If you are new to the online business world you might be wondering, what’s up with all the online scams and pyramid schemes and how can you protect yourself.
To protect yourself from something, you first need to understand it.
A pyramid scheme is when you make money by promoting the same program you bought.
Let’s say you invest in a business opportunity. If your main source of income with that business opportunity is to recruit others to buy the same business opportunity you just bought, then that would be a pyramid scheme.
If that business opportunity allows you to represent a variety of products and services as part of your existing business, then there is nothing wrong with paying a fee. Depending on the business model it could be labeled as a dealership, franchise or licensing fees.
Some affiliate programs might also have a fee or restrictions on who can promote those offers. Some companies do that to create a barrier of entry. They only want people who have tried their products and services to promote them.
NOTE: Many legitimate companies that have large selection of products and services can get accused of being a pyramid scheme. That can happen when either the company or its representatives focus more on the business opportunity resell value rather than promoting individual products and services.
A scam is when someone takes your money but gives you nothing or something of less value in return.
Funny story… when I first moved to Canada, I got a letter in the mail saying I won a trip to Paris. All I had to do was send cash or a check to cover the cost of issuing the ticket.
Not so funny… I fell for it. Few weeks later a miniature plastic Eiffel Tower replica arrived in the mail with a post card that said “we hope you enjoy it” but no airline ticket. I paid $20 cash plus postage fees for an item that costs few cents.
With the internet, scammers are getting more aggressive and targeting less internet savvy victims like the elderly.
At the same time, many people who have false expectations buy legitimate training, services or products that they don’t use properly. When they don’t get results, rather than blaming themselves, they call it a scam.
Check my previous post on scams to view more options to avoid.
How To Protect Yourself
Before you invest in any business training, affiliate program or business opportunity consider the following 7 tips:
- Take a personality test to find out what is your learning style and what type of career you are more likely to succeed in. The more you know about yourself and your capabilities, the better career and business decisions you will make.
- Educate yourself on your options so you can pick the right online income path that works for you. Because what works for someone else might not work for you. To improve your chances off success with any business, focus on improving your marketing skills first. Because if you don’t know how to do any marketing, you’ll become a victim of a business with low or no sales. That’s why most businesses fail and shut down.
- Avoid “Business Opportunities” and pick programs that allow you to Earn While You Learn. The key difference is in how you label the program and what type of products and services are offered. Pick programs for their education value and view them as a chance to practice your marketing skills. Once you get better at marketing you can move on and promote any products and services you want. You can even use your new skills to build a consulting business by helping other business owners.
- Brand yourself first. Business opportunities and affiliate programs come and go. The only thing you can hold on to is your name, personal business reputation and what you learned.
- Get support. Surround yourself by positive people who have a similar business to the one you want to build. To increase your chances of success, start joining groups, organizations and attend live events and masterminds where you can meet and network with other business owners you aspire to model.
- Expect Changes. Understand that the market is always changing. Search engines, social media platforms and marketing tools and resources are always being updated. So any training program you buy now will likely get outdated very soon. There will never be one book, one course, one seminar, one mastermind, one mentor or one business opportunity that will have all the answers for you. In this new economy, your education is going to be an ongoing process too.
- Set a business budget and stick to it. While the cost of starting an online business is extremely low compared to other business models, the price of advertising is drastically increasing. If you have the skills or willing to learn but have no money, then partner with someone who has money. If you have money but find it hard to learn the skills, then partner with someone who is a quick learner. You don’t have to do this alone!
Something to watch out for when it comes to legitimate or “so called” scams is YOU.
You are responsible for pulling out your credit card and making a purchase. Just like buying a home or investing in the stock market, have a business budget and stay within it. No one can force you to buy something.
Plus, no one can guarantee your results no matter what training program, business setup or business opportunity you choose.
People buy from people. To get faster results always pick programs that fit your needs and focus on delivering value in the marketplace. Provide value and let the market see why they should hire you, work with you and buy from you. That's your responsibility. No one can guarantee your success there.
If you are not sure what online income model can work for you, check out my book and free training on “How To Make The Internet Work For You.”