CHAPTER 1

INTRODUCTION

This chapter proposes a research that will provide a deeper understanding of

the level of satisfaction among multilevel marketing agents. Certain factors that

contribute to the satisfaction and success of MLM agents will be identified and

measured in this study.

Rationale and Background of the Study

Multi-level marketing (MLM), also known as direct selling or network

marketing, usually refers to the products or services sales that is provided by an

agent to individual customer. Agents are rewarded through incentive schemes,

and are also paid for the effort to introduce or recruit another agent or distributor,

who duplicates their work to sell the product or service to others.

Purchase of an initial startup package is required for an individual to qualify

as an agent of a multi-level marketing company. Distributor, direct seller,

business owner or sales agents are the terms used to address the frontline

representatives of a multi-level marketing company. Agents are not employees

of a MLM company; they are not paid with a fixed salary nor given any employee

benefit. They are completely independent and earn from reward plans and

recruits. Agents are trained and motivated in order to promote the company’s

products or services to his/her family and friends. Agents equipped with sales

technique and product knowledge will tend to have better sales.

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 In a study by Loi Kai Yin (2015), he stated a brief history about how Multi-

level marketing started in the United States of America (USA) in year 1700.

The method had gradually improved and transformed to door-to-door service

to sell off the products in year 1800. Followed by the establishment of

California Perfume Company (now known as Avon), and the aluminum

cookware company Wear-Ever Inc. At the beginning, the products were sold

solely depending on door-to-door selling and organizing home party by

demonstrating the products features. These were all finished-goods that

brought out to sell to the family. Later, in year 1905, Madam C.J. Walker had

set up her own hair care manufacturing company and started the distribution

by herself. She had engaged some “walking agent” to approach individual

family. This enables them to provide in-depth sharing on the products and to

get closer relationship with the customer.

As multi-level marketing is flourishing and gaining much attention in the

business world for the past few years up to present, one of the researchers of

this study was convinced to join a multi-level marketing company in year 2014

out of curiosity and enthusiasm that was present in her during the seminars

and talks she attended.

With this being said, the researchers intended to study the level of

satisfaction among multi-level marketing companies agents in Dagupan City,

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and what makes them stay in the industry. This study attempted to eliminate

stereotyping that when someone talks about multi-level marketing, the first

that comes to mind is the word “scam.” This study also wanted to prove that

multi-level marketing can actually be a legitimate source of income whether it

may be for part-time or full-time commitment, and to give more knowledge of

what multi-level marketing can contribute to the economic development of the

city and the country.

Theoretical Framework

This study is framed by the theory of Hector Delgado. He conducted his

study in year 2000 wherein he developed a theoretical model about the impact of

recruiting and training practices on the satisfaction and success in network

marketing distribution channel. The influencing factors identified in his study that

contribute in the satisfaction and success of MLM agents were (1) methods of

diffusing business opportunity, (2) perceived quality of recruitment process, (3)

perceived quality of training program and (4) up-line support.

In this framework, the researchers adopted the theory developed by

Delgado and expanded it by adding products/services awareness and monthly

income as factors that contribute to agent satisfaction.

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 Quality of
Up-line
Recruitment
Support
Process

Quality of Products/
Training Services
Program Awareness

Methods of
Diffusing Agent Monthly
Business Satisfaction Income
Opportunity

Figure 1.1 Theoretical Framework Model

The framework model above served as the basis of this research study.

The framework is developed based from the research objective and problem of

this study. In this study, agent satisfaction is the dependent variable, while the

aforementioned factors above are the independent variables.

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 Multi-level Marketing (MLM) Companies’ Agent’s Satisfaction

INPUT PROCESS OUTPUT

1. Respondents’
The level of
profile: satisfaction among
Multi-level
1.1 Age; marketing
companies’
1.2 Sex; agents.

1.3 Educational
Descriptive
Attainment; method
through
1.4 Years in questionnaire
industry;

1.5 Monthly

income;

1.6 How was the The solution/s that

can be proposed
agent to solve the
problem.
introduced to

MLM?

Figure 1.2 Research Paradigm

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Statement of the Problem

This study intended to determine the level of satisfaction of multi-level

marketing companies’ agents in Dagupan City.

The study seeks to answer the following questions:

1. What is the profile of the respondents as to:

1.1 Age;

1.2 Sex;

1.3 Highest educational attainment;

1.4 Years in industry;

1.5 Monthly income;

1.6 How was the agent introduced to MLM?

2. What is the level of satisfaction of the respondents along the following

areas:

2.1 Method of diffusing business opportunity;

2.2 Quality of training program;

2.3 Quality of recruitment process;

2.4 Up-line support;

2.5 Products/services awareness?

3. What are the challenges faced by multi-level marketing companies’

agents?

4. What measures can be proposed to solve the challenges/problems

encountered?

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Significance of the Study

There have been other studies conducted concerning the factors affecting

Multi-level Marketing agent’s satisfaction. However, the result of previous

studies showed a broad explanation about the research topic. In this study, the

researchers intended to provide more specific results regarding the level of

satisfaction among multi-level marketing agents in Dagupan City.

This study aspired to (1) help the managers be aware of what factors

encourage their agents to retain in the company, each factor will be justified on

its effect to the agent’s satisfaction, (2) prove that multi-level marketing can be a

legitimate source of income whether it may be a part-time or full-time

commitment in the field of business, (3) provide a better understanding of the

nature of multi-level marketing companies and make a proper distinction with the

illegal activities associated with multi-level marketing that’s threatening the

public, (4) improve the understanding on the satisfaction of an agent in multi-level

marketing companies operating in Dagupan City.

The results of this study can be used by the MLM companies in improving

their recruiting method, training program or to what aspect they are inadequate.

The outcome of the study will help respondents to understand the differences in

the level of satisfaction among MLM companies’ agents. Results can also be

used as a reference for future researchers intending to study Multi-level

Marketing companies’ agent’s satisfaction.

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Scope and Delimitations of the Study

The research concentrated on the level of satisfaction among multi-level

marketing companies’ agent’s satisfaction, and was focused specifically along

the following areas: Methods of Diffusing Business Opportunity, Quality of

Training Program, Quality of Recruitment, Up-line Support, Products/Services

Awareness and Monthly Income.

Twenty (20) Multi-level marketing companies were found to be currently

operating in the city but this research will be limited to the selected MLM agents

in Dagupan City who are available at the time the researchers floated

questionnaires.

Definition of Terms

For a better understanding of the terms used in this study, the following

words/phrases are defined.

Agent - According to Merriam-Webster Dictionary, agent means a person who

does business for another person.

In this study, it refers to the one that markets or sells the products or

services of a multi-level marketing company. Agents, often called distributors,

are independent business owners operating in partnership with their chosen

multi-level marketing company. This term refers to a representative of a MLM

company who sells the firm’s products or services. This representative is also

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encouraged to build his own team/organization by recruiting and enrolling

additional sales force known as down-line/members.

Cocooning – According to searchsecurity.techtarget.com, cocooning is the act of

insulating or hiding oneself from the normal social environment, which may be

perceived as distracting, unfriendly, dangerous, or otherwise unwelcome, at least

for the present.

In this study, it means the desire to perform the majority of social and

cultural interactions from home rather than by going outside.

Commission - According to Merriam-Webster Dictionary, commission is a fee

paid to an agent or employee for transacting a piece of business or performing a

service; especially a percentage of the money received from a total paid to the

agent responsible for the business

In this study, it refers to a percentage allotted to a distributor for services

rendered that resulted in the facilitation of a sale. This can be calculated based

on the dollar amount of the sale or the personal volume in which it generated and

will vary from company to company.

Compensation Plan – According to www.smallbusiness.chron.com,

compensation plan refers to all the components in addition to the manner in

which the compensation is paid and for what purpose employees receive case

bonuses, salary increases and incentives.

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 In this study, it refers to the details of how the commission of distributors in

a multi-level marketing company will be determined on their personal sales

revenue and that of their down-line. This document also specifies incentives for

recruiting, bonus structure, and necessary qualifications for generating income

with the company.

Dependent Variable – According to en.wikipedia.org, the dependent variable

represents the output or outcome whose variation is being studied.

In this study, it refers to as the agent satisfaction.

Down-line – According to en.m.wiktionary.org, down-line describes a lower level

in a hierarchal management structure.

In this study, it refers to the members distributors have recruited or who

have joined the organization after their enrolment and whose sales or referrals

also generate income for that distributor.

Duplication – According to www.dictionary.com, duplication means an act or

instance of duplicating.

In this study, it refers to the process of taking knowledge from previous

experience and showing others how to do the same. Often said to be one of the

keys to building a successful multi-level marketing business, it is where a

successful distributor teaches a new enrolee how to duplicate their efforts and

their success.

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Fishing – According to Merriam-Webster Dictionary, fishing means a sport or

business of catching fish.

In this study, it refers to a way of prospecting in the MLM industry wherein,

the agents set enticing bait to lure a prospect, make him/her interested to join

multi-level marketing company.

Front-Line – According to Merriam Webster Dictionary, front-line means relating

to, being, or involved in a front line

In this study, it refers to the members in your down-line that are personally

enrolled by you.

Independent Variable – According to libguides.usc.edu, independent variable is

stable and unaffected by the other variables you are trying to measure. It refers

to the condition of an experiment that is systematically manipulated by the

investigator. It is the presumed cause.

In this study, it refers to as method of diffusing business opportunity,

perceived quality of training program, perceived quality of recruitment process,

up-line support, perception on products/services and monthly income.

Multi-Level Marketing (MLM) – According to thebalance.com, MLM is a system

for selling goods or service through a network of distributors.

In this study, it refers to a business opportunity that enables people to

make money outside of a conventional job. Multi-level marketing, also

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called network marketing, is a strategy by which a company markets their

products through a network of independent distributors.

Pyramid Scheme – In this study, Pyramid Scheme, lexically and operationally

means, an unsustainable model of business where an organization offers

participants payment, primarily for enrolling other people into the scheme, where

no actual product or service is exchanged with the public. With no revenue

generated other than from the company’s own distributors, it is considered

a scam as opposed to a legitimate form of business.

Ponzi Scheme - In this study, Ponzi Scheme, lexically and operationally means a

fraudulent investing scam promising high rates of return with little risk to

investors. The Ponzi scheme generates returns for older investors by acquiring

new investors.

Referral Marketing/Program – In this study, referral marketing/program, lexically

and operationally means a method of promoting products and/or services to new

customer through referrals, usually word of mouth.

Sales Kit – According to www.businessdictionary.com, sales kit means case or

folder containing information about a firm or product; any sales promotion

material that helps a salesperson in winning new business.

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 In this study, sales kit is a kit required for purchase in order to enrol as an

agent/distributor. These are often available in different sizes and price-points,

but selections depend primarily on the ambition of the enrolling distributor, and

often include training tools, marketing materials, branded apparel, and samples

of the company’s products.

Scam – According to dictionary.cambridge.org, scam means an illegal plan of

making money, especially ones that involve tricking people.

In this study, it means an attempt to cheat or take advantage of a person

or group by earning their trust first. This has stained the MLM industry’s

reputation over the years where fly-by-night companies that have proliferated

deceiving people into instantly earning four to five figures a week when they sign

up for a corresponding fee.

Tryvertising – According to www.urbandictionary.com, tryvertising, lexically and

operationally refers to a marketing parlance for a growing trend of experience-

based consumption, or a kind of “test-driving” that can be applied to a place as

well as product.

Up-line – According to www.thefreedictionary.com, a line or track leading from

the provinces toward the metropolis or a principal terminus.

In this study, up-line is the person who recruited you into an MLM

company, or any person who is connected within the same line to the person

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who recruited you. Understanding the word “up-line” is a lot like understanding

the word “boss.” The person you work for is your boss, but the person he works

for is also your boss. Your up-line is the person who brought you into the

business – but their up-line is also your up-line.

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 Chapter 2

REVIEW OF RELATED LITERATURE

This chapter presents the related literature and studies after a thorough

and detailed search done by the researchers, where it includes several studies

and articles from foreign, national and local authors.

Related Literature

Foreign

Multi-level Marketing is a way of distributing products or services in which

the distributors earn income from their own retail sales and from retail sales by

their direct and indirect recruiters. They stated that members at any level of

multi-level marketing model can make income through the company’s products

and/or services without signing up new members. As a form of direct selling

MLM involves non-store retailing based on face-to-face communication between

a selling representative and a potential buyer. (Vander and Keep, 2002)

In the study of Rawlins and Johnson (2005), they investigated in their

article the cultural factors that are contributing to the increasing trend of direct

selling. The factors which influenced to growth in direct sales which include:

Cocooning, new concept of marketing, differences in male and female

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satisfaction to factors of retail selling, and gender biases in corporate earning

potential. Their study concluded that multiple cultural trends have combined with

the result that direct sales are growing at over twice the rate of standard retail

sales. Cocooning, tryvertising, the glass ceiling, and differences in gender

expectations of the shopping experience most likely result in the continuation of

growth in direct selling practices.

However, despite the massive booming of MLM, there are some issues

that are thrown to the industry. Some question its legitimacy and its linkage to

illegal recruitment schemes.

In the research paper “Ethical issues in Multi-Level Marketing: Is it a

legitimate business or just another Pyramid Scheme?” of James A. Muncy

(2004), he emphasized on marketing and sales class students showing interest

in MLM program for advice this students approaches their marketing professors.

In this case, marketing educators need to be able to help their students

differentiating ethical, legitimate business opportunities.

The research paper throws light on the brief overview of MLM industry and

the problems faced by it. The researcher concluded that because so many

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ethical problems exist in the industry, educators may be tempted to advise

students to avoid multi-level marketing activities.

Vander and Keep (2002) also differentiated multi-level marketing from

pyramid schemes by defining the latter as a non-sustainable business that

involves the exchange of money, usually in a form of a sign-up fee and usually

has no product or service. The only people that are able to make money on a

pyramid scheme are the people at the top of the pyramid and this may lead to a

fraud and misguide the society.

In a 2007 article, P. Sreekumar wrote that Multi-Level Marketing is

embracing more and more areas nowadays. Many MLM companies having quite

large spread in the market are joining hands with leading insurance brands to

promote their products along with an assortment of their own products.

Insurance sector makes available long-term debt for the economic development

of the country. At the same time the MLM route provides employment

opportunities to many people and enhances their social status. The researcher

also stated that the MLM members also get tremendous opportunity to develop

themselves personally. This multiple role of MLM companies can be looked at as

a social contribution and as a development oriented social movement.

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 In a dissertation study by Hector Delgado (2000), he studied some factors

that may affect the satisfaction and success levels of the network marketing

participants also called multi-level marketing agents as to this study. These

factors are namely method of diffusing business opportunity, perceived quality of

training program, perceived quality of recruitment process and up-line support.

The results of his study have provided that network marketing participants are

affected by the support they received from their up-line and the recruiting method

had no effect on the satisfaction and success levels of participants. However, the

results showed in Delgado’s study that the success and satisfaction levels of the

participants were affected by the recruiting practices of the network marketing

industry. Also, the satisfaction and success of the participants were affected by

the training practices of the network marketing distribution channel. It appears

that the trainer's lack of training does have a negative effect on the trainees.

Similarly, the level of management involvement was found to be positively

related to the level of satisfaction and success levels of the participants.

Along with the factors studied by Delgado, this research includes other

factors that affect agent’s satisfaction like monthly income and perception on

products/services. In a research conducted by Coughlan and Grayson (1998)

entitled “Network Marketing Organizations: Compensation Plans, Retail Network

Growth, and Profitability,” the researchers developed, analyzed, and calibrated a

dynamic decision model of the growth of retail NMO. It showed how

compensation and other model parameters affect distributor motivation, sales,

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and network growth and profitability. In short, it is important for the distributor’s

point of view to have a good compensation and incentive plans to remain in the

business and earn reasonable profit.

In the United States, the pro-consumer Federal Trade Commission has

provided tell-tale signs that could indicate whether a seemingly legitimate MLM

company is actually a pyramid scheme: “Your income is based mainly on the

number of people you recruit, and the money those new recruits pay to join the

company – no on the sales of products to consumers. You’re required to buy lots

of inventory. You’re forced to buy other things you don’t want or need just to stay

in good standing with the company.” Another major indicator according to FTC is

that you’re likely to lose money.

Ethics is important in direct selling organization. If ethics are not followed

by sales people, it will contribute to loss to bottom line and indirectly lose

customer. Self-regulation by industry has become an important strategy in

improving the ethical environment. (Chonko, et al., 2002)

In a research paper by Ouyang and Grant, 2004, they tried to find out

how NMOs capitalize social network into sales opportunities, and developed

the model which is capable of proving various real situations in NMOs practices.

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 The model suggests that, the successful NMOs are those with the contact

rate and the persuasive rate dominating the quitting rate i.e. how many people

an IBO have contacted and persuade them is higher than how many people

quit the organization. Unsuccessful NMOs are those with the quitting rate is

dominated the contact rate and the persuasive rate i.e. how many people leave

the organization is higher than how many people contacted and persuade.

National

In a 2016 article of Josiah Go, multi-level marketing is a modern direct

sales compensation plan where distributors are paid depending on their personal

sales and sales of their recruits. They improve their income source from the

efforts of others, liberalizing what used to be available only to employed sales

managers and sales supervisors.

MLM is not the same as pyramiding, an illegal business method where

compensation is derived from either simple recruitment (without sales) or

complex recruitment (balancing a pair of recruits, as in a binary plan, not allowed

by the Consumer Code of the Philippines and Department of Trade and

Industry’s Administrative Order No. 8.

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 According to Atty. Lalaine Monserate (2015) MLM also known as Network

Marketing, a person earns income by selling a certain product. In a pyramiding

scheme, on the other hand, there is no product involved. A person only earns

based on his number of recruits.

TheFilipinoExpat (2014) differentiated a pyramid scam and networking by

defining pyramid scam as a business model where you earn money primarily

from bringing other people into the business rather than selling real products, and

networking as a marketing system. As a marketing or sales system, networking

has proved to be quite effective for selling certain types of products and services

directly to the consumer. It bypasses media advertising and is usually via word-

of-mouth.

Meanwhile, according to an article by Ricardo V. Puno, Jr. (2005), DTI

said that pyramiding should not be confused with MLM which is a legitimate

marketing strategy designed to generate increased business volume. A SEC

advisory further clarified that multi-level marketing plans are legitimate types of

pyramid operations whose primary purpose is to sell a product and mainly to sell

the distributorship itself.

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 Josiah Go (2016), also said that independent distributors focus on selling,

sponsoring other people to sell, and conducting related activities like training,

managing and motivating down-lines (the recruits) while the company handles

other operations like sourcing, delivering, service and commission pay-out thus

making MLM much easier to master than starting one’s own business.

Authorized multi-level marketing companies have actual products and/or

services of good value to sell (e.g. Tupperware, Herbalife and Avon).

Furthermore, the distributors earn most of their profits from product sales and not

much, if none at all, from the recruitment process. (Erika Fille T. Legara, 2013)

According to Vernon B. Sarne (2014), MLM is a type of business that

rakes in profit from the non-stop recruitment of new members – especially since

the new members need to pay a certain fee and purchase assorted products to

join the organization.

The use of products – including those that have to do with wellness and

beauty – gives MLM companies a cloak of legitimacy, but if you really analyse

their business model, it’s really the pyramid scheme at work. The scheme is so

cold because the model requires the exponential recruitment of members from

top to bottom in order to succeed, wherein individuals at the top earn wads of

22
cash of every recruitment brought in by the members under them. To make their

business legit this companies often involve consumer products, because by itself,

he pyramid scheme is highly illegal.

According to TJ Figueroa (2015) he explained why MLM a good business

in the Philippines is that many motivational speakers and inspirational authors

recommend network marketing because of the built-in system, has free trainings

that are sponsored by the company and the quality of the products where the

company don't have to pay for advertisement or middle men to advertise their

products because it is already done by their agents who use and share their

products to their families and friends. He also included the low start-up cost that

network marketing has where the start-up cost depends on the amount of

products being bought at a discounted price, it may range from 4 to 5 digits in

Philippine peso. The agent may resell their products at a certain amount and if a

certain individual wants the product he or she can either buy again from the

company's agent or avail a lifetime membership to enjoy the products for a long-

term. Also, unlike franchises and traditional businesses, the business taxes, rent,

salaries, and other business expenses for the manufacturing of products are

shouldered by the company and the agent don't need to worry about any of those

and just focus on building their business. Network marketing also allows every

agent to build a passive income from repeat orders from their customers,

retailers and business builders. It also allows agents to recruit other individuals to

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build a business and form a team. "Believe or not, most of the top income

earners around the world came from MLM companies before." he stated.

The rapid growth of the industry is prompted by not restricting themselves

in the real world but rather introducing it to the virtual world. The concept of

networking, whether in the virtual or real world, is basically the same. The

purposes may be different (e.g. Professional, personal, business dating). (Atty.

Fred, 2006)

“If you enjoy people, are a good communicator and a hard worker, either

direct sales or network marketing can provide an accelerated income potential.

It’s ultimately up to you to figure out which best fits your needs and goals.”

(Entrepreneur, 2003)

Local

Network Marketing Business (MLM) in the Philippines is spreading like a

virus. From Top Multilevel Network Marketing Companies to some unregistered

Network Marketing Businesses in the Philippines, many Filipinos are so crazy

engaging in this kind of business. Especially if they heard about the

compensation plan and they see the 'million-income-potential', they tend to take

24
the bait and register to the Network marketing company they are invited in.

(affordableCebu, 2011)

DTI-Pangasinan Director Peter Mangabat discussed how a MLM agent or

networking business participant can generate earnings for himself by performing

any or all of the following tasks: (a) as a direct marketer of product and services;

(b) as a supervisor of the people directly recruited by him; and (c) as a marketing

manager of his entire network of marketing people from the first level up to the

last. He also said that in pyramiding, the task is focused mainly on the

recruitment of new participants who are promised a high return without selling a

product. (Sunday Punch, 2014)

According to Anne Gonzales-Tesoro, director of Securities and Exchange

Commission (SEC) office in Baguio City there is a distinction between Multi-level

Marketing, Pyramiding and Ponzi scam. MLM is legal but Pyramiding and Ponzi

scheme are not. MLM is focused on selling of products and services, while

Pyramiding and Ponzi are focused on recruiting people they could swindle. A

Ponzi scheme is where a group of people collects money on a promise of a

bigger amount of money at a rate far beyond what is offered in the banks.

Pyramiding is when a promoter asks someone to register and pay for a plan that

will give them privileges to earn easy money. In Pyramiding, members are not

25
after the products, they are after enticing more people to join the pyramid which

is the basis of their profit. (Giovani Joy Fontanilla, 2015)

In an article written by Andy Uyboco (2014) he stated that in a legitimate

MLM, the goal is not simply to make money off new recruits (in fact, some MLMs

do away with this “joining commission” altogether)—the goal is to create a large

network of satisfied users and sellers of your company’s products. Most

successful MLM companies in the world sell products which are consumable, or

have a wide range of products, where income is not dependent only on the

purchase of a “Starter package” but on subsequent, regular and repeated

purchases and sales of goods.

In its simplest form, MLM is a modification of direct selling. In direct

selling, for example: if you sell product A, you get a commission and earn money.

In MLM, if you recruit an individual to join your organization, and you sell product

A, you get a commission, and you get what is called an overriding commission.

The basic concept is that given a large enough organization, you can make

decent money on overrides. That is what drives MLM agents to constantly keep

recruiting people and training them to go out and recruit some more. There is

nothing wrong with this practice. (Andy Uyboco, 2014)

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 Chapter 3

RESEARCH METHODOLOGY

This chapter presents the method of research to be used, the instrument

of research and statistical data to be gathered. In this chapter, readers/users of

this study will be able to know the process that will be taken to accomplish this

work.

Research Design

In this study, the researchers employed a quantitative method of research

in collecting and interpreting data, and to measure the variables that would affect

the level of satisfaction of multi-level marketing companies’ agents.

Quantitative methods emphasize objective measurements and the

statistical, mathematical, or numerical analysis of data collected through polls,

questionnaires, and surveys, or by manipulating pre-existing statistical data using

computational techniques. It is used to answer questions on relationships within

measurable variables with an intention to explain, predict and control a

phenomenon.

This study aimed to find out the level of satisfaction among MLM

companies’ agents based on the six influencing factors and determined the

relationship between the independent and dependent variable, thus using this

type of research is applicable.

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 Moreover, use of descriptive-survey questionnaire has been employed

under this method. It is a data-gathering instrument and a predefined series of

questions used to collect information from the respondents (Research

Connections, 2016). The questionnaire was designed with statements and a

Likert scale for the respondents to rate the statements indicated.

Sources of Data

In the present year, there are twenty (20) registered multi-level marketing

companies currently operating in Dagupan City, but the study was limited to the

selected agents in Dagupan City who were available to answer the

questionnaires. Respondents were given questionnaires from which answers

gathered was used in drawing and interpreting results and conclusions.

Since the lists of agents of Multi-level marketing companies are

confidential, the researchers were not able to get at least the population of the

MLM agents; therefor the researchers used convenience sampling. This is a

type of non-probability sampling technique where respondents are selected

because of their convenience accessibility and proximity to the researcher.

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Locale of the Study

The study was conducted in Dagupan City, Pangasinan. The city was

chosen by the researcher as the locale of the study to identify the level of

satisfaction among multi-level marketing companies’ agents. The gathering of

data was favorable to the researchers because both of them are currently

studying at Lyceum-Northwestern University, Tapuac District, Dagupan City.

Figure 3.1. Location of Dagupan City taken from Google Maps©

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Instrumentation and Data Collection

The researchers used a descriptive-survey questionnaire as the main

instrument for data gathering. The questinnaire consists of three parts: the first

part deals with the respondent profile, the second part is the level of satisfaction

among multi-level marketing agents and, the third part deals with the challenges

faced by MLM agents. The questionnaires were distributed by hand and

electronically.

The researchers appraoched the respondents and explained initially to

them the purpose of the survey. Afterwards, the researchers proceeded with the

distribution of questionnaires. Questions from the respondents were entertained.

After gathering the data needed from the questionnaire, the researchers then

tallied, tabulated and classified the gathered data.

Tools for Data Analysis

The researchers used the following statistical tools for data analysis:

percentage, weighted average mean and ranking. The respondent’s profile was

measured by means of frequency and percentage distribution, the level of

satisfaction and the challenges faced by MLM agents by means of weighted

average mean.

The following formulae will be used:

30
Percentage

A percentage describes how many parts there are out of one hundred

parts of a particular thing. The percentage can be computed using the formula:

f
P= x 100
n

Where:

P = Percentage

f = Frequency

n = Number of respondents

Weighted Average Mean

Weighted average mean is computed by considering relative importance

of each item is called weighted arithmetic. It gives due importance to each item

under consideration by assigned number called weight to each item in proportion

to its relative importance (eMathZone, 2016). This is computed using the

formula:

∑ fx
𝑋̅=
∑f

Where:

𝑋̅ = Weighted Average Mean (WAM)

31
f = Frequency response

∑ fx = sum of all products of f and x

∑ f = sum of all

The computed WAM will be interpreted using the following statistical limit

constructed by the researcher.

Statistical Limit Numerical Value Descriptive Rating

4.20-5.00 5 Highly Satisfied

3.40-4.19 4 Satisfied

2.60-3.39 3 Neutral

1.80-2.59 2 Dissatisfied

1.00-1.79 1 Very Dissatisfied

Statistical Limit Numerical Descriptive Rating

Value

4.20-5.00 5 Extremely Affected Very Satisfied

3.40-4.19 4 Affected Satisfied

2.60-3.39 3 Moderately Affected Moderately Satisfied

1.80-2.59 2 Slightly Affected Dissatisfied

1.00-1.79 1 Not at all Very Dissatisfied

32
 Chapter 4

RESULTS AND DISCUSSIONS

This chapter presents all the data gathered and findings for the problem

stated in this study. The data are tabulated accordingly to provide convenience

and better understanding for those who will read this study.

Table 4.1

Frequency Distribution for the Respondent’s Profile

Frequency (f) Percentage (%)

1. Age
18–25 years old 45 62
26–30 years old 13 18
31–40 years old 7 10
41–50 years old 8 11
TOTAL 73 100
2. Sex
Female 41 56
Male 32 44
TOTAL 73 100
3. Highest Educational Attainment
High School Graduate 19 26
Vocational 7 10
College Undergraduate 23 32
College Graduate 24 33
TOTAL 73 100
4. Years in Industry
1–5 years 67 92
6–10 years 6 8
11–15 years 0 0
16 years and above 0 0
TOTAL 73 100
5. Monthly Income
Below ₱10, 000 44 60
₱10, 000–15, 000 13 18

33
 ₱16, 000–20, 000 4 5
₱21, 000–30, 000 7 10
₱31, 000 & above 5 7
TOTAL 73 100
6. How was the agent introduced to
Multi-level marketing
By reading an ad in a printed
publication 4 5
Through social media 17 23
By a friend or relative that talked
about the business opportunity 34 47
By a company distributor that talked
about the business opportunity 18 25
TOTAL 73 100

Respondents’ profiles of the multi-level marketing agents are shown in

Table 4.1. In terms of age, bracket 18-25 years old constitutes the majority of the

respondents having a frequency of 45 or 62% of the total population of

respondents. This shows that people engaged in multi-level marketing are mostly

young adults. Then bracket 26-30 years old followed with a frequency of 13 or

18%. Next would be bracket “41-50 years old” with a frequency of 8 or 11%.

Lastly, bracket 31-40 years old falls behind with a frequency of 7 or 10%.

In terms of sex, females comprise the majority of the total respondents

with a frequency of 41 or 56%, while male respondents have a frequency of 32 or

44%.

In terms of highest educational attainment, the table shows that 33% or

frequencies of 24 respondents are college graduates. College undergraduate

followed with a frequency of 23 or 32%. Then high school and vocational

graduate followed with a frequency of 19 or 26% and 7 or 10%, respectively.

34
 Based on years in industry, bracket 1-5 years led with a count of 67 or

92%. Bracket 6-10 years followed with a count of 6 or 8%.

When it comes to monthly income, bracket below ₱10, 000 comprises

more than half of the income generated by MLM agents with a frequency of 44 or

60%. The frequency of 13 or 18% is constituted by bracket ₱10, 000-15, 000.

The other 10% or count of 7 is covered by bracket ₱21, 000–30, 000. While

brackets ₱31, 000 & above and ₱16, 000–20, 000 followed with a count of 5 or

7% and 4 or 5%, respectively.

Finally, based on how the agent was introduced to Multi-level marketing,

majority of the respondents were introduced by the sharing from someone they

recognized. There were 34 respondents or 47% who got interested by a friend or

relative that talked about the business opportunity, while 18 respondents or 25%

were approached by a company distributor. A frequency of 17 or 23% got

interested through the social media like Facebook, Instagram and other social

media platforms. Only 5% or frequency of 4 respondents was introduced to MLM

by reading an ad in a printed publication.

35
 Table 4.2

Weighted Average Mean for the Methods of Diffusing Business Opportunity

Particulars 𝑋̅ DR

1. Conducts seminars to present the products and the

4.56 HS
company itself.
2. Uses social media platforms like Facebook, Instagram,
4.43 HS
etc. to advertise.
3. Sponsors/hosts events to familiarize people about the
4.42 HS
company.
4. Uses a referral program. 4.19 S
5. Partners with local government and entrepreneurs. 4.21 HS

Legend:

𝑋̅ = Weighted Average Mean

DR = Descriptive Ranking
Statistical Limit Numerical Value Descriptive Rating
4.20 - 5.00 5 Highly Satisfied
3.40 - 4.19 4 Satisfied
2.60 - 3.39 3 Neutral
1.80 - 2.59 2 Dissatisfied
1.0 1.79 1 Very Dissatisfied

Table 4.3 presents the weighted average mean of each indicator for the

method of diffusing business opportunity level. The variable “Conducts seminars

to present the products and the company itself” has the highest mean of 4.56.

Followed by “Uses social media platforms like Facebook, Instagram, etc. to

advertise” with a mean 4.43. Next would be the “Sponsors/hosts events to

familiarize people about the company” with a mean 4.42. Then the next is

36
“Partners with local government and entrepreneurs” with a mean 4.21. Finally,

the indicator “Uses a referral program” has the lowest mean of 4.19.

Table 4.3

Weighted Average Mean for the Quality of Training Program

Particulars 𝑋̅ DR

1. I have received the necessary amount of training in this

4.49 HS
multi-level marketing company.
2. The training has helped me to achieve success as an
4.42 HS
agent in multi-level marketing.
3. I was very well motivated during the training session. 4.44 HS
4. The trainings organized addresses the important issues
4.49 HS
related to my job as an agent in multi-level marketing.
5. I am provided with timely trainings to enhance my
4.49 HS
knowledge and skill as an agent.

Legend:

𝑋̅ = Weighted Average Mean

DR = Descriptive Ranking
Statistical Limit Numerical Value Descriptive Rating
4.20 - 5.00 5 Highly Satisfied
3.40 - 4.19 4 Satisfied
2.60 - 3.39 3 Neutral
1.80 - 2.59 2 Dissatisfied
1.0 1.79 1 Very Dissatisfied

37
 Table 4.3 presents the weighted average mean of each indicator for the

quality of training program level. The indicators “I have received the necessary

amount of training in this multi-level marketing company”, “The trainings

organized addresses the important issues related to my job as an agent in multi-

level marketing” and “I am provided with timely trainings to enhance my

knowledge and skill as an agent” has the highest mean of 4.49. Followed by “I

was very well motivated during the training session” with a mean 4.44. Finally,

the indicator “The training has helped me to achieve success as an agent in

multi-level marketing” has the lowest mean of 4.42.

Table 4.4

Weighted Average Mean for the Quality of Recruitment Process

Particulars 𝑋̅ DR

1. I conduct prospecting by fishing. 3.91 S

2. Our company conducts an orientation and thereafter,
4.29 HS
we persuade interested individuals to join MLM.
3. I send messages to my prospects with testimonies of
4.14 S
some successful agents through social media.
4. I leverage my up-line’s experience and let them help
4.30 HS
me explain the business.
5. I do timely follow-ups to my potential recruits. 4.26 HS

Legend:

𝑋̅ = Weighted Average Mean

DR = Descriptive Ranking

38
 Statistical Limit Numerical Value Descriptive Rating
4.20 - 5.00 5 Highly Satisfied
3.40 - 4.19 4 Satisfied
2.60 - 3.39 3 Neutral
1.80 - 2.59 2 Dissatisfied
1.0 1.79 1 Very Dissatisfied

Table 4.3 present the weighted average mean of each indicator for the

quality of recruitment process level. The indicator “I leverage my up-line’s

experience and let them help me explain the business.” has the highest mean of

4.30. Followed by “Our company conducts an orientation and thereafter, we

persuade interested individuals to join MLM.” with a mean of 4.29. The next

would be the “I do timely follow-ups to my potential recruits.” with a mean of 4.26.

Proceeded by the “I send messages to my prospects with testimonies of some

successful agents through social media.” with a mean of 4.14. Finally, the

indicator “I conduct prospecting by fishing.” has the lowest mean of 3.91.

39
 Table 4.5

Weighted Average Mean for the Up-Line Support

Particulars 𝑋̅ DR

1. Competent in the job he/she is doing. 4.47 HS

2. Shows interest in the concerns and needs of his/her
4.50 HS
down-line.
3. Always in the best disposition of helping his/her down-
4.43 HS
line.
4. Leading, developing and working with me. 4.58 HS
5. Empowers and encourages me to strive more at what I
4.47 HS
do.

Legend:

𝑋̅ = Weighted Average Mean

DR = Descriptive Ranking
Statistical Limit Numerical Value Descriptive Rating
4.20 - 5.00 5 Highly Satisfied
3.40 - 4.19 4 Satisfied
2.60 - 3.39 3 Neutral
1.80 - 2.59 2 Dissatisfied
1.0 1.79 1 Very Dissatisfied

The table 4.5 presents the weighted average mean of each indicator for

the up-line support. The indicator “Leading, developing and working with me.”

has the highest mean of 4.58. Proceeded by the “Shows interest in the concerns

and needs of his/her down-line.” with a mean of 4.50. Next would be “Competent

in the job he/she is doing.” and “Empowers and encourages me to strive more at

40
what I do.” has the same mean of 4.47. Then finally the indicator “Always in the

best disposition of helping his/her down-line.” has the lowest mean of 4.43.

Table 4.6

Weighted Average Mean for the Products/Services Awareness

Particulars 𝑋̅ DR

1. My company offers high-quality products/services. 4.79 HS

2. My company offers effective yet affordable products. 4.65 HS
3. My company offers products that are good for personal
4.70 HS
use and recommendable.
4. My company offers safe and tested products. 4.79 HS
5. My company offers FDA approved products. 4.77 HS

Legend:

𝑋̅ = Weighted Average Mean

DR = Descriptive Ranking
Statistical Limit Numerical Value Descriptive Rating
4.20 - 5.00 5 Highly Satisfied
3.40 - 4.19 4 Satisfied
2.60 - 3.39 3 Neutral
1.80 - 2.59 2 Dissatisfied
1.0 1.79 1 Very Dissatisfied

Table 4.6 presents the weighted average mean of each indicator for the

products/services awareness level. The indicators “My company offers high-

quality products/services.” and “My company offers safe and tested products.”

41
has the highest mean of 4.79. Next would be “My company offers FDA approved

products.” has the mean of 4.77. Proceeded by the “My company offers products

that are good for personal use and recommendable.” indicator has the mean of

4.70. Finally, the “My company offers effective yet affordable products.” has the

lowest mean of 4.65.

Table 4.7

Weighted Average Mean for the Challenges faced by Multi-Level Marketing

Companies’ Agents

Particulars 𝑋̅ DR DR

1. Multi-level marketing (MLM) is often associated with the

2.93 MA MS
word “scam”.
2. Some MLM companies have cult-like behaviours where
2.72 MA MS
they try to brainwash people.
3. MLM is often being confused with a fraudulent business
scheme that uses the investment of new agents to 2.66 MA MS
distribute returns to existing investors.
4. MLM lies about passive income. 2.67 MA MS
5. MLM agents prospect unsuspecting individuals that are
fooled by a promise of extraordinary returns on 2.77 MA MS
investment.
6. In MLM, you can earn by recruiting new individuals who
3.35 MA MS
will then recruit more individuals for them to earn money.
7. MLM companies offer products that aren’t worth the
2.63 MA MS
value of the consumers’ money.
8. In MLM, only those pioneers (up-lines) in the industry
2.63 MA MS
earn and succeed.
9. Same with some illegal schemes, MLM companies
don’t register investments to the Securities and Exchange 2.60 MA MS
Commission (SEC).
10. MLM companies promise high returns with no risk but
2.63 MA MS
in reality it’s the other way around.

42
Legend:

𝑋̅ = Weighted Average Mean

DR = Descriptive Ranking
Statistical Limit Numerical Value Descriptive Rating
4.20 - 5.00 5 Extremely Affected
3.40 - 4.19 4 Affected
2.60 - 3.39 3 Moderately Affected
1.80 - 2.59 2 Slightly Affected
1.0 1.79 1 Not All

Statistical Limit Numerical Value Descriptive Rating

4.20 - 5.00 5 Very Satisfied
3.40 - 4.19 4 Satisfied
2.60 - 3.39 3 Moderately Satisfied
1.80 - 2.59 2 Dissatisfied
1.0 - 1.79 1 Very Dissatisfied

Table 4.7 presents the weighted average mean of each indicator for the

challenges faced by multi-level marketing companies’ agents. The indicator “In

MLM, you can earn by recruiting new individuals who will then recruit more

individuals for them to earn money.” has the highest mean of 3.35. Next would be

“Multi-level marketing (MLM) is often associated with the word “scam”.” with the

mean of 2.93. Followed by “MLM agents prospect unsuspecting individuals that

are fooled by a promise of extraordinary returns on investment.” With a mean of

2.77. Proceeded by “Some MLM companies have cult-like behaviours where they

try to brainwash people.” with a mean of 2.72. Succeeded by “MLM lies about

43
passive income.” with a mean of 2.67. Next would be “MLM is often being

confused with a fraudulent business scheme that uses the investment of new

agents to distribute returns to existing investors.” with a mean of 2.66. Followed

by indicators: “MLM companies offer products that aren’t worth the value of the

consumers’ money”, “In MLM, only those pioneers (up-lines) in the industry earn

and succeed.” and “MLM companies promise high returns with no risk but in

reality it’s the other way around.” with the same mean of 2.63. Finally, the “Same

with some illegal schemes, MLM companies don’t register investments to the

Securities and Exchange Commission (SEC).” has the lowest mean of 2.60.

44
 Chapter 5

SUMMARY, CONCLUSIONS AND RECOMMENDATIONS

This chapter presents the summary of the study, conclusions constructed

based on the findings and recommendations rendered.

Summary

This study determined the level of satisfaction among Multi-level

Marketing companies’ agents in Dagupan City.

The researchers had a total of seventy (70) respondents by employing a

non-probability sampling specifically the convenience sampling which is the most

suitable technique for the researchers at the time of conducting the study. The

researchers used quantitative research method and descriptive-survey

questionnaires to collect data. The data gathered were tabulated to different

statistical formulas namely frequency, percentage and weighted average mean.

Findings

The findings of the study are as follows: for the respondent’s profile as to

age, bracket 18-25 years old comprises the majority of the respondents with a

frequency of 45 or 62%. While bracket 31-40 years old was left behind with a

45
frequency of 7 or 10%. As to sex, females constitute the majority of the total

respondents with a frequency of 41 or 56%, while male respondents have a

frequency of 32 or 44%. In terms of highest educational attainment, frequencies

of 24 respondents are college graduates. This shows that 33% of the total

respondents have finished their tertiary education which concludes that multi-

level marketing is also practiced by professionals. The vocational graduate had

the lowest frequency of 7 or 10%. Based on years in industry, bracket 1-5 years

had a frequency of 67 or 92%, while bracket 6-10 years had a frequency of 6 or

8%. As to monthly income, bracket below ₱10, 000 comprises more than half of

the income generated by MLM agents with a frequency of 44 or 60%. Bracket

₱16, 000–20, 000 fell behind with a frequency 4 or 5%. According to how the

agent was introduced to Multi-level marketing, 34 respondents or 47% of the total

respondents were introduced by a friend or relative that talked about the

business opportunity, and only 5% or frequency of 4 respondents was introduced

to MLM by reading an ad in a printed publication.

The findings regarding the level of satisfaction as to methods of diffusing

business opportunity show four (4) items namely conducts seminars to present

the products and the company itself, uses social media platforms like Facebook,

Instagram, etc. to advertise, sponsors/hosts events to familiarize people about

the company, and partners with local government and entrepreneurs garnered a

highly satisfied (HS) rating, while use of referral program had a satisfied (S)

rating.

46
 All the variables concerning level of satisfaction under quality of training

program have a descriptive rating of highly satisfied (HS). These results show

that multi-level marketing agents are highly satisfied with the quality of training

program provided to them by their respective companies.

With regards to quality of recruitment process, the level of satisfaction

among agents were scattered between highly satisfied (HS) and satisfied (S).

“Our company conducts an orientation and thereafter, we persuade interested

individuals to join MLM”, “I leverage my up-line’s experience and let them help

me explain the business”, and “I do timely follow-ups to my potential recruits”

have a rating of highly satisfied, while “I conduct prospecting by fishing” and “I

send messages to my prospects with testimonies of some successful agents

through social media” have a rating of satisfied.

In terms of level of satisfaction as to up-line support, all variables have

garnered a highly satisfied rating. This figures that up-lines are supportive

responsible to their down-lines and are able to manage their team and help them

grow as company agents which makes multi-level marketing agents highly

satisfied with their up-line support.

47
 With regards to level on satisfaction based products/services awareness,

results show that all variables under it also have a highly satisfied rating. Multi-

level marketing agents are highly satisfied with what their company offers and

provides when it comes to product. As these products are speak for the

company as a whole. Results show that most MLM agents use and highly

recommend their own products.

The challenges that Multi-level marketing agents face include, but are not

limited to “Multi-level marketing (MLM) is often associated with the word “scam””,

“Some MLM companies have cult-like behaviours where they try to brainwash

people”, “MLM is often being confused with a fraudulent business scheme that

uses the investment of new agents to distribute returns to existing investors”,

“MLM lies about passive income”, “MLM agents prospect unsuspecting

individuals that are fooled by a promise of extraordinary returns on investment”,

“In MLM, you can earn by recruiting new individuals who will then recruit more

individuals for them to earn money”, “MLM companies offer products that aren’t

worth the value of the consumers’ money”, “In MLM, only those pioneers (up-

lines) in the industry earn and succeed”, “Same with some illegal schemes, MLM

companies don’t register investments to the Securities and Exchange

Commission (SEC)”, and “MLM companies promise high returns with no risk but

in reality it’s the other way around”. These variables are constructed by the

researchers in accordance with Pyramid and Ponzi scheme. All the variables are

sheer representation and components of the schemes mentioned. According to

48
the findings of the researchers, all these challenges moderately affect multi-level

marketing agents.

Conclusions

There are many factors to deal with when considering the level of

satisfaction among Multi-level marketing agents but only five (5) were addressed

in this study.

Based on the gathered data, the researchers conclude that majority of

multi-level marketing agents are within the age bracket 18-25 years old, females

and are college graduates. Most of them have stayed in the multi-level

marketing industry for at least 1-5 years and generate a monthly income of below

₱10, 000. Results also show that most of the respondents were approached by

a friend or relative that talked about the business opportunity that multi-level

marketing offer.

Based on the findings, with regards to methods of diffusing business

opportunity, agents are most highly satisfied with the variable wherein the

company conducts seminars to present the products and the company itself.

This indicates that when the company conducts seminars, agents are highly

49
satisfied. This is because they see it as an opportunity to attract and recruit more

people to join in their industry, and when they succeed they will earn money.

With regards to quality of training program, findings show that agents are

highly satisfied with all the variables that comprise it. This suggests that agents

are actually provided with a continuous and good quality of training program that

helps them develop their knowledge and skills as agents.

As to quality of recruitment process, agents are most highly satisfied with

the variable “I leverage my up-line’s experience and let them help me explain the

business.” According to one of the researchers of this study who is also a MLM

agent, this technique is very useful especially for those agents who are just

starting in the business. Leveraging their up-line’s experience and showing proof

of success is a very big help.

In terms of up-line support, agents are ultimately highly satisfied with the

variable “Leading, developing and working with me.” This denotes that up-lines

are really responsible with their front-lines and down-lines. Showing interest in

working with their down-lines and help them develop is a big factor.

50
 Last factor considered was products/services awareness, results show

that multi-level marketing agents are highly satisfied that the company they

belong to offers high quality products/services, and offers safe and tested

products. With this being said, agents we had a chance to talk to express their

eagerness to use, promote and recommend the products they sell. Many agents

are also personal users of their products.

Moreover, as to challenges faced by multi-level marketing agents, findings

show that the variables aforementioned under it moderately affect and satisfy the

agents.

Recommendations

Based on the conclusion drawn, the following are the recommendations of

the researchers:

The researchers recommend further advertisements or programs that can

attract individuals to join and try being a part of a MLM company because results

show that most of the respondents were approached only by a friend or relative

that talked about the business opportunity. And also been discussed, the

researchers recommend further improvement in MLM company’s products and

attitudes to make agents stay in the MLM business for the benefit of all.

51
 According to the conclusion said above, the aforementioned challenges

faced by multi-level marketing agents moderately affect the agents. That is why

the researchers recommend that agents to uplift and strengthen the integrity of

what their multi-level company believes in. So that, individuals who are in doubt

of joining will have the courage to join and be part of the MLM business with no

more doubts and remarks.

The majority of the results in the agents are already highly satisfied

therefore there is no more recommendations needed to be add.

52
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57
APPENDICES

58
APPENDIX A
(Letter of Transmittal)

59
 LYCEUM-NORTHWESTERN UNIVERSITY
Tapuac District, Dagupan City

COLLEGE OF BUSINESS EDUCATION

MARCH 2018
_____________________________
_____________________________
_____________________________

Dear Sir/Ma’am:

The undersigned researchers taking up Bachelor of Science in Accountancy at

Lyceum-Northwestern University are currently conducting a research study entitled
“Multi-level Marketing Companies’ Agent’s Satisfaction”.

In line with this, may we ask your cooperation in answering the survey-questionnaire
and to conduct interview which is related in the above-mentioned topic.

Rest assured that all information gathered will be treated with utmost confidentiality
and for academic purposes only.

We hope for a favorable response from you. Thank you and God bless!

Respectfully yours,

_________________________________
BLANCHE MARIANNE B. BAUTISTA

_________________________________
ANGELICA G. PEROS

Noted by:

____________________________________________
MRS. MARIEL KAREN FRANCESCA O. AQUINO
Thesis Coordinator

Approved by:

______________________________________
DR. GENOVEVA Y. REYES, CPA, FRIAcc
Dean, College of Business Education

60
APPENDIX B
(Survey Questionnaire)

61
Respondent’s Profile

Name : (Optional) ___________________________________

Age : 18-25 y/o 26-30 y/o 31-40 y/o 41-50 y/o

Sex : Female Male

Highest educational attainment :

High School Graduate Vocational

College Undergraduate College Graduate

Years in industry :

5 years & below 6-10 years 11-15 years 16 years & above

Monthly Income :

Below ₱10,000 ₱10,000-15,000 ₱16,000-20,000

₱21,000-30,000 ₱31,000 & above

How were you introduced in the Multi-level Marketing business?

By reading an ad in a printed publication

Through social media

By a friend or relative that talked about the business opportunity

By a company distributor that talked about the business opportunity

If contacted by a person, how were you initially approached?

By telephone/cellphone

By e-mail/letter

62
 Through social media

In person

Instruction: Please put a check (√) on the number based on your satisfaction on

the following items.

5 = Very Satisfied

4 = Satisfied

3 = Neutral

2 = Dissatisfied

1 = Very Dissatisfied

Level of Multi-Level Marketing Companies Agent’s Satisfaction

As to methods of diffusing business 5 4 3 2 1

opportunity:

1. Conducts seminars to present the products and

the company itself.

2. Uses social media platforms like Facebook,

Instagram, etc. to advertise.

3. Sponsors/hosts events to familiarize people

about the company.

4. Uses a referral program.

5. Partners with local government and

entrepreneurs.

63
As to quality of training program: 5 4 3 2 1

1. I have received the necessary amount of training

in this multi-level marketing company.

2. The training has helped me to achieve success

as an agent in multi-level marketing.

3. I was very well motivated during the training

session.

4. The trainings organized addresses the important

issues related to my job as an agent in multi-level

marketing.

5. I am provided with timely trainings to enhance

my knowledge and skill as an agent.

As to quality of recruitment process: 5 4 3 2 1

1. I conduct prospecting by fishing.

2. Our company conducts an orientation and

thereafter, we persuade interested individuals to

join MLM.

3. I send messages to my prospects with

testimonies of some successful agents through

social media.

4. I leverage my up-line’s experience and let them

64
help me explain the business.

5. I do timely follow-ups to my potential recruits.

As to up-line support: 5 4 3 2 1

1. Competent in the job he/she is doing.

2. Shows interest in the concerns and needs of

his/her down-line.

3. Always in the best disposition of helping his/her

down-line.

4. Leading, developing and working with me.

5. Empowers and encourages me to strive more at

what I do.

As to products/services awareness: 5 4 3 2 1

1. My company offers high-quality

products/services.

2. My company offers effective yet affordable

products.

3. My company offers products that are good for

personal use and recommendable.

4. My company offers safe and tested products.

5. My company offers FDA approved products.

65
Instruction: Please put a check (√) on the number that reflects your opinion on

each of the following items.

5 = Highly affected

4 = Affected

3 = Neutral

2 = Slightly affected

1 = Not at all

Challenges faced by MLM 5 4 3 2 1

Companies’ Agents:

1. Multi-level marketing (MLM) is

often associated with the word

“scam”.

2. Some MLM companies have cult-

like behaviours where they try to

brainwash people.

3. MLM is often being confused with

a fraudulent business scheme that

uses the investment of new agents

to distribute returns to existing

investors.

4. MLM lies about passive income.

66
5. MLM agents prospect

unsuspecting individuals that are

fooled by a promise of extraordinary

returns on investment.

6. In MLM, you can earn by

recruiting new individuals who will

then recruit more individuals for

them to earn money.

7. MLM companies offer products

that aren’t worth the value of the

consumers’ money.

8. In MLM, only those pioneers (up-

lines) in the industry earn and

succeed.

9. Same with some illegal schemes,

MLM companies don’t register

investments to the Securities and

Exchange Commission (SEC).

10. MLM companies promise high

returns with no risk but in reality it’s

the other way around.

67
 APPENDIX C
(Computation of Weighted
Average Mean)

68
 ̅)
Computation (𝑿
Methods of Diffusing Business Opportunity

VS S N D VD ̅
Particulars ∑ 𝑿 DR
5 4 3 2 1

1. Conducts seminars to f 27 13 3 0 0 43
present the products and the 4.56 HS
company itself.
fx 135 52 9 0 0 196

2. Uses social media f 20 10 5 0 0 35

platforms like Facebook, 4.43 HS
Instagram, etc. to advertise.
fx 100 40 15 0 0 155

f 24 13 6 0 0 43
3. Sponsors/hosts events to
familiarize people about the 4.42 HS
company. fx 120 52 18 0 0 190

f 18 18 4 3 0 43
4. Uses a referral program. 4.19 S
fx 90 72 12 6 0 180
5. Partners with local f 21 13 6 0 2 42
government and 4.21 HS
entrepreneurs. fx 105 52 18 0 2 177

̅)
Computation (𝑿
Quality of Training Program

VS S N D VD ̅
Particulars ∑ 𝑿 DR
5 4 3 2 1

1. I have received the f 27 11 4 1 0 43

necessary amount of training
4.49 HS
in this multi-level marketing
company. fx 135 44 12 2 0 193

2. The training has helped me

f 23 15 5 0 0 43 4.42 HS
to achieve success as an

69
agent in multi-level
marketing. fx 115 60 15 0 0 190

f 25 12 6 0 0 43
3. I was very well motivated
4.44 HS
during the training session.
fx 125 48 18 0 0 191

4. The trainings organized f 26 13 3 1 0 43

addresses the important
issues related to my job as an 4.49 HS
agent in multi-level fx 130 52 9 2 0 193
marketing.
5. I am provided with timely f 26 12 5 0 0 43
trainings to enhance my
4.49 HS
knowledge and skill as an fx 130 48 15 0 0 193
agent.

̅)
Computation (𝑿
Quality of Recruitment Process

VS S N D VD ̅
Particulars ∑ 𝑿 DR
5 4 3 2 1

f 16 12 12 1 2 43
1. I conduct prospecting by
3.91 S
fishing.
fx 80 48 36 2 2 168

2. Our company conducts an f 22 10 10 0 0 42

orientation and thereafter, we
4.29 HS
persuade interested
individuals to join MLM. fx 110 40 30 0 0 180

3. I send messages to my f 19 16 7 0 2 44
prospects with testimonies of
4.14 S
some successful agents
through social media. fx 95 64 21 0 2 182

4. I leverage my up-line’s f 23 14 4 0 2 43
experience and let them help 4.30 HS
me explain the business. fx 115 56 12 0 2 185

70
5. I do timely follow-ups to my f 20 17 4 1 1 43
4.26 HS
potential recruits. fx 100 68 12 2 1 183

̅)
Computation (𝑿
Up-line Support

VS S N D VD ̅
Particulars ∑ 𝑿 DR
5 4 3 2 1

f 24 15 4 0 0 43
1. Competent in the job he/she
4.47 HS
is doing.
fx 120 60 12 0 0 192

2. Shows interest in the f 26 14 4 0 0 44

concerns and needs of his/her 4.50 HS
down-line.
fx 130 56 12 0 0 198

f 22 19 3 0 0 44
3. Always in the best
disposition of helping his/her 4.43 HS
down-line. fx 110 76 9 0 0 195

4. Leading, developing and f 28 12 3 0 0 43

4.58 HS
working with me. fx 140 48 9 0 0 197

5. Empowers and encourages f 27 12 2 1 1 43

4.47 HS
me to strive more at what I do. fx 135 48 6 2 1 192

̅)
Computation (𝑿
Products/Services Awareness

VS S N D VD ̅
Particulars ∑ 𝑿 DR
5 4 3 2 1
1. My company offers high-
f 34 9 0 0 0 43 4.79 HS
quality products/services.

71
 fx 170 36 0 0 0 206

f 28 15 0 0 0 43
2. My company offers effective
4.65 HS
yet affordable products.
fx 140 60 0 0 0 200

f 33 8 1 1 0 43
3. My company offers products
that are good for personal use 4.70 HS
and recommendable. fx 165 32 3 2 0 202

4. My company offers safe and f 37 5 0 0 1 43

4.79 HS
tested products. fx 185 20 0 0 1 206

5. My company offers FDA f 36 6 0 0 1 43

4.77 HS
approved products. fx 180 24 0 0 1 205

̅)
Computation (𝑿
Challenges faced by Multi-Level Marketing Companies’ Agents

EA A MA SA NAA ̅
Particulars ∑ 𝑿 DR
5 4 3 2 1

1. Multi-level marketing f 11 4 11 5 12 43 2.93 MA

(MLM) is often associated
with the word “scam”.
fx 55 16 33 10 12 126

2. Some MLM companies f 6 9 9 5 14 43

have cult-like behaviours
2.72 MA
where they try to brainwash
people. fx 30 36 27 10 14 117

3. MLM is often being

confused with a fraudulent f 5 9 10 6 14 44
business scheme that uses
2.66 MA
the investment of new
agents to distribute returns fx 25 36 30 12 14 117
to existing investors.
4. MLM lies about passive f 8 4 11 4 15 42 2.67 MA

72
income. fx 40 16 33 8 15 112
5. MLM agents prospect f 6 10 8 6 13 43
unsuspecting individuals
that are fooled by a promise 2.77 MA
of extraordinary returns on fx 30 40 24 12 13 119
investment.

6. In MLM, you can earn by f 14 8 8 5 8 43

recruiting new individuals
who will then recruit more 3.35 MA
individuals for them to earn
money. fx 70 32 24 10 8 144

7. MLM companies offer f 8 5 7 9 14 43

products that aren’t worth
2.63 MA
the value of the consumers’
money. fx 40 20 21 18 14 113

8. In MLM, only those f 6 8 8 6 15 43

pioneers (up-lines) in the 2.63 MA
industry earn and succeed. fx 30 32 24 12 15 113

9. Same with some illegal f 6 7 10 4 16 43

schemes, MLM companies
don’t register investments to
2.60 MA
the Securities and
Exchange Commission
(SEC). fx 30 28 30 8 16 112

10. MLM companies f 6 9 7 5 16 43

promise high returns with no
2.63 MA
risk but in reality it’s the
other way around. fx 30 36 21 10 16 113

73
 ̅)
Computation (𝑿
Challenges faced by Multi-Level Marketing Companies’ Agents

EA A MA SA NAA ̅
Particulars ∑ 𝑿 DR
5 4 3 2 1

1. Multi-level marketing f 11 4 11 5 12 43 2.93 MS

(MLM) is often associated
with the word “scam”.
fx 55 16 33 10 12 126

2. Some MLM companies f 6 9 9 5 14 43

have cult-like behaviours
2.72 MS
where they try to brainwash
people. fx 30 36 27 10 14 117

3. MLM is often being

confused with a fraudulent f 5 9 10 6 14 44
business scheme that uses
2.66 MS
the investment of new
agents to distribute returns fx 25 36 30 12 14 117
to existing investors.
4. MLM lies about passive f 8 4 11 4 15 42
2.67 MS
income. fx 40 16 33 8 15 112
5. MLM agents prospect f 6 10 8 6 13 43
unsuspecting individuals
that are fooled by a promise 2.77 MS
of extraordinary returns on fx 30 40 24 12 13 119
investment.

6. In MLM, you can earn by f 14 8 8 5 8 43

recruiting new individuals
who will then recruit more 3.35 MS
individuals for them to earn
money. fx 70 32 24 10 8 144

7. MLM companies offer f 8 5 7 9 14 43

products that aren’t worth
2.63 MS
the value of the consumers’
money. fx 40 20 21 18 14 113

8. In MLM, only those

f 6 8 8 6 15 43 2.63 MS
pioneers (up-lines) in the

74
industry earn and succeed.
fx 30 32 24 12 15 113

9. Same with some illegal f 6 7 10 4 16 43

schemes, MLM companies
don’t register investments to
2.60 MS
the Securities and
Exchange Commission
(SEC). fx 30 28 30 8 16 112

10. MLM companies f 6 9 7 5 16 43

promise high returns with no
2.63 MS
risk but in reality it’s the
other way around. fx 30 36 21 10 16 113

75
APPENDIX D
(Curriculum Vitae)

76