Wednesday, 9 February 2022

MLMs and pyramid schemes

I have written before about multi-level marketing (MLM) companies (here), which are effectively pyramid selling. Those companies say that they are not pyramid sellers, of course - as pyramid selling is illegal - because they sell you products. You know, those really expensive ordinary products that you pay three times the ordinary price for because you can ONLY buy it from them. And then you need to recruit your downstream people. And you clip their ticket on their sales.

And you get encouraged to attend conferences with lots of self-help on how to sell. Keynotes by those with 'Diamond" status and big houses. And are encouraged to recruit more people. And have trouble making your monthly sales targets. And your family members stop answering your calls. 

Ah, a rose by any other name. 

The only people who make money from pyramid-  ah - MLM companies are those who get in very early. Then, as the 'get rich quick' scheme starts to roll out, and more suckers buy in, they lose money. In my view, these schemes are even more parasitic than hard-sell businesses such as car sales and real estate (showing my prejudice here, sorry).

I recently ran across a very good TED video which explains the following: the MLM concepts; the dangers; and outlines how a few in at the beginning make money, while most participants lose. This presentation is very, very clear.

What I particularly liked about the beginning of this presentation by Stacie Bosley was that it started with the proverb: if it seems to good to be true, it probably is (TED Ed, 2019). So, so accurate!

Please share this with anyone who is tempted to 'get rich quick'.


Sam

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