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Multi-level marketing companies and the disinformation they sell

A LulaRoe clothing sales business inside an apartment. (Jeremy Drey/MediaNews Group/Reading Eagle via Getty Images)
Written by publishing team

This was originally rebroadcast on September 30, 2021.

Multilevel marketing distributors promise big money in a way that fits your life.

But for many people who sign up, they quickly spot an issue.

“Their entire industry is built on misinformation,” Amanda Montell says.

This misinformation is carried over to conspiracy theories.

today, on point: Multi-level marketing companies and the misinformation they sell.


Amanda Montell, writer and linguist. Author of “Cult: The Language of Intolerance”. (Tweet embed)

Stephanie McNeill, Senior Culture Correspondent at BuzzFeed News. (Tweet embed)

also appeared

Jessica Hickson, formerly working distributor.

Transcript: Jessica Hickson on MLM Perils

Jessica Hickson runs a successful YouTube channel where she shares her experience with MLMs, and warns others about the dangers of MLMs.

When she left It Works in 2020, she lost everything: her income, her friends, her daily routine. In January of this year, with the encouragement of her neighbor, she began sharing her experience on YouTube. Below, she tells her story:

My name is Jessica Hickson. I am 30 years old. I currently live in the St. Louis area and have been part of It Works for five years.

[Tape from Jessica’s It Works marketing videos]: “Hey guys, I just wanted to make a quick video and tell you guys why. Why did I decide to join It Works and why am I doing what I do.”

It Works sells a variety of…what they call health and wellness products. They were initially known for their slim shell, which is what they call it. So it’s just a wrap that you put on what’s purportedly surrounding you.

[Tape from Jessica’s It Works marketing videos]: “Anyway, I tried this wrap and in the morning I took it off and was like holy crap. It works. It really works!”

I actually didn’t know what an MLM was before I joined one. I just saw my girlfriend post about it and she was talking about the money she was making personally. At the time, my husband had just gone into active duty and we were at our first duty station and so we were sharing a car.

I used to work as a nanny here and there, but other than that, it was very difficult for me to work outside the home with his schedule. So I thought, if this is my girlfriend and I know her personally and she’s making money off of that, I might as well give her a try because I can’t really work outside the home anyway. I was like, OK, let’s do this. I will do whatever it takes. I did research on how to be successful.

I think the difference in my story and those of others when they were in MLM is that the majority of people we know lose money. The difference with me, however, was that I was bringing in more money than I could have ever imagined with a regular job. And so that was a big part of me…because I thought if I was making that amount of money, others could too.

I saw red flags along the way. But when you’re surrounded by everyone who believes in the same thing, you’re taught to turn off that voice inside your head that’s telling you these are red flags, you have to run.

We didn’t actually have to, like, carry stock, which is one of the big selling points. However, with that being said, we are strongly encouraged to keep the product on hand in case someone wants to purchase it or shows that you are using the products. And a lot of leaders wouldn’t even talk to someone below them if they weren’t managing their monthly car shipment.

The bonus plan is designed in such a way that if you do not maintain ranks, you do not get bonuses and you are not making much income. So a lot of people had a huge incentive at the end of the month to buy a bulk order of the products in order to maintain this rank so that their salaries were not halved the following month.

The most important thing about the products is that they are designed to be a quick fix. I have a before and after picture that floats, it works because I’ve had good results with the products. But the problem with that is that they leave out huge details about my weight loss. In the previous photo, I just had my daughter. I had two children within two years.

And I wouldn’t go so far as to say I have an eating disorder in the pictures that are circulating of me now. But I would say there have been times when I’ve felt a little hungrier than I should or worked out a lot, you know, just to get before and after photos to show people that my products work.

My husband was spreading. And at the time I had, I think, a two- and three-year-old. So the months before it was posted, I just wanted to spend it with my family. I didn’t receive any of our team calls, which we had once a week. And so my husband ended up leaving.

I was talking to my top shortly after. You called to do like check me out and just say, how’s it going? And at that point it was so new and so new that he left. So I was a wreck. I was just crying. I was like, I don’t know how I’m going to do this.

And then at the end of the call, she just said, OK, OK, I just wanted to tell you that I removed you as a leader on our team page because we need someone who leads by example. And you don’t do that now.

Everything someone above me said was taken as true.

[ARCHIVAL TAPE] Promotional video that works: “It always works. Everything about our company works. The compensation plan works. People work, we work, products, all of the above. I love this company.”

So even if in my heart I really thought this wasn’t true, I had to portray it in a way that made it true for my team. And then once you do it a lot, you start believing it yourself.

[ARCHIVAL TAPE] It Works promotional video: “The biggest obstacle everyone needs to overcome is your belief in yourself.”

MLM wouldn’t exist if they couldn’t tell any lies at all.

Interview highlights

What are MLM?

Amanda Montell: “MLM, which stands for multi-level marketing, also known as relationship marketing, direct sales, and is often referred to as the legally spoiling fraternal twin of a pyramid scheme. They are pay-and-hire enterprises that are not supported by salaried employees, but by coaches and affiliates Distributors and international business owners, whatever kind of euphemism the organization chooses for its recruits who are lured with the promise of this wonderful opportunity to become an “entrepreneur”.

“Since wives and stepmothers are often the target of most of these perks, they can make a full-time living by working part-time. All they have to do is pay the subscription fee and then meet certain monthly quotas…they need to dump the product, no It matters who, they can buy it themselves, and they also need to recruit their friends and family to become sellers themselves.

“The problem is that when you have a lot of people who are constantly recruiting and recruiting and recruiting, the market sinks dramatically with too many sellers scarce. And you find a very small group at the top of this hierarchy making money at the expense of a tight block at the base “.

How is today’s MLM different from the MLM of the past, like Amway or Mary Kay?

Amanda Montell: “MLMs are experts at rebranding. And so while groups like Amway, Mary Kay, and Tupperware, their vendors were the kind of Suzy Homemaker you might imagine in the 1940s and ’50s when MLMs promised they would be the best thing that happened to them since they got the right vote.

“Now, MLM taps into a kind of Pinterest feminist and natural, holistic, and organic leanings for a younger audience. MLM will have sleek, up-to-date packaging. They will use language like Girl Boss, Boss Babe, Fembire, and SheEO. They will tap into whatever bogus feminist buzzwords are. The trendy ones resonated with the people of the time.”

About the “sectarian” behavior behind MLM like LuLaRoe

Amanda Montell: “There was a lot of language being used here that made the company a lot more than a company and a lot more than a scam. So MLM is not just an ordinary financial scam. They are complex institutions that take your life and speak a language and they have a culture of their own. They have these. The powerful and pervasive ideologies are of a missionary nature, and they have these founding leaders who come recruits to worship at the level of a spiritual teacher.

“These leaders are believed to be know-it-all, charismatic, and enlightened. Measures are in place to make sure they are not questioned. Everyone in the company is elevated by labels that make them feel superior to everyone else in the economy. And there are labels that criticize everyone who is not involved in Commercial Business.

“In fact, recruiters are encouraged to either involve the people they know or breathe from their lives. So incredibly co-dependence relationships are forming within these groups, especially because you are financially dependent on selling and recruiting everyone above and below you. So under that kind of pressure. Things can get quite cultural.”

About how MLM conspiracy theories spread

Amanda Montell:“Think of a Venn diagram with MLMs in one circle. Anti-distractors, wellness warriors, and newcomers in another. And classic conspiracy theorists, say QAnoners, Flat-Earthers, Holocaust deniers and the like in the third circle. The convergence there is a lack of Deep trust in key institutions.Whether it’s bureaucracy, mainstream media, government, the health care system.During times of social crisis and turmoil – and I think we’re in one of those times now – alternative affiliations tend to rise.

“We saw it in the late ’60s and ’70s with the Vietnam War and the Civil Rights Movement, and the Kennedy assassinations. And now with a lot of ideological dissociation and political turmoil, a pandemic and certainly the Internet, there’s now a cult for everyone. And if you lose faith in these key institutions, if you I have internalized Sovereignty’s message – the idea that you must take your health, life, and career into your own hands – to be able to find others who believe in the same.”

About solutions to stop the spread of misinformation from MLM

Amanda Montell: “MLM is legally spoiled by an earlier case involving Amway a few decades ago. The government is incentivized to maintain its relationships with the DSA because they have very strong political ties and donate generously to the coffers of mostly Republican presidential candidates. So there is a kind of toxic coexistence between the association Direct selling and government there.

“Government has no real incentive to shut down DSA or MLM in general because it benefits the industry. I would also comment on the commenter from before that not all MLM will use cultural tactics equally. However, selling association in general is kind Its own pyramid scheme.

“Because let’s say you sign up for an MLM and that doesn’t work for you. Odds are the pattern shows that you’re going to sign up for another one. That’s what a lot of people do. And just because someone got an MLM it probably didn’t affect you negatively, that doesn’t mean that they It hasn’t affected a lot of other people negatively. I often like to draw analogies to toxic singles and abusive relationships. You can have a very good relationship with someone who used to abuse others. So it’s all about perspective.”

From the reading list

hustle: “LuLaRoe isn’t just a scam – it’s a cult” – “I first learned about the ‘panty cult’ in the small hours of a winter morning 2017. I was approaching the event horizon of a Facebook black hole when I came across a message that caused a shiver: It was a language teacher The former high school Englishman is trying to send a scam to hundreds of her digital “friends.”

BuzzFeed News: “Gen Z Moms Build Their Brands Around QAnon” – “Last June, Alexis, a 23-year-old mom of two from Tennessee, created an Instagram account aimed at sharing fake novels related to QAnon, which I recently discovered.”

About the author

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