They tell us that multi-level marketing isn’t a pyramid scheme. When I say that it’s endless chain recruiting, they tell me that’s nonsense. But it IS all about recruiting. They pretend it’s about the products, but we’re bombarded by requests to bring guests and interview them. Oh, it’s just for practice. Let the director interview them. It’s just for fun! Have her do a survey. We just just want her opinion!
Tell me why we’re wasting everyone’s time if we’re just pretending? Because they’re not pretending! They really DO want to recruit them. AND IT’S A NUMBERS GAME. The more people they talk to, the greater chance they have of recruiting someone.
But that’s not the only numbers game that’s involved here. In Mary Kay they pretend that there are an infinite number of women with skin. There are an infinite number of women to recruit into this scam. Sorry, but that’s not true. The marketing plan ensures that nearly everyone will fail. But lets just assume they’re right and “everyone” can succeed with this awesome “opportunity” and can recruit anyone. What would the numbers look like?
I’m a new sales director and I have 24 women in my unit. Since anyone can succeed with this “business,” they all become new directors, so they all have 24 women below them. This is a viable business opportunity, and they’re all on the fast track and this all fast and easy and they all become directors within 4 months of signing their agreements! Everyone keeps becoming directors. See how fast this multiplies:
1 director
24 new recruits in 4 months
576 new recruits in 8 months
13,824 new recruits in 12 months
331,776 new recruits in 16 months
You can see how quickly this gets absurd. Imagine if each of these directors/consultants got 100 customers each. (Having been in Mary Kay, we know how difficult it is to get 100 loyal customers because women have so many choices for their products these days, but work with me here.)
The amount of products that would be purchased as each of these women worked through DIQ and the required production of $18,000 wholesale each would add up quickly.
I’d be a National Sales Director in no time if the numbers game worked like this. And the population of the world would quickly run out. It’s impossible to recruit like this, and there are always losers at the bottom of the pyramid. Why do you think that the women at the bottom of Mary Kay are always scratching to make a few pennies? Even the women at the top who are supposedly the most successful are still putting on a front.
Why do you suppose Mary Kay stopped printing the incomes of a whole boatload of NSDs each month? (Do any of you remember when they used to print ALL NSD commission checks in Applause? Probably not because it’s been so long.) They stop printing those incomes because it was embarrassing. They’re at the very top of the company yet they were making less than $10,000 per month. Would consultants be inspired by that? These are not nameless, faceless women. They put up on a pedestal as the ultimate success in MK, yet HALF of the NSDs are making less than $10,000 per month. Let that sink in for a minute.
This idea that you *could* make a ton of money in Mary Kay is so silly. Sure. Anyone *could*. Almost no one *will*. When will women accept that the odds are so far stacked against them that it is the worst deal in the world? When are women going to stop taking money from their families and putting into this stupid nonsense, pretending it is a real opportunity for them? Yes, it’s a numbers game. One that is stacked completely against them.
Less than 150 people made “executive income” in July. All you have to do is read Applause to see it. It’s denial all the way!
I was in AWE of how much my former NSD made (she was an offspring of Arlene Lenarz). Thousands of dollars per month, month upon month. I wanted to be her.
I left MK behind over a decade ago. The executive income was never, ever there. I get to where my NSD was would have been impossible, even in the best of circumstances. Heck, even as an SD, I was struggling to make a decent income unless I worked myself ragged. Fast forward to today. I just accepted a clinical education specialist role at my hospital, and damn skippy I will be making an executive income! As a registered nurse. With work staying at work.
Yet, they prey on nurses saying no money is there! Show up, get guaranteed pay, and leave work at work. Love hearing this!
They do that with teachers, too. One SD used to quote that 1/3 of MKers were nurses, 1/3 were teachers and the last 1/3 were the rest of us.
Teachers here in Canada get paid very well (many get executive income once established and/or with advanced degrees) and very good pensions. Carol Thompson is an example who threw away being a teacher and a guaranteed pension for MK and her empire is falling apart. Not a good move, Mrs. Thompson….
Tracy’s articles that analyze the numbers like this are obviously ignored by the “Friday critics” who write in to chastise all us negative people who gave up early. [For the record, I was never in Mary Kay or any other MLM, and have no personal axe to grind. I just don’t like all the lies and injustice.]
But the numbers are there, they’re important, and they’re pretty stark. Take the total annual sales of most MLM companies and divide by the number of reps, and the per-rep average comes to less than $2,000. Even at 50% profit (ha!), that’s a whopping $83 per month average income. That means for every one earning $100k per year ($8,333 per month) there must be 100 earning zero, or 200 earning about $40/month, or… well, you get the picture. That’s why 99% lose money in MLM.
This is where endless-chain recruiting always ends up, because the math says it must. Mary Kay counts on the fact that parading the few big earners across the stage keeps the lie going just well enough to bring in fresh recruits. The sales-force size stagnates at about that $1-2k per year level; that seems to be the balance point between dropouts and sign-ups. Does that sound like a fair system to you?
MLM companies are well aware that they’re running an exploitative business; they just don’t care. As long as they can lie and manipulate enough victims into paying for the privilege of losing money, they’re sitting pretty. And that’s just wrong.
It’s just WRONG.
1. It’s tough to resell with this method. There’s no stores, no adverts, only a friends and family circle; but wait, there’s more. Newbie consultants need to consider this:
Who benefits from her resale? Only her and not the company, and not upline! They already profited off her original order. And even if she resells and needs to replace “inventory”, with her limited circle, that isn’t that much.
2. IN COMPARISON, what if she recruits? Who benefits? Upline and the company! That new recruit buys directly from the company, not the consultant, and it’s a much larger order. Upline also makes a commission. Remember, reselling would only benefit the consultant herself.
3. Also, if you were a good customer buying a lot, why pay double retail when it’s easy enough to sign up? That’s an inherent flaw. Plus, as stated above, the consultant is encouraged to recruit her customer because it benefits the company and upline. By nature of the small friends and family circle, she wouldn’t have many customers anyway. Might as well recruit for that exponential growth.
Confused? It’s easy. Assume you’re Mary Kay running a billion dollar company with employees to pay, health insurance to provide, etc., who would you prefer?
– One consultant, with a small circle, reselling for her own profit, and ordering only for that?
– One consultant recruiting huge “inventory” orders directly from your company, so you can clear your warehouse. And that recruit recruits another recruit with another huge inventory order, who then recruits another.
It’s so obvious when you stop and think. But this must be disguised for legal reasons and to convince the new recruit that it’s HER product reselling business – so she’ll sign up and order BIG.
It’s actually not her product reselling business. She’s just the customer ordering directly from the company, who will then be encouraged to ENDLESS-CHAIN RECRUIT. That’s what benefits the real company as already explained. I mean duh, when you really think about it.
MLM is an inherently flawed and corrupt model.
Advanced course: It’s not really about the products as viable consumables. They are merely a tool to lure people into the money con game. The products also launder the money made from illegal opportunity selling. The better and sneakier cons will have elements of truth and plausibility. Instead of horribly fake products, make them mediocre like MK. No need to spend too much, as they just have to be good enough. Why waste money on expensive ingredients when opportunity selling is the name of the game. Here, real consumer demand for product is irrelevant.
Do you ever wonder how much Mary Kay product would be in the hands of consumers without the lure of the “opportunity”? Current consultants ask yourself, how much did you buy before you were “in” Mary Kay? See how that works!
Now factor in Tracy’s numbers game article. Nearly every MLMer will fail, unless she’s a skilled LIAR willing to take advantage of poor, single mothers – thousands of them. Are you that mother, or the one taking advantage of her? Scam or be scammed when it comes to participating in MLM.
(I know “duh” doesn’t sound very professional or mature, but sometimes it’s the only word that fits. My post was a bit thrown together, but I hope Miss New Consultomer dupe walks away smacking her forehead.)
Referring to human beings as numbers is absolutely cold hearted. For a company that touts Faith and family they sure do devastate others with these recruiting schemes.