Commentary #99: Thoughts on Multi-Level Marketing (MLMs)

Image Credit: Reddit

Disclaimer: This post contains strong language.

I’ve been wanting to write a post about multi-level marketing for a while. But, I’ve resisted. They are everywhere.

Full disclosure: I’ve been swept up in them for a while. Not selling for any company, but buying from them and “supporting” friends.

Throughout my life, I was buying from MLMs and not really realizing it. This means that I have hosted a party, attended a party, or bought product from a seller or consultant.

  • Mary Kay
  • Avon
  • Thirty-One
  • Stella and Dot
  • The Pampered Chef
  • Pure Romance
  • Arbonne
  • Scentsy
  • Origami Owl
  • Jamberry
  • LuLaRoe
  • Young Living
  • Sseko Designs
  • Rodan + Fields

Along the way, I have been approached by consultants to try samples, buy product, or actually sell Cutco, Advocare, Plexus, Norwex, Jamberry, Young Living, Amway, and Sseko Designs.

Over the last several months, I have been researching MLMs. It all started with John Oliver’s piece – Multilevel Marketing. Al and I watch his pieces on YouTube every week. It’s funny, entertaining, but also well-researched and frighteningly real.

I felt sick after watching his piece on MLMs. I realized, in the span of 30 minutes, how much money I had FUCKING WASTED on shitty products for many, many years. I’m also grateful I resisted “investing” in any of these companies, meaning that I never signed up to sell anything. Sure, I hosted a few parties, but I never joined anyone’s team.

And I’m so glad I didn’t.

You see, many of these MLMs are like cults. You’re swept up into the world of the company, its culture, and their products. And it’s really, really hard to leave.

I’m so glad I didn’t pay money upfront to “start a business.” Sure, I bought a lot of product – Makeup, skincare, bags, nail strips, essential oils, diffusers, jewelry, clothing, and more.

I recently added up how much money in extra product I had in my house from Young Living. This included unopened essential oils, laundry detergent, cleaning products, makeup, skincare, and foaming hand soap. It was roughly $2,000.

I had it all out on my kitchen counter. And I wanted to throw up. $2,000 is a mortgage payment and then some.

All because I believed that paying for overpriced, “chemical-free” essential oil products would help my family be healthier. For more than TWO YEARS. I was buying product every month, to the tune of about $100 per month, sometimes up to $400 per month. I went back to my purchasing history and cried. I wasted so much of my hard-earned money.

Al actually asked me to stop using the YL detergent months ago because it wasn’t cleaning his clothes as well. That was the first light bulb moment for me.

Then, I started closely researching the cost of my products with Rodan + Fields, and LuLaRoe (LLR). There was so much money in my bathroom and my closet. R+F was costing me about $300 every eight weeks. My skincare regimen in their fancy bottles, and their tiny tube of LashBoost. The LashBoost alone was almost $70. Per tube.

After I joined a Facebook group called Sounds like MLM but ok, my eyes were opened even wider. There were WAY MORE MLMs than I ever imagined. This group has a master list that is literally pages long.

That’s how I discovered Sseko Designs was a fucking MLM, for example. At first, I felt hurt, betrayed even. Hardly anyone had attended the party I had thrown on Facebook earlier this year, and now I know why.

And then there are the lawsuits. One of the biggest reasons I wanted to stop buying R+F several months ago was because of the class-action lawsuit I discovered specifically about LashBoost.

Here are some of the details, from the Keller Rohrback Law Offices: Rodan + Fields LashBoost Litigation.

Another glorious thing I discovered was The Dream podcast. If you haven’t listened to it yet, I highly recommend it. You can find it on Stitcher and Apple Podcasts. Jane Marie is a gem, and I can’t wait to see what happens with Season 2.

I could go on for days about MLMs. They are some of the most deceptive “companies” out there.

What bothers me the most, however, is how predatory they are. They advertise, falsely, that you can make so much money so quickly. Yet, in my interactions with consultants trying to get me to join their teams, all the language is shady and vague. Many pitches are copied and pasted from their upline, or the people above them.

In my research, I’ve discovered that roughly 95 percent of people in MLMs don’t make any money. Zero. Zilch. Nada.

Google “income disclosure statement,” and immediately many MLM names come up behind it – Monat, It Works, Arbonne, Young Living, Beachbody.

For example, Monat’s income disclosure statement reads “A typical Participant in the Plan earns between Cdn $22 and $1,188 annualized.”

That’s NOTHING. Fucking nothing. Only $1,188 PER YEAR? And that’s Cdn – Canadian. Currently, 1 Canadian dollar equals 0.76 United States dollar. Quick math – I think that translates to $902.88 USD per year.

That’s not even enough to pay my mortgage for ONE MONTH.

And that $1,188 CDN doesn’t include costs incurred by hosting parties, participating in events, and purchasing products. So, very likely, a Monat partner will never see that $902.88 in a year.

I’ve heard horror stories of people, mostly women, (but men are targeted for MLMs, too) have accumulated THOUSANDS of dollars in debt from purchasing inventory. My Facebook Marketplace is full of people desperate to unload their excess stock of Young Living oils, unsold LuLaRoe clothes and leggings, Scentsy products, and more.

Bottom line: MLMs are designed to prey on vulnerable people – Women and men. And many are stuck in it for years. It’s all very sad, and infuriating.

However, there is some good news. At the beginning of October, AdvoCare and its former CEO agreed to pay $150 million and be banned from multi-level marketing to resolve Federal Trade Commission (FTC) charges that the company operated an illegal pyramid scheme.

My hope is the FTC continues to investigate these predatory companies and take action. Like many industries, however, there are lobbyists and politics involved. I’ve posted a link to the Direct Selling Association (DSA) below in my resources list.

So, what can you do about MLMs?

  • Become aware. Many MLMs follow similar models, and use similar language to get people to buy in.
  • If you know someone involved in an MLM, don’t try to convince them to get out or stop. It’s like being in an abusive relationship – Only the person involved can decide when they want to leave. No one else, sadly, can change their mind.
  • Research. A simple Google search brings up articles from various sources, including The Washington Post, CNN Money, and AARP.
  • If you are approached by someone to invest or buy in, don’t be afraid to ask questions. Be your own advocate. Use words such as MLM, multi-level marketing, direct sales, or pyramid scheme.
  • At craft fairs, farmers markets, and other local events, support your neighbors and their small businesses. I guarantee you it will be a better experience for everyone. The money you spend will help them grow and invest in their products, whether it’s handmade soap, hand-crafted jewelry, doll clothes, or locally-sourced food.
  • If you help organize craft fairs, fundraisers, or farmers markets, work to limit the number of MLMs that are allowed to participate. Some places and organizations have gone so far to ban them entirely. I’m not telling you what to do, but just be mindful of the businesses you want to attract and support.
  • “No” is a complete sentence.

Resources

Until the next headline, Laura Beth 🙂

8 thoughts on “Commentary #99: Thoughts on Multi-Level Marketing (MLMs)

  1. I have no idea what multi-level marketing is, but it doesn’t sound like fun from what you’ve said.
    Whoa, really? That’s a lot of money.

  2. Great advice. I’m sorry you had to go through such an expensive lesson to pass it on to us, though.

    Definitely support hand-crafted jewelry! 😁 (I kid, because I make my own jewelry lol)

  3. I used to buy so many products from Stampin’ Up because my aunt sold it, and I almost became a consultant, but I thought about it. The only true deal were some free/discounted craft products, and I live in a really rural area, how many people would actually host parties? I looked into it, I can buy the same exact products on Amazon for half the price. I stock up on paper and various other supplies when I visit Michaels, AC Moore, or Hobby Lobby because the closest one of each is an hour away, and because I usually buy in bulk, I get major discounts and deal and still pay less than I did for Stampin’ Up. It’s ridiculous how much money I was spending on Stampin’ Up & they hook you because you can buy kits where the stamp colors match the paper, etc… which, yeah , is cool, however; a good eye can do that in a craft store as well. I try to shop local & support local businesses who truly just want to earn a living by offering fresh ingredients and good quality items, not scam anyone or double or triple the cost of what it actually takes to make/grow. (Again, I understand upping the price to make a profit, but there’s a difference in earning a living and ripping people off.) Thank you for sharing this, it’s sad that we live in a world where we have to research EVERYTHING, but I find myself doing so, because I’ve been burned so many times, and not just me personally, I’ve seen other people struggle from cooperation’s (big and small) that they trusted. It’s not only sad, it’s scary!

    • Thank you for sharing your story! I didn’t even realize Stampin’ Up was a company, let alone an MLM, until I joined the Sounds like MLM Group. Now, I see them EVERYWHERE! The hooks they use are so sad. I love that you shop locally. I’m working on that myself, especially since we have so many farmers markets and local businesses! It is very scary. I’m glad you’re aware.

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