Moderated MLM Crap :(

[Joecool]

I love the way you guys just ignore evidence that doesn't support your belief systems. It's such strong examples of confirmation bias.

Do you consider CostCo membership "a hobby"?

You mean the way you ignore the fact that nearly all IBOs make nothing or lose money? Or that fact that it's not hard to find testimony showing that Network 21 isn't much different than WWDB or any of the other systems.

Or how you ignore the fact that IBOs purchase most of Amway's products. It is why the TEAM exodus resulted in significant sales loss to Amway. WalMart could lay off as many people and not have their sales affected in the least, because their employees are not the primary consumers of their goods.

Costco is a buyer's club. They do not tell anyone they will get rich shoppinng there, in contrast to some Amway IBOs.

Significant to them. I've had many people who joined my business because they wanted to make a hundred bucks a month.

But that's not how the Amway business is presented is it? It's 6-4-2 and 2-5 years to diamond. BTW, how many of those many people actually made a hundred bucks a month?

Great, we agree then. If you encounter anyone promoting Amway that way, please ensure you report them to Amway. Same for any other MLM, but especially those who are members of the DSA.

That would be factions in every LOS, including Network 21. Lifelong residual income is promoted by factions of every LOS I know of.

 

[icerat]

Or how you ignore the fact that IBOs purchase most of Amway's products. It is why the TEAM exodus resulted in significant sales loss to Amway.

oh good grief. Do you think if a TEAM member had 50 customers and he quit Amway because he thought Amway and done something wrong, he'd call up Amway and say "I've got 50 customers, can I pass them on to someone else?"

Are you a fool or do you think others are?

As it happens though, I've got several former TEAM IBOs who have contacted me and purchase products from my US Amway business as customers because they still want the products.

And this from a group notorious for promoting the business badly and not teaching their people about the competitive advantage of the products!

Costco is a buyer's club. They do not tell anyone they will get rich shoppinng there, in contrast to some Amway IBOs.

And as you well know I think anyone promoting the idea of getting rich by shopping is an idiot.

Amway is both a business opportunity and a buyers club. Deal with it.

But that's not how the Amway business is presented is it? It's 6-4-2 and 2-5 years to diamond. BTW, how many of those many people actually made a hundred bucks a month?

Yes, that IS how the Amway business is presented, at least in my experience. It's how I was presented the business, it's how I presented the business, it's how many people, and Amway themselves, present the business. You an make as little or as much as you want. Even the classic "6-4-2" example you are obsessed with is pretty much always shown in a series of diagrams with different levels of income possibility. Did you seriously just jump straight to platinum level when you were marketing Amway? Was that how it was shown to you?

That would be factions in every LOS, including Network 21. Lifelong residual income is promoted by factions of every LOS I know of.

And they tell you that can be achieved by doing nothing just registering? Really?

<SNIP>

Edited by Locknar: 

Edited, breach of rule 11, rule 12.

 

[marplots]

That's only because basically, the IBOs themselves are the only customers save for some downtrodden friends and family of IBOs making sympathy purchases.

This is absolutely true and highlights a further tragedy. The value in relationships is called social capital. Amway knows there is a monetary value here and will encourage you to generate a "hot list" of prospects to get at this money. Losing your social capital in the service of a false dream is very sad.

It reminds me of the addict who becomes a leach and a drain on their family and friends. They can see the addiction but for awhile they feel like they should help out -- some money now and again.

What really bothers me is that I do believe in a version of the "work hard and work for yourself" dream. I'm an independent business owner myself. It's wonderful. Guess what? Real independence means you don't need an upline. Any tools you buy you seek out and buy with your own dollars-- we call those profits.

It is quite possible (and practical) to start your own business in the US and make a living at it. No selling to my family and friends either. I'm happy to give my services to them for free -- after all, they are my loved ones.

I'm all for the American dream. I'm not for Amway. I believe they corrupt what is good about the impulse to freedom and independence.

Just remember, when you look at those making big money in Amway, you are looking at the tip of a very large iceberg of misery and failure. This is the beautiful mushroom, proudly on display, but growing from a huge network extracting nutrients from a rotten carcass. Oh. And the mushroom is both poisonous and hallucinogenic. Don't eat it. Wash your hands after touching it.

 

[marplots]

Here is another distinguishing feature.

How often does this conversation happen?

"You haven't been doing well, I don't think you are cut out for this Amway thing. I'd really like you to consider moving on to something else."

I bet it never happens.

On the other hand, I've mentored a couple of people in my line of work. I've had to tell more than one that they weren't a good fit. That's called honesty.

 

[Joecool]

oh good grief. Do you think if a TEAM member had 50 customers and he quit Amway because he thought Amway and done something wrong, he'd call up Amway and say "I've got 50 customers, can I pass them on to someone else?"

Are you a fool or do you think others are?

As it happens though, I've got several former TEAM IBOs who have contacted me and purchase products from my US Amway business as customers because they still want the products.

As a result of this TEAM thing, it was revealed that only about 4% of products are sold to non iBOs. Thus we can reasonably conclude that a loss of 100,000 IBOs costed Amway about 4000 customers. It was the loss of sales to those IBOs that was damaging.

Amway is both a business opportunity and a buyers club. Deal with it.

I thought promoting Amway as a buyer's club was illegal.

And they tell you that can be achieved by doing nothing just registering? Really?

Nope, they tell you 6-4-2 and 2-5 years then you sit back forever sitting on exotic beaches sipping mai tais the rest of your life. That implies getting something for nothing after putting in a little bit of work. It's a lie, and apparently one that you believe and promote.

 

[Joecool]

And they tell you that can be achieved by doing nothing just registering? Really?

Edited by Locknar: 

Moderated content removed.

You are the only one advocating Amway on this thread. Everyone else, including myself has provided very realistic and in some cases, factual evidence. Yet you ignore or simply do not agree or do not believe what has been presented.

As Mycroft said, you took evidence that Amway doesn't work and presented it as evidence that it does work.

It's like you're wearing the dunce cap but walking around thinking everyone else is stupid.

I'm not trolling and I do not resort to name calling or telling people they need help. Maybe you should look yourself in the mirror and see if maybe your viewpoint is skewed. Do you really think all of the reasonable people and arguments here on this thread is all wrong and you, the one lone advocate is right despite all the facts suggesting otherwise? And you think I need help?

BTW, my name isn't Steve.

Here is another distinguishing feature.

How often does this conversation happen?

"You haven't been doing well, I don't think you are cut out for this Amway thing. I'd really like you to consider moving on to something else."

I bet it never happens.

On the other hand, I've mentored a couple of people in my line of work. I've had to tell more than one that they weren't a good fit. That's called honesty.

My observation and experience suggests that in a situation like this, most upline would advise you to buy more tools because that would help fix the problems your business is facing. It's like the solution to a failing business is to spend more money and open new stores.

 

[icerat]

This is absolutely true and highlights a further tragedy. The value in relationships is called social capital. Amway knows there is a monetary value here and will encourage you to generate a "hot list" of prospects to get at this money. Losing your social capital in the service of a false dream is very sad.

I entirely agree. So don't do it. Never lost a friend because of my involvement with Amway, made plenty.

Seriously though, this is a legitimate issue. Ironically I've noticed that when people are thinking of their friends/family with $$$ signs floating over their heads, it's virtually a guarantee that they won't build a successful Amway business. I don't think that's limited to MLM though. As I mentioned earlier I happen to be a Microsoft reseller. If I bugged all of my friends to by software off me that would lose social capital. Same when I had a web hosting company. Same with some preschools I'm in the process of setting up, same with any business.

Just like with my Amway business, I let people know what I have available, but I don't bug them. Still, I admit it is irritating when someone goes and buys something off a competitor when they could have got it off you, which I've had often several times in non-Amway businesses.

That's life though, no big deal.

What really bothers me is that I do believe in a version of the "work hard and work for yourself" dream. I'm an independent business owner myself. It's wonderful. Guess what? Real independence means you don't need an upline. Any tools you buy you seek out and buy with your own dollars-- we call those profits.

I'm not sure I understand the distinction? Plenty of people build Amway businesses without using their upline. And plenty of people, myself included, seek out and buy tools with their own dollars, including profit, from non-upline sources.

It is quite possible (and practical) to start your own business in the US and make a living at it. No selling to my family and friends either. I'm happy to give my services to them for free -- after all, they are my loved ones.

Services perhaps yes, but I'd suggest that giving away consumable products in high demand that have cost you money to any friend or family that wants them, free, is going to cost a lot of money.

I'm all for the American dream. I'm not for Amway. I believe they corrupt what is good about the impulse to freedom and independence.

I believe your beliefs about Amway have been corrupted by (a) myths about Amway and (b) truths about the way some unprofessional idiots operate Amway businesses.

Just remember, when you look at those making big money in Amway, you are looking at the tip of a very large iceberg of misery and failure.

Where are all these people? As already noted, there's been millions who have been involved in Amway over the years in North America alone. Yet there's very, very few complaints about the company. And when you do look at the complaints, they're virtually all involving the same group within Amway, a minority of Amway.

Heck, there's few complaints about the entire MLM industry! The FTC did a large investigation into the industry a couple of years ago. They were developing new rules regarding Business Opportunities. They ended up excluding MLM and one of the reasons they gave was because there were so few complaints about the legitimate players, and the illegitimate players were mostly scams already covered, and being prosecuted, under existing laws

 

[icerat]

Here is another distinguishing feature.

How often does this conversation happen?

"You haven't been doing well, I don't think you are cut out for this Amway thing. I'd really like you to consider moving on to something else."

I bet it never happens.

You bet wrong. I've told downline that they need to seriously think about what they're doing because they're just spending money and not doing what needs to be done to succeed, so they'd be better off doing something they'd actually do

On the other hand, I've mentored a couple of people in my line of work. I've had to tell more than one that they weren't a good fit. That's called honesty.

I've many times heard Rich DeVos (founder of Amway) and Jim Dornan (founder of Network 21 and Amway Founders Crown Ambassador) say that Amway isn't for everyone.

If the Amway I experienced operated the way you think it operates, I wouldn't recommend it either. Not my experience.

 

[icerat]

I've noticed that pretty much none of this thread has actually been about Multilevel Marketing per se. It's been about how people promote MLM businesses, or whether particular products are good value etc.

It's like ostensibly talking about whether internet shopping is a viable business model but in reality just talking about the problems of spammers promoting viagra web stores.

Anyone want to actually talk about the Multilevel Marketing business model itself?

 

[Joecool]

Just remember, when you look at those making big money in Amway, you are looking at the tip of a very large iceberg of misery and failure. This is the beautiful mushroom, proudly on display, but growing from a huge network extracting nutrients from a rotten carcass. Oh. And the mushroom is both poisonous and hallucinogenic. Don't eat it. Wash your hands after touching it.

That is a good illustration. Rather than a pyramid, Amway is like an iceberg because much of the problems are below the surface and cannot be seen by outsiders.

Icerat is using his old defense that there aren't complaints against Amway. It's because in Amway, many people are sponsored by friends and family, thus even if they determine they were scammed, they are usually just happy to quit and disappear, and not likely to file a complaint. Also, those who quit quickly do not lose too much money so they will often chalk it up as a learning experience.

But here's food for thought. I heard many unethical teachings and I know a lot of this stuff still goes on as evidenced by current IBOs posting their experiences online. I sat in functions where at times, had audiences of close to 20,000 people in attendance and that was one of many functions going on all over the country. I wonder how many millions of people got bad or unethical advice?

 

[marplots]

Anyone want to actually talk about the Multilevel Marketing business model itself?

Yes, let's.

I'll start by proposing that a distribution chain with too many people taking little bites of the pie needs a tremendous increase in prices to support it. Rather than allowing efficiencies in distribution, MLM requires these inefficiencies and explains why we do not see stores opening with MLM products for sale.

My premise is that the more layers between manufacturer and consumer, the more you have to increase the retail price, or, conversely, shift some costs onto willing but foolish distributors.

How's that?

 

[psionl0]

I have been hassled by amway distributors before. When I say that they are describing a pyramid the only answer I get is "no, pyramids are illegal" (implying that they use some legal loophole to avoid being charged for marketing a pyramid).

However, amway and all other forms of MLM are precisely pyramids. You are not going to make much money selling their crappy products. The real money is in recruiting people to do just what you are doing (ie recruit other people to recruit more people).

 

[The Don]

Thanks to the link to amway.com - can't believe I couldn't find it:

Kid's shampoo:
Amway $1/oz (2x8oz, $16.00)
Wallmart 12c/oz (2x22.5oz, $5.56)

Motor Oil
Amway 19c/oz (6x32oz, $37.38)
Walmart 9c/oz (3x160oz, $46.41)

First two things I picked at random

 

[icerat]

Yes, let's.

I'll start by proposing that a distribution chain with too many people taking little bites of the pie needs a tremendous increase in prices to support it. Rather than allowing efficiencies in distribution, MLM requires these inefficiencies and explains why we do not see stores opening with MLM products for sale.

My premise is that the more layers between manufacturer and consumer, the more you have to increase the retail price, or, conversely, shift some costs onto willing but foolish distributors.

How's that?

You apparently misunderstood the model. As the FTC reported in FTC vs Amway, and which I've already mentioned in this thread, the number of levels in an MLM distribution chain is very similar to in traditional retail.

In Amway it's inherently limited by the volume bonus scale. In other MLMs there are explicit limits to the number of payout levels

 

[icerat]

However, amway and all other forms of MLM are precisely pyramids. You are not going to make much money selling their crappy products. The real money is in recruiting people to do just what you are doing (ie recruit other people to recruit more people).

I'm curious as to how you think that works, given distributors make no money when they recruit people?

Payment for recruiting is the sine qua non of a pyramid scheme. It doesn't happen in Amway and other legitimate MLMs.

As for "their crappy products", that's a subjective opinion. They've won independent awards around the world, so others apparently disagree.

 

[marplots]

You apparently misunderstood the model. As the FTC reported in FTC vs Amway, and which I've already mentioned in this thread, the number of levels in an MLM distribution chain is very similar to in traditional retail.

In Amway it's inherently limited by the volume bonus scale. In other MLMs there are explicit limits to the number of payout levels

Can we work through an example?

I think you are connected enough to pick a product and work out who is making what (at least until you get to the manufactured price where you may not know Amway's cut). I assume there's a known percentage added on at each level -- how does that work exactly? I don't know that breakdown, but we could figure it out with your inside info.

It should look something like this... retail - distributor - next level up - next level up... and so on. Any product will do, all we want to see is what the add-ons are.

This seems like a fair way to evaluate the MLM model-- start with what money is available and where it comes from.

 

[psionl0]

I'm curious as to how you think that works, given distributors make no money when they recruit people?

It's been a while since I allowed an amway distributor to bore me for more than 5 seconds at a time but if memory serves me correctly, you get a cut of the sales the people you recruited make - whether that be direct sales or sales that people they recruited made.

Maybe not paying an upfront fee makes it "legally" not a pyramid but that doesn't make it a legit scheme.

As for "their crappy products", that's a subjective opinion. They've won independent awards around the world, so others apparently disagree.

The last amway distributor I met hated me for saying that laundry soap is better than anything they make. Add some carb soda or vinegar and you have an effective, environmentally friendly cleaning arsenal that makes anything that amway is flogging look like expensive poison in comparison.

 

[icerat]

Thanks to the link to amway.com - can't believe I couldn't find it:

Kid's shampoo:
Amway $1/oz (2x8oz, $16.00)
Wallmart 12c/oz (2x22.5oz, $5.56)

(3)Amway 19c/oz (6x32oz, $37.38)
Walmart 9c/oz (3x160oz, $46.41)

First two things I picked at random

(1) Why would you pick those two products instead of any of the products the business is actually based around? Neither Amway nor Amway reps are in the motor oil or baby shampoo business, any more than a Toyota dealer with a coke machine in the showroom is the coke business. Those products are for distributor convenience, and not sold at that price to distributors.

(2) You compared kids shampoo with baby shampoo. Not even in the same category. Even within the categories I don't know enough about the products to be able to sensibly compare any. How's your knowledge about the ingredients/quality/value of baby shampoo?

(3) You compared a synthetic oil with a conventional oil. They're quite different

I checked and Walmart has a synthetic product as well

They don't give a web price unfortunately. For comparison a quick google found -

Mobil 1 94003 Synthetic 10W-30 Motor Oil - 1 Quart, Pack of 6 (Amazon) 6*1quart $52.64= 27c/oz.

Red Line 10W30 Synthetic Oil - 1 Quart, Pack of 12 (Sears) 12*1quart $226.58= 59c/oz

So for those competitors at least, the Amway version, at 19c/oz full retail, 18c/oz members price, is significantly cheaper.

 

[icerat]

It's been a while since I allowed an amway distributor to bore me for more than 5 seconds at a time but if memory serves me correctly, you get a cut of the sales the people you recruited make - whether that be direct sales or sales that people they recruited made.

That's not even remotely the same as getting paid for recruiting. In fact, for any given product sale you make *less* money by selling it via a recruit than directly to an end consumer. Same as if a wholesaler sells a product to a retailer rather than direct to an end consumer themselves, or a retail store owner sells a product via an employee rather than directly themselves. Lower margins, less profit, made up for (hopefully) by increased sales volume.

Maybe not paying an upfront fee makes it "legally" not a pyramid but that doesn't make it a legit scheme.

So buying in volume and reselling at wholesale or retail to someone at a markup, which is the basic Amway model, is somehow illegitimate in your mind?

The last amway distributor I met hated me for saying that laundry soap is better than anything they make. Add some carb soda or vinegar and you have an effective, environmentally friendly cleaning arsenal that makes anything that amway is flogging look like expensive poison in comparison.

You can eat the Amway laundry powder if you like, while I wouldn't recommend it, it's not poisonous.

So you've actually tried the Amway product and compared it's cleaning ability to your carb soda/vinegar connection? I'd note that virtually any laundry powder on the market will be expensive compared to that. Doesn't mean they're all some how scams. Some are indeed poisonous.

 

[Skeptic]

(1) Why would you pick those two products instead of any of the products the business is actually based around?

Because the customer doesn't give a damn about the silly excuses amway reps give for their stuff being ridiculously overpriced.

Neither Amway nor Amway reps are in the motor oil or baby shampoo business

They aren't? So why do they sell them?