What is MLM?
MLM stands for Multi-Level Marketing. If you are involved in an MLM program, hopefully you will let your guard down so I can give you some outside perspective. You don’t usually get a unique perspective if you are involved in a group where everyone thinks and acts the same.
I know you PAY to be a part of an MLM company, so you are going to want to defend yourself if you are a part of it. People can spend TONS of money to buy and promote different products associated with MLM companies. Everyone feels stupid when they realize they’ve been ripped off, and I am not calling anyone stupid if you are or were a part of an MLM. It is part of your journey to success, and we need to find out what doesn’t work before we can find what works.
Here in this post, I am going to make some valid points that I think everyone will appreciate. People that love or think they love MLM, and people who hate MLM’s because of their past experiences. Either way, these are undeniable points and I just ask that everyone hear me out.
With MLM You have to Hustle!
When you join an MLM company, you are a salesperson that tries to sell your “scheme” to other people so that you can get a commission. You are selling health products or insurance programs that no one has heard of yet. If you help others do what you are doing then they become your “downline” and you can make money off of what they sell (the more successful you make your “team” the more successful you will be). However, this requires TONS of work.
With MLM you have to hustle. You are taught to make cold calls, sell to your friends and family, talk about it every day, check up on your “downline,” post things about your products on social media, etc. You have to hustle and work REALLY hard to promote these new products that use the MLM format.
Doing this kind of hustling can damage your reputation. I hate listening to people pitch their MLM product to me, especially if they don’t even really use the product (most don’t or they are forced to, because they just want to make money).
In order to be successful with MLM, you have to hustle and hustle others.
There is also a problem with MLM business models. You have to get other people into the program, and you rarely just try to get actual customers. You convince people to spend WAY too much money on products.
MLM’s Overcharge For Their Products and Services
If MLM companies didn’t overcharge for their products/services, there would be no plausible way to earn real money. You have to automatically sell people overpriced things, and they are usually unsafe, untested, and unproven programs. ALSO, most of the time it has nothing to do with the actual product. You sell people into a scheme just so they can do the same to others. With most MLM’s you have to pay a fee or purchase the overpriced product in order to join.
An MLM would disappear very quickly if they didn’t overcharge for their products, have fees, or rely on recurring product orders (from people like you in the program). The MLM relies on you to sell the same scheme to others so the people who started the business can make more money, and this will continue until people start to wake up and realize what’s really going on!
I’m sorry to say, but it’s a PYRAMID scheme.
A common tactic for MLM’s is to get “credentials” so their products will gain authority. There are many “awards” that you can pay money for out there.
They can pay the BBB (Better Business Bureau) so they can get accredited and improve their ratings. Yes, even totally illegitimate companies can pay for ratings within the BBB. It is the same for the “Stevie Awards,” which is an unethical system for “awarding” status to unethical companies.
There are many companies that have been banished by the FTC for scamming people, and these companies have received awards like this.
Making Money Off Your Friends and Family
Usually people make money with MLM programs by recruiting others to the scheme.
I have been involved in MLM’s, and the only way I could promote it was by reaching out to friends and family. I sold to my parents, grandparents, cousins, and tried to sell to some of my friends because I though I was being an entrepreneur. I think they joined my MLM program just because they felt bad for me, not because they believed in it.
You get tired real quick of promoting the products/services, and selling the scheme to people you know. You get tired of getting “denied” by people. The way you are taught to promote MLM gives people the perception that you are a scammer, which you won’t like.
With MLM You Are NOT Building a REAL Business
You don’t own this business. You don’t own your website if you are provided with one. The only thing you own is the product that you are usually required to buy (for way more than it is actually worth). Most MLM’s tell you that you are building your own business, but you’re not.
With something like Affiliate Marketing you can create your own website, create a brand, and a following (which is a business). With MLM you are “hustling” constantly, trying to add another person to your “downline,” and making your loved ones waste their money. These MLM’s can also get VERY expensive.
MLM’s also give you a “sponsor”, or something similar, to “help” you with your business. These people just want you to be successful so they can make money, you are just another block in the pyramid.
The top of a pyramid will always be supported if there is MORE blocks underneath them. That’s why the CEO of these companies make millions, and the average person that joins the program will NEVER make as much as the people below them. So if they tell you that you can be like them, or make as much money as them, they’re lying!
Then when you decide to quit the MLM madness, you are left with a lot of “extra” product that you never used. This just shows that you were not part of this program because of their products, but because of the opportunity to potentially make a living off of finding others to promote it as well. This is the wrong way to do business, even though with MLM it’s not really a business.
MLM vs Affiliate Marketing
MLM is nothing like Affiliate Marketing. Affiliate Marketing gives you the freedom to promote whatever you want, within any niche. You can even create and sell your own products/services.
With MLM you can only promote ONE program. You do not have people’s best interest in mind, because you sell them an overpriced and usually unproven product.
Affiliate marketing is when you promote products to customers. You do not just promote an “opportunity” with products hidden in the background. If you promote real products to others, then you are an affiliate marketer, but if you recruit people into your program to be in your downline, you are involved in MLM.
Don’t confuse MLM with affiliate marketing, because one is an ethical way to promote products to get a commission (affiliate marketing) and the other is an unethical way to promote products where you get “recruitment” fees for getting people involved (MLM).
Some MLM’s Are Still Thriving Today, and Some Aren’t
There are many MLM’s still out there, actually thousands of them. There is a reason for this and why they are so popular. SOME people make money with them (mostly the company and a very small handful of people).
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
- Kyani (read review here)
- Young Living Essential Oils (read review here)
- Origami Owl
- Rodan & Fields (read review here)
- 7 Minute Workout
Then there are the MLM’s that have been banned because they were unethical from the very beginning. Beacuse of legal issues these MLM’s have departed, and this is all too common. It sucks if you are a marketer for them because when a company goes down, so does your entire business.
Here are some MLM schemes that were shut down by law enforcement:
- Vemma (read review here)
- Mona Vie
- Wake Up Now
- Fortune High-Tech Marketing (FHTM)
- Global Information Alliance
People that are looking for an opportunity to make money have different reasons for doing so. Money is a MAJOR factor, and that’s why people want to promote MLM’s most of the time. If everyone is doing it, then it must be legit. However, there is no one there to tell you to do your research on the company.
If you are involved in an MLM, you’re not a bad person, and if you have been involved in many, you’re still not a bad person. In life, most of us are defined by what we achieve and the amount of “stuff” we have. This is why why many of us have that intrinsic motivation to make money, make it fast, and make it just like the people at the top of these pyramids that are so successful (which is how they get you, by showing their stories and knowing not everyone will make as much as them).
You are a good person, and there are opportunities out there that take you farther than any MLM ever could (affiliate marketing being one of them). I want to encourage all of you to think outside the box, and think of other ways you could be successful in creating a business. Don’t get wrapped up in MLM’s. I have never been happier than I am now with the program I am a part of!
There comes a time when the “hustle” is not worth it anymore, and you realize that 95% of people fail with multi-level marketing schemes. It is tiresome to constantly have to recruit others. Instead, promote a quality product that you are passionate about selling (which you can do with affiliate marketing).
If you have any questions or have had experience with MLM’s, please leave a comment below. I would be happy to hear them!