Well, seeing how the title of this article is “7 BIASED Reasons Why Affiliate Marketing Is Better Than MLM”, you should expect that my answer will be very biased, and I will likely upset some people.
I’ve been involved in both types of business models before. But now, I am only using affiliate marketing in my business.
At the end of this article, I will give you my personal opinion on why I choose affiliate marketing and not even wasting my time thinking about MLM.
Without further ado, let’s get started!
Table of Contents
What Is Multi-Level Marketing?
Multi-level Marketing (MLM) is also known as network marketing, pyramid selling, and referral marketing.
It’s a controversial marketing strategy that uses the non-salaried workforce to distribute the MLM company’s products or services.
Because of the pyramid-shaped compensation structure, it’s highly dependent on recruiting people to sell the products in order to reap the maximum benefits.
Oftentimes, MLM companies require some fees to join, and their products are usually overpriced because they need to ensure their own profits and the benefits among the members.
I guess you’re quite familiar with this business model already because there’ll always have people around you who engage in this industry.
What Is Affiliate Marketing?
Some of the well-known affiliate networks are encompassed:
- Amazon Associates
- Best Buy
- eBay Partner Network
Many people have misconceptions about these 2 business models, thinking that they’re the same because they are all about promoting other people’s products for commissions.
The biggest difference between affiliate marketing and multi-level marketing is that there’s NO recruitment involved in affiliate marketing.
Thus, there’s no multi-level upline and downline relationship in affiliate marketing. It’s just between you and the merchant.
The sales you generated for the merchant will be recorded by way of a tracking cookie, and you’ll be getting paid for commissions that you deserved.
7 Reasons Why Affiliate Marketing Is Better Than MLM
#1: Audience Size
⇒ If you ever join any MLM program, you’ll know that MLM compensation plan emphasizes recruitment over product selling.
That’s why MLM has a limited audience size because it looks very close to pyramid schemes. Most people are trying to avoid it.
If you’re an excellent salesperson, taking a regular sales job might make you more money than an MLM opportunity.
⇒ As opposed to MLM, affiliate marketing is more customer-centric because all you’re doing is merely creating informative content to problem-aware audiences, and then providing them with the solution to overcome their problem.
Yes. You’re still making sales, but you aren’t hard-selling your audiences like most MLMers did.
⇒ As I said, recruitment is the top priority in MLM
It’s possible to make money by only promoting products, but the most earning potential lay in recruiting new members to branch out your circle.
That’s why it’s called Multi-Level Marketing (MLM).
But the problem is…It requires COUNTLESS time to recruit enough people to put yourself high on the level of the pyramid and generate enough money for living.
You’re leaving with no choice but to pitch your friends, family, and everyone around you into the “good opportunity” where most people lose money.
Some people who go too aggressive on recruitment will ruin their relationships and eventually make themselves a social pariah.
Most people will shun them because of their network marketing pitches.
⇒ Affiliate marketing doesn’t rely on recruitment at all.
The great thing about affiliate marketing is when it all boils down to it, you are essentially just helping people find the information on the internet that they were looking for.
If you do a great job by providing them lots of values, they’ll share your article with others, and you’ll get a great reputation.
#3: Product Choices
⇒ When you joined any MLM company, you’re restricted only to promote their products.
Most MLM companies are either operate in the health & wellness niche or beauty & cosmetics niche.
But not everyone isn’t interested in these niches, especially for men. That’s why you can see that a far majority of MLM distributors are females.
Trying to sell something you don’t believe in may be difficult.
⇒ On the flip side, there’re millions of affiliate programs in different niches, so the opportunities are virtually endless for what to promote.
You don’t need to rely on only one company or limited to promoting the product that you might not interested in.
With affiliate marketing, you can choose any products from an affiliate program that you enjoy marketing rather than something you are forced to promote.
#4: Start-up Cost/Joining Fee
⇒ Most MLM will require you to pay an amount of joining fee to be their associate. If you don’t pay, you can’t be a part of the business and can’t earn commissions.
This is not the end yet, some of them have a recurring monthly fee or minimum product purchase requirement (known as Autoship in MLM term) to keep your membership active and get paid.
This can add up to thousands of dollars per year just to stay active. Most people can’t even cover their investment back and ended up losing money.
⇒ Unlike MLM programs, affiliate programs are free to join, and it takes little to zero cost to start an affiliate marketing business. That’s the beauty of affiliate marketing.
Most people do at least get their own domain and website, but that’ll only cost a small number of fees every year.
Yet, it’s still possible to start an affiliate marketing site for free in the first 6 months with SiteRubix. The 6-month is considered more than enough time to decide if you are serious about it or not.
#5: Affiliates’ Benefits
⇒ The harsh truth is that MLM opportunity often stays hot at first and then starts to phase out after a few years.
Unless you are one of the TOPPs (top-of-pyramid) who joined the program earlier, it’s challenging for you to make some serious dough because you are running out of people to “recruit”, while a portion of your commissions is shared with your uplines.
Some people just called MLM an pyramid scheme because it’s structured in a way that mainly benefits the owner/creator.
They are very similar to pyramid schemes in this way.
The only real difference is that in an MLM, you make a commission on product sales to customers, whereas pyramid schemes base their pay on new recruitment.
⇒ As I mentioned earlier, Affiliate Marketing doesn’t rely on recruitment. Its commission pay structure is happening just between you and the vendor.
Often you can make 50-80% commission off of a product sales, and you own all of it. There’s no distribution of commission with other third parties.
#6: Ease of Operation
⇒ Whenever an MLM company promises to give you a “Work From Home” opportunity, I can say it’s just a marketing tactic to talk you into their program.
By its nature, you’ll need to build a loyal downline team in order for them to recruit new members and sell products for you.
That means you’ll be spending most of your time meeting with prospects, cold calling, “brainwashing” your downlines, attending events, or anything else along those lines.
All these can’t just be done by working from home! You have to go out and meet peoples.
⇒ With affiliate marketing, all you have to do is brainstorm content ideas that can drive traffic to your website.
The more traffic you can generate to your site, the revenue you’ll be able to earn. As there’s no recruitment involved, all these can be done from the ease of home.
⇒ MLM companies usually coined their members as “Independent Business Owners”, which is ridiculous to me.
As an MLMer, there are a lot of things that are out of your control.
- You don’t own the company.
- You don’t own the website they give you.
- You have to abide by their rules and regulations.
- You aren’t allowed to do certain things.
- You are forced to following what others are doing.
Most importantly, your income is highly reliant on your downlines. If they don’t sell or recruit, you won’t earn a penny.
Besides, MLM often faces legal lawsuits because of their unethical business models. They could get shut down by regulatory bodies anytime.
Imagine if it happens to the MLM program you joined, everything you put into it (the time, money, hard work, and peoples’ trust in you) can be wiped out instantly.
⇒ If you want to build a sustainable business that you’ve 100% control over your income and takes the same amount of time to be successful, affiliate marketing is a far better option.
Here are why:
- You own the website.
- You build your personal brand.
- You set the rules.
- You promote that thing that you genuinely love and trust.
- You have complete control over how you promote products.
- YOU ARE THE BOSS.
Affiliate Marketing Is Better Than MLM, But Why There're Still Many People Fail?
Reason #1: Having The Wrong Expectation
Many people get into affiliate marketing with a wrong expectation, thinking that they could achieve decent results within a short period of time. That’s not true at all!
It WILL takes you a lot of time and hard works to build a profitable Affiliate Marketing business if you are generating traffic to your site through Search Engine Optimization (SEO).
Generally speaking, you will start seeing SEO results after 6~12 months, and it will grow over time, along with your site authority.
But the premise is that you’ve to be willing to put in the work consistently (i.e. publishing at least 3 informative contents every week).
Reason #2: Don’t Treat It Like A Real Business
T. Harv Eker once said: “Where your attention goes, energy flows and results show.”
If you aren’t serious about affiliate marketing and don’t treat it like a real business, you’re going to fail.
Reason #3: Target Broad Keywords
For the sake of people who don’t know what a “keyword” is in Google’s term, it is a word or a phrase that someone types into a search engine.
People use words or phrases to find things they are looking for online, and there are ENDLESS of keywords you can target out there.
Targeting a super broad keyword in your content could bring you massive traffic, but the possibility to be ranked high on the search engine results page (SERP) is really low because broad keywords often lead to high competition.
With that in mind, you should focus on the low-competition keywords, and there are many more of them.
Even though these keywords get less traffic, the idea behind this approach is to get rankings, in volume and be able to do so with much more ease than trying to go after highly competitive terms.
You can try out the Jaaxy keyword research tool. It’s the free tool that I used the most.
The term “QSR” used in Jaaxy stands for Quoted Search Results. It’s the number of competing websites ranked in Google for this exact keyword.
In this case, the QSR of “Why Affiliate Marketing Is Better Than MLM” is 26, which means that I would have only 26 competitors (super low competition). Meanwhile, the SEO score of that keyword is as high as 94!
All these data gives me a great sign that I could get a high ranking for this keyword by producing a more comprehensive article than my competitors.
You can rinse and repeat this process to explore the potential keywords with low competition that could bring you traffic for the long term.
Reason #4: Promoting Low-Ticket Products
Plain and simple. If you want to make more money, don’t promote low-ticket affiliate products with meager commissions.
Make sure you choose a good relevant affiliate product that fit the criteria below:
i) High Commission
⇒ An affiliate product that has at least 20% commission is great.
Digital products usually have a higher commission than physical products.
Clickbank is a great place where you can find high-commission digital products. Some of them even offer you up to 80% commission.😱
ii) Recurring Commission
⇒ Promoting an affiliate product with the recurring commission a great way to build a Passive Income stream.
This is because you’ll be getting a commission as long as the customer keeps using that product.
To prolong customer retention, the product that you promote must be trustworthy and useful for them.
iii) Solves a Huge Pain Problem
⇒ This is pretty straightforward. If the product can solve a huge pain problem among people, it would be an easy sell.
Plus, if the affiliate product is beneficial for the customers, customer retention will be lengthened.
The longer the customers stay, the more recurring commission you can earn.
Reason #5: Focusing On Too Many Products At Once
When you’re first getting started with affiliate marketing, being an associate of one or two affiliate networks is enough. It could be Clickbank, Rakuten, JV Zoo, CJ Affiliate, etc.
Promoting dozens of products from multiple affiliate networks couldn’t make you more money.
On the contrary, it would make things worse as it’s tough to manage, and you’ve no core affiliate product that you can leverage to maximize the earning potential.
Reason #6: Don’t Have A Sales Funnel
Having a sales funnel (a.k.a sales process) will enable you to filter out people who aren’t interested in your service and making you more money.
Allow me to explain.
Most people aren’t ready to buy into the product that you promote when they first visit your website/blog.
If you can set up a funnel to capture the leads (i.e. email addresses), it means they might be interested in your affiliate product, that’s why they give you their emails.
As time goes, your email list will continue to grow.
You can then utilize email marketing to follow up with those potential customers by regularly providing them free values.
If your free values blow their mind, they can’t help but throw the money at you so that they can work with you or get more from you.
That’ll eventually lead you to more $$$. Make sense, right?
If this still sounds vague to you, the figure below shows you the sales funnel that I personally use in my affiliate marketing businesses.
I think it might give you more insight into how a sales funnel works, so I just leave it below for your information.
Reason #7: Back Hat SEO
If you are like me, obsessed with getting lots of rankings in Google (and other search engines) and doing so for FREE, your website would be mainly relying on SEO to get traffic.
People tend to overthink SEO and think there is MORE to it than there actually is.
And some of them even trying to hack Google’s algorithm with black hat SEO to get high rankings.
I can tell you, first hand, that’s not a long term strategy. It only works for a short period of time.
Then, your site is more likely to be penalized by Google, and they’ll not rank your content anymore. SEO strategy is beneficial to your website only if you utilize it correctly.
Always bear in mind that you are creating content for human beings, not the search engines. If Google found your content doesn’t provide any value to their searchers, naturally, it’ll not be indexed by Google.
Why I'd Rather Choose Affiliate Marketing Than MLM?
Even though affiliate marketing is not easy, or I can say it’s as hard as MLM, I still prefer the former and don’t even spend time thinking of MLM.
Here’re my reasons:
#1: Low Startup-Cost
I think I have explained this clearly in the earlier section. The start-up cost of starting an affiliate marketing business will be far less than what you would spend on an MLM business.
#2: Affiliate Marketing Is Best For Introverts
Frankly, I am a shy and introverted person who isn’t good at making new friends.
I will be very uncomfortable around a group of people I don’t know. That’s why I often avoid such a social setting as I possibly could.
Obviously, MLM is definitely not for me because it requires a lot of socializing, which is my fatal weakness.
But with affiliate marketing, it doesn’t require me to do any face-to-face selling, so I don’t need to go out frequently to meet someone else, and “recruit” them to be my downline.
#3: The Problem Of Blind Leading The Blind In MLM
Like any other MLM business, you can get help from your upline (the person who introduced you to this business).
However, this could create a problem of “blind leading the blind” since they maybe your friend or family who doesn’t know much about selling as well.
If the company doesn’t have substantial training in place, this will make things even worst.
Where To Go From Now?
If you’re anything like me, who’s an introvert and hate face-to-face selling, but you want to earn money by promoting products and services that you genuinely love while providing people values.
Then affiliate marketing is a more fulfilling route to financial gains.
I recommend you to spend a few minutes to check out my top recommended Affiliate Marketing training here.
It was designed specifically for newbies who are just getting started, and it’s a great primer into the world of affiliate marketing.
There are no hypes in this training. They’ll set you the right expectation toward affiliate marketing in the beginning.
Also, there are a lot of successful affiliate marketers in different markets ready to help you out.
By the end of your first week, you’ll have a solid business plan. You’ll know which products and services you will be promoting.
You probably still hold a healthy dose of skepticism towards the training. No worries, the training is free to get started.
So it’s 100% Risk-Free for you to start learning something useful today (no credit card required).
You can leave anytime if you found the training didn’t suit you, with no commitment required.
So wait no more, click the “Learn More” button to discover my top recommended learning platform that can help you turn your passion into profits with Affiliate Marketing!