Glossary of MLM Words
My upline called and wanted to make sure I understood the comp plan and bonuses from the distributor kit my downline just ordered so that I could look at my PV and check out my GV. Confused? Let’s face it. Getting into an MLM is a whole new world with its own language. When you start the business or even just start looking into it, you can get confused fast. I’ve compiled the most used words in the MLM world to help you start talking the talk. Here is a simple glossary of MLM words to get you in the know!
Active: The status that many companies require in order to maintain their status as distributor. This is usually a minimum monthly personal volume (or amount sold).
Bonus: Amount of money or compensation of products rewarded for good performance.
Commission: Amount given to distributor for sales. This is usually a percentage of sales.
Compensation Plan: The details of how a distributor will get paid based on their commission and their downline. This can include recruiting incentives, bonuses and the necessary qualifications for generating income. (Abbreviation: Comp Plan)
Crossline or Sideline: Distributors in the same company that are not connected to each structurally. These are typically in the same geographical location and will often work with one another on the same team to promote products.
Distributor: Someone who sells for an MLM company
Distributor Kit: Usually an MLM requires you to sign up to sell and buy a kit that contains product and marketing material.
Downline: Each distributor can recruit people to sign up below them. These enrollees become their downline and the distributor who signed them up will generate income when their downline generates income.
Enroll: Signing up of new members
Front line: People who are directly signed up by you the distributor
Group Volume (GV): All purchases made by a team, which will consist of a distributor and their downline
Home Meetings: When a distributor meets face to face with prospective clients
Incentives: Awards given by companies to motivate distributors
Lead Generator: A way to get new leads or prospects
Legs: Distributors who have signed up under another distributor are called their legs
Level: In an MLM organization, level means the vertical placement of a distributor or member. New recruits placed under him or her belong to the first level while their recruits will be assigned on his or her second level. New sign ups from the recruits’ recruits will be on the third level, and so on. The more levels an independent distributor has, the bigger the organization, which can bring in increased sales and higher earnings and commissions. Building active levels within a team may guarantee a stable business and passive income over time.
Multi-level Marketing: A business where they have direct distributors sell their product. Instead of being paid for the hours they work, each of these MLM distributors are paid on the production of their efforts, usually through a compensation plan. Distributors are able to make money for the sales they personally generate, but also for the sales of the distributors that they recruit.
Personal volume (PV): The amount one person sales
Profit: Amount a distributor makes from the sell of a product
Prospect: A potential customer
Qualified Leads: Potential customers who have shown interest in the company and products. They are people who won’t need much extra knowledge or push to order because they already are interested in the product.
Recruit: Verb- To enroll or seek to enroll new members of your team Noun: someone who has just been enrolled or recruited
Referral: Using word of mouth to spread the word about your product
Rep: Short for representative, rep can mean a sales rep or distributor who can effectively sell the products/services of a particular network marketing company to consumers.
Retail: Retail refers to the sale of products or services to consumers for profit.
Retention Rate: In network marketing, retention rate refers to the percentage of people/members who continue to stay with a particular company.
Team: The members in a specific downline
Upline: The person who recruited someone
Volume: Number of items sold
In the Know
Does that feel better? Now you have the lingo to better help you talk the talk. We think these are 29 terms every Maskcara Artist should know that will help get you places! Now get out there gorgeous =)
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