MLM Prelaunch the Good the Bad and the Ugly

April 2nd, 2009 | by Chris |

The concept of MLM prelaunch is on the rise on the Internet as many companies use that business and marketing tactic to start their operation. Whatever forum you would visit you would find discussions going on about the newest prelaunches and you could see countless ads on relevant websites. But no matter how promising or exciting a new launch may seem the truth is that the great majority of them won’t make it past the 6 months.

Unfortunately that is a universal truth for every start up in business, only a small minority will finally succeed and become a profitable business. That is also true in multilevel marketing as only few would become the next great MLM companies that would take a share of the market.

Of course that doesn’t mean that a pre-launch MLM is something that someone needs to avoid altogether as no matter how small the chances are some of these network marketing companies are going to succeed and make a lot of distributors happy, if not rich. You need good information and proper evaluation in order to distinguish a “winner” from a “loser” and join the right start-up that is going to succeed and help you make a great income.

But first let’s see what an MLM prelaunch is

A network marketing prelaunch is nothing more than a short period of time during which new members may sign up under favorable terms, usually free. During that window of time people may build their downlines in the company pretty fast as the free to join phrase can lure a lot of people. Of course how many of them would finally upgrade to paid members when the MLM opportunity officially launches that’s another subject, but some of them certainly will.

The concept of prelaunch is both a business and a marketing tactic.

A business tactic as it helps many companies to come into profits very quickly and save them from the need to start with a very big capital in order to endure the first stages when a company is losing money. You see in order for a MLM company to be profitable it needs to move a certain number of products in order to pay for its expenses. Such a launch can help it move faster to that point and consequently start becoming profitable.

It is also useful as a marketing tactic as the incentives it gives for new distributors to join at that stage are hard to pass by and so it attracts many members that would otherwise think twice before signing up. It also creates a certain buzz online as it becomes the favorite topic in many forums which is nothing else than free advertising.

The MLM prelaunch companies can be divided in three categories the “good”, the “bad”, and the “ugly”.

The good ones are the companies that their founders and their management team have planned everything correctly, are well capitalized, and they can serve a market segment profitably. These as you understand are the companies that are going to succeed and consequently will make a lot of distributors successful that had the good fortune to join such company at that stage.

Tierra del Fuego II
Photo by Ville Miettinen

The bad ones are nothing else than the countless scams and schemes that make their appearance online as MLM start-ups only to full people out of their money and run with them. Unfortunately the nature of start ups is such that is hard for someone to distinguish whether they are legitimate or whether some scam artists are hiding behind it taking advantage of the obscurity that surrounds the first period of a multilevel marketing company’s launch.

The third category, the ugly ones, are the ones that can’t make it and finally close down disappointing a lot of distributors that thought that this was the real deal and the company that would eventually have made them rich. Besides the lost time and effort many members may lose also money that have paid in advertising in order to build a downline in that company which makes things even worse.

Some things that can help you reach some conclusions when you are examining or evaluating a multilevel marketing start-up is first whether the company has an address where its office is. Second the names of the founders and the management team. Do a search and find as much as you can about them. Do they have any previous experience in the MLM industry? Are their names clean or are there any rumors or even worse facts about their past?

Third, examine the claims they make about the product. Are they realistic or are they promising to much. If they make any claims that don’t have the facts to back them up you should be careful. It is not unusual for companies to promise too much and many of them at some point have problems with the authorities as they came under scrutiny for those claims. You don’t want to join such a company as it may be forced one day to shut down.

Fourth, check whether there is a market for the product or not. If no one wants that product and there is no demand for it you would have a hard time to make sales and recruit new distributors. After all, we are at the sales business and without sales we have virtually no business at all.

Of course those are not the only things you have to check as there are also many details that you need to look before you take a decision. Sometimes even the most thorough analysis cannot tell you if that multilevel marketing prelaunch is going to succeed or not. There are also forces outside the control of the MLM company that can affect it and lead it to bankruptcy or other problems no matter how well the management have planned ahead. So sometimes you may also need to follow your instinct and join one.

If you are new to MLM network marketing a start-up may not be for you and you would be much better off by joining an established company with years in operation. You have to learn a great deal about multilevel marketing already and how to build your home business, so taking the risk of joining a company that may fail is unnecessary for you at this point.

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