Network Marketing

DEFINITION of 'Network Marketing'

A sales strategy in which a salesperson attends meetings of organizations whose members are likely to be interested in a particular product or service in order to develop a book of business. The three major components of network marketing involve prospecting (finding sources of potential customers), following up with inquiries from interested parties, and selling the good or service to the prospect. Once prospects are cultivated, the salesperson will try to use his or her relationships with the prospect to get in contact with other individuals that the prospect might know.

INVESTOPEDIA EXPLAINS 'Network Marketing'

Salespeople may visit organizations related to things that they have a common interest in. Or they may visit organizations that they think will contain prospects but that are of no interest to them personally. For example, a financial advisor may visit a local meeting of a retired railroad worker social club in order to determine if any of its members could be considered potential clients. Or a real estate agent may attend an investment real estate club because he is both interested in investment real estate and the club offers contact with potential clients.

RELATED TERMS
  1. Networking

    A process that fosters the exchange of information and ideas ...
  2. Soft Sell

    Advertising and sales practices denoted by subtle language and ...
  3. Sales Meeting

    A gathering in which a product or service is being discussed, ...
  4. Hard Sell

    Advertising and sales practices denoted by aggressive or forceful ...
  5. Always Be Closing - ABC

    Retail jargon used to describe a sales strategy in which a salesperson ...
  6. Commission

    A service charge assessed by a broker or investment advisor in ...
Related Articles
  1. Great Expectations: Forecasting Sales ...
    Fundamental Analysis

    Great Expectations: Forecasting Sales ...

  2. Measuring Company Efficiency
    Fundamental Analysis

    Measuring Company Efficiency

  3. 4 Dishonest Broker Tactics And How To ...
    Personal Finance

    4 Dishonest Broker Tactics And How To ...

  4. Doing More With Less: The Sales-Per-Employee ...
    Investing

    Doing More With Less: The Sales-Per-Employee ...

Hot Definitions
  1. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  2. Leading Indicator

    A measurable economic factor that changes before the economy starts to follow a particular pattern or trend. Leading indicators ...
  3. Wage-Price Spiral

    A macroeconomic theory to explain the cause-and-effect relationship between rising wages and rising prices, or inflation. ...
  4. Accelerated Depreciation

    Any method of depreciation used for accounting or income tax purposes that allows greater deductions in the earlier years ...
  5. Call Risk

    The risk, faced by a holder of a callable bond, that a bond issuer will take advantage of the callable bond feature and redeem ...
  6. Parity Price

    When the price of an asset is directly linked to another price. Examples of parity price are: 1. Convertibles - the price ...