Page 49 - Marie Claire Australia (January 2020)
P. 49
AUSTRALIAN REPORT
hard-sell tactics promising success in
bucketloads – success that rarely
materialises. In fact, research by Dr
Jon M Taylor at the Consumer
Awareness Institute in the US revealed
a staggering statistic: that 99 per cent
of all MLM distributors lose money.
Dr Máire O Sullivan, a lecturer
in advertising and marketing at
Edge Hill University in the UK,
he walls of Nikki’s rumpus room has also conducted research into
are lined with boxes. Piled high, MLM’s advertising tactics on social
they sit untouched, collecting dust, media and is damning of their
filled with unsold Tupperware practices. “Vulnerable people are
containers and unopened being targeted by the allure of making
Younique and Arbonne beauty easy money, fitting work around their
products. They’re a constant own schedule, and entering a
T reminder of Nikki’s mistake: her supportive community,” O Sullivan
failed attempt at conquering modern-day direct says. “But some of these companies
selling or multi-level marketing (MLM). “I could have an alarmingly cult-like mentality,
fill a standard bedroom top to bottom with all of the they practise ‘love bombing’, and
excess stock I’ve got,” says Nikki, shaking her head encourage you to cut off anyone who
and looking around at the piles of wasted product isn’t supportive of the MLM or has
in her modest home “in the sticks” of rural Victoria, concerns about the business model.
where she lives with her husband and three teenage That is alarming and abusive
kids. “Every day I see these boxes and boxes and behaviour.” Not surprisingly, an
boxes, and it’s hard. I really struggle with it.” anti-MLM movement is gaining
Nikki, 35, first heard about the MLM make-up momentum across the globe, with
scheme Younique in 2013. The wife of her husband’s some protesters calling for change in
friend messaged her out of the blue on Facebook with legislation to protect the vulnerable.
“an exciting opportunity to join an amazing company For vocal critics, it’s the
and make money from home”. At the time, Nikki was recruitment of new members by
living in a housing commission property as a full-time MLM distributors that raises the
carer to her husband, who’d suffered a spinal injury at most concern. If you are a Younique
work, and she couldn’t afford the $129 sign-up fee. The “presenter”, Arbonne “independent
wife of her husband’s friend paid it and said all she had consultant” or doTERRA “wellness
to do was sell make-up on Facebook from home. advocate”, you can earn money from
“I was really naive. We were struggling financially, recruiting new members. When
barely making it week to week, and I thought I was someone signs up under you, you then
going to have a ‘high-end business’,” she says. But what become an “upline” and take a portion
was meant to be her golden ticket out of financial stress of their earnings. If they sign up people
became a living nightmare. “It was horrible,” says Nikki, beneath them, you also get a cut of
who estimates she spent more than $8000 on Younique their profits. The more people you sign
products, earning “next to nothing” back. up, and the more people they sign up,
Today, MLM schemes are booming. From old-school the more commissions you make –
staples such as Tupperware, Herbalife and Mary Kay so the people at the very top pocket
cosmetics to new kids on the block – Younique, Arbonne, money from the many at the bottom.
Isagenix, doTERRA and Scentsy – all employ a similar When you map it out on paper, the
business strategy where revenue is generated from both shape that forms resembles a pyramid,
product sales and recruitment of new distributors. They though use the phrase “pyramid
all primarily target women, luring them with similar scheme” at your peril: an online attack
promises. “You can earn five figures a month, working from fanatical distributors may follow.
from home, with no experience,” is the start of the In Australia, MLM businesses are
standard script for an MLM scheme. Getting an legal as long as most of the scheme’s
opportunity to join a kick-ass sisterhood of boss babes money comes from selling a product
is also a regular feature. Women make up 75 per cent instead of recruiting new people,
of direct sellers in Australia, and MLMs frame otherwise they fall under illegal
themselves as empowering women (Younique calls pyramid selling schemes.
itself “a sisterhood with a mission to uplift and Whatever you call it, MLM is
empower women around the world”). big business. Research from 2017
While these strategies are as old as the Avon estimates 117 million people around
lady army that ruled Australia’s suburbs in the 1960s, the world were involved in direct
what is new is that the push to sell has moved online, selling, with retail sales of $276 billion.
meaning more and more women are exposed to the Data from The Industry Association
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