This article covers my disdain, dislike and distrust of all multi-level marketing programs and companies. Doesn’t matter if you call it network marketing: it’s the same.
Basically, in a summary:
- it’s overpriced your uplines/toplines
- you can “sell” the products or choose to “sell” the dream (often this is the way people do it
- the products tend to be substandard (to increase profit margins of course, to pay uplines and toplines)
- normally everyone has to pay and get the monthly sales of their own personal consumption “to ensure they too can say that they’re consumers” when in actual fact, it’s to “feed the system”
- it’s shitty because it tends to use hype to motivate you to sell it to your family and friends and you generally lose family and friends because of this, and you get sick and tired of getting rejected and losing family and friends
- in the end, the business doesn’t belong to you ie if the MLM company you’re in closes today, you entire network and compensation is gone. Poof.
And that summarizes why I dislike and distrust MLM companies. They’re not scams at the lower level of recruits, but scams at the topmost level executives because it no longer adds value but takes value by selling dreams to people with pure motives, and doesn’t even belong to you in the end.
And it’s ok, I don’t care if I annoy those who are in MLM, or ruffle some. But…if you’re thinking about joining a MLM, or already part of one, please, lend me your ears for a few minutes and hear me out.
Do allow me to give you some perspectives as being someone on the outside (note: I had participated in Herbalife, Amway, Jeunesse before, so I have some inkling of how it works). Usually when someone is in a group, group dynamics and actions done in the group is seen as normal…though it’s not.
Also, when you’ve paid or have been paying for something, you may not like it that I say that it’s not good. Because you don’t want to feel stupid or believe that you’ve done something stupid.
It’s ok, you can get angry at me.
I’ve done it a few times to others too, but it’s important enough for me to risk this. You have been ripped off and deluded, and I will not call you stupid: you are smart and have good intentions, and this is all part of the journey to success, and sometimes we learn what works and what doesn’t along the way.
I mean, that’s how we all succeed right?
Think about first time we cycle: we had fallen a lot of times before we got it right, right?
This article discusses both sides of the MLM fence, of those who love MLM versus those who hate MLM. Regardless, it’s data points to consider.
You have to hustle and sell aggressively in MLM
Whether you like it or not, you are the hard-selling and pushing salesman that goes from door to door, or the one that stands at the corner of the street. The one that sells your special program to your friends, people…or should I call them prospects?
You likely have to sell something that no one has ever heard of, and you do that because of the possibility and opportunity to get others to do the same as you are…just that if you recruited them, it’d be at your profit.
Every MLM is the same. You will be told that
- you have to speak to all your family and friends
- you have to make cold calls
- you have to talk about it every day
- you have to write about it on your Facebook or social media
- you have to keep calling your prospects
- you have to keep checking on your downlines
- you have to keep taking and boasting on how great the products are
That is the hustle, and inasmuch as I like hustling, in the case of MLM, you’re tainting your personal reputation. It’s really annoying to hear and be pitched again and again about a product that I don’t care about or the business opportunity that will make me X amount of dollars tapping on the relationships and employees I have.
My relationships are important to me, and I am not going to waste or heckle my family, friends and colleagues (well, not anymore at least in terms of MLM). Once you get someone in, the you have to convince them to stay and to convince them to keep consuming the products that are…
Unfairly and purposely overpriced…for the bloody sake of compensation
The way to make money for any MLM company is to:
- cheapen the product in terms of ingredients, production and distribution
- increase the price 5 -8x to pay all the uplines and toplines
Now I don’t mind paying good money for good quality and high value stuff that I care about, but MLM gets you to sell overpriced junk to people you actually care about. And worse, these junk can be unsafe, untested and even dangerous.
But often, the products are just “for show” to be able to legally shy away from being called a ponzi scheme. Products “can” legalize Ponzi schemes by then calling it MLM…because most of the time, it’s got NOTHING to do with the product.
Most of the time, you’re gotten to keep recruiting people into joining the program so that they in turn, can recruit other to do the same. Sounds like a pyramid ponzi scheme yet?
Also, most MLM has a fee to join, and most of them require you to purchase their products, consume or sell them away “to keep your points and membership active”. Look on Amazon and eBay, the number of MLM such as Herbalife, Jeunesse etc products that the people are “flushing” to buy their PV or CV points.
And the problem is that all the MLM products have to be jacked up 5-8x to pay the compensation structure of the program.
If MLM companies build high quality products and not overprice their stuff, they will die really quickly. They don’t pride themselves on getting good things to their customers at a good price: they rely on selling people on the high price so that they can earn…and recruit others who will do the same and get a cut of the profits.
And the endless vicious cycle continues.
What about all the logos and accolades and achievements?
Sadly, such awards and credentials…are bought. Paid with cash.
It’s a common tactic to gain authority fast and easily, by buying credentials to put on their websites and name, and there are so many “buyable awards” out there.
A lot of MLM companies has so many online complaints that they dedicate budgets to have teams clear their online name as well as pay money to award companies and BBB to improve their ratings (yes, you can pay for ratings even with BBB and Stevie Awards that has “approved and endorsed” many unethical companies.)
Unknowingly, cheating your friends and family
Sigh. This is the saddest part of it: the most common ways they get you started in MLM is to recruit your family and friends to build your downlines. I know because I was involved before (to those who got involved by me, I am sorry): I sold my uncles, aunties, siblings, friends.
Some of them bought, and I thought I was an entrepreneur.
Now I know, it’s not because I was a good entrepreneur: they bought because they felt sorry for me, or because they love me. And that’s my bitter feeling towards MLM, which is essentially cheating people whom I actually care for.
It’s actually quite tiring to keep trying to chase for downlines and selling overpriced junk to others, and equally tiring to keep getting rejected…and the perception that you’ve been cheated, and now trying to cheat others to join you.
Ugh and bleh. Yuck.
Think about it man, why would you spend $200 bucks on 30 days of cheap-ass and lousy antioxidants, when you can get a really good one at half the price? Yeah, you can pay premium, but what for? It’s just inflated and worse, crap product. That’s Jeunesse by the way.
You’re not building a real business with MLMs
It’s not rocket science: you don’t own the business nor the products nor the network. You don’t own anything in MLM (other than the products you’re forced to buy).
This is the main thing that people in MLM don’t get, because they either hadn’t seen or experienced any MLM closing down and losing all their hard work.
It’s not the same as affiliate marketing, where you build your own website, you build your own brand and your own clients and following (all of which forms your online business).
In MLM you’re in constant search-brainwash-and-recruit mode, always trying to sucker the next person to be your downline, brainlessly and shamelessly promoting the overpriced products and the business opportunity, and worse, you have to buy the products yourself to keep qualifying or keeping the points, and this is an expensive and silly lesson.
You may be given names like “sponsors”, “distributors” whatever, and may reach titles like “diamond”, “platinum” or “double star” and more names, but they are essentially a show to mask that you’re in MLM.
And it’d make no sense at all.
Think about it.
No matter what, your topline and upline will always be above you, and for you to succeed, you always need people under you. And the person on top always makes more than the person below from a group perspective (they try to differentiate from personal sales, but its still the same generally).
And more often than not, when you finally give up your MLM stuff, you will have lots of extra products that you bought and never used – and this confirms that you were there just for the business opportunity and to recruit others, and not in the products at all.
And that’s not the way to do any forms of business at all.
MLM is not the same as affiliate marketing.
MLM is nothing like affiliate marketing, as in MLM, you own nothing. The business, brand, products – nothing is yours.
Affiliate marketing on the other hand, is the other opposite: you get 100% flexibility to choose whatever products and services you like and want to promote, in any given sector/industry/niche, and if you want to, you can even create and sell your own products and services.
It’s your business. 100%. Your brand, your business, your customers.
MLM limits, blocks and locks you to just their products and their single program. You have no ability or means to provide something that is of the best interest of your customers, and you are only required to sell and say the same overpriced junk and dreams to people.
Affiliate marketing on the other hand means that companies partner with you to sell their products to your customers, and you get to choose who you want to partner with, and who are your customers. It is unlike MLM, where you just keep on brainlessly promote the single company product and business opportunity, usually trying to keep it under wraps until you meet your prospects in person (and where they can’t run).
It’s pretty straightforward to tell if you’re an affiliate marketer or MLM person. If you’re promoting products and services to others – you’re an affiliate marketer. If you’re trying again and again to recruit people into being your downline, you’re in MLM.
Please don’t mix them up, affiliate marketing is legal, ethical and moral way to promote products in return for commission, whereas MLM is unethical way to promote product in exchange for recruitment fees, recruiting others to do the same.
Here are some of the most popular MLM programs:
- Herbalife (under huge pressure by authorities)
- NuSkin (under huge pressure by authorities)
- Pampered Chef
- Mary Kay
- Young Living Essential Oils
- Origami Owl
- Stella and Dot
- Nerium International
- Rodan & Fields
- Karat Bars
- 7 Minute Workout
And there there are the MLMs that have “bitten the dust”, and generally it’s because they were unethical from day 1. It is in fact very common for MLM companies to shut down because of legal issues, which sucks because in the end, the MLMer who had put in effort to build their network…all gets flushed down the drain when the company goes.
That’s why I say that MLM is not a real business.
Recent Multi-level Marketing Schemes Shut Down By Law Enforcement
- Mona Vie
- Wake Up Now
- Fortune High-Tech Marketing (FHTM)
- Global Information Alliance
If you’re involved in MLM, you’re not a bad person.
I’ve been an entrepreneur since 2008, and I’ve come to realize and notice over the years that people who seek opportunities have different reasons and motivations.
Yes, obviously they want to earn more money and MLM “had work for their uplines”, so it seems ok to also participate. After all, so many people is doing, cannot be wrong ya? (herd brain talking).
Unfortunately, there is little to no one to tell you that it’s not good, or to show you a better way. So let me be the one to say it.
If you’re thinking of joining a MLM or already in one, you’re not bad or unethical. Even if you’re a serial MLMer.
I affirm your hunger and desire to make more money, be it for yourself, your family, your reasons (unless you’re out to scam others, which I don’t believe). I am a man, husband, father and CEO: I think of how to help ensure everyone has more than enough to take home every month, so I can relate.
You are a good person, and I respect your motives.
MLM is not sustainable, nor is it ethical to sell overpriced inferior products or to keep pushing/recruiting your family and friends. MLM is not a real business, and there are better solutions out there: Read my #1 recommendation.
I encourage you to take some time out, just an hour or so, to think creatively outside the box and look around, especially if you’ve been in MLM and all you’ve been saying is MLM-stuff to date.
MLM isn’t worth your time and money. More than 95% fail, and only the top 2% “make it” and you have to only sell the MLM products that aren’t good/may not be tested yet overpriced, and are at risk of legal shutdown. It’s based mainly on recruiting others.
It total opposite is affiliate marketing that is offering high quality products to people who are already interested in it.
I would be happy to entertain all comments, questions, and experiences here within my comment thread. I know a lot of you will have some awesome insights to share along with some opinions. I would love to hear them and I promise to get back to you!