All MLM Companies Suck – Even Yours
No one wants to think they are a member of a vulnerable population preyed on by unscrupulous companies.
Well, I know I don’t want to feel that way! I’m smart about advertising, savvy about the Internet, and feel confident about my place in the world.
I’m not, like, a victim. Or a target. Or a mark for a con artist.
And yet I can tell that I am a member of a vulnerable population by how many multi-level marketing (MLM) companies are swirling around me and my friends.
- Usborne (books)
- Thirty-One (bags)
- doTerra, YoungLiving (essential oils)
- Younique, Limelife (makeup)
- LuLaRoe, Agnes and Dora (clothes)
- Avon (beauty, home)
- Pampered Chef (kitchen)
- Melaleuca (personal, home)
- WildTree (spices)
- Norwex (cleaning supplies)
- HempWorx (CBD oil)
These are JUST the MLMs that have personally impacted my life and the lives of people I know in person. I joined two of them, held parties for two more, and my friends have fallen prey to the rest.
And here’s what I have to say about these companies: they all suck. They are all evil, predatory companies that are exploiting and abusing people for profit.
I have to put this explanation out there so that I won’t feel guilty the next time a friend of mine signs up for their next new “business opportunity”. I’ll have said my piece, and then they can make their own decision.
What Is an MLM?
MLM stands for multi-level marketing, which is also called direct sales and network marketing. It’s a method of sales with two components:
- The participants market to their own friends and contacts through social media and in-person parties and booths.
- The participants also work to recruit and sign up new participants.
MLM companies are also called pyramid schemes because money is funneled from later recruits to earlier recruits.
MLMs sell a product, which keeps them from being illegal and gives them a veneer of legitimacy, but in order to make significant income you have to recruit people underneath you.
What Do MLMs Promise?
You can also spot an MLM by what they offer when they try to talk you into signing up. They make a lot of promises. However, all of their promises are tainted.
The Promise: You can become a business owner.
The Truth: You are not a business owner. At best you are a salesperson for someone else’s company, and at worst you are an exploited customer.
The Promise: You can make money from home, in your spare time, from your phone.
The Truth: While they claim that your schedule and time commitment will be flexible enough to work around your life, MLM participants quickly find that the time commitment spirals out of control. More and more demands and tasks are piled on you as you search for the elusive money.
For example, some MLMs give an income estimate based on “4 hours of work a week”, which is their estimate for how long it takes you to do an in-home party presentation. However, setting up each party requires many more hours of preparation, and then hours of processing afterwards.
Additionally, chasing sales and recruitment leads requires more and more effort as your immediate circle becomes tapped out.
The Promise: You only need to invest a tiny bit of money at the beginning.
The Truth: The limited investment you’re offered is the initial sign-up fee, which might in fact be low. The MLMs that prey on me and my friends typically have a signup for less than $100.
However, your financial commitment doesn’t end with the sign-up fee, and MLMs purposely obscure how much it costs to be a participant.
You will have office and administrative costs, advertising costs, the cost to buy sample and display products, giveaway and incentive item costs, transportation costs, packaging and shipping costs, and a whole list of other small costs that add up.
None of these expenses are mentioned when you sign up. If you balk at paying for these items you are accused of not taking your business seriously.
The Promise: Unlimited Income
The Truth: On top of your spiraling costs, your income is incredibly limited. Right off the bat, your income is limited by how many earlier recruits there are in your company. Chances are, by the time you’ve heard the name of an MLM company, it is too late for you to make money at it.
99% of MLM participants make less than $13 a month in commissions – and that is before you subtract expenses.
After you subtract expenses, those 99% are LOSING money.
The Promise: Join an encouraging “team”
The Truth: MLMs try to sell their positive, uplifting culture. They say you’ll be surrounded by people who want you to succeed, who will protect you from the haters, and who will cheer you on.
If that sounds kind of cult-ish, that’s because it is.
It can feel very good at first to feel like you have your own personal cheering section. However, they are only cheering you on because they want to make money off of you, and they are only cheering you on as long as you also maintain cheerfulness.
This “positivity” culture can lead to absurd situations where participants are not even allowed to ask questions that would help them do their jobs.
When I worked with Usborne Books, participants above me in the pyramid (my “upline”) began pushing a monthly book club package that we could offer to our customers. However, they were pushing this idea without a lot of details about how the cost would work out. Women who said things like, “I don’t understand how I will make money off of this sale. It looks like it will cost me money,” were routinely belittled and even banned from groups.
People who question whether they are being annoying by repeatedly asking their friends for sales are mocked.
People who complain about quality control issues with the product are silenced.
People who express any fatigue or doubt about their success are belittled.
Your “team” is not your team. They are your handlers. Their brand of “positivity” quickly wears off.
The Promise: You will be selling high quality, in demand products.
The Truth: MLMs sell mediocre products at inflated prices. If you are currently caught up in an MLM you may have a hard time hearing that. However, MLMs are infamous for their quality issues on their overpriced items. Some of them are outright dangerous products! Some of them are the exact same products that are available for less under other labels.
The Promise: THIS company is different.
The Truth: No, it’s not. Go ahead. Drop the name of your MLM down in the comments, and let’s talk about how much they suck as much as all the other ones.
I Promise: Yours is just the same as all the other ones!
Time For Part Two
There’s so much to cover about how horrible MLMs are that it’s taking me more than one post. Keep reading at The Deviousness of MLM Companies for more about:
- The big lie that defines the whole business model.
- What I mean by exploitation.
- Who is targeted by MLMs.
In the meantime, let’s start a conversation about this problem. Have you or people you know worked with an MLM? Drop me a comment and let’s talk about it.