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Thursday, October 20, 2011

Multi-Level Marketing Plan$ "Sister Wives"

Multi-Level Marketing Plan$


If you follow the Brown family, you have heard a lot about multi-level marketing plans over the last two days.  Do you know what a multi-level marketing plan (MLM) is?  I decided to do some investigative reporting and went to the heart of my hometown financial district (the Frostbite Falls combination Money Mart and Tattoo Parlor) to find out about MLMs.
Multi-level marketing (MLM) is a marketing strategy where the sales force is compensated for the sales they generate AND for the sales of other salespeople that they recruit, creating a hierarchy of multiple levels of compensation.  Other terms for multi-level marketing include network marketing, pyramid selling, and referral marketing. 
Usually, the salespeople sell directly to customers through relationship referrals and word-of-mouth marketing.  Some people use “direct selling” as a name for MLM, but it isn’t really because MLM always involves multiple layers of sales people who receive differing levels of compensation and lots of types of direct selling does not involve this.  MLMs are contrasted with a single level marketing network where there is 1 level of salespeople selling directly to the customer.
MLMs have been the subject of criticism and even lawsuits.  The criticism focuses on the similarity of MLMs to illegal pyramid schemes, product price-fixing, high initial start-up costs, emphasis on recruiting new (lower) levels of salespeople over actual product sales, requiring product use by salespeople, exploiting personal relationships to develop sales and recruit new salespeople, overly complex compensation schemes, and cultish motivation techniques.  There are claims that the success rate for breaking even or making money are far worse than with other types of businesses.
Many illegal pyramid schemes try to pass themselves off as legitimate MLMs.  The U.S. Federal Trade Commission says that pyramid schemes are dangerous because plans that pay commissions to recruit new levels of salespeople (or members, distributors, associates, consultants, or whatever they may be called) collapse when no new salespeople can be found.  When such a plan collapses most people end up empty handed – except, perhaps for those at the very top of the pyramid. 
Here are a couple of quick tests to differentiate between a legal MLM and an illegal pyramid scheme.  Check with the experts if you need to know more:
·      Is there more emphasis on recruiting new members than on selling the product or service?  If so it might be a pyramid scheme.
·      Is the plan designed so that more money is made by recruiting new members than by selling the product or service?  If so it might be a pyramid scheme.
We should also remember, however, that many long-standing successful companies such as Avon, Mary Kay, and Tupperware use this sales method.
Resources:

 WRITTEN BY TERRASOLA

15 comments:

  1. So the more Sister Wives "lovers" they get signed up, the more money they make?
    Are they using TLC?

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  2. What makes me ill is this "use" they are going to play off of these innocent victims.
    Sell some bogus $15 recipe book, but not a pyramid scheme that is EXPENSIVE.

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  3. "We should also remember, however, that many long-standing successful companies such as Avon, Mary Kay, and Tupperware use this sales method."

    We should also remember that those companies were actually selling legitimate products.

    There is nothing on the LIV international site that I would consider a legitimate product.

    ReplyDelete
  4. Now, it's going to help addictions!

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  5. In their own propoganda they state something like they want you come with them to help them convince other people to convince other people to....

    That says it is MLM. You are layering people. The product is immaterial.

    I am 500% against this. It is hateful, immoral, bogus, ungodly, etc. Contemptible is the best word that comes to mind.

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  6. yes, AVON, etc. are LEGITIMATE MLM's cause you think of their products FIRST because that's what they promote FIRST. whoever thinks about them even being MLM?

    but this LIV is showing its true nasty and scammy side because they're pushing recruiting to get rich! not working your butt off selling product. and yes, with all the ridiculous moron fans i see kissing their asses on FB, Browns have a much better chance of getting rich off this scam thanks to their long line of suckers ready and begging to be on Team Kody.

    good lord, people are stupid. especially that lady that's working round the clock to get TLC's attention and FB fans to get a fund set up for them to buy them their DREAM HOME!! good gawd!!

    ReplyDelete
  7. I sold Longaberger Baskets once, just because I love them and could get a discount. However, I got lucky because everyone in the area bought them.
    I sold 15,000 worth the first year. What little i made went up in buying more product to show.
    Real money made 0.

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  8. Yes that is the world of MLM.... But have you state to your mind that they'll put on the top because they're truly believe in the company and to themselves. The work of determination to success. Be on top is like you are in the business as the business grows company get rich.

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  9. AVON is now a MLM scam. Their #1 product is a business opportunity. One where 99% of AVON reps do not earn an income. AVON was once a real legit business. Now it's a scam, just like all the rest.

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  10. MLM = Mormons Lying to Mormons

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  11. MLM can be categorized as direct sales but direct sales is not always MLM. Most experts would use the compensation model as the distinguishing factor.

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  12. ok, so these people are bashing MLM while Donald Trump, Robert Kiyosaki and many other millionaires endorse MLM. Who would you listen to? The answer is a no brainer!!! But do your research because unfortunately there are thieves out there looking to make a quick buck.

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  13. I just love your site, it is fresh, filled with related articles, eye-catchy design has a very nice right!Because several articles helped me in my job really, thanks for that!home based business

    ReplyDelete
  14. Ugh - Liv University. http://www.livuniversity.com/LivTheJourney.aspx
    Compensation is ugly, especially the Bonuses. That's the only part I read. That and what is in the products. {{shaking head}}

    ReplyDelete