And How, Brands Are Swapping MLM For Affiliate Marketing

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The basic model—in which independent distributors earn income from direct sales and sales generated by their recruited downline seller teams—has remained constant. For direct seller "distributors," MLM promised high potential income and the opportunity to be your own boss. 

MLM companies have been successful for decades, but, recently, many have struggled to drive sales and profit growth. In response, companies that historically relied on MLM sales models have been making changes to modernize their businesses, accelerate growth and increase profitability. This includes embracing affiliate marketing, either as a complement to their existing model or a complete replacement.

BODi (part of Beachbody) recently transitioned to an affiliate-centric model . Other major MLM-focused businesses such as 4Life, BELLAME, Herbal Alchemy, Pure Romance and SimplyFun have either added affiliate programs or replaced MLM with this form of digital partner marketing. And a survey by Direct Selling News showed that 67% of MLM companies are either contemplating or have already implemented business model changes. 

Secondly, MLM distributors divide their efforts between selling products and recruiting new representatives. Some believe that the distraction of downstream recruitment impedes overall business growth. Additionally, increased regulatory scrutiny is prompting some MLMs to seek less controversial selling structures. 

Changing consumer behavior is also a major factor to evaluate, as people today look to digital media for product ideas and information and want recommendations from trusted sources. Many consumers also want to avoid the high pressure of person-to-person sales, preferring to discover products based on the recommendations of creators and publishers they trust.

As a result of these changing shopping behaviors, and a focus on more authentic purchase journeys, affiliate has become a promising and more effective model.

Affiliate marketing is a performance-based system where businesses reward partners for driving desired actions, like sales or leads. Affiliates promote a company's products or services, earning a commission for each successful referral.