Your network marketing experiences...or...attack of the pod people

In My Humble Opinion
1

UGH. One of my dearest, oldest, and closest friends has begun selling a network marketing product. She uses and loves it, and is kind of hard up cash-wise, so good for her for doing something to try to make herself more independent and successful financially.

However, I had to endure a training phone call from her (and her supervisor) the other day. I thought it was going to be her practicing her sales pitch and extoling the virtues of the product; instead it was more a JOIN US Attack-of-the-Pod-People kind of call, with the supervisor doing nearly all the talking. sigh

Now, I’m sure there are people who’ve made oodles of cash selling Avon/Mary Kay/Body Wise/Cookie Lee/Arbonne/Pampered Chef/Tupperware/Amway, but seriously…the stats the supervisor fed me seemed a bit, erm, inflated. First is the schpiel about why their company is superior to other companies that rely on network marketing, how studies have shown (well, she only quoted a study) that network marketing is The Thing of the future, and that their particular field is The Area of the future. Then she goes into the how much cash one can make selling this stuff. I could quit work and take care of my baby at home, she says. It gets eye-rolling here…lines like, “National vice presidents make upwards of $31,000 a month–would you be like to be making that much?” :rolleyes: No, no thanks, I’ll keep my teacher’s salary.

Anyway, I’ve seen several of my friends dive into several of these company lines, and none of them a) made $31k a month (ha ha :rolleyes: ) or b) made enough to pay their bills. Several of my friends wound up out the good chunk of cash they had to shell out to buy all the products (and sales kits) they needed to get started.

So I’m here in IMHO asking y’all if you have experiences (or insights) into this whole network marketing world. I’m more interested in your stories than anything else, although research into how these companies work is of interest to me, too. It all seems like a cleaned-up pyramid scheme to me. Sure, some of the products (or maybe all the products) are good quality and worth buying, but this Attack of the Pod People/Join Us overtone is kinda creepy. They can’t all be like this, right?

2

I’ll share my strangest Amway experience. I was partying with these two Goth guys. (this was the mid 90’s - their clothes were the from the ‘Trenchcoat Mafia’ line that those Columbine kids made very unpopular.) We were getting pretty seriously drunk and wasted, to the point of practing karate chops on their apartment’s door trim. Then one of them starts talking about his new job… you guessed it, Amway. He was trying to sing me up! I was wasted, but not that wasted!

I have heard that people can make money in these things, but you have to work your ass off. Quite frankly, if you have the drive, you can buy your own inventory and sell it and grow your business that way. I don’t know if you can get product as cheaply, but you wouldn’t owe anybody a cut. (Well, except the government.)

It is kind of a pyramid scheme. I think most new converts probably are concentrating on signing up new converts than moving the merchandise.

3

AUGH…my friend just called me and let me know she had shipped my sample. But it’s not just a sample–it’s the whole friggin’ starter kit used for sales. I’m not really clear on what it is, except that I need to send it back to her. A few times I repeated the question, “But I thought I was just getting a sample of the anti-aging cream…” She said something about it being cleaned with alcohol, but I’m lost as to what it is. I thought it was a video or brochure thingy they were sending to sell me on the company–UGH. Now I have to return it.

This multi-level marketing thing is just creepy. It’s like that MCI Friends and Family crap–you make the mistake of signing up, then pissing off all of your friends and family because they keep getting pressured to sign up.

4

Those I know also know this: I’m not interested. At all. They know not to sour the friendship by pressing the issue. I don’t try to talk them out of doing what they do, because it’s like religion to them. They can see no wrong or fault with the logic.

Like the old sign in pubs says about politics and religion – its a topic to skirt right around.

5

Selling something to a friend that they want or need is always OK.

Using deception or manipulating people’s natural inclination to accommodate their friends is never OK.

These schemes do just that. You need to shut these people down before they get started, and shut them down firmly. The friendship can be damned… they’ve already told you how much the friendship is worth to them. Never, ever, just go to the dinner… just accept a sample… just come to the party… Tell them to cram it up their arse and come back if and when they come to their senses.

6

Have you considered becoming and indie film director?

7

We knew one person who got into an MLM and that was enough. A couple of anedotes from our experience knowing her:

– She offered to help us move. She offered about a month before the move was to take place. Then, the morning of the move, she called and said that she had to attend a “motivational meeting” of her MLM company that day, and couldn’t help us. They had called her the night before and told her. Attendance was mandatory, apparently. So, like a good little pod person, she went. I was kind of surprised and disappointed that a commitment that had been made a month before could be blown off just like that in favour of an MLM’s “motivational meeting.”

– After she had unsuccessfully nagged her friends about joining this “wonderful business opportunity,” she needed some more leads. You know those “drop your business card in the fishbowl or our monthly free lunch draw” deals at restaurants? She’d grab a handful of cards when the host/hostess wasn’t looking and cold-call the people.

– She use one wedding she was invited to as a guest to make her pitch to the other guests. 'Nuff said about that one.

However, I’m pleased to report that she got out of it. (“Escaped it” may be a better term.) She finally saw the futility of it all after she had spent a pile of money on starter kits and promotional materials without making a dime, had missed a number of social engagements because nobody wanted to be pitched to during weddings and so on, and was starting to lose the few friends she had left. Ask her now about her experience, and she’ll speak about it, but she sounds (perhaps not so strangely) like a deprogrammed former religious cultist.

8

I have failed to talk a dear friend of mine out of committing herself to a MLM telecom business. They sell VOIP (voice over internet) phone and other phone services and they’re all getting in on the ground floor to become multigazillionaires just like the co-founders who are as rich as NBA lottery picks, supposedly. They have to go to “motivational” (ie sales) meetings all the time, and even attend out of town “conventions” (other sales meetings) at their own expense, which she wanted me to come to as a vacation. No thanks. She’s been in it for 2 years and still needs help paying her own rent.

9

I’m curious if there are any positive stories or experiences with any of these MLMs. People make money doing this–I’m wondering who and how. It seems only successful in annoying friends.

10

This link is to a video Dateline NBC did about the king of the MLM’s, Quixtar, back in 2004. I found it quite informative.

11

Pod person here checking in. My husband and I joined our second MLM company in 95. We worked it full-time for about 2 years. We traveled a lot, spent a lot of time sending things out and talking on the phone. We purposely didn’t prospect any of our family and friends. We would tell them about what we were doing when asked, but never brought it up on our own. We never asked them to listen to tapes or attend a meeting or meet our upline. We wanted to keep friendships separate from the business.

When we reached a fairly high level in the company, we knew we had to make a choice. We could continue working it and make a ridculous amount of money. But we knew from meeting the other people in our company who made ridiculous amounts of money that something strange happened to them along the way. They were so involved they couldn’t talk about anything else. Their entire lives revolved around training meetings and conventions and building their downlines. We did know several that made quite a bit more than 30K a month.

My husband and I really didn’t want to turn into pod people, we just wanted a nice stream of residual income so we could do what we wanted to for the rest of our lives. The way the compensation plan is set up, we have been able to “retire.” We haven’t attended any meetings, talked to any prospects, haven’t done a thing for almost 10 years now. In order for us to remain “active” and get weekly commission checks we have to order $150 of products each month, but that isn’t a problem. We really do love and use the products and we give our families products as they use them also. Our income has remained constant, and we make a enough to not have to work at anything else. My husband plays golf every day weather permits, and I am now involved in raising money for equine and horseracing related charities. We both spend our days doing what we want to do. MLM has enabled us to do that, so I can’t think badly of the entire industry.

I think there are more bad companies than good ones out there. But there are some good companies and if approached right it can be a good way to make money.

And in a strange twist, when our friends saw that we were able to completely stop working, and pay-off our home, and have money for investments (if the company should go under for some reason, we are now at a point the investment income will cover us so we don’t have to worry about that anymore) and long vacations, several of them were mad at us for not talking them into joining when we joined. We purposely didn’t want friendships to end because we bothered them with the MLM stuff. Instead a couple of friendships ended because we didn’t do that. They were convinced if they had gotten in when we did, all the money would have floated up to them too. They felt we were selfish by not “sharing” what we were doing. I don’ t think they ever realized how hard we worked those first two years. We didn’t get in on the bottom level of a new company, money didn’t just float up to us. We can only laugh at that, figuring they weren’t that good of friends anyway to be mad at us for not hassling them to sign up.

And because we never talk about MLM, many new acquaintances think we must be doing something illegal since neither of us have jobs or talk about where our money comes from. The biggest draw-back I have found in making money through MLM is that when you meet someone new and they ask what you do for a living. When I used to say MLM or network marketing, people would excuse themselves very quickly, afraid I would prospect them. After a while I learned to say “direct sales” so people wouldn’t want to run from me.

For us, they key was finding a company that had superior, consumable products. We never tried to talk our family and friends into the business side, but we have talked to them about using the products if we really felt they would benefit. We do have many friends who buy the products, but not from us. We tell them to just order directly from the company, still not wanting to make money off of our friends, but wanting them to have the health benefits the products offer.

So back to your question of whether all MLM companies have creepy pod people. From my experience, yes, they all do. But you don’t have to become one of them to be able to make a good income. I am quite sure my husband and I are the exception to the rule, but it is possible.

And I would have to say our experience was a positive one. We first got involved because we both like the idea of “owning” our lives. We chose who we worked with, where we would go. We have met wonderful people all around the country. I am 41 and my husband is 55. And this is not something I would expect sympathy for, but the only draw back now is that none of our friends our age are retired yet, so we don’t know many people who can take the time off to travel with us. So we find a destination that has a golf course and a racetrack and make new friends on our trips.

For us, MLM was a way for us to achieve the lifestyle we wanted. And using what I learned from MLM, I now have many skills that help me with my fund-raising for charities. Fund raising is all about networking, and “no” doesn’t phase me, I just move on to the next person. I feel so fortunate that I am now at a plalce in life I can help others. I really don’t see another way I could be in the position I am in now if it weren’t for MLM.

12

I figured there had to be some success stories out there. And really it has to depend on the company, yes? Mary Kay and Avon have been around forever and seem to be pretty successful…some of the newer companies are more of a question mark.

I watched the Quixtar video–wow. It seems a bit more extreme than several other MLMs though; I’d be curious how some of the lower-key ones operate.

Grits and Hard Toast–initially, was your profit contingent on signing up new people to the MLM, or a commission of what you sold? How is it you only need to buy $150 worth of product per month now to keep afloat financially–where does your income come from if not a percentage of products sold?

13

From the people below her in the pyramid.

14

I was involved with Amway for a year or so, this was probably 10-12 years ago. I personally didn’t make any money at all. If you read the small print in the materials you see that the average rep makes about $250 per year. This is of course not counting the meetings, tapes, books and such that they want you to buy. I did personally know a number of people that made good money. One was at around a $50k income the other 2 were more like $200k plus.

One big thing to keep in mind, the products and commissions come from the company. The other stuff, (meetings, books,tapes etc) come from the sales rep organizations. The company itself is usually not the problem, it’s the sales organizations that give it such a bad name.

I dropped out of it partially because I wasn’t getting anywhere, but mostly because the sales group that I was in made it increasingly obvious that they were VERY anti-gay.

15

That’s more or less what I figure. I was kind of hoping there was some other way (perhaps it isn’t just a pyramid thing), so I asked…but unless she returns and states otherwise, I assume it is just a pyramid thing.

16

With most of the setups, you earn residual income based on the performance of your downline. However, to maintain your status as a distributor you must generate a certain amount of sales volume yourself.

As I recall, it’s part of the federal law that keeps it from being an illegal pyramid. It’s been a number of years though and I may be remembering that part incorrectly.

17

There are many many types of compensation plans in MLM. Some are set up in a way that makes it next to impossible for someone new starting out to make any money.

The first company we were with had a plan that you got commissions from the people you personally signed up when they bought products. They paid down three levels that way. You had to sign up a lot of people to replace the people who dropped out. The company then changed it, and you were mostly paid on your own personal sales. We left when they made that change, since it resulted in a huge commission check decrease for us because of the way we had built our downline.

The next company was structured differently. Over the first two years we signed up about 30 people. These were people we had met through our first company, or at other MLM meetings who were already involved with another company but not happy with the company they were with. They switched when we showed them what our new company had to offer.

We had an unusually high success rate. Since we only signed up people who already had MLM experience and knew what they were getting into, we had very few drop out. They understood it would be hard work and they were willing to do it. They also tended to sign-up experienced network marketers, so their downlines were strong. We would travel to new areas and mostly teach people why our products were better than others. We all used the products and believed them to be the best out there.

Out of our original 30 people, 5 are now making more money than we are. About 5 are still working it part-time and have a very nice second income. Some have told us their MLM income is now covering their kid’s college. When college is paid for, they will use the MLM income and their pensions and retire from their other jobs. They still enjoy the meetings and the company is a big part of their social lives. The other 20 have moved on to other companies. I would be surprised if any of them left MLM altogether.

The compensation plan is set up in a way that we get commissions down to a certain dollar amount in each leg of our downline. We got to a point that 90% of the people could stop buying products and our commission check would not be affected. That was when we felt safe to stop building, confident that we would keep 10% of the people who bought products. And so far we have been right. In fact now I think 99.9% of the people who are in our direct line could stop buying products and we would still not even notice. The company continues to add new products as science advances, and is expanding all around the world. A guy in our downline in Australia is making over $800,000 a year. I couldn’t guess how many levels below us he is, but the fact that he and others like him around the world are joining and doing so well means our income is safe. Other companies are not structured that way and we would not be paid down that far.

There is still the risk that the company could change the compensation plan, like our first company did. That is why we took any extra money and paid off our house and invested the rest so if we lost the MLM income, we would still have money coming in from the investments and wouldn’t have to build another MLM business.

We don’t ever want to have to build another downline. Two years of hard work was definately worth it for us to now be able to do what we do. But I get tired just thinking about how hard we worked in the beginning.

And on preview, yes the $150 requirement is because of some laws. We do generate some new sales, our friends who use the products and buy directly from the company still show up on our downline. We don’t get any extra money because of them, but it shows we are still selling. I really don’t consider that active recruiting on our part because we aren’t trying to get them to sign up to be a distributor and we come across enough people in casual conversations that mention they would to try what I use on my hair or face, or take for allergies or arthritis that I really don’t consider that part work. It does help us meet our legal obligations, but it would happen just the same if we didn’t need to have new sales. That part happens just from a desire to share what works for me,and at this point would continue even if we didn’t need to do it. Without even trying, we well exceed the amount needed from people who try the products and continue to get them every month. We just need to have 5 wholesale customers each month buy something. These don’t have to be new people, or the same people, just 5 buying each month. We still have the original 5 we signed up for that purpose buying each month, plus a whole lot more now just from recommending people try the product.

18

Here is a good anti-mlm site.

For me, if a friend becomes involved in a MLM (or ANY direct marketing program that swears they’re not a pyramid), that is a deal breaker for me. I’ll tell them after they mention it the first time, that if they bring it up again, the friendship is over.

Sounds harsh, but I’ve watched too many people throw their money away on these things. I don’t want to be considered an “opportunity.”

19

My parents did Amway when it first hit the UK back in the early 80s - they turned into pod people, converted some of their friends and drove away the rest; kept on talking about how nice it would be when they ‘went diamond’ (which never happened, of course). I think they made a modest income from it, for a little while.

I’m still convinced it was a significant contributory factor to their divorce a few years later.

Silly thing is that I actually think some Amway products are quite good; multi-purpose mild detergent ‘LOC’, for example, is something I would still buy - and indeed tried to buy recently when a neighbour popped round with a brochure, but that’s the whole problem - you can’t buy the frickin’ products - you come into contact with a distributor and you will be able to place about two or three orders before they come down heavy with the recruitment deal - wherupon your choice is to become a pod-person, or be ignored thereafter.

20

This happened to me, but I was never offered an opportunity to buy products. I was working for a well known computing services company and another guy in the office who was in a different department and I would run into each other. I commented on his Star Trek tie. We would keep running into each other at work. We would joke with each other at the office and have lunch together now and then and we started becoming close acquaintences.

One Saturday morning he called me at home (which I found strange as I had never given him my home phone number) and wanted to know if my wife and I would like to have lunch with him and his wife. I suspected some sort of MLM but we went anyways and he never brought it up. The lunch was perfectly wonderful and we had a very nice time.

The next week, he asked me to lunch and then made his MLM pitch, though it was very non-chalant. He would say things like, “I plan on retiring in 3 years.” (He was 28.) Though he was trying to get me to ask something like, “Really? How are you going to pull that off?” I never took the bait. He asked me to look at a video tape and we would get together the next day.

I didn’t have to look at the tape. I already knew what he wanted, and I wasn’t interested. So the next day I handed the tape back and very politely told him that this wasn’t an opportunity I was interested at this time, that I had other goals I wanted to persue and this MLM didn’t fit into those goals. He barely spoke to me during the rest of lunch that day, and never spoke to me again.

I’ve been approached about joining an MLM before, but what bothered me about this one was that this guy genuinely seemed to want to be friends with me. We would joke around and had a really good rapport and when I refused to sign up, he just left. Of course that is what most will do anyways… I understand that… He got me emotionally involved more so than others who have tried to get me in. That just really bothered me for a long time. I have since gotten over it and recognized the guy for what he was, plus the experience has helped hone my MLM-Pod-People detection skills that much better.