Exponent Trading Company Brings Network Marketing to eBay

July 4, 2007

I was reading Jim Cockrum’s blog last night when I ran across mention of a network marketing approach to helping people get started on eBay. A company named Exponent Trading Company has built a system that is supposed to offer personal mentorship in addition to training material for people wanting to learn how to make money on eBay.

Network Marketing Hype
I listened to a conference call where Jim Cockrum and Skip McGrath talked with some of the leaders of Exponent Trading and came away with mixed feelings.  One thing I’ve never liked about network marketing is the hype that goes along with it.  Everyone is always talking about “the opportunity” instead of the product or service that’s actually being sold and wants to share stories of wildly successful people.  In many cases the product itself is not so great.  It may be different in the case of Exponent Trading since it seems to provide a legitimate service of mentoring people on eBay selling, time will tell.

Costs of a Mentor
I do understand the point Jim makes on the call.  It does take time to mentor someone through getting started on eBay and time is money.  A multi-level marketing approach would make it more worth someone’s while to help someone else get setup and running a successful business.  However, I’m not entirely clear on all the fees required to join and participate and those costs are what I’m wary of. 

A Different Approach?
Another aspect about network marketing I’m not to fond of is the emphasis on selling your product or service to your friends & neighbors.  It does seem from what I’ve heard so far that the Exponent model would be a little different. There are many people interested in learning how to make money on eBay.  I have people asking me how selling on eBay works, they might benefit from the service. 

Instead of pushing expensive lotions or soaps that people don’t want or need as is the case with many network marketing programs, people could be referred to the program after approaching eBay sellers asking for help.  Of course, if they just want to sell their antique collection or clean out their garage would they really want to pay the signup fee and ongoing costs just to sell a few hundred dollars worth of stuff?

Marketplace Effect
One thing I wonder about is the impact the marketing of the Exponent system will have on the eBay marketplace.  If the number of sellers increases dramatically but the number of buyers remains the same the flood of products may be good for consumers but bad for sellers.  As a buyer this sounds good, as a seller it’s not as appealing.

Opposing Views
The fact that Jim Cockrum and Skip McGrath, two well known eBay entrepreneurs, are serving as advisors to the program does carry some weight.  However, there are others, such as Terry Gibbs and Gary Hendrickson who advise against the Exponent Trading Company.

One thing to keep in mind is that Jim and Skip do stand to gain a lot of money from signing others up underneath them so there could potentially be some bias there. You could also argue that Terry might downplay Exponent since potential customers of his information products might go with the Exponent solution instead.  All these guys have proved themselves on eBay and have a good track record of helping others do the same so deciding who to listen to is a tricky thing.

Time Will Tell
I’m sure there will be a lot of discussion on the web about network marketing coming to eBay over the next few weeks, it will be interesting to hear the reaction of people that sign up for Exponent and to learn more about the details of who actually benefits from the program.  I’ll give updates on how it progresses, if you’re interested you can sign up for the updates in your feed reader or your email inbox.  I’m also working on a resource about selling on eBay, if you have any questions I could address in the eBook just let me know and I’ll send you a copy when it’s ready.


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Ben Edwards, the founder of Money Smart Life, saved up enough to buy a Nintendo back when he was 12 years old. When he used the money to buy shares of Wal-Mart stock instead, he knew he wasn't like the other kids... His addiction to personal finance has paid off for his family and now he's helping you to afford the life that you want. Check him out on the web at Google Plus, Twitter and Facebook.

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