Friday, March 17, 2017

MLM and a "Quality" Analogy

Today's blog post is about a recent stint of analogies that have been coming up on other blogs. The idea that MLM products somehow have better quality than other products is a myth that has been going around since the beginning, but the analogies seem to change and evolve over time. MLMers can't ever point out what that special ingredient, potion, spell, voodoo, or whatever it is that makes the product better, but they have no problem espousing that it exists, and that it makes their MLM product of the highest quality unlike the generic competition found at every other brick-and-mortar or online store. The price for these top shelf, top notch, grade-a, MLM products is always far higher than their competitors (http://themlmsyndrome.blogspot.com/2016/12/mlm-and-product-value.html), and it also is much more difficult to purchase because many require a membership. You may also have to sit through a pitch about the business opportunity, and in certain cases you have to purchase monthly, which makes these products far less reasonable to purchase.

So, how do MLMers attempt to prove that their company's products are of a higher quality? Do they attempt to utilize research from clinical tests? Do they research the ingredients from the competitors and do thorough analyses of the contents in comparison to their company's products? Unfortunately, the answer is a resounding no. Instead, they try to use technical jargon, mixed with circular arguments, and then transition into the bad analogies. It is important to note, none of these techniques have any veracity and are simply used to deceive and mystify.

One of the common quality analogies that continues to be used is the comparison between Mercedes and Honda. Their hypothesis is, if MLM products are more expensive than their competitors, then it is because of the quality. Similarly, Mercedes is more expensive than Honda, therefore the quality of Mercedes is better. Aside from the kindergarten logic being used, let's break down all of the flaws in this argument.

Higher price does not always mean better product. Yes, products of higher quality tend to be priced higher than those of lower quality. However, there is more than just this simple notion as the market place is more dynamic and has different tiers. You have to make sure that you are comparing two products that are in the EXACT same category, and the analogy above fails to do so. Honda does not target the same market as Mercedes (for the most part), and both have success for varying reasons.
Honda is designed to focus on an economical and simple vehicle, whereas Mercedes focuses on a luxurious and technically engineered vehicle. Mercedes and Honda both have specific regulations they must adhere to, and both must price their vehicles according to the market they are targeting. The bottom line is, BOTH have excellent quality for the markets they are targeting and they BOTH have great financial success.

A better comparison would be between Honda and Toyota or BMW and Mercedes. Not only are these comparisons involving the same target markets, but they are also involving the same countries of origin. When comparing these companies, price is usually the last thing to look at because it is more important to know which company has, more recalls, longer warranties, better safety standards, better gas mileage, better interiors, better longevity, and then somewhere down the line you can worry about the price.

Analogies like the one listed above run rampant in MLM pitches and it is important to remember that analogies are great for helping to understand, but they are not acceptable for determining facts. If an MLMer decides to answer your question with an analogy, especially if it is pertaining to something requiring data, then it is important to analyze what is actually being stated. 

3 comments:

  1. Dear Dr. Doe --

    You've touched on a major point here: the American propensity to confuse high price with high quality per se, without looking at other factors like intended market, place of origin, company history, and other things that might provide a context to a given price.

    Of course, as you say, it's simplistic to compare a Honda with a Mercedes. When Amway freaks go on spouting false analogies like this, what they are surreptitiously attempting is to make you think that Amway products are the "Mercedes," and anything more cheaply priced is the "Honda." This is pure sleight-of-hand. In logic it's called "begging the question," or assuming that you have already made a point without actually proving it.

    Amway products aren't the "Mercedes." Amway products are merely adequate, or generic. They aren't special or "concentrated" or whatever-the-hell-else that Amway freaks claim. They are just ordinary stuff. Some of the products are downright lousy. Amway freaks think they can get around this simply by assuming that you agree that higher prices men higher quality.

    Amway products aren't expensive because they are better or superior. They have a high price tag because of a long series of up-line IBOs, each of whom is entitled to a small cut of the purchase price! In fact, it is in Amway's economic interest to make their products as cheaply and as inattentively as they can, in Third-World sweatshops and factories, to make sure that production overhead is low. This way, the actual retail price can be raised high enough to guarantee a hefty cut of the profits to all of the IBOs in that particular line.

    When you are being pitched an Amway product, if you complain about the high price the IBO will usually answer "Wouldn't you pay a little more for quality?"

    Here's what you should reply: "Maybe I would, but this stuff isn't quality. The only reason this stuff of yours is expansive is because I'm being asked to pay a cut to every person in your Amway up-line."

    That should shut him up.

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  2. Anonymous,

    Thank you for the response! The way you described it as a sleigh-of-hand technique is perfect! I would really like to sit down with the person that created these verbal misdirections and figure out where they get their creativity for obfuscating facts. It takes a certain level of art mixed with a lack of moral fiber to make these ridiculous comparisons for the sake of manipulating and deceiving their pawns.

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  3. It's very simple ro debunk. I've been blogging and commenting about Amway for more than 10 years. If MLM people truly believed that quality argument, MLM sales would continue to climb each year. People drop out of MLM at approximately 50% or more each year. That is millions of people. If these folks believed that the MLM product was great quality and worth the money, they would surely buy it after they quit. Perhaps some actually do, but being that the big MLM's like Amway for example, only has (currently) 9.5 billion in sales annually, a decline from 11.8 billion a few years ago, suggests that when people don't see residual income and untold wealth from their MLM's anymore, somehow their desire for MLM products goes out the window.

    If not, MLM and Amway in particular, would have much higher worldwide sales than 9.5 billion. WalMart stacks em deep an sells em cheap, with worldwide sales at about 500 billion (half a trillion). Now which one do you think works better?

    Amway sales would be miniscule without the dreams and hopes of reisdual income attached to the business opportunity.

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