Direct selling and network marketing

Network marketing and multi-level marketing have been described by author Dominique Xardel as being synonymous, and as methods of direct selling.^[9] Other terms that are sometimes used to describe multi-level marketing include "word-of-mouth marketing", "interactive distribution", and "relationship marketing". Critics have argued that the use of different terms and "buzzwords" is an effort to distinguish multi-level marketing from illegal Ponzi schemes, chain letters, and consumer fraud scams.^[19] Some sources classify multi-level marketing as a form of direct selling rather than being direct selling.^[20][21][22]

The Direct Selling Association (DSA), a lobbying group for the multi-level marketing industry, reported that in 1990 twenty-five percent of members used MLM, growing to 77.3 percent in 1999.^[23] By 2009, 94.2% of DSA members were using MLM, accounting for 99.6% of sellers, and 97.1% of sales.^[24] Companies such as Avon, Electrolux, Tupperware,^[25] and Kirby all originally used single level marketing to sell their goods and later introduced multi-level compensation plans.^[20] The DSA has approximately 200 members^[26] while it is estimated there are over 1,000 firms using multi-level marketing in the United States alone.

Reference:  www.wikipedia.org