Driving Distributors’ Satisfaction in Multilevel Marketing (MLM) Companies

Abstract

The purpose of this study is to identify the major factors that will influence the satisfaction of distributors towards multilevel marketing (MLM) companies in Malaysia. The five antecedents investigated are: up-line support, methods of diffusing business opportunity, perceived quality of recruiting process, perceived quality of training program and perception of products/services. A proposed conceptual framework that serves as the foundation in this research is adopted from Delgado (2000), with the inclusion of an additional independent variable, perception of products and services (Osei, Katsner, & Narteh, 2014). Results from the study indicate that among the five factors, only the perceived quality of training program has no significant impact on distributors' satisfaction. Method of diffusing business opportunity, perceived quality of recruiting process, up-line support and perception on products/services are shown to have positive impact on distributors' satisfaction.

The moderating effect of environmental turbulence and the influence of critical factors for sustainable MLM business growth: an empirical study

“…In contrast to the findings of K.-F. Lee and Loi (2016), which state that companies should invest more in product development. Attracting new customers and potential distributors requires an appealing product offering.…”

Towards Satisfying Distributors in Multilevel Marketing Companies

“…The distributors are self-employed, independent contractor, and they earn from product sales as well as successful recruitment (Keep and Nat, 2014). When a distributor brings in another distributor, the new recruit becomes the down-line while the recruiter becomes the up-line in the same network (Lee et al, 2016). Their collective performance is achieved through purchasing products and recruitments, which generate volume to their network.…”

The flip side of multi-level marketing: A diagnosis of factors leading to the mass uptake of unregulated pyramid schemes in South Africa

“…However, it is difficult to distinguish a legitimate marketing opportunity from a pyramid scheme (Muncy, 2004). Similarly, Lee et al (2016) have noted that beginners in the multi-level marketing sector start building their businesses by recruiting close friends and relatives since there is a higher propensity to tolerate mistakes made by a close associate. The reality is that people are skeptical about joining "new unbelievable businesses" that are viewed as "too good to be true" if these are marketed to them by strangers.…”