MLM (Multi-Level Marketing) software is an affiliate marketing tool. It is used by enterprises that follow the network marketing business model to sell their products and services. The software allows the admin to manage the network, the users in the network, their compensation, etc. The users in the network can access their status, information about the payouts and manage referrals.
Network marketing is a business model in which an enterprise hires or recruits distributors and agents to sell the products in the market. The agents further recruit more agents, thereby expanding the network throughout various markets. Geographical locations are not a problem in this business model. As long as the enterprise can send the products to the agents, they will sell them in countries they are residing in.
This business model doesn’t depend on explicit advertising or marketing strategies. It uses the concept of word of the mouth to spread the news about the brand and attract more customers. For every sale made by an agent, the agents higher up on the network also get a share of the commission. This depends on the type of network model followed by the enterprise.
Enterprises that use the network marketing model need different software to keep track of the agents in the network and their commissions. Here is where MLM software comes into the picture. Many companies have released MLM software for enterprises to use as their business systems. The Best Multi Level Marketing Software allows enterprises to customize the software to include various integrations that will enable effective business transactions and increase profits. The main aim of following the network marketing model is to get more profits.
Customizing an MLM software means to add new features, integrate new software solutions for e-commerce, create a new ticket support system, send automated responses to users, use multi-currency and multi-language systems to enable transactions from all corners of the world, change the page layouts, color scheme, and design, and much more.
As a part of the customization process, the MLM plans can also be customized to suit the business model of the enterprise. The companies that provide the software can also create a new plan for the enterprise. Before we see more about the different types of MLM plans, let us first know what it is all about.
An MLM Plan is a compensation plan that is created to calculate the amount of commission that has to be paid to the agents at different levels in the network. The percentage of commission, the process of calculation, and the promotion of agents from one level to another will be dealt with according to the procedure followed in the MLM plan. There are quite a few plans that are already being implemented by many enterprises from across the globe. While some plans are quite popular, others are slowly catching up.
- Binary MLM Plan: This is a simple and very basic compensation plan. It is also very popular as it is an effective way of arranging agents in the network. This plan is being followed from the late 1980s, when it was invented. Every agent recruits two new agents who are placed as two branches of the main agent. The agent on the right and left branches will individually recruit two more agents and further expand the network two branches at a time.
- Australian Binary MLM Plan: This is similar to the binary plan, though it is not as popular. Mostly used by the Australian enterprises, this plan includes a third branch to the network, on either side. Apart from the left and right branches, another branch can be added to the same level.
- Matrix MLM Plan: A favorite plan of many brands, this MLM plan has a specific matrix form. It is easy to be managed as there are no breakaways in the network model. For example, if the enterprise adopts a 5*7 matrix plan, it means that the matrix can grow up to 7 levels down and has 5 distributors or agents at each level.
- Board MLM Plan: Also known as a Revolving Matrix Plan, this plan is suitable for enterprises that have a limited number of agents. A board is the main component of the plan. Once the pre-defined number of agents is filled, the board is split into two teams. The agents who perform well are promoted to the next level and the vacancy is filled. The process is cyclic and continues as the business grows.
There are more MLM plans such as the generation plan and gift plan. Once the enterprise decides which plan and what other integrations it wants, the company that provides the MLM software will complete the customization process; help with installing the software and training employees to work on the new software.