Chaining

All multi-level marketing (MLM) programs, as well as illegal pyramid schemes, chain marketing schemes, and chain letters have this multi-level chaining characteristic in common. But be cautious absout joining programs in which you are recruited into a chain of distributors (agents, representatives, etc.), which are organized into multiple levels, especially where the position in the chain is determined by timing of entrance into the program and by success at recruiting others. While a few earn substantial profits, most participants in such programs lose both time and money.

In theory, the use of person-to-person referrals is a very powerful marketing strategy. And with outstanding products, fast-talking promoters, and/or connections with famous persons or notable "experts," it is easy to be taken in by their appeal.

It should also be noted that quality of products or services often becomes questionable when incentives are tied to recruitment. This would apply to such products and services as health products, investments, or internet services.

For most multi-level programs, income is dependent primarily on downline recruiting. As a general guideline, if you must recruit to be successful, or if a program's emphasis is on building a downline, it is a de facto pyramid scheme, whether or not it has been declared illegal by authorities. You may just be setting yourself up for wasting much precious time and money, depending on factors that can be identified by answering the questions to follow.