The Business Model that is Literally too good to be True
Luxury cars, designer clothes and holidays abroad represent most people’s idea of success. These are the things that are photographed and posted to the Instagram grids of many multi-level marketing (MLM) pioneers. With over 400,000 people in the UK signed up to one scheme or another, MLM corporations are rapidly growing and making more money than ever.
The job of a multi-level marketer is appealing to many; work and earn from anywhere in the world, be your own boss and earn big money. So, why are only 1% of people making any noticeable profit?
These schemes typically represent the Marxist idea that the rich get richer and the poor get poorer. Targeting the most vulnerable people in society is the easiest way to gain recruiters. This is often the case for young women, particularly single mums. Those with disabilities and others who may be unable to work are also seen as targets as it is assumed that
they have low incomes, so they are more easily sold a dream.
MLM businesses have a pyramid-like structure and use direct selling as a tool to sell their product or service. Although the focus for many of these schemes is to recruit new sellers –new sellers are encouraged to buy products in bulk to become more advanced in their job role and get to know the products by testing them out for themselves. Of course, for many, this is a hefty investment. For a single mother living on her own and looking after children, money might be tight. These women are prime targets for recruiters of an MLM. Guilt tricks surrounding the idea that mums should both earn money to support their family and stay at home to look after their children creates an added pressure in a society where women already can’t be everything that is expected of them.
The idea of female empowerment is usually the main persuasion tactic used to encourage women to sign up. Societal pressure that women should look a certain way, be successful in their careers and be the perfect parent is heightened. Women feel these burdens daily,
which means it is easy for recruiters to use this to their advantage.
Those at the top of MLM schemes find the weak points of the most vulnerable. An example might include a family in debt – recruiters can lure in potential people by discussing the prospects of affording Christmas presents. They look out for things that people might
wish for in life. Maybe somebody posts an image of their dream handbag online, a recruiter will tell the individual that signing up to their MLM scheme will allow the person to afford this luxury. Once recruited, the most vulnerable begin to dream about the new lifestyle they will become a part of once they invest hundreds into products. Of course, this is not the case.
Products are not easy to sell – a lack of brand recognition often means that there is very little
interest from consumers. Hard work is put into something that has no benefits, people are in more debt and as a result, mental health deteriorates. The mental pressure on a multi-level marketer is enough to cause difficult struggles that spiral into depression and other mental illnesses. Of course, these people are being set up to fail. They are given the task to sell poor quality products to people who have no interest in buying the items in the first place.
Those at the top know that products do not need to be of a high quality – it is the recruitment process that creates income because new members will place bulk orders whilst their mindsets are positive. They are willing to invest due to the excitement of future prospects within an MLM scheme. When these individuals start to struggle, the recruiters cleverly manipulate them into believing that they aren’t trying hard enough. Workers then become convinced that they have the wrong mindset and therefore work harder; some even give up their jobs with the hope that they can have a lifestyle like those at the top of an MLM scheme.Unfortunately, this can be where things become dark.
Family and friends start acting distant; MLM companies actively encourage workers to view them as their target market. When loved ones then become concerned, it is common for companies to manipulate sellers into believing they are being held back by the negativity of people around them. Workers are exhausted and these brands become their lives. And they’re not making a penny. So why would anyone keep going? They want that dream:
the car, the house, the holidays. They are told that if they keep going then they will get there… but less than 1% do. It becomes a cult-like environment for those in a dark
place. Some realise what is going on but can’t seem to get out. Others become brainwashed and lose everything to these companies: time, money, friends, family.
The large corporations fail to acknowledge any damage that occurs for new recruiters at the bottom of the pyramid-like scheme. In this article, the organisational structure has been discussed based on the relationship of the recruiter and the vulnerable person being recruited. This makes up just two levels, yet the pyramid has multiple chains of command with a long line of fragile people struggling at the bottom. Although the recruiters sound like they are the problem, they are simply victims of those at the top, scrambling to keep going.
MLM companies will keep going until they stop making money. This means that purchasing needs to come to a halt and this must occur at the bottom. Without realising it, the victims are the unethical consumers that enable the companies to grow. They are the ones handing over their money and allowing the lives of others to suffer.
The solution? Stop signing up and stop buying into these schemes. The MLM schemes can only continue to exist if those at the bottom of the foundation remain.
Words: Ashleigh Dooler, Artwork: Natasha Cassidy
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