| By :
Jeff Schuman
When you search for ways to make money online you will come across opportunities in affiliate marketing and network marketing. If you are not sure how these two business models work you will enjoy this article on understanding the differences between both of them. The main difference between network marketing and affiliate marketing lies in building a downline of distributors. As an affiliate marketer you will primarily make your money selling products or performing a specific action for an affiliate merchant. This could include getting paid by a click or by the lead. Some affiliate marketing programs have a 2 tier feature. This means that you can also make money on the sales of anybody you personally recruit. However you will not make any money on people that they recruit. You cannot build a downline of affiliate marketers that you make money on. If building a large organization is something that appeals to you then you want to look at the network marketing business model. In network marketing you get paid to sell products. You also make money as products move through your downline. This not only includes people that you personally sponsor, but it includes your downline distributors which can go several levels deep. Exactly how many people you earn money on will vary from one MLM company to the next. Each one has its own compensation plan. However many network marketing companies also pay you a bonus on the overall volume of the entire company. This is a great feature becomes as the company grows you get to share in the profits. This does not happen with an affiliate marketing company. With an affiliate marketing company you can make very high commissions on products you sell. This is especially true if you are selling digital information products. Some of theses products will pay you as high as 75% in commissions. You can find thousands of them to sell at affiliate networks such as ClickBank. Affiliate programs are free to join. Therefore they tend to draw thousands of people into them who never do anything with their business. Network marketing programs require a fee to get started. Therefore you will not have as many people join them. However, the amount of money it takes to join an MLM company is generally pretty low, so you still have a large number of people who will join and then again not do anything with their business. One final point to bring up is with network marketing you can generate a residual income. This means you continue to get paid long after you stop working. That is virtually impossible to do with the affiliate marketing business model.
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