There's a documentary about LuLaRoe coming out, so let's talk MLMs. What are your experiences with MLMs? Have you ever bought an MLM product? Have you ever sold MLM products? Have you ever seen relationships damaged from MLMs? Will you be watching the documentary? I'd love to hear your thoughts.
I think the difference between an MLM and a company like Avon or Mary Kay is that with an MLM the seller is required to purchase a lot of the product upfront. I believe that Avon and Mary Kay don’t work that way. The seller just places the orders she receives. I’m not 100% sure of this, but I think it’s correct.
This isn't totally correct. Beachbody is an MLM and products are sold directly from the organization to the customer- the "coach" or whoever refers them then gets a cut of whatever they order.
While Avon used to be a purely direct sales business, they have been an MLM company for over 15 years, meaning that as well as selling products to retail customers, Avon reps can also make money by recruiting others into the company – selling the 'business opportunity.' This bums me out - I have fond memories of my mom buying Avon when I was a kid in the 1980s.
Every Mary Kay rep I know had to buy a bunch of products to get started. They bought them at 50%, so they thought they'd make a good profit, but Mary Kay didn't place any limits on how many reps could be in the same area, so the market was oversaturated.
There is a podcast by one of the women (Roberta Blevins) in the new documentary called, "Life After MLM." She goes over the way Avon and Tupperware used to be different, more sales of products vs building a downline, but today function more like MLMs. It's a fascinating podcast and covers so many of your questions!
Interesting. I "sold" both Tupperware and Mary Kay in the '90s and both were definitely MLMs. I put "sold" in quotes because I never made any money and was terrible at selling/recruiting and lost a good amount of money for a young woman at the time! It was terrible for me and these companies definitely prey on women.
I think in the podcast they were referencing like the 1940s and 50s, not anywhere near the 90s yet. I agree with you, any which way these companies prey on women, especially women in vulnerable economic and cultural situations.
The podcast The Dream was all about MLM’s: the history, how they manage to stay legal, etc. it was so fascinating. I highly recommend it to anyone who wants to understand MLM’s, and also to anyone who enjoys a good narrative non-fiction podcast!
I came here to recommend this podcast series as well. It’s fascinating. I don’t believe they go deeply into why so many MLMs/pyramid schemes are tied to the LDS community, but my guess is that one or two organically grew in Utah and we’re immensely popular (especially because there’s a tight-knit community where many women stay at home to raise kids), so they just took off and became ingrained in the culture.
I am wary of any product that isn't sold in regular stores - I had no idea that Usborne books also had an MLM model, because you can buy them at any regular bookstore, on Amazon, etc. I have no idea if they have a downstream, but they are the only "good" MLM I can think of...
Yep. I've already made many comments here and now you just reminded me I also "sold" Usborne books for a short time when my kids were little (never actually sold much, just spent my own money). Sheesh, am I a sucker for these things or what? Now I'm very against MLMs and know that they do prey on women all the time.
Usborne was also my first thought. I love their books and wish the high school girlfriends I buy them from didn't hassle me about hosting parties or selling myself.
At my daughters preschool there was a really nice mom who everyone thought was just very friendly. Until she'd invite us to drinks or parties and without fail it would turn into a pitch to join her MLM team. I got facebook and instagram messages for a couple years thinking oh how nice she's reaching out to say hi, they moved away, and no it was really still about joining her MLM team. It bummed me out.
Mary Kay is definitely an MLM! Same exact structure, and at least when I got recruited to do it, sellers had to buy a LOT of product and keep it in their stock. I lost over a thousand on that to Mary Kay, and never earned anything. Granted, I'm terrible at sales and only had one or two parties, but it's without a doubt an MLM. I know less about Avon, but assume it's the same. And Tupperware and the essential oil companies we all know about are both definitely MLMs too.
Yeah, there is no such thing as a “good” MLM. The business model for the founders is to have the reps buy lots of product (they will say there’s no need to keep inventory, but the companies still push it, the most attractive products sell out all the time, and so it’s difficult to build a customer base without buying premium products so you can get them to your customers). The business model for the vanishingly small number of reps who make actual money is to get in early and build a huge downline. If the founders were really in it to sell products, they would do so in the normal way. Ultimately they’re in it to exploit people, and way too many good-hearted and well meaning people wind up exploited.
Whenever any MLM hits the news for shady practices the rest of them scramble to pretend that they’re different, but it’s so transparent that they’re not.
I've been to an in-person party for Noonday Collection. I enjoyed it, but felt a little oogy hosting one. That said, I really love the products and the business model they have of supporting artisans to build their own businesses. So, I continue to buy pretty much all my jewelry there.
I have zero interest in having a party (even online) or repping for Color Street, but I do like the strips, so I buy them from a local rep. Thankfully, neither of the Noonday or Color Street reps that I buy from have ever pressured me to go beyond being a customer. If they had, I probably would not enjoy the products as much as I do.
The most compelling theories I’ve heard for the LDS/MLM nexus: 1) the emphasis of missionary work in the church means that a high proportion of LDS folks have the confidence and interpersonal skills that work well for sales, and 2) LDS folks generally have an interesting mindset that combines entrepreneurial drive with respect for authority and hierarchy. Folks with the former but not the latter would be more likely to start their own companies, but having both makes the MLM mode attractive (to the detriment of many LDS women).
Definitely so. In addition there's an issue with "Affinity Fraud" where victims tend to overly trust those with the same lifestyle or values. Utah is the number one state for Affinity Fraud and it affects not only MLMs but tons of white collar financial fraud as well.
My aunt has 6 children and every single one of them did LuLaRoe after my cousin got in early. She also got a bunch of cousins and my aunts in on it too. My cousin made lots and lots of money but when the rest of the family (her downline) wasn't making anything, they started dropping out of the company. Half of the family still doesn't talk to each other anymore because she was mad they quit. I bought a few dresses and was gifted a couple of skirts but I wouldn't host a party so I was deemed unsupportive. With the recent LuLaRoe lawsuits, everyone is out of the business now. My cousin was the last to leave and is doing her own boutique now. She definitely isn't able to keep up her lavish LuLaRoe lifestyle anymore. I'm really interested in seeing the new documentary after seeing it all go down in my own family.
I will support a friend who starts up with an MLM if its something I will genuinely use... I would not support a 'new friend' for the reason that many years ago during a particularly lonely and tough time in my life I had gone on a leadership retreat and met a girl who I thought could be a future close friend. We met for coffee after the retreat and within 10 minutes of sitting down she started on the Amway sell. The entire coffee was her trying to get me to sell the products and I was fighting back tears. Not the usual response I would have but again, I needed a good friend in my life and thought I had found one... never heard from her after that, i can only assume because I wasn't interested in Amway. I was crushed. This experience was over 15 years ago and I still remember the feeling. Its the reason I am wary of anyone acting friendly when I know they also sell an MLM product.... my first instinct is not to trust them!
From my former mother-in-law: "I need to increase my tithing so that the bishop can see how well I'm doing with this company." I saw her wreck many friendships through her sales pitches. Sad.
Gabrielle, while I’ve never been to Alt Summit or have an interest in that particular area, your posts about Alt Summit tell me that it is a fabulous event and very popular. You are such a creative person I am sure you could create an online version that is just as popular until you can do it face to face again? You would have to rethink the format, 3 days online would be hard, but what about a series of six online 3 hour events each focused on a particular topics over the course of the year?
I've always hated MLMs and never understood the appeal. I am also Mormon but in my experience most people who pushed MLM stuff on me were not. I was invited to more parties when I lived in Las Vegas, Cincinnati and Connecticut. It drove me crazy at times when I was strapped for cash myself and didn't want to spend even $5 on something I didn't need. I dreaded getting invites and the guilt trips "Just come. You don't have to buy anything." Yeah sure but someone is going to try really hard to get me to. I have now lived in Provo for the last 8 years (where there are a lot of headquarters nearby). Interestingly no one here has ever invited me to a MLM party and I can only think of one person who sold anything. I think the real issue is the need for more job flexibility for women and specifically moms. Most people I knew bought into it because they needed extra income and could not easily work at a job outside the home. MLMs really seem to prey on these people.
Ugh--this all hit so close to home. Growing up my parents really tried their hand at Amway. When it inevitably failed my mom swore she would never do another MLM again. Well, I actually didn't know that until a few years ago when she said, "I swore I'd never do another MLM again, but this one's different..." The main difference is that they were high end products she was constantly pushing on the family that didn't fit anyone's taste but hers and it aggravated us all to no end. I would say no to a $400 backpack she tried to get me interested in, so she'd casually leave a catalogue around the house. She approached family members that she knows could not afford to pay hundreds of dollars for a purse. I had no idea how deep she was into all of this until the company apparently changed their pay structure (of course they did!) and she left... it's been a number of years now and we've still been receiving old product of hers for Christmas/birthday gifts. I didn't realize how much she had purchased, and thus lost. Sadder still, she has participated in at least 2 more MLM's since, and possibly a third. It's maddening and sad at the same time.
I guess I've been lucky because no one has ever asked me to join their downline - maybe they just knew I wouldn't be interested? Or even good at it? I've been to a few parties, but I was rarely friends with the person selling stuff, so I didn't feel any pressure. I do find myself feeling skeptical of people who use their social media accounts to push their MLM and who constantly talk about how much it's supposedly blessed their life. Also, I had a roommate who joined one, and while she didn't have to buy product upfront, she still kind of had to buy stuff in order to advertise those products. One thing that felt eerily familiar to me when I watched LuLaRich is that this roommate thought her MLM was different because in the training, other sellers would tell her, "This isn't a get-rich-quick scheme. If you want to make money doing this, you're gonna have to put in the work." I never even realized that was a standard line in MLM's, with the misleading implication being that everyone *can* earn good money, as long as they put in the work.
I think the difference between an MLM and a company like Avon or Mary Kay is that with an MLM the seller is required to purchase a lot of the product upfront. I believe that Avon and Mary Kay don’t work that way. The seller just places the orders she receives. I’m not 100% sure of this, but I think it’s correct.
This isn't totally correct. Beachbody is an MLM and products are sold directly from the organization to the customer- the "coach" or whoever refers them then gets a cut of whatever they order.
While Avon used to be a purely direct sales business, they have been an MLM company for over 15 years, meaning that as well as selling products to retail customers, Avon reps can also make money by recruiting others into the company – selling the 'business opportunity.' This bums me out - I have fond memories of my mom buying Avon when I was a kid in the 1980s.
Every Mary Kay rep I know had to buy a bunch of products to get started. They bought them at 50%, so they thought they'd make a good profit, but Mary Kay didn't place any limits on how many reps could be in the same area, so the market was oversaturated.
There is a podcast by one of the women (Roberta Blevins) in the new documentary called, "Life After MLM." She goes over the way Avon and Tupperware used to be different, more sales of products vs building a downline, but today function more like MLMs. It's a fascinating podcast and covers so many of your questions!
Interesting. I "sold" both Tupperware and Mary Kay in the '90s and both were definitely MLMs. I put "sold" in quotes because I never made any money and was terrible at selling/recruiting and lost a good amount of money for a young woman at the time! It was terrible for me and these companies definitely prey on women.
I think in the podcast they were referencing like the 1940s and 50s, not anywhere near the 90s yet. I agree with you, any which way these companies prey on women, especially women in vulnerable economic and cultural situations.
The podcast The Dream was all about MLM’s: the history, how they manage to stay legal, etc. it was so fascinating. I highly recommend it to anyone who wants to understand MLM’s, and also to anyone who enjoys a good narrative non-fiction podcast!
The Dream podcast was so interesting, I could hardly wait for the next episode to come out every week.
I came here to recommend this podcast series as well. It’s fascinating. I don’t believe they go deeply into why so many MLMs/pyramid schemes are tied to the LDS community, but my guess is that one or two organically grew in Utah and we’re immensely popular (especially because there’s a tight-knit community where many women stay at home to raise kids), so they just took off and became ingrained in the culture.
I am wary of any product that isn't sold in regular stores - I had no idea that Usborne books also had an MLM model, because you can buy them at any regular bookstore, on Amazon, etc. I have no idea if they have a downstream, but they are the only "good" MLM I can think of...
Yep. I've already made many comments here and now you just reminded me I also "sold" Usborne books for a short time when my kids were little (never actually sold much, just spent my own money). Sheesh, am I a sucker for these things or what? Now I'm very against MLMs and know that they do prey on women all the time.
Usborne was also my first thought. I love their books and wish the high school girlfriends I buy them from didn't hassle me about hosting parties or selling myself.
At my daughters preschool there was a really nice mom who everyone thought was just very friendly. Until she'd invite us to drinks or parties and without fail it would turn into a pitch to join her MLM team. I got facebook and instagram messages for a couple years thinking oh how nice she's reaching out to say hi, they moved away, and no it was really still about joining her MLM team. It bummed me out.
Mary Kay is definitely an MLM! Same exact structure, and at least when I got recruited to do it, sellers had to buy a LOT of product and keep it in their stock. I lost over a thousand on that to Mary Kay, and never earned anything. Granted, I'm terrible at sales and only had one or two parties, but it's without a doubt an MLM. I know less about Avon, but assume it's the same. And Tupperware and the essential oil companies we all know about are both definitely MLMs too.
Yeah, there is no such thing as a “good” MLM. The business model for the founders is to have the reps buy lots of product (they will say there’s no need to keep inventory, but the companies still push it, the most attractive products sell out all the time, and so it’s difficult to build a customer base without buying premium products so you can get them to your customers). The business model for the vanishingly small number of reps who make actual money is to get in early and build a huge downline. If the founders were really in it to sell products, they would do so in the normal way. Ultimately they’re in it to exploit people, and way too many good-hearted and well meaning people wind up exploited.
Whenever any MLM hits the news for shady practices the rest of them scramble to pretend that they’re different, but it’s so transparent that they’re not.
I've been to an in-person party for Noonday Collection. I enjoyed it, but felt a little oogy hosting one. That said, I really love the products and the business model they have of supporting artisans to build their own businesses. So, I continue to buy pretty much all my jewelry there.
I have zero interest in having a party (even online) or repping for Color Street, but I do like the strips, so I buy them from a local rep. Thankfully, neither of the Noonday or Color Street reps that I buy from have ever pressured me to go beyond being a customer. If they had, I probably would not enjoy the products as much as I do.
The most compelling theories I’ve heard for the LDS/MLM nexus: 1) the emphasis of missionary work in the church means that a high proportion of LDS folks have the confidence and interpersonal skills that work well for sales, and 2) LDS folks generally have an interesting mindset that combines entrepreneurial drive with respect for authority and hierarchy. Folks with the former but not the latter would be more likely to start their own companies, but having both makes the MLM mode attractive (to the detriment of many LDS women).
Definitely so. In addition there's an issue with "Affinity Fraud" where victims tend to overly trust those with the same lifestyle or values. Utah is the number one state for Affinity Fraud and it affects not only MLMs but tons of white collar financial fraud as well.
My aunt has 6 children and every single one of them did LuLaRoe after my cousin got in early. She also got a bunch of cousins and my aunts in on it too. My cousin made lots and lots of money but when the rest of the family (her downline) wasn't making anything, they started dropping out of the company. Half of the family still doesn't talk to each other anymore because she was mad they quit. I bought a few dresses and was gifted a couple of skirts but I wouldn't host a party so I was deemed unsupportive. With the recent LuLaRoe lawsuits, everyone is out of the business now. My cousin was the last to leave and is doing her own boutique now. She definitely isn't able to keep up her lavish LuLaRoe lifestyle anymore. I'm really interested in seeing the new documentary after seeing it all go down in my own family.
I will support a friend who starts up with an MLM if its something I will genuinely use... I would not support a 'new friend' for the reason that many years ago during a particularly lonely and tough time in my life I had gone on a leadership retreat and met a girl who I thought could be a future close friend. We met for coffee after the retreat and within 10 minutes of sitting down she started on the Amway sell. The entire coffee was her trying to get me to sell the products and I was fighting back tears. Not the usual response I would have but again, I needed a good friend in my life and thought I had found one... never heard from her after that, i can only assume because I wasn't interested in Amway. I was crushed. This experience was over 15 years ago and I still remember the feeling. Its the reason I am wary of anyone acting friendly when I know they also sell an MLM product.... my first instinct is not to trust them!
From my former mother-in-law: "I need to increase my tithing so that the bishop can see how well I'm doing with this company." I saw her wreck many friendships through her sales pitches. Sad.
Gabrielle, while I’ve never been to Alt Summit or have an interest in that particular area, your posts about Alt Summit tell me that it is a fabulous event and very popular. You are such a creative person I am sure you could create an online version that is just as popular until you can do it face to face again? You would have to rethink the format, 3 days online would be hard, but what about a series of six online 3 hour events each focused on a particular topics over the course of the year?
I've always hated MLMs and never understood the appeal. I am also Mormon but in my experience most people who pushed MLM stuff on me were not. I was invited to more parties when I lived in Las Vegas, Cincinnati and Connecticut. It drove me crazy at times when I was strapped for cash myself and didn't want to spend even $5 on something I didn't need. I dreaded getting invites and the guilt trips "Just come. You don't have to buy anything." Yeah sure but someone is going to try really hard to get me to. I have now lived in Provo for the last 8 years (where there are a lot of headquarters nearby). Interestingly no one here has ever invited me to a MLM party and I can only think of one person who sold anything. I think the real issue is the need for more job flexibility for women and specifically moms. Most people I knew bought into it because they needed extra income and could not easily work at a job outside the home. MLMs really seem to prey on these people.
Ugh--this all hit so close to home. Growing up my parents really tried their hand at Amway. When it inevitably failed my mom swore she would never do another MLM again. Well, I actually didn't know that until a few years ago when she said, "I swore I'd never do another MLM again, but this one's different..." The main difference is that they were high end products she was constantly pushing on the family that didn't fit anyone's taste but hers and it aggravated us all to no end. I would say no to a $400 backpack she tried to get me interested in, so she'd casually leave a catalogue around the house. She approached family members that she knows could not afford to pay hundreds of dollars for a purse. I had no idea how deep she was into all of this until the company apparently changed their pay structure (of course they did!) and she left... it's been a number of years now and we've still been receiving old product of hers for Christmas/birthday gifts. I didn't realize how much she had purchased, and thus lost. Sadder still, she has participated in at least 2 more MLM's since, and possibly a third. It's maddening and sad at the same time.
I guess I've been lucky because no one has ever asked me to join their downline - maybe they just knew I wouldn't be interested? Or even good at it? I've been to a few parties, but I was rarely friends with the person selling stuff, so I didn't feel any pressure. I do find myself feeling skeptical of people who use their social media accounts to push their MLM and who constantly talk about how much it's supposedly blessed their life. Also, I had a roommate who joined one, and while she didn't have to buy product upfront, she still kind of had to buy stuff in order to advertise those products. One thing that felt eerily familiar to me when I watched LuLaRich is that this roommate thought her MLM was different because in the training, other sellers would tell her, "This isn't a get-rich-quick scheme. If you want to make money doing this, you're gonna have to put in the work." I never even realized that was a standard line in MLM's, with the misleading implication being that everyone *can* earn good money, as long as they put in the work.