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Multi-level Marketing

Discussion in 'General Discussions' started by snowy, Apr 23, 2015.

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  1. snowy

    snowy so kawaii Staff Member

    Is MLM a business opportunity or a pyramid scheme? Is there any clear cut answer to that question?

    I do not have the answer to the question, but I'm curious to see what other people think, and I do know that we have someone who does MLM on the boards.

    Personally, it's not for me. I get invited at least once a week on Facebook to a "party" of some kind: 3-D mascara, Jamberry nail wraps (I'll do my own nails, thanks), jewelry, household goods, kitchen crap, etc. The latest was essential oils. A cousin sells jewelry, and it's my understanding that she gets most of her business from 1) church and 2) other people who MLM, because they feel they have to "support" each other. I'm sure there are some great products available through MLM channels; on the other hand, I can't help but feel that it's almost cult-like in the way it tries to get people to buy into what's being sold.

    Have you ever purchased anything through direct sales or multi-level marketing? I've purchased Mary Kay in the past, but experience has taught me that the drugstore sells similar products for half the price. I've also purchased sex toys, but the coupons for Adam&Eve can't be beat.
     
    snowy, Apr 23, 2015
    #1
  2. Baraka_Guru

    Baraka_Guru Möderätor Staff Member

    Location:
    Toronto
    I hate, hate, HATE this.

    MLM is both a business opportunity and a pyramid scheme.

    I'm currently trying to finish up some work. I just wanted to put in my brief two cents.

    I'll be back for more discussion later.
     
    Baraka_Guru, Apr 23, 2015
    #2
  3. Fremen

    Fremen Allright, who stole my mustache?

    Location:
    E. Texas
    My sister works in a hospital, pretty good position, decent pay. Enough to feed, clothe and entertain 3 growing kids.
    Along with my bil's two jobs, they pay the bills, but it's not enough to take the camping vacations they like, or the dinners out.
    So about 5 years ago, she started doing various MLM schemes. (and I do believe they're schemes)
    She usually didn't make much from them. It was usually her sponsor (or whatever you called them) who made the most.
    She'd supposedly get great discounts on her jewelry, personal protection/personal pleasure devices (I swear, it was either a stun gun, or a dildo) or whatever else she was hawking. Just a bunch of hooey if you ask me.

    Tupperware was the same way with my mom back in the 80's. Great discount on their products, not much cash in the register.
     
    Fremen, Apr 23, 2015
    #3
  4. spindles

    spindles Very Tilted

    Location:
    Sydney, Australia
    I have a clear recollection of my brother getting sucked into Amway many years ago and trying to enthuse me about it. He was convinced the products were great and that everyone would want to be involved.

    What actually happened is that his friends started to avoid him and his evangelical ways and he quickly came to realise that you make money by getting minions underneath you who have minions underneath them. It was all too hard. I guess if you get into one of these things early enough to be at the top of the tree, you'd probably rake in a fair bit of cash, but it takes a lot of sweat for anyone *not* near the top to make any money.

    Further, the products weren't actually that great - at least not enough to justify the markup over stuff you could get in the supermarket.
     
    spindles, Apr 24, 2015
    #4
  5. redravin

    redravin Cynical Optimist Donor

    Location:
    North
    Avon is the only one that had decent products and seemed to treat their people pretty well.
    Don't know if that's changed.
     
    redravin, Apr 24, 2015
    #5
  6. Plan9

    Plan9 Rock 'n Roll

    Location:
    Earth
    Yeah, my Admiral Akbar sense tingles when people like this are near.

    One of my woman's best friends sells fancy-ass nutrition supplements for a major brand. She's a female body builder / figure competitor (I don't know much about that arena) and has basically been consumed by this MLM scheme: she promotes it online, goes to conferences, has parties (local sales to friends), has basically turned into a Scientologist. It gets annoying because she has basically brainwashed herself into injecting these products into everyday conversation with my woman. "Ugh, today was stressful and I've got a thumping headache." "I'm sorry to hear that; maybe you could try these new Whamco brand Stress Less caps? The 2-week trial bottle is free." Nobody talks like that. Except she does and has to really work to shut it off.

    I get the feeling that most of the MLM stuff is aimed at women's weaknesses: make-up, jewelry, supplements, etc.

    I'm also a little disturbed that most of my woman's friends have been sucked into sales at one point or another.

    It's just as bad as the preachy Born Again Christian (TM) crap you see on Faceyspace. Except they sell shit.
     
    Last edited: Apr 24, 2015
    Plan9, Apr 24, 2015
    #6
  7. snowy

    snowy so kawaii Staff Member

    I'm a natural target for them, I guess. I imagine they see dollar signs when they look at my situation (DINK).

    I still don't want 3-D mascara.
     
    snowy, Apr 24, 2015
    #7
    • Informative Informative x 1
  8. Chris Noyb

    Chris Noyb Get in, buckle up, hang on, & be quiet.

    Location:
    Large City, TX
    The only people who really benefit from MLM are the ones start them and are able to recruit sales people who are then able recruit sales people, etc. My position is pretty simple--Why would I buy a product that has to go through so many people with a price mark-up at each level?

    Many years ago my wife & I were approached about joining a company that essentially was Amway Online (I think I know the name, but I'm hesitant to post it in case I'm wrong). Which Amway denied because of the negative publicity that Amway was receiving at the time. Which was stupid because many of the products offered by the We-Are-NOT-Amway online store were labelled......Amway. Basically the small percentage to be paid for sales would have been based more on how many people we could recruit to recruit others, not by how much product was purchased by the people we directly signed up. It was a pyramid scheme.
     
    Last edited: Apr 24, 2015
    Chris Noyb, Apr 24, 2015
    #8
  9. Stan

    Stan Resident Dumbass

    Location:
    Colorado
    My rules of thumb are that I never, ever donate money or buy anything from someone soliciting on the phone and I never go to parties where anything is being sold.

    I shop for products and refuse to be sold anything. I'll walk away from something that I want or need if the sales pitch is aggressive.
     
    Stan, Apr 24, 2015
    #9
    • Like Like x 3
  10. snowy

    snowy so kawaii Staff Member

    Ugh, and another friend from college has started selling nail wraps. Yaaaay. That's one more Facebook group to leave.
     
    snowy, May 12, 2015
    #10
  11. Street Pattern

    Street Pattern Very Tilted

    Location:
    The American Midwest
    MLM = pyramid scheme
     
    Street Pattern, May 12, 2015
    #11
  12. cynthetiq

    cynthetiq Administrator Staff Member Donor

    Location:
    New York City
    2 cents in your briefs... damn son, you're hardcore, 50 cent got nothin' on your 2 cent P. I. M. P.

    I've done 2 stints with Amway. Each time wasn't for access to product but for access to people on how to effectively network and build businesses. The tuition for learning this stuff meant going to rallies and events, weekly locally and monthly regionally, and quarterly/yearly nationally. Weekly events were held in a home or when that became too small in a hotel. Monthly events were either in a large public hall, school, or church. The monthly and quarterly events were large money generation machines. This fascinated me more than anything and that's where I understood the majority of the money being generated was earned. I didn't want to earn money that way because I felt it was duplicitous to how the MLM payouts worked.

    I already knew lots about business, I didn't know how to network well or even effectively but the group did teach me how to connect with people. The girlfriend I had at the second stint, went on to start her own company that makes a good amount of money doing IT service. She still does some MLM on the side, I think recently Pampered Chef.

    I'd do MLM again in a heartbeat so long as the cost of entry is low. I'd do it again because the network opportunity is bigger today than it was prior and I'd be interested to see if the new methods of communication have caused the MLM model to adjust.
     
    cynthetiq, May 12, 2015
    #12
  13. Chris Noyb

    Chris Noyb Get in, buckle up, hang on, & be quiet.

    Location:
    Large City, TX


    No doubt MLM can be a learning experience. But it's learning experience that most people would rather avoid.
     
    Chris Noyb, May 12, 2015
    #13
  14. cynthetiq

    cynthetiq Administrator Staff Member Donor

    Location:
    New York City
    Most adults don't want to learn anymore past high school or college. Only professionals that require CEU every couple of years or IT people continue to learn.
     
    cynthetiq, May 12, 2015
    #14
  15. snowy

    snowy so kawaii Staff Member

    Gotta call BS on that one. Most engineers I know in industry are still dedicated learners. If you work in an industry that requires and relies on innovation, continuing to learn is essential.
     
    snowy, May 12, 2015
    #15
  16. Chris Noyb

    Chris Noyb Get in, buckle up, hang on, & be quiet.

    Location:
    Large City, TX
    And how, exactly, does that apply to people wanting to avoid MLM? I give folks credit for seeing MLM for what it is, a pyramid scheme, and avoiding it.

    Think of the MLM companies that aren't what they once were: Tupperware (BTW, I like many of their products), Amway, Advocare, and eventually Pampered Chef will fade. These are just the ones that jumped to mind.
     
    Chris Noyb, May 12, 2015
    #16
  17. snowy

    snowy so kawaii Staff Member

    I miss my Tupperware soup cup.
     
    snowy, May 12, 2015
    #17
  18. Chris Noyb

    Chris Noyb Get in, buckle up, hang on, & be quiet.

    Location:
    Large City, TX

    One very good thing about hitting thrift stores, resale shops, garage sales, flea markets, etc. is we find older Tupperware items that work just fine and have been NLA for years.

    I have no problem occasionally buying products that are only available through MLM reps, but the product has to be exceptionally good and not readily available by normal shopping means (and in the internet age, how often is that the case?). That doesn't mean I want to be a MLM sales rep.
     
    Chris Noyb, May 12, 2015
    #18
  19. cynthetiq

    cynthetiq Administrator Staff Member Donor

    Location:
    New York City
    Sure you can avoid such things, but for some reasons the top performing MLM companies are still thriving and succeeding. They survive DOJ and IRS probes. Why? The top 10 produce revenue as much as $11.3 billion.
    2013 top 10 MLM revenue


    Rank Company Annual Sales (net) Country Category Sales Associates Markets Year Founded
    1 Avon Products, Inc.

    AVON | Shop Avon Beauty Products

    AVP—NYSE $11.3 billion USA Beauty, fashion jewelry, apparel 6.5 million 100 1886
    2 Amway


    Amway Official Site: Start Your Own Business Today | Amway

    $10.9 billion USA Cosmetics, personal care, food and beverage, home care, wellness 3 million 80 1959
    3 Herbalife Ltd.


    Herbalife - United States - Official Site


    HLF—NYSE $3.5 billion USA Cosmetics and personal care 2.7 million 79 1980
    4 Natura Cosmeticos SA

    http://www.natura.net

    NATU3.SA—São Paolo $3.0 billion Brazil Cosmetics and personal care 1.4 million 7 1969
    5 Vorwerk & Co. KG

    Vorwerk $3.0 billion Germany Cosmetics, household appliances, home care 600,000 76 1883
    6 Mary Kay Inc.




    Mary Kay | Official Site



    $2.9 billion USA Cosmetics and personal care 2.4 million 35 1963
    7 Tupperware Brands Corp.

    Tupperware

    TUP—NYSE $2.6 billion USA Storage and serving products; beauty, personal care 2.6 million 100 1946
    8 Oriflame Cosmetics SA

    Oriflame Sweden

    ORI-SDB.ST—Stockholm
    $2.1 billion Luxembourg Beauty 3.6 million 67 1967
    9 Nu Skin Enterprises, Inc.

    www.nuskin.com

    NUS—NYSE

    $1.7 billion USA Cosmetics and personal care 855,000 52 1984
    10 Belcorp

    www.belcorp.biz
    $1.6 billion

    Peru

    Cosmetics and personal care

    938,000

    16

    1968

    Forbes article states this well:
    Would You Join A Multi-Level Marketing Company For Retirement Income?
    "Daria M. Brezinski Ph.D, a practicing psychologist and former marketing director for a multi-level marketing magazine, echoes these sentiments. “Many people don’t realize that multi-level marketing companies are successful because they help people satisfy a number of important human needs, including feeling significant, having connections, learning something new, and making a difference. I have heard people in network marketing say again and again, ‘I’m doing this because I’m meeting amazing people … making so many connections … and I feel so good about myself.’”

    Dr. Brezinski’s point is well taken and easy to see practiced by popular network marketing companies. Many MLM and NM companies tout a three-to-five year plan to attain freedom and wealth, yet many of the people running company meetings have been in the business for five or ten years and still haven’t left their full-time job or landed on easy street. “As it turns out,” Dr. Brezinski notes, “when other human needs are being met, the members and consultants don’t focus solely on the financial aspects.”

    Continuing my interviews, I challenged three others who are in the business to be straightforward, and prove to me that the process really works. What I found was good, consistent business advice applicable to any new business."
    --- merged: May 12, 2015 at 2:50 PM ---
    That's my point of stating the IT groups, to stay current or into new knowledge or techniques it's in the best interest of the individual to stay marketable. That's not very many people within the job market. It is heavy in the 20s, less in the 30s, and gets less in the 40s and I'm still looking for people in their 50s.

    Like I stated most are CEU based because it's mandated, many won't bother if it wasn't. I'd like to believe that many if not most people will continue to learn but that's not true nor is there evidence to back up the ideas that they do.
     
    Last edited by a moderator: May 19, 2015
    cynthetiq, May 12, 2015
    #19
  20. redravin

    redravin Cynical Optimist Donor

    Location:
    North
    Teachers too, in terms of having to learn new things every year, though granted some of them it's kicking and screaming the entire way.

    My brother was big into Amway for a lot of years and it never did him any good.
    It might be because he's an incredibly intense kind of punk rock guy who is 6'5" and tends to lean in but who knows.
    His wife got him out of it and I think it's been for the better.
    He's been doing a lot better not chasing that particular brand of dream.
     
    redravin, May 12, 2015
    #20
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