Mary Kay’s Air of Suspicion

Yesterday was taking a look at a letter that Mary Kay Inc. wrote to the FTC in 2006. The FTC was coming up with a Business Opportunity rule to protect consumers, and MLMs were scrambling to have themselves exempt from the rule. The gist of the rule that was implemented (and its later revisions) was that it would protect people who were getting involved these “business opportunities” (any sort of work-from home arrangement) and require that certain information be disclosed to them and that they would have a waiting period (a period of time after being given the disclosures, before they could sign the contract). You can see the 2011 version of the business opportunity rule (and the disclosure form) here. The FTC explains more about the rule here.

You might notice that MLM companies aren’t specifically discussed anywhere. So while the FTC doesn’t actually say they’re exempt from these rules, it’s pretty clear in the rule and the discussion of the rule that they aren’t really a part of this. Why? Because the MLMs lobbied so hard to be exempt from it, because God forbid they’d have to make certain disclosures about how terrible the “business opportunity” is.

Mary Kay wrote their letter to the FTC as well, and yesterday I was amused by this portion of their letter:

Requiring a seven day waiting period will stifle this enthusiasm and lessen the chance of the individual’s participation and/or success. In our opinion the presale disclosure requirement is a significant barrier to entry – and makes the simple decision of becoming an Independent Beauty Consultant unnecessarily burdensome and complicated while delaying the ability to “hit the ground running” after her introductory experience.

Furthermore, we believe the proposed Rule’s disclosure requirements and waiting period needlessly creates an “air of suspicion” in the mind of a prospective Independent Beauty Consultant. A prospective Independent Beauty Consultant trusts the Mary Kay experience shared by her family, her friends, and her co­workers. If, in the future, prospective Independent Beauty Consultants are required to be presented with a presale disclosure document and wait a period of time for review, analysis, and examination, it would be natural for her to think “what is wrong here?” despite her general trust in her family and friends’ experience. Such suspicion would be misled in light of our 43 year history with legitimate and ethical business practices coupled with our built-in consumer safeguards, but nonetheless, these concerns would impact Mary Kay’s ability to continue to tell the Mary Kay story. This disclosure requirement would suggest a level of risk that simply does not exist.

Well look at that. It’s a “simple decision” to start a business and invest hundreds or thousands of dollars. Oh I know… They’ll say it’s only a $100 decision because that’s the cost of the starter kit, and anything after that is a separate decision. (Incidentally, it’s one that involves a whole lot of arm twisting, guilt, and con games.)

And how dare we stifle some enthusiasm or create an air of suspicion! Mary Kay and others worried that giving people 7 days before they could sign their MLM contracts might make them rethink signing up. No kidding! If people have (true) disclosures about income and they have time to research before they sign up, there are at least some people who will change their minds.

It doesn’t really delay the ability to hit the ground running. If someone wants to sign up for MK, she can go ahead and get the process started, and during her waiting period she could start lining up parties. What a great use of time! It takes some time to set up appointments anyway.

So this air of suspicion… Yes, indeed. There SHOULD be an air of suspicion surrounding MLMs. More than 99% of people lose money in MLM. The fact that Mary Kay Inc. has been skilled at selling their con for decades doesn’t change that fact. It would be natural for her to think what is wrong here??? Yes! Exactly! People should be given time to research this “opportunity.” What is Mary Kay so afraid of? If the company is as wonderful as they say, a week shouldn’t have much impact on recruiting efforts.

Oh, wait. There IS a problem with the company and its bogus business opportunity. And the time would give peopel a chance to research. And they would be more likely to research because they would wonder what might be wrong. And they’d find websites like Pink Truth. And they’d start to see facts about MK that bother them. And they’d see all the tired lines and scripts that were used on them, and realize they’re used on everyone to manipulate them into signing up.

And the concerns of potential recruits “would impact Mary Kay’s ability to continue to tell the Mary Kay story.” Really? You can’t tell your story if people are concerned? No. What you really mean is that it would impact MK’s ability to sell their nonsense to unsuspecting recruits.

The risk that simply does not exist… An outright lie. There is tremendous risk, and women who sign up as Mary Kay consultants are almost assured of not recouping their initial investment. And Mary Kay Inc. knows this.

5 Comments

  1. Jason Houston

    “43 year history with legitimate and ethical business practices”?

    Where?

    WHERE???

    And “built-in consumer safeguards”?

    Where do they keep those??????

    And you swear on your dear mother’s grave Mary Kay is not telling me any lies?

    By the way, did Mary Kay ever sell that big bridge in New York she had?

  2. enorth

    Oh, they hate when you do research. Watch the MLM “training” videos yourself. You’ll get quite an education. And some laughs.

    – “You want to get them excited so they sign right away. Don’t let them go home and have someone poop on their parade.”
    – “You don’t want them talking with Uncle Harry who had a bad Amway experience 20 years ago.”
    – “Don’t talk with your husband. What does he know about makeup? Besides, does he ask your permission when he wants to buy a new golf club?”
    – “If they won’t join, get them into the Preferred Customer Program. It’s auto-ship, but don’t call it that.”
    – “Roll this device over your face. It irrigates your skin, just like you irrigate your lawn.”

    It’s encouraging to see more and more videos from people who have quit MLMs and explain why. I saw one recently where the young woman had just quit Limelight cosmetics. She said she fell for the “There’s no saturation” line. While there is no Limelight saturation, she found there IS cosmetic saturation: cosmetics available everywhere and anywhere…high-quality cosmetics at lower prices than Limelight. She simply couldn’t find anyone willing to buy over-priced MLM makeup. In the meantime, she was still paying Limelight annual fees, monthly website fees, etc.

    The company ALWAYS gets its money.

  3. PurpleH

    Is that scary phot of MKA supposed to inspire someone to want her life? It looks like she’s in a community theatre cast of “The Graduate.” Squinty eyes, overly shadowed, OBVIOUS WIG, red talons that clash with pink furry costume – this is your business leader? “Are you trying to RECRUIT me, Mrs. Multiple Names?” (((shudder)))

  4. BestDecision

    And then there’s Kristin Sharpe, an NSD who claimed her fame by having the biggest unit meeting in the country. With multiple Directors, mind you. But, now, there’s under 30 in the room. Not one looks like they should be teaching anybody about makeup application, either.

    Funny how things work out after all.

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