Jump up ↑ Lewis, Truman (September 10, 2012). “Medifast Subsidiary Agrees to $3.7 Million Penalty”. ConsumerAffairs.com. http://www.consumeraffairs.com/news04/2012/09/medifast-subsidiary-agrees-to-37-million-penalty.html. Retrieved July 16, 2015.
Once you are ‘in’ you can start making money by selling merchandise or services directly, and will also start making commissions on the sales of those you recruit. So, to succeed, you need not only to dedicate to selling the product or service of the company but should also be ready to sign up and train others to sell these products and services.
I recommend you consult with a professional before ingesting any essential oils. Consult a Medical Doctor, Naturopath, or clinically trained Aromatherapist who knows you and is aware of your medical history, as well as any medications you are on. With this information, the professional can tailor a regimen that works for your body.
And it’s working. In 2015, MLM companies generated $2.55 billion in sales, a 10 percent increase from a decade before, says Linda Herron, the interim president of the Direct Sellers Association of Canada (DSA). These businesses are overwhelmingly female: 83 percent of the direct sellers in Canada are women, something you’ve likely noticed if your Facebook feed looks anything like mine.
LuLaRoe gives these women a way to have it all: a career, new friends, body confidence, extra money, all with enough time left over to be an excellent mother and wife. “Want to earn full-time income for part-time work? Ask me how!” reads a sign that was sent out to new consultants last year. Stidham often promotes the idea of her company being a perfect part-time job for mothers by talking about being a single mother of seven hustling out of her home—even though she was already remarried and her kids grown before LuLaRoe was founded.
Thus, there is reason for the “bad taste” most people have for MLMs. By instinct if not experience or insight, we wince at the thought of what we know will follow in the wake of an MLM. Relationships strained, factions formed, deception, manipulation, greed, loss, a closet full of videotapes, brochures, and useless inventory that “everybody wants.”
In a classic and severe case of crank magnetism, MLMs are notorious for specializing in products of dubious value (supplements, essential oils, laundry balls) and making pseudoscientific, questionable or outright false claims.
There’s another positive that consultants always emphasize: friendship. MLMs often provide a sense of belonging for their consultants; a crucial lifeline for moms sitting at home with only the kids to talk to. “I had come out of a rough situation, a custody battle,” Sophie says. “I was lost. I had no friends, I had no social life. And then instantly I had this giant family of women who I didn’t even know. ‘We love you. What do you need? Let me help you. You’re having trouble with sales? Let me share my customers with you. You can’t make an order this month? Let’s trade shirts so we have new inventory.’ It was a true, true sisterhood.”
“These types of businesses hurt women because they are not informed of the true risks of investment. Their time, relationships and money are not valued, they are used and discarded if they become frustrated or do not meet ‘sales goals.’
MLMs blur the line between ‘contractor’ and ‘customer.’ That’s because participants aren’t just required to sell products – they’re required to recruit other people, presumably in the same general geographic area, who also sell the same products. When you recruit someone, you’ve just created a competitor, which will decrease your own sales. What you gain from recruiting that person (i.e. the cut from his sales) is never enough to offset the loss of your own sales, and thus, your income.
Of course, there’s an even better indicator that these companies might have been unfairly maligned: the women who have actually joined them. Despite the dismal stats, many women say they’re making money and actively contributing to their household’s bottom line — and they don’t feel exploited. Like, at all.
Hassay isn’t wrong. Pyramid schemes require participants to recruit new members who have to pay to play, and they use income from those new members to compensate older recruits. Often, there are no sales of actual product; it’s all about reeling in rookie sellers, often with the promise of amazing sales incentives: cars, trips, six-figure salaries. Incentives play a role in MLM, too — Arbonne consultants can earn a monthly cash bonus towards the lease or purchase of their own white Mercedes-Benz, while Rodan + Fields sends top sellers on trips to pretty amazing destinations, such as Maui or California’s wine country. But sales are key, says Hassay, so while there is recruitment, it’s not the primary focus of the business. In that way, successful “uplines” resemble mini-CEOs, driving strategy while someone else does the hands-on selling.
A few noteworthy points on this list… The only companies considered for this list are U.S.A. based; and if you click on each and every company linked above, what you will not find should be as interesting to you (and as revealing) as what you will find. There are no travel companies, only two technology companies (ACN and 5LINX), just one service company (Legal Shield), and 22 health and wellness companies. Even Amway, whose core product line still includes soap, really got started by way of the wellness revolution! Read this book by Paul Zane Pilzer and you’ll understand why nutrition, weight management, and skincare products continue to drive the trends in the network marketing industry to this day.
**For purposes of comparing Internet search term interest using Google Trends (GT),all 25 companies were compared to the term, MLM. A score of 1.00 would indicate the same level of Internet search interest; anything above 1.00 more interest, anything below 1.00 less interest.
It is a fact that a few large MLMs have survived against the best efforts of law enforcement officials to shut them down, spending millions of dollars to protect, lobby, and insulate themselves. But the same could be said for any organized crime. It is difficult to stop once it becomes so large.
Investigate companies. Choosing the right company is key to your success. Quick and easy internet searches can usually answer many of the questions you may have. Do some research to determine which company is best for you personally. Some questions you should ask yourself when researching companies are:
For example, when a hypothetical 20-something, Priya, buys skincare, makeup and bath products from Arbonne at a discount and sells it at the suggested retail price, she earns a commission of about 15 percent. But Priya can also earn a percentage of commission on whatever Sarah, a friend she recruited to the company, sells. Word-of-mouth is one of the key strategies in direct sales, so both Priya and Sarah are likely reaching out to their friends and families — and, increasingly, online social networks — to both move product and recruit for their respective sales teams.
Fed the fantasy of achieving the all-elusive American dream, many of them are being wooed by multilevel-marketing companies. Known as MLMs (or “direct-sales”), the current US administration is stocked with their cheerleaders: Betsy DeVos, the secretary of education, is married to a cofounder of Amway; Ben Carson is a spokesperson for a vitamin MLM called Mannatech; and president Donald Trump used to have an MLM, Trump Network, and was a spokesperson for another.
Perhaps a better paradigm than the runaway train analogy offered earlier of how MLMs perform over time is this: a helium balloon let loose in an empty room with a spiked ceiling, where product quality is analogous to the amount of helium. The better the product, the faster the balloon will rise, accelerating unhindered, towards disaster. The other option would be the case of a lousy product, in which case the balloon will sink of its own accord, never getting off the ground. To be sure, equilibrium is not in the cards, except perhaps as an accident, and then only temporarily. MLMs are intrinsically unstable. For any company that chooses an MLM approach, it’s pop or drop.
Indeed, one of the biggest complaints we’ve heard about MLMs is that once someone joins one, they see every social interaction as an opportunity to make their sales, or add to their downline. Friendships have ended and relationships have broken up through this.
Network marketing is considered by many to be a form of direct selling (the person-to-person sale of goods or services). It utilizes a few different strategies to generate commission payments, such as recruiting, lead generation and management. Network marketing may be referred to by a variety of names, including “multilevel marketing,” “cellular marketing,” “affiliate marketing,” “consumer direct marketing (CDM),” “referral marketing,” “pyramid selling,” or “home-based business franchising.”
Mary (last name withheld) is a wife and mother who holds a master’s degree in nursing and works from home in Arizona. She bought her first pair of LuLaRoe leggings in 2015 and loved them. But what started as a fun social activity turned into a compulsion, and she found it taking over her life. “I spent more hours than I want to admit ‘hunting’ that pair,” she says. “I spent more than $3,000 in a month. I would lie to my husband about feeling ill so he would take the kids to their afterschool activities so I could be at home to watch pop ups. I would also drive as far away as an hour to attend LLR events.”
Jump up ↑ David Ingram (September 7, 2012). “Medifast unit settles false ad claims for $3.7 million”. Reuters. https://www.reuters.com/article/2012/09/07/us-usa-medifast-settlement-idUSBRE8860X720120907. Retrieved 2012-09-09.
There are more than a few MLM “executives” like this who will pop up tomorrow in the MLM du jour. MLM exploitation can be very profitable and the jail sentences light. Let the MLM “dream” buyer beware.
That self-help-tinged speak is a common thread among MLM companies. Arbonne’s tagline is, “transform your life and the lives of others.” Part of Stella & Dot’s appeal, says Berendson, is that, “the [company’s] name stands for the CEO and Chief Creative Officer’s grandmothers, and the business is all about empowering women and creating a business her way on her own time.” But that enthusiastic brand loyalty might be part of the reason for the persistent negative perception of MLM companies, which have sometimes been described as, “cult-like.” If you’re not in the community, that much enthusiasm can be off-putting.
Jump up ^ Pratt, Michael G.; Rosa, José Antonio (2003). “Transforming work-family conflict into commitment in network marketing organizations”. The Academy of Management Journal. 46 (4): 395–418. doi:10.2307/30040635.
Using this model, LuLaRoe sellers busted out of the traditional confines of heritage, Avon-style MLMs. One of the reasons Avon had so much success in the 1960s was that it was the easiest way for suburban Americans who were an hour away from the closest department store to sample and buy makeup. Convenience won out. Now Facebook can provide their contemporaries with that same easy purchase availability from the comfort of their couches.
Whether they realize it or not, consultant leaders often use time-honored cult tactics of denial and blame to keep women within their sorority. A famous series of experiments from the 1950s conducted by Soloman Asch in England showed that three out of four people will deny evidence right in front of them if the majority says it’s not true. In the study, individuals were placed in groups where they were constantly contradicted by other members. When this happened over a length of time, they would start to agree with the majority—even though it was clear that the opposite was true. In MLMs, “you’re trained to avoid people who question whether this is a viable business or not,” Brooks says. “Which is exactly the same technique that cults use—they try to isolate you from people who question your belief system. I’ve been contacted by a number of people who deal with cult survivors, and some of their clients are former MLM people.”
Jump up ↑ Ohlheiser, Abby (24 September 2014). “FDA warns three companies against marketing their products as Ebola treatments or cures”. Washington Post. https://www.washingtonpost.com/news/to-your-health/wp/2014/09/24/fda-warns-three-companies-against-marketing-their-products-as-ebola-treatments-or-cures/. Retrieved 26 September 2014.
Consult professionals about your business. Remember, you are responsible for everything associated with running a business- taxes, laws, etc. It helps to have an accountant and lawyer on hand to help you manage your business in the most effective way possible.
So is “The Top 25…” just an online popularity contest? Not exactly. To make a fair assessment we gave consideration to things that really don’t matter; for instance, 24 of the 25 companies are members of the DSA. And to things that really do matter; like time in business!
MLMs often teach their participants to recruit their best customers. What kind of normal business turns one of its best assets into a liability? Imagine if the local Starbucks started encouraging all its best customers to open up their own Starbucks, where all the customers would, in turn, be encouraged to open up their own Starbucks. How long before there are too many Starbucks and no paying customers left? Which brings us to point #2…
Honest confession: until we recently we thought MLMs were fairly harmless. In fact, we’ve even unknowingly profiled them on our site (we weren’t aware some businesses were MLMs). While they didn’t particularly appeal to us, we didn’t see the harm in them.
The claim that an MLM is merely a “common man” implementation of a normal real-world distribution channel becomes even more absurd in this case. Imagine buying a product or service in the real world and having to pay overrides and royalties to five or ten unneeded and uninvolved “distributor” layers. Would this be efficient? What value do these layers of “distributors” provide to the consumer? Is this rational? Would such a company exist long in a competitive environment?
With a dizzying cluster of local and state property laws, the modern real estate agent has become an invaluable resource for those looking to find, evaluate and finance real estate. Often acting as a catalyst between the various parties involved, a … Read more
MLM salespeople are not employees of the MLM company. Participants do not derive a salary/wage, nor do participants receive remuneration from the MLM company for their invested labor and expenses in their MLM “independent business”. The income of participants, if any income is made at all, is derived only from commissions on their personal sales or their share of the commissions on the personal sales of their downlines (the MLM compensation structure).
Français: devenir pro du marketing en réseau, Español: tener éxito en las redes de mercadeo, Deutsch: Im Network Marketing erfolgreich werden, Português: Alcançar o Sucesso com Marketing Multinível, Italiano: Avere Successo nel Network Marketing, 中文: 成功进行网络营销, Русский: преуспеть в сетевом маркетинге, Nederlands: Succesvol zijn in netwerkmarketing, Bahasa Indonesia: Sukses Di Pemasaran Jaringan, العربية: النجاح في مجال التسويق الشبكي, Tiếng Việt: Thành công trong việc kinh doanh theo mạng
MLM.com is wholly owned and published by InfoTrax Systems. The opinions expressed by bloggers and forum participants are their own and not the responsibility of InfoTrax Systems, its employees or management team. MLM.com makes every effort to monitor the content of this site but does not warrant or endorse any company, individual or their opinions expressed herein. MLM.com encourages lively conversation and debate but prohibits any disparaging of individuals or institutions, except as appropriate in professional criticism and reportage. Report any abuses you suspect to MLM.com.
LuLaRoe’s messaging is filled with positive language: “I believe in you” is the company’s unofficial tag line, and body-positive imagery floods its website to showcase its large selection of flattering plus-size outfits. “It’s hard to find plus-size clothing that actually looks good—that makes you feel like you look good,” Sophie says. “That’s why there’s such a customer base for LuLaRoe.”