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Currently viewing:: 2007 > August > 24 > Ignorance and responsibility.

Ignorance and responsibility.

Counter prejudice with truth?

A common scenario when someone publicly questions or criticizes Network Marketing is for 'pro' zealots to vigorously defend the business regardless of 'right or wrong'—and any sensible discussion is quickly abandoned.

A relatively mild & intelligent example is this 'is mlm any good?' old Newsvine exchange between Ty Tribble and Michael Stevens. [In our re-post, for clarity rather than emphasis, Stevens' comments are shown in italics.]

MLM—A Flawed Concept?

By Ty Tribble.

I often hear critics say that MLM is a fundamentally flawed business concept. Of course they are right. However, they shouldn't toot there horns quite yet. The reality is, every single business in the world is flawed. No business will work for everyone.

In fact, I'm flawed, you are flawed, and the world is flawed. Yet, I still live what I consider to be a pretty good life. I'll bet you do too. I have good health, a beautiful wife and great kids. I have a lot of things to be thankful for as I'm sure you do.

There are flaws in Network Marketing, but there are also some distinct advantages. In Network Marketing, I have more control over my income than I would at a typical job. In Network Marketing, I have less to worry about (paperwork, product distribution, employees) than I would by having a typical business.

MLM is not for everyone, but it certainly isn't any more flawed than the profession of the person that is telling you how flawed it is.

MLM is fundamentally flawed in ways that make it largely unviable. MLM often ignores simple supply/demand forces, making it harder for distributors to sell their product.

All the advantages you present could exist without the presence of uplines or downlines. However, companies stick with the MLM framework because the real money is to be made in selling distributorships, not in selling the product.

I've done a lot of research into MLM, and as an economist I feel it is entirely unworkable as a method of selling product, which is why companies with in-demand products don't use it.

You propose however that MLM is flawed because, hey, we're all flawed. Well, Hitler was flawed too. All things aren't equal, and I would stay far away from MLM schemes.

You are making a huge and flawed assumption here: '…because the real money is to be made in selling distributorships, not in selling the product'. That is simply not true and the FTC makes sure of it.

Network Marketing contributes $72 Billion to the US economy each year. If that is 'entirely unworkable as a method of selling product', I would like to see what you consider workable.

Then why sell distributorships at all? For distributors, they are necessary to make real money. For the company, they are necessary to create demand… the biggest customer for these firms are those who've been suckered into the business of MLM. They are the ones who buy the products.

It doesn't matter how much Network Marketing contributes… it's not an efficient or desirable method of selling product. MLM doesn't exist to sell desirable products… companies create products in order to push their MLM systems.

Hhhmmm… in view of his MLMManifesto ('denouncing Network Marketing as usual—changing the way we do business and therefore changing the perception of Network Marketing) I'd expect better of Ty.

Sure, Stevens is typically anti and perhaps unfairly disregards some important points…a scenario which is best handled with clearly factual statements—and Ty's countering of 'because the real money is to be made in selling distributorships, not in selling the product' with 'that is simply not true and the FTC makes sure of it' is plain wrong.

That there's way too much emphasis on recruit-not-retail is clearly evident to any-and-all who've taken more than a cursory look-see. Until this business responsibly owns its shortcomings, it'll continue to be dismissed by many who could do well in it (and thus improve the standing of the whole business).

Like any commercial activity, Network Marketing has 'good and bad'. By openly acknowledging this can we shift misguided perceptions. And, when considering 'genuinely bad', we have to be honest in a 'yeah, it's crap' way.

Filed by g on August 24 2007

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