Glossary of Direct Selling Terms

Whether you are a new social influencer, brand ambassador, or a successful business builder, we're sure you've had a time when you heard a direct selling term you didn't know the meaning of or weren't sure if you were using the word correctly.

Here is a comprehensive glossary of industry terms used in the direct selling, multi-level marking (MLM), influencer marketing, and networking marketing industries to help you sound like an expert from day one.

If you found we missed a term, please let us know here!


A prospect is an individual who is fully qualified to fit specific criteria and fits your target market perfectly. Unlike an unqualified and unidentified lead, a prospect is authorized to make buying decisions and is a potential consumer.

Qualified Leads

Qualified leads show an interest in a company's service or product. In other words, they are more likely to buy a product compared to other leads. Companies pay special attention to such leads and work hard to add them to their conversion funnel.


It is the position of distributors in the MLM genealogy tree. The rank is based on the performance and experience of the distributor, starting from leader to upline and then downline members. Distributors increase in rank just like in a traditional sales organization where growing sales and team members' success are rewarded.


In a direct selling business, recruiting is the addition of new members by a distributor to the downline. Recruiting, in some ways, overlaps with prospecting, as more or less the same marketing techniques are applied while adding new members to the downline.

Referral Marketing

In referral marketing, a company encourages the consumers to share their product with their family, friends, and community members to become new customers. It's a word-of-mouth strategy that depends on loyal brand customers and advocates.

Replicated Website

A replicated website is a template that can be reused and customized for many users. MLM companies generally provide replicated websites to each of their distributors to help them grow their business. Typically each distributor has the same personal website, with differences only in name, photo, and contact.

Retail Sale

The meaning of retail is the sale of goods from a business to a consumer for consumption through independent retailers. As far as the strategy is concerned, there's almost no difference between retail and MLM businesses, one relying on independent retailers and the other on MLM consultants or distributors. However, the distributors don't have a shop, unlike retailers.

Single Level Marketing

Unlike the MLM plan, single-level marketing has only one type of compensation plan. It consists of paying commissions to sales associates only on their sales. Direct sellers do not recruit or form downline teams in this type of plan.

Social Selling

Social selling in the MLM industry is a strategy that leverages social media channels to connect with prospects, build relationships and sell products.


In a direct selling MLM business, the definition of a sponsor is any distributor who enrolls new members or sales representatives to her downline. The sponsor then gets a commission on her and her recruits' sales, also known as the override commission.

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