Depending on your age and where you live, multilevel marketing schemes (also known as MLMs) might be ubiquitous in your life. Or you might be thinking: Wait, those still exist? They do exist, although companies get away with not being pyramid schemes largely thanks to legal technicalities. Some of the older brands in the MLM game include companies like Amway and Tupperware (yes, really), and those fancy knives people used to sell at parties out of their living rooms (Cutco). But between the pandemic and social media, MLMs have gotten a fresh hayday—and that’s fundamentally dangerous for absolutely everyone involved.
Picture this: You log onto your Instagram, TikTok, Facebook, or even YouTube. You see a person—probably a woman, white, young—who is talking about making an income working from home. Specifically, from their phone. Specifically, in small pockets of time. They may even call themselves a stay-at-home mom and feature their little ones in the background of videos and photos where they’re talking about this miraculous essential oil, or a protein shake, or leggings, or a deep conditioner. Maybe she really does love the product—and maybe she’s tumbling into debt, chasing a dream to rise to the top of a company that is suspiciously pyramid-shaped.
MLMers—sometimes referred to as “huns,” a riff on the stereotypical opening message of “hey, hun” you might receive in a text or direct message—had plenty to work with when the pandemic hit and people lost their jobs. That sounds cold (and it is). We all remember seeing restaurants close, cashiers and grocery store workers pressed to the max, and teachers scrambling to work from home or in hybrid models. The vaccine was in the distant future and people were downright terrified about how they were going to survive, both in terms of their health and their finances. And huns? Well, they were happy to promise you that you could make money working for yourself from the safety of your home—as long as you bought in and joined their team.
Here’s a great, short video from The Financial Diet (a website centered around making finances accessible to women) about MLMs and the pandemic, specifically.
What’s particularly terrible about this, in my opinion, is how heavily MLMs target low-income folks who truly don’t have the money to blow on a starter kit or auto-shipment of these products. Even if you do manage to sell a lot, the money is usually minimal until you start building your “team” and stack other sellers under you (hence the pyramid), and that’s even more labor. You’re not only trying to sell the product, but you’re trying to sell the idea of this new “lifestyle” to other people who will then sell under you, helping both you and the person who sold the idea to you and is above you. A nightmare if you ask me.
And many people in these companies do show off a certain kind of lifestyle online. Flashy cars. Salon trips. Vacations. Consultants are encouraged to show off, in fact, and to thank their company while doing it—you’ll see many posts where a hun makes a point of saying their last check filled their gas tank or that they were able to treat themselves to a shopping trip because of a bonus. You’ll never really see specific numbers, because they’re generally not allowed to share that information on account of how deeply misleading it is. But they can (and do) promote a lifestyle—or at least, the perception of one.
These people don’t get health insurance. They don’t get retirement. They don’t get paid time off. Or sick time. Or child care assistance. Or a remote work stipend. Remember, they’re buying in for the products in order to sell them. And again: Maybe that woman on your feed sincerely loves that protein shake and really would spend the money anyway. Or maybe she’s posting a new smoothie recipe every morning because she needs to justify her sunk cost and really, really wants a break.
If you’re wondering why people don’t just quit when they realize what they’re involved in, I think there’re a lot of reasons. Some people do, seriously, make great money off of MLMs with minimal work—think celebrities, for example, or people who otherwise have huge social followings online. Or random people who get in at the start of the company and thus have the widest possible pool available to sell to. Or people who get lucky. People will do a lot to hold onto a dream. People will also do a lot to avoid admitting they’ve been fooled. Shame is a powerful tool—one that’s powerful enough to keep people trapped in a pseudo-pyramid scheme? Maybe.
So this holiday season, keep your eyes and ears out for sales pitches and carefully crafted shilling. Is someone who sells an MLM product a bad person? Absolutely not. More likely than not, they’re vulnerable and got sucked in. These companies tend to prey on people who are, frankly, desperate. That’s not a judgment. But do I encourage people to buy something just to help them out? That’s your choice, but my personal vote is no. Instead, perhaps refer them to resources for leaving MLMs and offer to give them some funds or supplies directly, instead of becoming a “buyer” for their sales.
You can check out videos from Roberta Blevins, a woman who left an MLM while toward the top of the company she worked with. (And if she looks familiar to you, it’s perhaps because she was part of the Amazon Prime documentary LuLaRich.)
You can also check out videos by Jessica Hickson, who talks about her experience leaving a different MLM while at a top rank.
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