Why not take a chance: The Coming Network Marketing Boom

Why not take a chance: The Coming Network Marketing Boom

Although there were about as many company launches in each half of the decade, there are actually more companies that launched during the first half that are still in business today than during the second. While network marketing flourished from 1980 to '85, the rest of the decade saw some of the worst fiasco in network marketing history. Also, another indicator of MLM economic conditions is the number of legal actions. During industry slumps companies and distributors tend to be more aggressive and take greater risks. The number of law suits almost doubled during the second half of the 80's compared to the first. And, while network marketing was thriving the first half of the 80's, unemployment continued to rise. In fact, in 1982 it was at it's highest level in 40 years at 9.7%. During the second half MLM slump unemployment dropped considerably, and by the end of the decade the number of those out of work was almost half of what it was at the beginning of the decade. http://www.probuilderpluspowerteam.comThe 1990's saw perhaps the clearest distinction between halves of any decade with more major company launches and more companies going into momentum than any other time in history. There was also more wealth being created by way of MLM from 1990 to 1994 than any other 5 year period in network marketing history. The second half, as many of you probably still remember, wasn't exactly the best of times for network marketing. In fact, if there ever was such thing as an MLM recession, we had one from about 1996 through 1999. Why? One reason may have been the very high unemployment rate from 1990 to '94, and the sharp drop during the second half of the decade where it hit a 30 year low at 4.2% in 1999.The only exception to this half-century long pattern is the 1970's, but that was an exceptional decade. Remember, the last half of the 60's industry growth slowed as unemployment dropped to a post-war low. During the first half of the 70's network marketing started rocking again as unemployment rates jumped. Unfortunately, all that rocking started rocking some boats, and the result was over five times as many MLM related law suits from 1970 to 1974 than all of the 50's and 60's combined. These included landmark cases involving Koscot, Bestline, Holiday Magic, Culture Farms, and others, and in 1975, there was a federal action which essentially questioned the legality of network marketing in general. Fortunately, one company, Amway, had the financial ability to defend themselves, and in essence, the entire multilevel marketing industry. This case lasted until late 1979 when the court eventually ruled in favor of Amway and as a result there was, for the first time, a clear delineation between illegal pyramids and legitimate network marketing companies. So, obviously, there was a pretty dark cloud hanging over the industry the last half of the 70's and there wasn't a lot of expansion in spite of the even higher unemployment rate.The last, and arguably greatest MLM growth phase began in 1990, the same year we went into our last economic recession. And, again, from 1980 to '84 were boom years for network marketing and we experienced recessions in 1980, part of '81 and most of '82. Nineteen-seventy to '74 were also boom years, and our economy was in recession almost all of 1970, and 1974. Remember how the last half of the 50's and into the early 60's were years of great MLM expansion? We were in recession from '57 to '58 and most of 1960. In deed, every severe economic downturn in the last 50 years has been during, or immediately preceded every period of network marketing expansion.We're not done yet. According to figures supplied by the Direct Selling Association, not all, but most of which is made up of network marketing companies, U.S. sales increased from 1990 to 1992 by an annual average of 9.25 percent. That was during our last recession. From 1997 to 2000, at the peak of our last economic boom, annual sales within the direct selling industry increased by a little more than half as much. Clearly, the condition of our national economy absolutely does effect the condition of the network marketing industry.So where does this lead us? Well, as I write this it's early 2002 and we are in a recession, and have been for several months. Most recessions last around 12-18 months, but that doesn't mean that when a recession is over, so is a slumping economy, or high unemployment rates. And again, it's rising unemployment rates that are most closely tied to rising interest in network marketing. Here's a rather remarkable fact – we've had eight recessions in the last 50 years, and during the 12 months immediately after the end of the recession the unemployment rate went up! Every time. What's more, most economic experts today are predicting a much slower recovery than that which followed previous downturns, followed by volatile economic swings for the next several years.And remember, we're only on reason number one. Let's move on to what I feel is an even more powerful reason to believe in a coming network marketing explosion.Reason #2: Demographics.Although the network marketing industry offers almost every conceivable product or service imaginable, most product lines are made up primarily of personal care products, diet, and health related products. These are all products that would be of most interest to again baby boomers. Now, this concept of what Dr. Ken Dychtwald refers to as the "Age Wave" in his book of the same name, is certainly not a new concept as it relates to network marketing. Purveyors of personal and health care products have been emphasizing this concept for several years now. But it does warrant a brief overview.Baby Boomers are those born from the years of 1946 to 1964. The reason for this baby boom doesn't need a lot of explanation. During the great depression, immediately followed by WWII, folk just weren't economically, psychologically, or geographically able to make a lot of babies. So, once WWII was over they had some catching up to do – and they did. There were about 76 million babies born during this 18 year period, which at the time accounted for almost one-third of the entire U.S. population. This explains why diaper and baby food companies flourished in the later 40's and early 50's, or why rock&roll records and drive ins were so popular in the mid- to late 50's. It also explains why more grade schools were built in the early 60's and more college campuses were built in the later 60's than any other time in our history. Think back to the 70's and early 80's. How many athletic clubs, health stores,