Multi-level and multi-channel marketing. How are they related to traffic arbitration?
Multilevel marketing
Multi-level marketing (MLM) is a sales strategy where products or services are sold through a network of independent distributors. The basic idea is that each distributor not only sells the company's products, but also attracts new distributors to his network, receiving commissions from both his own sales and those of his subordinates. This creates many levels in the sales hierarchy, hence the name "multi-level" marketing.
In multi-level marketing (MLM), participants, called distributors or independent entrepreneurs, purchase the company's products at a discount or at wholesale prices. They can use these products for personal consumption or sell them by selling them to end consumers. At the same time, they can invite other people to join the company as distributors.
When a new distributor joins the network, he becomes part of the network of the one who invited him (his sponsor). The sponsor trains the newcomer and helps him start his own business. Distributors earn commissions not only from their own sales, but also from the sales of those they invited to the company and from the sales of those who were invited by subordinates and so on. This creates a multi-level revenue structure.
It is important to note that in an MLM company, the goal is to sell a real product or service, and not just attract new participants. This distinguishes MLM from financial pyramids, where the main focus is to attract new participants for financial investments without real products or services. In MLM, product sales support the structure, and in financial pyramids, the structure lives by the entry of new participants.
Thus, MLM provides an opportunity for people to create their own business by selling real products and inviting others to join the company, while financial pyramids are focused on attracting funds from new participants without a real product or service.
Multi-channel marketing
Multi-channel marketing is a strategy in which a company uses several different communication channels to attract and interact with customers. The main idea is to be present in the channels that target consumers prefer and provide them with a unified and consistent impression of the brand, regardless of which channel they interact with the company through.
The company uses a variety of channels such as phone calls, targeted advertising and email newsletters to reach its audience. These channels may work independently of each other, but together they create a comprehensive approach to marketing.
However, although each channel can function separately, it is important to ensure their consistency and integration so that customers can get a unified and consistent impression of the brand. For example, if a customer contacts a problem by phone after receiving an email newsletter, it is important to provide support and solve the problem in the same spirit and style that was presented in the newsletter. This will help strengthen the company's image and improve the customer experience.
Another term that can be confusing is omnichannel marketing, which is so similar to multichannel. How do they differ? Let's take a closer look at their differences:
Multi-channel marketing:
- This is a strategy in which a company uses several different communication channels for its marketing.
- Each channel can have its own audience and be targeted at a specific market segment.
- The channels work independently of each other, that is, they are not integrated or connected within the company.
- Prices and offers may vary depending on the channel, and customers may have a different experience in each channel.
Omnichannel marketing:
- This is a strategy in which the company uses several communication channels, but they are all integrated and combined into a single seamless network.
- Customers can switch between different channels and their experience will be continuous and consistent.
- All data about customers, their preferences and interactions with the company is systematized and combined, which allows you to provide a personalized and consistent experience.
Thus, in multichannel marketing, companies use different channels, but they operate independently, while in omnichannel marketing, all channels are integrated into a single system, providing customers with a unified and consistent experience of interacting with the brand.
Traffic arbitration and how it is related to marketing
Traffic arbitrage, also known as affiliate marketing or affiliate marketing, is a marketing strategy in which a company (advertiser) pays a commission to a partner (affiliate) for each customer they attract through their traffic or advertising. Let's look at how it works and compare it with multi-level marketing (MLM) and multi-channel marketing:
Traffic arbitration and MLM:
Product selection: In traffic arbitration, an affiliate can choose which products or services to advertise, while in MLM, participants usually sell products from the same company.
Purpose: The main purpose of traffic arbitrage is to attract customers, while in MLM the main focus is on selling goods and attracting new participants.
Promotion options: In traffic arbitration, an affiliate can use various methods to attract customers, while in MLM, participants usually use direct sales and personal communication to attract customers and team members.
Earnings: The affiliate receives a commission for each attracted client in traffic arbitration, while MLM participants can earn both from their own sales and from the sales of their team through a multi-level structure.
Traffic arbitration and multi-channel marketing:
Goal: In traffic arbitration, the goal is to attract customers through various channels, while in multi-channel marketing, the main focus is on ensuring a unified and consistent interaction with customers through a variety of channels.
Customer Approach: In traffic arbitration, the focus is on attracting customers, while multi-channel marketing focuses on interacting with customers through various channels, offering them a unified and consistent experience.
Thus, although traffic arbitrage, multi-channel marketing and MLM may use several channels to attract customers, their goals, approaches and earning models differ, which determines their unique characteristics and features.
Conclusion
Multi-level marketing (MLM) is a business model in which customers can also become independent sellers by buying goods both for personal use and for sale. The seller receives a percentage of the sales attracted by him independently or through his network of acquaintances.
Multi-channel marketing is a strategy in which companies use many different channels to advertise and interact with customers. This helps to create a personalized experience for customers, but channels often work independently of each other.
Traffic arbitrage is a way of earning money in which people help sell products or services of companies over the Internet. This method combines techniques from both MLM and multi-channel marketing, but the goal is to effectively attract traffic and customers to maximize profits.
