Lily Gauthreaux Knows You Will Lose Money

Mary Kay nsd Lily Gauthreaux spent some time discussing the “99% of people lose money in MLM” statistic this weekend. Her conclusion: She knows it’s true, but she doesn’t care. Because in all of her years in MK, she has never known ANYONE who has treated MK as a business and hasn’t made a ton of money.

She must not have met the millions of women have visited Pink Truth over the last 15 years. Because there are countless women who treated Mary Kay like a business, did all the right things, and still lost money (primarily because they were frontloaded with large inventory packages and they could never sell the products for a profit.)

Lily basically admits that 99% of people lose money in Mary Kay, but wants you to ignore it. Why? Because she says 90% to 95% of the people who join MK don’t want to make money anyway. We’ve heard this argument before, directly from the mouth of Laura Beitler, a Mary Kay executive.

If almost no one who wants to join MK wants to make money, why do they keep recruiting with false income claims? Why do they keep promoting this as a business if it’s nothing more than a wholesale buying club? What percentage of women do you think are frontloaded with inventory packages by Lily? Do you think it’s the 5% that she knows want to make money? Or do you think it’s closer to 50% to 70% of recruits? How ethical is it for her to frontload women with inventory when she knows they don’t want to make money?

Here’s something else to ponder as you watch the below video: Lily Gauthreaux is called a “Mary Kay Millionaire.”  That means she’s super successful, right? WRONG. Lily is in the top position in Mary Kay. And she makes less than $10,000 per month in commissions before subtracting business expenses. MK only lists the NSDs who make more than $10,000 in a month, and Lily is never listed. Not even in June, which is always the highest earning month for members of the pyramid. Yes, Lily turns a profit in MK, but it’s nowhere near an “executive” income even after almost 12 years in the company. Don’t be like Lily.

29 Comments

    1. Juliet

      Of COURSE it’s questionable, Kristen!! The FTC is clearly biased on the side of the consumer!!! As usual, I am nauseous now considering what these trolls do to women….

  1. pinkboo

    What actual business recruits their customers and turns them into competitors? The fact that no matter how much product you sell, you will NEVER get that “free car” unless you recruit should be very telling and alarming. You MUST bring in other people. Why does MK keep track of how many people you recruit but not how much product you actually sell???

    1. Enorth

      “Why does MK keep track of how many people you recruit but not how much product you actually sell???”

      The only “sales” it’s concerned with is how much it sells to consultants (the real customers).

  2. Autumn

    Anytime I am lured into an MLM party, which is usually because I want to socialize with the other attendees, I wind up asking the rep why she’s trying to recruit her customers. I’m seldom invited anymore and that suits me fine!

    20
    1. NayMKWay

      Either she’ll take your (rhetorical) question to heart and realize what she’s doing makes no business sense and get out, or (more likely) she’ll get angry at you and never bother you again. It’s win-win!

      1. Destiny Angel

        One of the reasons my SiLs hun friends wanted me to sign up as a downline was we live in different provinces. so I wouldn’t be a direct competitor and they imagined a strong, untouched marketplace to expand into.

  3. Cindylu

    This MK NSD just sounds cruel and calculated. Ignoring the financial and other suffering of hundreds of women is just mean spirited. MK is NOT a business. It’s a sad predatory pyramid scheme. Taking advantage of vulnerable women by falsely saying they don’t treat this as a business is just heartless. Of course women try to sell these over priced products. Women try to book classes. MK is troublesome because NO one wants to book these silly parties anymore. There are many mlm’s and women distrust these recruiting scams.

  4. NayMKWay

    More blame-the-victim horse crap from an upper-level occupant of the pyramid. Color me unimpressed.

    90-95% of those who join don’t want to make money? Please.

    A couple of years ago a headline popped up on Google News about a US government study (probably by the FTC) that found 80% of people who signed up to MLMs did so because they wanted to make money. Only 20% signed up as a favor for a friend or relative, or to get the products at a discounted price.

    Not five or ten percent. Eighty percent.

    Lily, if you have better numbers to share, please provide us with the raw data, kay?

    Thanks in advance, but you’ll forgive me if I don’t hold my breath.

  5. Char

    She’s saying that 95% join to “enjoy the products and buy for a discount, and only 5% work the business”. Okay, what is she inferring that the “work” is? Obviously not product resales because anyone can join and save, remember?

    Her “work” is supposed to be reselling product for profit, isn’t it? How can that be if she admits that 95% join to enjoy products and buy with a discount.

    She refers to Mary Kay as “direct sales”, but that’s a contradiction to her message. FTC, are you watching this?

    Who, if any, is she selling to if everyone can join and buy at the discounted price? Does she tell this to her customers and have them overpay? Are these friends and family she’s ripping off?

    Maybe she just sells at a discount like Chelsea, but then how does she make any money? Oh I get it now. Her “work” is endless-chain recruiting and selling the opportunity to sell the opportunity for a commission.

    So, how does she get people to join this opportunity? Does she just say it’s direct product sales and therefore LIE; or does she admit that this is an endless-chain recruiting opportunity selling scheme (aka product-based pyramid scheme) for those who desire to do this kind of “work”? That’s a heck of a choice.

    TLDR: In the video she calls it “direct sales”, but claims most people join to buy products for a discount. Which is it?

  6. parsonsgreen

    Here’s another gem from Lily from her business coaching Instagram..

    https://www.instagram.com/tv/CNkcwrPH9To/?utm_medium=copy_link

    In this video, she mentions no one ever joins an MLM out of a sense of obligation, they are doing it because they truly love the product. If someone recommends a product, it’s better to buy from them because you will be supporting a small business and not purchasing an item from a multi billion dollar Corp like target

    1. NayMKWay

      “…not purchasing an item from a multi billion dollar Corp like target.”

      That’s true. Instead, you’ll be supporting a multi-billion-dollar scam like Mary Kay.

      I have a ready answer for anyone in MLM who asks why I won’t “support their business.” I’ll just say it’s not they I won’t support, it’s the scam they’re caught up in I won’t support.

  7. Enorth

    A quote from an analysis by Dr. Jon Taylor. (Oh, and it’s on the FTC website, not on some “angry ex-consultant’s blog.”)

    > “Recruitment-driven MLMs are truly scams. As a business model, MLM is likely the most successful con game of all time.”

  8. Christine Dambrosio

    I don’t get it…if sales consultants are buying loads of inventory that they can’t sell and recruiting others who also can’t sell the product, then how is MK staying in business? Then on top of it, consultants can return inventory and receive 90 percent of their money back…how is MK making money anywhere???

    1
    3
      1. Char

        “I don’t get it…if sales consultants are buying loads of inventory that they can’t sell and recruiting others who also can’t sell the product, then how is MK staying in business?” —

        Oh my! Might be a good time for that “corporate perspective” article I’ve been requesting.

    1. BestDecision

      $900/month Cadillac payments. $70 sheet masks from Consultants and Directors brainwashed into thinking their customers will buy them. Nationals and top Directors preaching to those under them that they need more inventory to be successful and that the newest products are going to make customers come TO them.

      And, there’s also horrible abuse and misuse of scripture, God, and illnesses. I know people that cared more about MK than their own pets they got rid of to do it.

    2. Kristen

      Christine,

      Think of it this way: Consultants ARE the customers to Mary Kay Inc. MK sells each customer thousands of dollars of products along with the promise that they can get rich selling it. They pay a portion of that to the top tiers in commissions. It’s a bit like promising your $300 purchases at Costco are an investment and once you sell them, you will make $600 back. Yet, anyone can sign up at Costco and do the same, so why buy from you? Yes, a portion of their purchases go to you if you showed them the Costco opportunity, but where is the money mostly going? To Costco. Nobody at Costco cares that you have a fridge full of rotting cheese.

      Yes, women should research the market and have a business plan before buying the inventory. However, if they do, they won’t sign up. The market is saturated. Pink Truth and other anti MLM sites educate women to do their research.

      5
      1
    3. Brooke

      Even if consultants returned inventory, the company is at a maximum 10% of the inventory purchased. It does NOT include the section two items ordered, limited edition items, or items ordered over one year of date of purchase (i.e. I order $1200 in January of 2021, $300 in June of 2021, but decide to return the inventory in February of 2022. I would only be eligible to return the $300 inventory package, because it is within the one year of purchase time frame). As you can see, even if inventory is returned – the company is still making money and holds nearly no risk.

Leave a Reply

Your email address will not be published. Required fields are marked *