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  1. #1
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    Affiliate Vs MLM
    Hello

    I'm a newb, so please bear with me.

    I have seen that there are some affiliate programs that are called Two-Tier to enable affiliates to earn from people they refer. These are one-off payments. This is like a watered down mlm scheme.

    Thus:

    Do affiliates get involved with driving traffic to mlm programmes or is it like mixing oil with water?

    Thanks
    Dunk

  2. #2
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    Affiliates turn around and run in the opposite direction when they spot a mlm scheme from a distance.

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  4. #3
    Moderator MichaelColey's Avatar
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    It's really completely different. The primary focus of most MLM programs is recruiting, and the true potential comes from the masses several levels down. With a simple two-tier structure, that's just not the case.

    Beyond that, it's rare for affiliate programs to even offer a two-tier program (and it's also a turnoff to most affiliates). In those programs that do have a two-tier program, a small percent of affiliates make up the majority of the affiliate referrals. Most of those are going to be people who focus on mentoring or people who make guides or websites showing people how to get into affiliate marketing or build websites.
    Michael Coley
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     Affiliate Tips | Merchant Best Practices | Affiliate Friendly? | Couponing | CPA Networks? | ABW Tips | Activating Affiliates
    "Education is the most powerful weapon which you can use to change the world." Nelson Mandela


  5. #4
    ABW Ambassador Vrindavan's Avatar
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    Most MLM programs require you to spend on products monthly with a high min. to keep the membership, to get your monthly commission or keeping the rank.

    Affiliate programs do not require you to make purchase to get your commission.

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  7. #5
    Newbie jkingston's Avatar
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    Affiliate marketing is all about providing value (At least it's supposed to )

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  9. #6
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    Quote Originally Posted by sam_park View Post
    Affiliates turn around and run in the opposite direction when they spot a mlm scheme from a distance.
    That's a nonsense statement. There are many affiliate marketers who also are involved with MLM (multi-level marketing). I've done both & have made good money with each marketing system. 14+ years ago I was the National Sale Director for a nutritional/weight loss MLM company but switched to affiliate marketing & domain sales/investing after that company merged into another. Now I'm back adding MLM to the mix.

    The reality is that often MLM products provide more value & quality than affiliate only products. The autoresponder I use is MLM & many affiliate marketers use that service. My wife & I are reps for a company selling body wraps, skincare, weight loss & nutritional products. I initially was just a customer of my wife (we love the products) but signed up as rep & will start promoting soon. The products provide more value & are of much higher quality then these nonsense overpriced affiliate nutritional products popping up left & right that add Dr. Oz "miracle" statements to their sites. I can guarantee that there is a lot of "loyal customer" purchases in addition to distributor recruiting. Good MLM companies have a lot of product sales occurring but it's true some are lacking with their e-commerce strategies however it's getting better. I do dislike it when "some" MLM companies charge affiliates for self-replicated websites though they do provide extensive training materials typically. I do enjoy the time freedom of e-commerce strategies rather than traditional face-to-face sales methods of MLM which can be time consuming. I also use to run presentation conference calls which were less time-consuming.

    Yes the residual leveraged income you can get from MLM by getting paid on rep/distributor volumes multiple levels deep can dwarf traditional affiliate income getting paid only on your own efforts. Most affiliate programs don't tie customers to you on future product purchases. Yes most MLM companies do require minimum monthly volume requirements (generally under $100) to get paid on other distributors volume but I know the company we are involved with will pay you off retail sales even if you aren't doing the minimum monthly volume. At least with the MLM products I promote... I can honestly say I'm a customer as well & believe in the product enough to use it.

    Now I also earn affiliate income off a wide variety of products (clothing/lingerie, perfume, IM products, books, jewelry, tech items, etc... ) & in some cases there are 2 tiers but not typical.
    Larry Wentz
    <a href="http://twitter.com/LarryWentz">Twitter.com/LarryWentz</a>

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  11. #7
    ...and a Pirate's heart. Convergence's Avatar
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    Affiliates turn around and run in the opposite direction when they spot a mlm scheme from a distance.
    Personally, I think it's a fair and accurate statement.

    MLM is NOT affiliate marketing. Are there those that do both? Yes, of course.

    There will always be exceptions in life...
    Salty kisses, Sandy toes, and a Pirate's heart...

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  13. #8
    Affiliate Network Rep JCrooks - AffiliateWindow's Avatar
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    There's a big risk to merchants if they do a two-tier affiliate program because then they become subject to MLM laws and regulations. Debbi Ballard is the expert in this area. Saw her speak at Affiliate Summit - brilliant! Whenever I have any questions abot MLM and affiliate marketing, she's the one I turn to.
    Jeannine Crooks - Always happy to share what I know! - Voted Best Network Rep 2013 & 2014
    Email | LinkedIn | Twitter | Affiliate Window
    US Programs | Canada Programs | UK Programs | Ireland Programs | Mainland Europe Programs

  14. #9
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    Yep Debbi does know her stuff. Check out this article of hers about affiliate & network marketers (MLM) converging -

    "More affiliates are now either joining or seriously looking into network marketing collaborative opportunities. There are many reasons. Foremost among them, however, is the ability to garner greater ongoing residual incomes. While there are residual income opportunities for affiliates, the amount of income that can be generated is far more limited than in network marketing.

    This is true since affiliates getting paid solely for their own efforts are not able to leverage the efforts of others in increasing affiliate income. Since networkers can each profit from their own sales production and the sales production of their respective downline team members, networkers have the potential to earn far greater residual incomes.

    Many top affiliates and top networkers are working both network marketing programs and affiliate programs. Often the tactics used create a synergy between the two whereby both revenue streams are increased."

    Networkers and Affiliates Continue to Converge in 2013 | MLM Consultants' Blog
    Larry Wentz
    <a href="http://twitter.com/LarryWentz">Twitter.com/LarryWentz</a>

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  16. #10
    Affiliate Network Rep JCrooks - AffiliateWindow's Avatar
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    It's possible for affiliates to also work MLMs if they wish, but not from the same company. My concern here is to protect those who don't know that merely adding a two-tiered program makes them subject to a long list of laws. That's very dangerous, so merchants need to know and make an informed decision instead of just a "that sounds good" gut reaction. It is important not to confuse an affiliate program with an MLM program - there is a difference.
    Jeannine Crooks - Always happy to share what I know! - Voted Best Network Rep 2013 & 2014
    Email | LinkedIn | Twitter | Affiliate Window
    US Programs | Canada Programs | UK Programs | Ireland Programs | Mainland Europe Programs

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  18. #11
    Super Dawg Member Phil Kaufman aka AffiliateHound's Avatar
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    Quote Originally Posted by wentzco View Post
    Many top affiliates and top networkers are working both network marketing programs and affiliate programs. Often the tactics used create a synergy between the two whereby both revenue streams are increased.
    I really doubt that is true. LEGITIMATE professional successful affiliate marketers would ever risk their businesses by the perils of mlm.
    Since June 10, 2012 a vegan aarf but still writing the Hound Dawg Sports Blog
    "If you don't have time to do it right, when will you have time to do it over?" -John Wooden;
    "Raj, theres no place for truth on the internet." -Howard Wolowitz[/SIZE]

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  20. #12
    Super Dawg Member Phil Kaufman aka AffiliateHound's Avatar
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    Quote Originally Posted by sam_park View Post
    Affiliates turn around and run in the opposite direction when they spot a mlm scheme from a distance.
    Absolutely true.
    Since June 10, 2012 a vegan aarf but still writing the Hound Dawg Sports Blog
    "If you don't have time to do it right, when will you have time to do it over?" -John Wooden;
    "Raj, theres no place for truth on the internet." -Howard Wolowitz[/SIZE]

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  22. #13
    ...and a Pirate's heart. Convergence's Avatar
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    Quote Originally Posted by wentzco View Post
    Many top affiliates and top networkers are working both network marketing programs and affiliate programs. Often the tactics used create a synergy between the two whereby both revenue streams are increased."
    More like more MLM marketers also dip into mainstream affiliate marketing, than the other way around...
    Salty kisses, Sandy toes, and a Pirate's heart...


  23. #14
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    Quote Originally Posted by Phil Kaufman aka AffiliateHound View Post
    LEGITIMATE professional successful affiliate marketers would ever risk their businesses by the perils of mlm.
    LOL - the perils of MLM? Any perils in affiliate marketing?

    LeClairRyan | Law Enforcement Perils & Pitfalls for Affiliates (Part 1)

    Google Adwords/Adsense slaps, Search Engine algorithm changes, Affiliate Merchants not paying up, your state joining the Amazon ineligible affiliate marketing list, etc...

    LEGITIMATE MLMs do a better job following legal laws (including making sure reps follow rules as well) than the average merchant who has an affiliate program or affiliate marketer
    Larry Wentz
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  24. #15
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    Quote Originally Posted by Convergence View Post
    More like more MLM marketers also dip into mainstream affiliate marketing, than the other way around...
    True - it should happen more often & is.
    Larry Wentz
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  25. #16
    Super Dawg Member Phil Kaufman aka AffiliateHound's Avatar
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    The perils of mlm are more than just the legality - there is the ethical issue at the forefront: 95% of mlm consists of unethical and barely legal scams that give false hope to vulnerable people, often inducing them to spend money they cannot afford on scams devised for one purpose and one purpose only, to make a profit for the m-l-marketer, with zero benefit provided the unwitting buyer of the koolaid.
    Since June 10, 2012 a vegan aarf but still writing the Hound Dawg Sports Blog
    "If you don't have time to do it right, when will you have time to do it over?" -John Wooden;
    "Raj, theres no place for truth on the internet." -Howard Wolowitz[/SIZE]

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  27. #17
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    Tell me where you got that 95% figure Phil. Your statements are some funny fear-mongering. For those that choose add MLM into their income they should research the company. If people are stupid & fall for a product (Affiliate or MLM) that has no value (kool-aid)... then people are stupid.

    My advice for people is to join an established & growing direct sales company - here's a list at The List &mdash; Direct Selling News
    Larry Wentz
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  28. #18
    ABW Ambassador Vrindavan's Avatar
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    Speaking in terms of their products,
    MLM companies are not all bad.
    There are some very good ones.

  29. #19
    ABW Ambassador JoyUnltd's Avatar
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    Most MLM products are waaaaaaay overpriced. The marketing hype...as said, barely legal. Unfortunately, the overwhelming market is moms looking to make a few extra bucks working at home hosting so-called "parties." Uggggghhh! Most don't even realize they have been rooked into MLM, now called "network marketing" and spend $$$ on inventory, promotional materials, etc. that just make $$$ for the company.

    They never ask themselves, "Have I ever gone to one of these parties and ever bought anything more than once?" or "Why in the world should I expect my family and friends to support my business on a consistent basis?"
    Rene
    Pay no attention to that woman behind the curtain. -Wizardress of Oz

  30. #20
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    Wow I sure see some ignorant kool-aid scare-mongering uninformed statements here. Luckily I speak from experience in MLM (network marketing) as well as affiliate marketing.

    Once again I request Phil to supply his source of his comment "95% of mlm consists of unethical and barely legal scams that give false hope to vulnerable people". If he doesn't than we must assume he just made it up - kool-aid nonsense ignorant statement.

    Rene's statements are extremely silly & she has a false image of network marketing. Don't be misled! - read 7 Tips for Network Marketing Success | Entrepreneur.com & you will see some more info regarding false images.

    A couple more articles to read - The Correlation Between MLM Success and Mentorship - Forbes
    &
    Network Marketing Myths and Truths I like this one Myth 3: Network marketing uses people. - Truth: Success in network marketing comes from helping others reach their goals. A person cannot earn income off the efforts of their recruits without investing time in helping them earn income, as well. Admittedly, some network marketers see potential recruits as dollar signs, but those people are not as successful as those who are genuine in their effort to help their recruits do well. (The reality is that in affiliate marketing we compete against each other & don't often share our successful methods because that may take affiliate commissions out of our pocket.)

    Again - if you want to learn more about MLM/Network Marketing/direct selling companies - visit Direct Selling News

    I haven't been active on aBestWeb in a long time but when I saw "Affiliate Vs MLM" as a featured discussion I knew I had to counter much of the false images people have & state.
    Larry Wentz
    <a href="http://twitter.com/LarryWentz">Twitter.com/LarryWentz</a>

  31. #21
    Moderator MichaelColey's Avatar
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    There are certainly some legitimate MLM companies. I think the main differentiation between the legitimate ones and the shady ones is the focus on sales vs. recruiting. I know several people who sell Avon, Pampered Chef, Scentsy, Watkins, LegalShield, and other lines.

    I think Renee is spot on about many being overpriced. It has to be that way, so that both the company and those in the upline all make money. It's not uncommon for things to be 2-4 times as expensive as comparable products sold by non-MLM companies. I think that's the main reason I don't like them as a consumer. That's not universal, though. I know of a few (like LegalShield) that I think are reasonably priced.

    You can definitely succeed with an MLM. I know people who have. The potential is there.

    But I'll go back to what I said initially in this thread. They are very different.

    With affiliate marketing, your destiny is primarily in your own hands and your work benefits you (and the merchant). With MLM, a lot of your success depends on those you recruit. And those above you in the network benefit from your hard work. As someone with an affiliate mindset, that is very unappealing. I want to earn the rewards for my work.

    With MLM, you're trying to get others to do what you do. As an affiliate, I don't want other affiliates competing in my niches. It's a very different mindset.

    With MLM, you're tied in to specific products, specific prices, and specific promotion methods. As an affiliate, you have a myriad of choices of who to work with, what to promote, and how to promote it. I like that flexibility.

    With MLM, there is often a layer of motivational, training, hype and materialism added into the mix. That's a big turnoff to me. I'd rather just do what needs to be done without all the fluff. I don't need to dream about a Lamborghini or a Rolex. I have no desire for those things.

    With products sold through MLM, there's often a gimmick to convince customers to buy. With affiliate marketing, I can promote things that people WANT to buy. As an affiliate, my sites are often helping customers solve problems. I feel much better about that, rather than tricking them into getting something (overpriced) that they really don't need.

    Some of the personality traits that make people good at MLM are the same as the personality traits that make people good at affiliate marketing, but many are different as well. Some of the differences: If you're good at motivating people, verbal communication, direct sales, and team building, those are good assets if you're pursuing MLM. But they're not as helpful for affiliates. If you're good at technology, written communication, understanding customer needs, and design, those are great assets if you're pursuing affiliate marketing. But they're not as helpful in MLM.
    Michael Coley
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     Affiliate Tips | Merchant Best Practices | Affiliate Friendly? | Couponing | CPA Networks? | ABW Tips | Activating Affiliates
    "Education is the most powerful weapon which you can use to change the world." Nelson Mandela


  32. #22
    ABW Ambassador JoyUnltd's Avatar
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    To say someone's comments are extremely silly or funny fear-mongering is simply a negative marketing ploy. Politicians use it all the time. I don't care how MLM currently positions itself. The reality is quite different.

    My experience comes from dealing with several dozen family/friends/neighbors/co-workers from Amway, Avon, Mary Kay + myriad jewelry, home decor, kitchen cookware / utensils, health & beauty products, etc. I'm so sick of that tired line ALL MLMers use: "I just have to share with you..." or "I share because I care" & "join me in my journey" (for health products).

    No, I don't have a false image of MLM at the bottom end. I know my merchandise/services & know their true value vs. hype.

    It consistently preys on those who desperately need to earn more $$$. I see upfront how family & friends were bamboozled by the lure of $$$ vs. the reality of having to spend, what...30 days training a recruit? Moms don't have 30 days to train anyone but their toddler to use a potty. This part is seriously downplayed for new recruits. Emphasized is how easy it is.

    Unless you recruit, you don't have a business. And as I write this...I kid you not...just received a recruiting attempt from a friend for a nutrition program. Oiy.
    Rene
    Pay no attention to that woman behind the curtain. -Wizardress of Oz

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  34. #23
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    Quote Originally Posted by JoyUnltd View Post
    My experience comes from dealing with several dozen family/friends/neighbors/co-workers from Amway, Avon, Mary Kay + myriad jewelry, home decor, kitchen cookware / utensils, health & beauty products, etc. I'm so sick of that tired line ALL MLMers use: "I just have to share with you..." or "I share because I care" & "join me in my journey" (for health products).
    I stopped going to a certain Barnes & Noble store as it became a hotspot for MLM marketers. I became so good at spotting them from a distance that I would know it's a MLMer when I see one approaching me. I started hating it (MLMers approaching me, their sweet talk and their BS, and their wasting my time, their unsolicited business advices) so much that I will never think about MLM in a positive light.

    If you like MLM, go ahead, do it. It's not for me. And it's not affiliate marketing. I don't see any synergy between the two.

  35. #24
    ...and a Pirate's heart. Convergence's Avatar
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    I was first exposed to it at 16 - answered an ad for "Part Time" work.

    Sat through the entire dog and pony show: Amway.

    Next was in my early 20's - some water filter company.

    Never got me hooked...
    Salty kisses, Sandy toes, and a Pirate's heart...

  36. #25
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    First of all - companies will not last selling overpriced products. Many distributors reselling their products also are retail establishments like salons, gyms & chiropractors. Good MLM companies also put tremendous research into their products & ensure they are top quality. It is true that good MLM companies should have a strong focus on product sales & not just recruiting. Often what will happen is customers end up becoming distributors/reps. As I have sold nutritionals/weight loss products via affiliate programs & network marketing... I can say that there is little difference in the price points for "quality" products (The quality of many affiliate program nutritional products I see is questionable & quite honestly is often more full of hype compared to MLM products). Via network marketing - people are able to purchase products at wholesale/near-wholesale by either becoming a distributor or via preferred/loyal customer program. I also know that I can make just as much of a retail commission via MLM compared to affiliate marketing with the products I sell. Consumable products like nutrition, cosmetics & food will provide better residual income in MLM - people want to buy these products... always have & always will (no gimmicks needed). About half of U.S. adults take vitamins and other dietary supplements so often it is just a brand switch for people. Exclusivity products are a selling point as well but that can be true in affiliate marketing tool. Clothing, jewelry, books, digital products, technology, home decor... I'm sticking with affiliate marketing.

    As Michael says in affiliate marketing - you don't want to help other affiliates compete in your niche. You only will get paid on your own efforts. In MLM you do want to help each other because that provides a "leveraged residual income". In affiliate marketing - typically you send a merchant a customer & you get paid a commission. When that customer re-orders thru them - the merchant doesn't pay you anymore. You gotta go find a new customer (better affiliate programs will tie that customer to you). In MLM - companies tie your customers (& distributors) to you so you get paid on re-orders. I can view our downline volume & see there are many distributors with hundreds of dollars of customer volume every month (obviously the products aren't overpriced if customers are re-ordering!). Now let's talk about leverage again ("I would rather earn 1% off a 100 people's efforts than 100% of my own efforts." - John D. Rockefeller). My wife signed up a tanning salon to sell body wraps/weight loss products. A customer purchased the body wraps & then decided to become a distributor as well. Because of that single initial sale - there are now hundreds of distributors/customers creating many thousands of dollars in business volume monthly in her business (online & offline). A lot of people are doing a little - that adds up. That would not have been possible with traditional affiliate marketing. Yes the merchants can leverage the efforts of hundreds or thousands of affiliates but you can't do that as a traditonal affiliate.

    People join or become a customer with an MLM either because they want the product, want more income or like the person sharing the product/business. Often one comes first then other reasons follow. "Relationships" is a key factor in network marketing success. That doesn't mean you should bug your famiy & friends (best to just let them know what you are doing, ask them if they want to take peek, state there is no issue one way or another if they say "no", do a quick share if they say yes & let them decide to buy the product or join the business - use zero pressure). Many companies have good "tools" to use such as a dvd, magazine or website that will do the presentation of product/business for you. Often - just handing someone a business card will do the trick. If your friend says they want to lose 10lbs & you sell weight loss products... you must be stupid if you don't share it with them. If your friends/family know you sell a certain type of product & someone mentions to them they need to drop weight/lower cholesterol/whatever... you will get referred. Online/Offline advertising gathering business or customer prospects is easier as these are people looking for solutions either financially or for an issue that your product addresses. It is true that motivational training is an aspect of MLM because "building people" will "build relationships".

    Rene - there is a right way & wrong way to build a MLM business... sounds like you may have exposed to some of the wrong ways. This is true with affiliate marketing as well... 90%+ of my email spam is from affiliate marketers (0% from MLMers by the way). I also see a constant flow of internet/affiliate marketers preying on those who desperately need to earn more $$$. There are many network marketers who just focus on retailing (not recruiting) that make money. They don't get the leveraged income however sometimes it happens to develop anyway when their customers decide to become a distributor. In some companies - training is needed but I've never seen a 30 day course as you state (1-2 day ones I've seen that were optional). Most good companies will have online training available for distributors. Did you instantly know how to do affiliate marketing & build websites or did you educate yourself thru training of some type?

    Sam - Barnes & Noble or Starbucks recruiting is a laugher but I know that it happens from people who obviously aren't trained the right way to do things - don't throw all network marketers into that category because that is a mistake. That's like saying all affiliate marketers are email spammers because you got spam from one.
    Larry Wentz
    <a href="http://twitter.com/LarryWentz">Twitter.com/LarryWentz</a>

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