Affliate Programs Versus Multi-Level Marketing
Affiliate programs on the internet are typically links into a website that give you, the referrer, credit when somebody uses your link or when a sale is made after your link is clicked. Typically, affiliate program effectiveness for you is a function of the amount of traffic you have on your website, how closely the affiliate is related to your subject matter on your website, and how visible the link or banner is on your website. So generally, it is you advertising for another website and you get paid for how much business you generate for them.
Affiliate programs that pay based on sales pay a varying degree of commissions, I have seen anywhere from 4% to 75%. You can actually measure how effective the program is for you based on the number of clicks the advertisement gets or the dollars in commissions you receive from having the advertisement on your website. Dollars is a better measurement but clicks might be easier to measure in the beginning as you are building traffic.
A multi-level marketing company or upline can similarly use affiliate programs to recruit or sell products, or both. Commissions on multi-level marketing for sales vary depending on many factors, but I have seen companies pay as much as 50% on direct sales with a decent amount of sales volume. In addition, you can also earn commissions from other distributors that you bring into the business, and those they bring into the business, and so forth. Some companies have unlimited depth and pay commissions based on overall volume. Others have break-away programs that pay on so many levels after the distributors below you break away. Ultimately, though, you can make commissions, perhaps small commissions, on each and every single sale within your downline network of distributors.
So the question really is: Is it better to use an affiliate program or a multi-level market program to generate income from your website? I will give you this answer: Sales from your website will be generated by how closely the product matches the information provided. If you sell household products on a business website, you will probably not see much sales. However, if you sell a business opportunity on a business website, you may sign distributors. Will those distributors buy or sell the products? I believe so, but I do not have personal proof of this at this time.
On the other hand, if you have an ecommerce website that sells the product that also recruits new distributors, this tends to be very successful as long as you can generate sales. Selling via ecommerce is retailing, and this usually means having the right product at the right price with the right services. Not everything will sell via ecommerce, but things that will not sell ecommerce probably would also not make good multi-level marketing products.
Some MLM companies have special rules for operating on the internet so make sure you know what these are before you get started. Good luck and let me know how it goes!