PYRAMID SELLING Meaning and
Definition
-
Pyramid selling refers to a business model that involves the sale of products or services through a hierarchical structure of participants, where each participant recruits others to participate in the selling process and receives commissions or bonuses based on their recruits' sales. Also known as multi-level marketing (MLM), network marketing, or pyramid schemes, pyramid selling typically promises substantial financial rewards and opportunities for participants to build their own business networks.
The structure of pyramid selling is characterized by different levels of participants, with each level expected to recruit a specified number of individuals beneath them. As new recruits join the network, the structure expands, forming a pyramid-like shape with the original participant at the top. Each participant earns a portion of the sales made by those recruited below them, with the highest level participant reaping the most rewards.
However, the distinction between pyramid selling and pyramid schemes lies in the emphasis on actual product sales. Pyramid selling is considered legal and legitimate when the focus is primarily on selling products or services to consumers outside the network, and bonuses or commissions are earned based on these sales. In contrast, pyramid schemes prioritize recruitment and often lack a genuine product or service, heavily relying on the constant recruitment of new participants to sustain the financial return.
It is important to note that although pyramid selling is a legal business model in many countries, it has also been associated with fraudulent schemes, misleading promises of high returns, and exploitation. Government regulations and consumer protection laws are in place to prevent or prosecute illegal pyramid schemes and protect individuals from potential financial harm.
Common Misspellings for PYRAMID SELLING
- oyramid selling
- lyramid selling
- -yramid selling
- 0yramid selling
- ptramid selling
- pgramid selling
- phramid selling
- puramid selling
- p7ramid selling
- p6ramid selling
- pyeamid selling
- pydamid selling
- pyfamid selling
- pytamid selling
- py5amid selling
- py4amid selling
- pyrzmid selling
- pyrsmid selling
- pyrwmid selling
- pyrqmid selling
Etymology of PYRAMID SELLING
The term "pyramid selling" is derived from the shape of a pyramid and the way this type of marketing scheme is structured. The word "pyramid" refers to a geometric shape with a polygonal base and triangular faces that meet at a single point, known as the apex.
Infographic
Add the infographic to your website:
