effectiveness of the method, complicate the program's terms, thereby confusing both themselves and the customer. If you want to combine several types of partnership programs, conduct an audit of the contractor's business processes, who has previously had practical experience in developing partnership systems from scratch.

Tiered Loyalty Program

In such a loyalty program, customers are rewarded with a small prize upon reaching a certain level. The higher the level, the more significant the reward. This way, companies manage to maintain interest in participating in the program.

For example, tiering is one of the conditions of the loyalty program of the sports goods store network - Sportmaster. After any purchase, a customer can get a regular club card. But by accumulating purchases above a certain amount, the card level can be upgraded. Naturally, the owner of a silver or gold card receives more benefits and bonuses than the owner of a regular card.

The main drawback of this method: the interval between purchase and reaching a level in the loyalty program is too long. A large portion of customers simply forgets about the program or fails to become interested in it.

Tiering is used in both programs for commodity business and in the field of sales of booking services, insurance, etc.

Referral Program

Classic conditions of a referral program imply that an existing client receives a reward for introducing a friend to purchases. In this method of customer acquisition, the reward is a secondary factor. The primary factor is the level of service and the quality of the product that one would want to recommend to family and friends.

More and more often, this type of program is used among gamers, as players often introduce close friends with similar interests to their hobby. For example, in WorldOfWarcraft, for bringing a friend who subscribes to the team, the player receives free game time, exclusive pets, or limited means of transportation.

Paid Premium Program

By offering significant benefits and creating VIP conditions, a company can put a price tag on it. Paid membership not only encourages repeat purchases but also prevents the customer from going to your competitor.

For example, in the Ukrainian online hypermarket Rozetka, you can get an annual subscription for free delivery by becoming a premium buyer. You just need to pay 399 UAH (equivalent to $16 or 1000 ₽) once a year for this.

So, business will definitely strengthen relationships with customers. But remember, the offer must provide real value, otherwise - you will just amuse, disappoint, or drive the person away from your company.

Cashback

The cashback service can be called a trend of recent years. In fact, cashback is a percentage of the purchase amount that is returned to the account as a reward, similar to traditional commission payments in network marketing.

There are a huge number of websites and platforms where you can find a list of companies and stores that offer cashback. To receive a percentage refund of the amount spent, the user needs to make a purchase through a similar service.

One of the bright examples in Russia is Letyshops. The resource redirects users to specific stores. Both the buyer and the intermediary (Letyshops founders) receive a percentage of the user's spent funds

Network marketing is a very progressive concept that inspires founders and marketers of companies operating in all areas. Any company that wants to increase sales volumes of its products and expand its customer base can use methods that come from MLM.

If you decide to implement any loyalty program into your company's business processes, turn to a contractor with practical experience in developing complex partnerships of various kinds. Learn more about solutions for your business from the specialists at FlawlessMLM, who will provide free consultation and help with your selection.

How network marketing methods will help retain a customer. Types of loyalty programs