We have all heard the term “Pyramid Scheme”. That’s what Multi-level Marketing companies are right? The person at the top of the pyramid is the only one that makes money. They got in the company first so they get all the glory. It’s impossible to make money in MLM companies. Are these things true?
What is Multi-level Marketing?
Before you judge a book by its cover, it is important to know what Multi-level Marketing is.
Investopedia says that “Multi-level marketing is a strategy that some direct sales companies use to encourage their existing distributors to recruit new distributors by paying the existing distributors a percentage of their recruits’ sales…”
Multi-level marketing companies are in essence really smart. I mean think about it. What better way to grow your business than offering the people who are already buying your products a check when they tell their friends about the products and they buy them? It’s much more effective than a billboard.
How Does Multi-level Marketing Work?
Say Amber hears that her friend Jenny is having a class at her house about essential oils. Jenny goes to that class and is super interested so she buys a Starter Kit and becomes a member under Amber. Amber earns a percentage (we will say 15%) of that sale because she recommended Jenny (this isn’t any different that Affiliate marketing and no one has an issue with that…. weird).
Jenny is super excited about the products because she is seeing a difference in her life so she shares it with her mom who decides she wants to buy a Starter Kit as well. Jenny earns 15% of that sale and then Amber earns 8% (these are just random numbers by the way).
This is a totally Pyramid Scheme, Erin! Okay I hear you. So say Amber decides she doesn’t want to do the business anymore, but Jenny is still super excited about it and is working really hard. Can Jenny pass up Amber in her monthly commissions? Absolutely! That’s a weird shaped Pyramid….
On a side note think about the company you work for….
“I am often asked if Network Marketing is a Pyramid Scheme. My reply is that corporations really are pyramid schemes. A corporation has only one person at the top, generally the CEO, and everyone else below.” -Donald Trump
So. Are Multi-level Marketing Companies a Scam?
Are some Multi-level marketing companies a scam? Yes! But they are very rare these days. Back in the day (around the 1980’s) MLM companies were very popular, but many of the companies were scamming people. They would require people to sell the products in order for them to buy the products for themselves. The distributors would have to spend hundreds of dollars in order to keep stock of products to sell and then never make enough to even break even. It was also impossible for people at the bottom to pass up the person at the top. Thankfully it doesn’t work that way anymore!
Unfortunately many people are still stuck in the 1980’s and have a very negative attitude towards Network Marketing. As soon as someone they know joins an MLM company they freak out and delete them off Facebook. Would you do that if they had opened up an Etsy selling things they were passionate about?
Just like you would with any job, you work really hard and you get paid for doing so. One difference with an MLM is that you can make as much as you set your mind to. Do you have that kind of freedom at your 9 – 5 job? When working for the man, you work your butt off every day and you don’t get paid any more than slacker that sits across from you.
This is not a get rich quick scheme! It takes many years and many many many hours of work to make a full time income. It’s just like starting your own business or even starting a new job!
How is Young Living Different from other Multi-level Marketing Companies?
I wanted to join an MLM for a long time and looked at a bunch of different options before going with Young Living. I chose them because I loved what they had to offer and wanted to share it with others. What makes them different? You’re not promoting something that doesn’t benefit society like pots or leggings. Those things are great, but when you are promoting essential oils and wellness products, you are promoting a healthy lifestyle. You can change lives! Their compensation plan is also pretty great! Check it out here.
“If you are a person with big dreams and would love to support others in achieving their big dreams, then the network marketing business is definitely a business for you. You can start your business part-time at first and then as your business grows, you can help other people start their part-time business. This is a value worth having – a business and people who help others make their dreams come true.” -Robert Kiyosaki
Have you considered joining a Multi-level marketing company? What is holding you back?
Although there is a huge earning opportunity with Young Living or any other MLM company, it takes a lot of time, sweat and blood (kidding about the blood) to make a full time income. Don’t expect to talk to a few friends and then make millions. I also advise you to not quit your day job and jump right into an MLM. You’re going to go broke and then claim that your MLM company is a scam…. Work your company part time as you keep your day job and then when you are making a full time income quit your day job. You will be so thankful for the nights you stayed up until 2 a.m to be able to set your own hours and do what you truly love.
Do you want to know more about Young Living (because it’s the best)? Check this out!