Tuesday, January 17, 2017

MLM and Rebates

Today's blog post is focused on the psychology of turning a commissioned sales person into a customer. MLMers are taught it is necessary to purchase the products monthly to qualify for commissions and they are also supposed to purchase for their own consumption. This is an extraordinary type of logic as it forces an MLMer to continue to purchase monthly regardless of their sales, and it confuses them by giving a rebate check for their own purchases rather than an actual pay check for the sale of the goods or services. There are different types of monthly subscriptions provided by MLMs, but they all come back to the same fundamental agenda of getting the distributors to spend their hard earned dollars on the MLM rather than the MLM paying the distributors to help move their product or service.

Amway, the founder of the MLM business model, was the first to utilize this psychological manipulation in order to generate a loyal customer base. They found sales were stronger and more consistent when the members of their work force were continuously buying products instead of retail customers. Amway continues to teach distributors to buy from "Their store" instead of a big box store, because it will help them generate revenue and they need the products regardless. Amway then offers compensation in the form of a rebate at the end of the month based on the amount of product purchased by the distributor. MLMers are then confused by the concept of "Their store", because it is actually Amway they are purchasing products from and generating Amway more revenue. The concept gets more confusing once the levels are implemented, hence the name multi-level marketing. Instead of selling goods or services, they are taught to increase their revenue by signing up friends, family, acquaintances, and eventually strangers to also purchase monthly goods and repeat the process. Once they have secured a solid foundation of people purchasing monthly goods, then they will start to see a rise in their paycheck and believe they are becoming more successful. This is how the pyramid is formed.

The MLM rebate is one of the key methods to lure unsuspecting consumers into the trap. They are extremely vague about how much money you will receive monthly based on the amount of goods purchased, and they do not explain that the rebate can only grow as long as more dollars are spent on MLM products. Naturally, if an MLMer doesn't have a downline then they will notice they are spending more money than they are making, but when they see that other downline members are helping to grow their rebate checks, they begin to ignore the obvious paradox. There must be more dollars spent in order to get a larger rebate, but the dollars spent don't have to come from their pockets. This in turn leads to exponential losses for the levels of MLMers that develop underneath the original tier.

MLM, in theory, could work if the MLMers were taught to focus on the sale of  goods or services before signing up new members, but that would defeat the purpose of the multiple levels of commissions. The multiple levels are used as a ruse to lure people into the MLM as a means to purchase more goods instead of selling goods, and then teach others to repeat the process. MLMers have found it is much easier to convince people to spend their own money on a business opportunity than it is to sell the goods or services they provide.

Wednesday, January 11, 2017

MLM and George Orwell's, 1984

Today's blog post is about a book I recently read by George Orwell, 1984. The story is about a man, Winston Smith, working for the government formally known as, The Party. The Party is the government of Oceania, one of the three main super powers, and is continuously at war with either Eurasia or Eastasia, or at least that is what they tell their people, in an effort to secure power. The Party has a figure head named "Big Brother", and he is a symbol of vigilance and power as his poster is hung everywhere throughout civilization along with "telescreens" and microphones used for monitoring every citizen twenty-four hours a day. There are three castes within the society, the inner party, the outer party, and the proles. The inner party is the group of people who control the government and dictate what the people of the outer party and the proles are allowed to do. The outer party helps with mundane tasks designed to increase the inner party's influence on the other two groups. The proles (proletariat) are the working-class, and they are the slaves of society that go through the motions of life (wake up, work, have children, die) without realizing they are being controlled.

The story is an important read, because it shows the development of a totalitarian regime and it also shows how people are manipulated and conned into giving up their ability to rationally think as well as have rights. The Party is a group that learned the mistakes of previous oppressive groups, the Christians with the Crusades, and the Nazi's with the National Socialist German Workers' Party, to become the ultimate power over its people. They learned how to manipulate and destroy the past so as to control the present, and they also manipulated and destroyed language to alter the way people thought. They created a society based on faith, loyalty, and surrender under the key assumptions of "War is Peace, Freedom is Slavery, and Ignorance is Strength".

MLMs have utilized similar techniques to create undying faith and loyalty. They have designed their business opportunity as an us versus them mentality by suggesting if you don't pursue MLM then you will be forever burdened with a 9-5 job and a life of constant struggle for the next pay check. MLMers are constantly at war with the outside world and the internet, and this war will continue as long as both exist. This technique of an ever lasting war outside of the MLM creates an odd sense of peace within as people falsely believe the leaders have their best interest at heart and somehow people within the MLM are more wholesome. It also brings a sense of unity and camaraderie as the people within the MLM band together and fight against the oppressive outside world.

MLMers preach freedom as long as they choose to follow the systems they have implemented. In fact, Amway has a special event called FED which stands for Freedom Enterprise Days in which they utilize the term Freedom as much as possible in regards to the MLM and success. Unfortunately, this is all a ruse as they utilize this "doublespeak" (saying one thing while believing another, also known as cognitive dissonance), to transform the idea of freedom into a meaning of slavery. What I mean by this is, in order to get financial freedom and live a life of luxury, you must commit yourself to the MLM entirely with both your money and time. You must show the business plans regularly, you must attend all functions, you must pay for monthly supplies, you must subordinate to your uplines. Only then, can you achieve freedom.

MLMers deliberately avoid the issues of facts and statistics. They prey on the ignorance of their followers and utilize the faith they impose as a business strength. They shun research and outside influence in an effort to keep MLMers devoted and unquestioning. If an opposing view is mentioned, then it is quickly attacked in a succinct and aggressive manner as to contain the problem as fast as possible. Similarly to an oil leak in the ocean, MLMers understand that dissenting positions can spread quickly and can be difficult, if not impossible, to remove. They are quick to attack the source of the opposing view, come up with a fallacious analogy, or simply pretend it doesn't exist, because they cannot specifically respond to the facts. MLMers understand the need for ignorance to generate strength within their organizations.

Even though George Orwell's 1984 was designed to combat a potential totalitarian government, it is easy to make connections to MLMs and their cult-like syndromes. If you are being pressured to join a MLM, please make sure to do research and examine red flags. Do not be afraid to have a dissenting opinion, and do not allow them to dictate where you get your information!

Tuesday, January 3, 2017

MLM and Religulous (Bill Maher Documentary)

Today's blog post is about a recent documentary I watched again over my holiday vacation. The documentary explores different religions that stem from the bible, and some of the interesting people involved with these different denominations of Judaism, Islam, Christianity, Mormonism, and Catholicism. While Bill Maher is not my favorite documentary host, he does a good job of plainly exposing simple "truths" upheld by religious fanatics. If you can get past his implicit bias and sensationalism, then I believe there is a lot to be learned from this documentary and there can be a lot of connections made to MLM.

The three main points I would like to focus on from this documentary are:

1. He focuses on questioning, "truths" that can't be explained by anything other than taking a leap of faith.

Throughout the documentary he confronts both followers and leaders about the supposed evidence to support claims of  miracles and teachings. He asks people to delve into their critical thinking abilities and try to describe a similar scenario to someone that is not a believer or insider without sounding crazy. An example of this is the story of Joseph Jonah, and how he survived for 3 days inside of a giant fish. There seemed to be a massive amount of cognitive dissonance around this story and the idea that maybe this wasn't factual or couldn't be proven.

MLMs have a notorious failure rate, and yet people see evidence of success within their companies. As they attend functions and seminars, they are consistently reminded that the highest ranks are achievable and they are living fabulous lives. MLMers are taught to focus on their dreams in an effort to escape the horrific reality of the scheme. Their blind faith in the evidence is only supported by the companies themselves and publications sponsored by the companies (such as the DSA, Inc Magazine) while the rest is made up hogwash from the sponsors passed down through the "leaders".

2. He focuses on the "leaders" of organized religion and how they choose to "interpret" the meanings of the bible.

The leaders in the documentary are fascinating because they embrace the writings to best conform to their ideals. One of the leaders tries to twist Jesus into a wealthy messiah that came from not-so-humble beginnings, while another actually suggested he was the second coming, but was also a descendant? There was a catholic priest that suggested science discredits the teachings of the bible and another catholic priest that basically said, they are nice stories but most of it isn't true. Finally, you have a rabbi helping Turkey fight against Israel, and you have a group of Muslims stating they preach peace while reciting scriptures that suggest imperialism and death to infidels.

MLMers have an interesting way of twisting words to better suit their needs as well, and rarely are able to come to terms with inconsistencies. At an FED I attended, I listened as MLM leaders came out on stage, after an introduction video which reflected MTV Cribs on steroids, and acted as though they were part of the common people. Meanwhile, they sat in isolation behind the scenes, and walked through the audience as celebrities, while the majority of MLMers were suffering tremendous losses for those "leaders" to have a comfortable lifestyle.

3. He focuses on the violence of religion and the us vs. them mentality.

Maher captures the violence of religion by three mediums, news footage, a death scene of Jesus Christ at an amusement park, and the language involved in the writings. There is an overlying theme between all of the Jewish denominations which is, one of them is right, and the rest are sworn enemies. The other overlying theme is the day of reckoning, known as Armageddon, which suggests everyone will perish and only the people of their chosen religion will be saved.

MLMers have a very similar view of the world, and it doesn't come as a surprise that they use religion to help fuel their objectives. While they may not be solely interested in the destruction of everyone else, they do not hesitate to impose their views while suggesting everyone else is doomed to fail. They preach their work is noble and everyone else is a slave to a time clock and a pay check, and they also preach any defectors from the group are evil (quitters, failures, deniers). They introduce only one path to salvation (retirement), and that involves endless obedience over an indiscreet timeline (your entire life to the business).

Thursday, December 22, 2016

MLM and How to Build Character

Today's blog post is about an article I recently read called How to Build Character. Someone who builds a good character is very different from someone with a good moral compass. Building a good character is important for functionality in society, but it is not indicative of a person's true self. Friedrich Nietzsche talked about people having masks and the impossibility to know who someone really is, and this article furthers that idea by providing a manual on how to develop good character. Unfortunately, this guide can be both good and bad depending upon who is using it and how they choose to use it.

"It doesn’t take much hard thought to comprehend what Bartol meant by likening character to a diamond. While in the literal sense diamonds do scratch other hard surfaces, including character might at first seem odd, but it really isn’t. Anyone of good character (or bad, for that matter) can make a lasting impression. Just as a scratch from a diamond that endures."

This quote summarizes the article nicely, and explains how character affects the people we encounter. People tend to remember extremes better than lulls and this especially includes impressions from a person's character. Nobody has trouble remembering the villain from an arson or the hero who saved the child from a burning building, but everyone forgets the person watching the event transpire. This is why it is important to learn how to build character and be able to present yourself in an appealing way to others.

MLMers utilize edification and character building to make themselves more impactful. MLMers work on their mindset by reading and listening to self-help gurus. MLMers work on their charm by watching and imitating their predecessors' actions when meeting new prospects. MLMers work on their self-image by dressing a certain way and utilizing clothing to assert an image of value. These people train themselves consistently and repetitively until they become the ideal character everyone wants them to be.

It is important to remember that this is a fa├žade and that MLMers are not a true expression of their outward appearance. MLMers at the highest ranks know this is not a viable business, and they utilize their good character (or appealing character) to generate revenue for themselves through deception. Eric Scheibeler was a perfect example of a wholesome individual that got to one of the highest ranks (Emerald in Amway) and realized the business was not viable and the leaders were phonies. This further demonstrates that good character does not represent a good person. 

Sources: http://psychcentral.com/blog/archives/2016/12/22/how-to-build-character/

Tuesday, December 20, 2016

MLM and Product Value

Today's blog post is going to involve some math as we delve into the list of competitive products MLMs offer. I have previously held discussions on other blogs about MLM products and their inability to be competitive in an open market system, but MLMers are always prepared to make a response. Some of their responses are, the products are better quality, more concentrated, and made from responsible manufacturers or some version of these points. Therefore, today's post will be an honest apples to apples comparison between 3 products from 3 different MLMs vs their competitors.

The first product I am going to do a comparison of is Amway's XS energy drink and Monster energy drink. The reason I chose XS out of the Amway products is, it is one of the most popularly sold items in their inventory and it is one that I have actually tasted. Energy drinks are an extremely popular item these days, and it is important to get the best value, best taste, and best product for your hard earned dollars. Something interesting to note, Amway XS energy drink is now available on Amazon and does not require a membership to Amway, or a membership to an LOS to purchase.

XS Energy is sold in a 12 pack and each can holds 8.4 fluid ounces. The price per case is $39.98 from this listing and it has the most positive feedback. For arguments sake, we will call this product $40.00 with shipping included. 12 x 8.4 = 100.8 fluid ounces per $40.00 spent, or about $0.40 per fluid ounce.

Monster Energy Drink is sold in a 24 pack and each can holds 16 fluid ounces . The price per case is $47.26 from this listing with shipping and has the same amount of stars with almost the same number of reviews. 20 x 16 = 384 fluid ounces per $47.26 spent, or approximately $0.12 per fluid ounce.

XS energy is approximately 3x more expensive than Monster energy, they both have the same amount of positive feedback, and they both are effective at helping with energy. Please make sure if someone debates that XS energy has something special that Monster energy does not that you specifically look at the ingredients. Each of them have plenty of caffeine which is the most important part of an energy drink. A common distraction brought up by XS proponents is the types of vitamins available in the drink versus other energy drinks. By and large, most people do not care about vitamins in their energy drinks, and vitamins are not the important ingredients for helping to keep energy levels up.

The second item from MLM is Youngevity's peppermint oil versus Plant Therapy's peppermint oil. They both come from plants and are both organic. They both are designed for the same needs and both are the same scent. They are both highly rated and seem to be extremely similar in effectiveness and production.

Youngevity's peppermint oil is available in 10 m/l for $24.70.  There is also a shipping and handling fee of $13.00 as well as a $2.28 tax bringing the total to a very convenient $39.98 which we will say is $40.00 a bottle. If you become a distributor you can knock 30% off and get free shipping which brings the bottle back down to $25.00 (they remove the "tax" as well), or you can order at least $50.00 worth of product and get free shipping (how inconvenient as one bottle costs $40.00).

Plant Therapy also offers a 10 m/l version on Amazon for $7.95 with free shipping and no tax. You do not have to buy a minimum amount and you do not have to sign up to be a distributor. You also do not have to sign up for a recurring shipment monthly.

Plant Therapy is between 3-5x cheaper than Youngevity for the same product with the same qualities. They both have high ratings and they both are manufactured well. There does not seem to be any logical advantages to buy the Youngevity version over the Plant Therapy version.

The third MLM product is Shakeology Vanilla from Beachbody versus Labrada Lean Body Vanilla. They both are designed as meal replacement shakes and both contain high quantities of protein mixed with vitamins and minerals. They both have high ratings and they both are made from responsible manufacturers.

Shakeology comes in a 30 pack for $129.95. They also add $2.00 shipping for the cheapest available and $10.56 in tax bringing the total to $142.51 or approximately $4.75 per serving. They also offer 10% off if you become a regular member (sign up for monthly shipments) and 25% off for coaches, but they still charge tax and shipping.

Labrada lean comes in a 16 serving tub for $27.98. In an effort to do a fair comparison we will double that order to 2 tubs for 32 servings. The cost of the two tubs will be $55.96 and then shipping is $8.31 bringing the total cost to $64.27. $64.27 split among 32 servings equals approximately $2.00 per serving.

While I didn't go into specific details about the ingredients, it is important to remember that both of these products serve the same purpose and Labrada lean is half the cost with no sign up or monthly commitments. It is designed to do the same thing as Shakeology and major clinics such as the Mayo clinic continue to post information about shakes and their overall effectiveness which is something to take into consideration before purchasing.

This pattern of overpricing products is not unusual because of the payout structure. The payouts go through many levels as new customers join the business. If an MLMer tries to tell you their product is the best value and the best quality then they are lying. There is no efficacy to prove their products are better because they are in market spaces with little to no regulation or clinical support, and their products are the most expensive when compared with their competitors. These three examples are not unique.


XS Energy: https://www.amazon.com/XS-Energy-Drinks-Variety-Ounce/dp/B002C94E1I

Monster Energy: https://www.amazon.com/Monster-Lo-carb-Energy-16-Ounce-27-5/dp/B001DNBYXK/ref=sr_1_2_a_it?ie=UTF8&qid=1482270856&sr=8-2&keywords=Monster+Energy+Drink+blue

Youngevity peppermint oil: http://youngofficial.com/product/youngevity-essential-oils-peppermint/

Plant Therapy peppermint oil: https://www.amazon.com/Plant-Therapy-Certified-Peppermint-Therapeutic/dp/B0062C2IKA/ref=sr_1_2?ie=UTF8&qid=1482272840&sr=8-2-spons&keywords=peppermint%2Bessential%2Boil&th=1

Shakeology: http://www.shakeology.com/where-to-buy#vanilla

Labrada: http://www.bodybuilding.com/store/lab/lean-body-mrp.html

Friday, December 16, 2016

MLM and Guilt

Today's blog post is about the use of guilt to manipulate a person. In this particular case, a person may utilize passive-aggressive behaviors to administer guilt in the other person in order to gain an advantage. For instance, if I were a member of a church and I asked someone to donate,because funds are needed to repair a part of the building, and they consistently refuse, I may use passive-aggressive behaviors to help coax them into donating. I could say something such as, "Do you feel that you are more special than the others who donate and attend the church?", or "It sure would be nice if everyone did their fair share around here" (In a sarcastic tone). This would almost certainly lead to guilt and probably a donation.

Guilt: make (someone) feel guilty, especially in order to induce them to do something.

MLMers use all types of coercion to get their way and guilt is one of their favorite weapons. They will consistently work on making a downline member feel worthless if they miss a meeting, don't pay their monthly subscription, or don't listen to their tapes/cds. The psychological warfare MLMers use on their downline can be vicious and can leave lasting effects after a person leaves the business.

When I was propositioned for Amway my sponsor and his upline were taught to use guilt very effectively. They would talk about the importance of following the system and emphasize the downfalls of missing important events. There was no opportunity to be successful without following the regiment, and the cost of deviation was guaranteed impoverishment while being controlled by a system that is designed to eliminate the possibility of growth.

The most ridiculous example comes from the FED I attended in October of 2015 when my sponsor made me feel terrible about potentially missing a Christian service. For the record, I'm not a Christian, but even if I were, it is unchristian to impose your beliefs on another individual. My sponsor told me it was a service I couldn't miss and could actually be beneficial to the business. My hands were tied as I had the choice of, compromising my values and attending something I didn't feel comfortable with, or face the possibility of missing out on a life-changing opportunity.

The interesting thing about guilt is, people can pick and choose what to feel guilty about. Many things are not within our control as human beings, but the emotions tied to guilt are within our grasp. It is good to feel guilty about doing the wrong thing, but it is important to remember that people may try to take advantage and manipulate that natural instinct. It is a good idea to think about why you feel guilty for a number of reasons, but mostly because guilt can be irrational and we have the ability to critically think and bring understanding to the situation.

Tuesday, December 13, 2016

MLM and Animal Farm

Today's blog post is about a book written by George Orwell named Animal Farm. This book was written in 1943-1944, and it is about a farm with animals that revolt against a cruel leadership. The story reflects greed and power while demonstrating that absolute power corrupts absolutely. This is synonymous with MLM as they utilize their cunning to manipulate and deceive the people within the organization. MLMs will utilize their higher knowledge to create a vacuum of information while continuously deceiving people into sacrificing their labor for a greater good. Animal Farm is a manual for creating a totalitarian empire.

The animals lived under a totalitarian regime, named Manor Farm which is run by the Jones'. They made the animals work tirelessly for very little food and comfort. The animals at Manor Farm have their own hierarchy reflected by their levels of intelligence with the pigs at the top.  The pigs eventually organize the revolt successfully and take control of Manor Farm for themselves, in which they describe it as a republic for all animal kind. The story demonstrates the slow progression as the pigs transform the republic into a totalitarian regime and ultimately into something much worse than the original faction run by the Jones'.

This book is a stirring read, and it is important to note the similarities between the book and MLM. When Napoleon (main pig leader) seizes control he begins to manipulate or abolish the previous rules to better suit his needs. He transforms the community by changing their commandments, changing the history of events, and eventually changing himself. He introduces mantras, such as songs and poems, that glorify himself. Also, he has a lackey named Squealer (appropriate name) who utilizes language to manipulate and deceive the rest of the animals whenever they have a contradictory opinion or concern. They lie, cheat, and deceive with the intent to advance their lives at the expense of the community.

MLMers are consistently breaking their word to better suit their need in a particular instance. An example of this is, when an MLMer suggests that you only need to work 10-15 hours a week in order to be successful. This rule gets warped as an MLMer becomes more indoctrinated and their responsibilities will slowly increase. MLMers will start to make downlines attend weekly meetings and show a certain amount of plans while still suggesting they go through the routine of introducing new prospects to the plan. Then they will add quarterly seminars, tapes, and books to increase the amount of focus a downline has, and not explain this as a necessary addition to the 10-15 hours a week.

MLMers will tell their downlines that uplines are extremely important, and if you ever have a question, they should be your first line of defense. However, if that upline leaves the organization they are quickly demonized and the downline is immediately taught to hate the former upline because of their betrayal.

MLMers will say the organization, as a whole, has never had an issue, but will fail to mention 99+% of recruits leave, and over 50% of recruits leave within a year. An example of this was my experience with Amway and WWDB. My sponsors never revealed to me that Amway has an incredible track record for making millionaires, but failed to mention it was a terrible statistic compared to the failure rates. If you bring up the failure rates, they are quick to focus on the system and suggest it is possible, but most people are lazy or do not have the desire. They shift the blame from the company to the members in an effort to retain their current crew.

MLMers utilize mantras and songs to help keep downlines involved in the organization. They will use terms like "Fired up", or "Freedom", or other chants to instill conviction and deter a downline from critically thinking. These mindless chants and mantras are designed to keep MLMers happy and devoted.

Finally, Squealer used fear tactics to sway the other animals and have them drop their concerns. MLMs are no different as they consistently bring up the negatives of a J-O-B, or talk about missing out on life as their family grows because they have to work. These tactics are extremely powerful, and consistently reinvigorate MLMers from dissenting opinions.