Direct Marketing Defined – Metcalf’s Law

There is no denying that those who do well in life have networked in some form or another.

Networking does not only apply to what most people consider MLM or multi-level marketing,but also to anyone who establishes contacts for the purpose of expanding and strengthening their business connections. So when one takes an in depth look at all types of businesses, including the financial sector such as banks, everyone networks in some way, even the job hunter who sends hundreds of applications to his or her favorite placement agency.

This then brings us to the topic in question. It is widely recognized that direct marketing is a closely related to network marketing. Or isn’t it the other way around. Let’s be clear on one thing, the term “network marketing” has been greatly abused. It is shunned upon as strictly meaning multi-level marketing, when it is not. Not that there’s anything wrong with multi-level marketing which is in fact, direct marketing.

But isn’t selling from a website direct marketing? Yes it is! Direct marketing (person to person), in whatever form you choose to apply it, whether it be an information product on the net, or as an independent business owner for various manufacturers and distributors that choose this route, is in my opinion the only viable source in today’s economy where anyone can become rich in a relatively short time frame as compared to conventional methods.

There is no argument…that if you want to escape life’s daily ruts which the lack of money imposes on people, there’s no other way! I firmly believe that!

Some universities, at least in my neck of the woods, have given it a new name. They call it “collective entrepreneurship”, based on people joining together in solidarity towards a common goal, which is obviously financial.

Direct marketing, because of the principle and the magic of geometric progression, is an engine of infinite success. Did you all understand this? Let me put it another way.

How many of you know who Robert Metcalf is? Robert Metcalf is one of the people credited for creating the Ethernet. The Ethernet dates back to when people first started using cable to hook computers up to each other in the late 60′s. In 1972 Robert Metcalf and David Boggs at the Xerox Palo Alto Research Center first standardized Ethernet. He more recently founded the technology company, 3ComCorp. But more importantly he is also credited for defining Metcalf’s Law which is:

A Network Economic Value = Number of UsersĀ²

In simple terms, if there exist just one telephone, that single telephone has no economic value. The moment there are two telephones, according to Metcalf’s law, the economic value of the phone network is now squared. The economic value of the network would go from 0 to 2 (squared) or 4. Add a third phone and the economic value of the network is now 9. In other words, the economic value of a network goes up exponentially, not arithmetically.

Direct Marketing, takes the theory of Metcalf’s Law and turns it into an unparalleled business model. Grasp the meaning and the power behind this, and you will understand the power behind Direct Marketing, also known as Viral Marketing.

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