Issue Details

THE RISE OF NETWORK MARKETING IN INDIA: OPPORTUNITIES, RISKS, AND CONSUMER PERCEPTIONS

ABSTRACT

The business model known as "network marketing," which was popularized by the corporation Amway in the 1950s in the United States, is gaining traction in India. “It was estimated that the total sales of network marketing companies in India was Rs 301,044 crores in 2005, with an annual growth rate of 25%. This was based on projections made in the year 2005. The India Direct Selling Association (IDSA) has projected that the value of the network marketing business in India would surpass 180,000 crores by the year 2020”. These projections are based on estimations made by the association. According to a number of studies, customers often have an unfavorable opinion of direct selling organizations and, in particular, network marketing organizations. This unfavorable impression has its roots in a variety of questionable business practices, including pushy sales tactics, distortion of facts during recruitment, pyramiding frauds, and unethical behavior when it comes to abusing connections. In the context of network marketing, this study explores the concept of exploiting relationships such as friends, family, and coworkers, as well as the mentality of channel members.

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