Friday, 14 August 2015

What's the deal with pyramid schemes?





What even is an MLM brand? MLM stands for Multi level marketing. Probably more commonly known as Network marketing or a Pyramid scheme to you and I.

 If you're reading this then the chances are you know which brands we are talking about. There are a lot out there globally.
 The structure of these brands usually works like this...

They have a sales team who promote the particular cosmetic or brand. This sales team rally in the support from friends and family by throwing "parties" or by constantly talking to their loved ones about how these products have changed their life.
 They encourage you to buy from the line (which they generally have had to purchase large quantities of themselves) and in some cases they then try to recruit you to also sell the brand.
 They are compensated through their sales and by how many people they can get to also sell the brand. The people they then recruit also try and sell to their family and friends and try to recruit. The chain gets longer and longer with only the people at the top of the pyramid making any real money.

We are not out to berate these companies or their sales teams but we wanted to write about our personal experiences with these brands and information we have learnt from talking with many others in the beauty industry or from those who have had first hand experience of working for them.

So this is the experiences we have personally had with MLM brands...

  • Our inbox contains no less than 10 emails everyday from various consultants, all often working for the same brand and competing against each other asking us to review the brand/product....for their own financial gain obviously. We decline because we don't feel comfortable supporting a system where one person receives all the benefit and who are also under pressure to sell to you regardless of the product efficiency.
  • Invites from friends to come over for a catch up. The coffee and catch up was not really what they wanted however, they want to bombard you with their sales pitch and try to flog you their products and get you to sign up with the promise of a huge income, new car, amazing lifestyle etc etc..
  • Speaking with others who no longer talk to certain friends because they have been constantly flooded with texts and calls asking them to join the brand and sell the products.
None of these have been positive experiences for us or others who work in the beauty industry. For that reason these emails go straight into the trash can and we don't pick up the phone when certain friends names flash up on the screen anymore, which is really sad.

I don't know how they train their new recruits but the language and hard sell used at these parties can make a familiar friend seem quite alien. It's almost as though they have been brainwashed! We are yet to come across anyone who has made millions and have only ever heard horror stories of people who have lost a lot of money.

It's a free world and everyone can make their own decisions however we wanted to put a little of our experiences on MLM brands out there and also to explain the reason why we never review or respond to emails from these types of brands. We can now just reply to the emails with a link to this blog!

We would welcome your comments on this subject and if you are now living in a beach fronted mansion in Cannes, driving a new white Mercedes and look twenty years younger than your age because of these wonder products then we would absolutely love to hear from you.

What are your opinions guys?...


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27 comments

  1. Thanks for this. Funny you should post this as I've recently had an in-depth conversation about this with a close friend (probably about the same product)

    i think that if someone isn't familiar with this business model, they can easily be misled and lose sight of doing the REAL numbers when excited about something big and shiny dangling in front of them *ahem* 'Turnover is vanity, profit is sanity' and all that!

    All I see is that the focus of MLM is on recruitment and not the (classically) overpriced byproduct, regardless of what that is. All I advise of anyone thinking of joining is to find information from IMPARTIAL sources, including an accountant is possible! (read NOT not the word of someone who looks at you as a cash cow by employing you as a distributor or a blog/article written by an employee!!) and do your in-depth research on the product. Most are very loosely based on fact and (if any!) scientific proof.

    you'd have to do a LOT of peddling at the expense of your own friends and family to make anything worth reporting home about. To make any kind of money with this model you need to be fairly ruthless and recruit even more innocents.

    Perhaps some people can make it work if they approach it more strategically and know exactly what they're dealing with though. Some of the more recent MLS schemes i've seen seem to have a fairly low barrier to entry, meaning it wouldn't be THAT difficult to break even and get some free/heavily discounted product for yourself- so you'd really have to LOVE what your selling AFTER doing the proper research on it. I personally wouldn't do it though!!

    When something seems too good to be true, it usually is.

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  2. Ok girls attempt to write this number 4 🙈

    I joined the mlm company with the mascara ;) and I think you have the wrong idea about us! We are definitely not a pyramid scheme(they are illegal) there is no obligation to sell once you purchase the £69 kit and there are no targets to hit or stock to hold at our own expense! You get out of it what you put in my upline has just come back from convention in Chicago and has earned a Jamaican cruise!

    The products are actually really good (a little expensive) but as they don't produce on big brand scale their costs are more expensive! I really recommend their liners and lip products so creamy but smudge proof on par with any high end comparables!!
    I'd love for you to talk with someone higher up the company from me as they will have more experience! 😋

    Xx Kellyannxx

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    1. Thanks for your feedback Kellyann, it's a shame really because the products may well be lovely but the absolute bombardment we have had from their sales people just instantly puts us off. Great to hear your opinion though.x

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    2. I don't really know how to not make it sound like a sales pitch, I know there are tons of other companies selling this way and I'll agree Facebook/Instagram/Pinterest has been bombarded with 'miracle' products most of the sellers are stay at home mums trying to earn an extra couple of quid a week! I'm a classroom assistant who had nothing to do this summer and so I thought I'd give it a try! I really like our products otherwise I wouldn't sell it simple as!

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  3. Jesus Christ... I know a couple of people on my Facebook that literally flood my time line with AMAZING RESULT Pictures or stupid videos.
    I really dislike the concept, I have been asked multiple times to join their 'team' and make loads and loads of money just sat at home on my laptop...

    NO THANK YOU... Not for me at all!

    I went to a salon to sell my products and ended up being pitched too and walked out with leaflets and flyers about this wrap company!

    not great experiences with these people either! :)

    xxx

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  4. As an MLMer myself, first it would never occur to me to e-mail you and ask you to review the products I sell. First of all, that'd would benefit the brand, not me, so I do the demos myself, albeit not being a professional, lol. In any case, it is deceiving to call an MLM a pyramid scheme and there is a lot of misconception about that. An actual pyramid scheme doesn't have a product or a customer base, all it has is downline. You get people to join with the promise of a cash reward, double your investment. There is no effort involved other than recruiting more people. MLMs, however, have a product and a customer to sell it to. Some reps give us all a bad name, and most of the times they are not at fault, is what they have been told to do by their upline. A specific MLM which is not makeup but should remain nameless has the habit (and instruction) to friend you on Facebook and tag you in their product ads. Automatic Block for me, thank you! Incidentally, as I write this, I look to the right of the box and Avon jumps at me on the list of Labels. Avon being the top MLM in the market if not the oldest one (the oldest one is Tupperware, lol). On a different note, love your blog and videos. You're both beautiful - she said with a tinge of jealousy, lol.

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  5. As a physician, I have seen quite a few patients who were put under pressure to buy MLM dietary supplements which were claimed to improve or even cure their multiple sclerosis, Parkinson's disease or whatever. Needless to say, it's highly unethical to make money with people's fears and hopes selling products which will do nothing to treat their illnesses.

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  6. I only have made one first hand experience with this... I told a friend about my (then) new interest in everything Beauty and skin care and she told me: Oh, my mother in law has a little cosmetics studio, you should definitely talk to her. So we were invited for cake and then she got started. The brand is just BLOODY awful. The first hour we just talked philosophically - and then she went down to business and let me try the creams, serums etc. They were so heavily perfumed, it was just disgusting! (And I'm not an anti-perfume-in-your-skin-care-product person!) I hated the texture, it all felt cheap, despite the price range being on a medium-to higher end...

    I took a brochure and went home, googling the ingredients of the creams. Totally cheap shit, sold in a nice packaging. AWFUL!!!

    But the worst thing was this: We spent ages talking about what kind of awfulness some products in the drugstore contains. And she absolutely had NO CLUE whatsoever, that the same shit was in her own products. *facepalm*

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  8. I'm getting fed up to the back teeth with it too! Messages from people I've not heard from for years selling me the dream. Crap products that are thrown down your throat, not for me thanks. Thanks for doing this blog on it, really helpful to spread the word so people aren't mislead

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  9. I once was sucked into an mlm that had a pink theme to it. I ended up getting into a crazy amount debt from being unable to sell many products that "practically sell themselves." I blamed myself for a long time and was ashamed about it. I was brainwashed and couldn't see past the facade.
    However, being a part of it led me to want to learn new makeup looks which led me to discover you two! It was the one good thing that came out of it.

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    Replies
    1. www.pinktruth.com which has all kinds of stories about the same thing.

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  10. Ah yes, we all have THAT friend who has tried them all - the mascara, the jamberry, the scensty, the arbonne etc.etc. Your facebook page gets flooded with them asking you to join there page to promote, and you magically get signed up to their mailing list even though you never opted in. I totally get why some fall for this, but I find it really rare for someone to actually make a solid honest living out of it. In the end, you almost always end up in the hole or breaking even. I did know one girl who went full board with Mary Kay - getting the pink Cadillac and all... but none of us talk to her anymore... just sayin'.

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  11. As a stay a home Mum, these multi level companies are very appealing! It is hard to get back into the work force, but I do find certain personalities succeed, and I do know some people who do well. I think you (Pixiewoo) have a very desirable position, that many consultants would love, so I understand why you get so many requests.

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  12. https://en.wikipedia.org/wiki/MMM_(Ponzi_scheme_company)

    This link is great example of Ponzi scheme. Which is a form of fraud similar in some ways to a pyramid scheme. Not about cosmetics though, but still on the subject.

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  13. I feel like this has died down a bit but maybe because I avoid the whole thing like the plague! I can see the the attraction for some but I am just not a sales person at all so I don't let myself get drawn in. I did reviews for a friend last year but that's it no more! I've even had people dropping business cards on the table when I'm out at dinner with family!

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  14. We had some 'friends' who wanted to talk to us one evening and it turned out to be a pyramid selling scheme. It was quite a delicious affair really with motivational quotes like "Aim for the stars and you'll reach the moon" etc. The approach seemed to work on the premise that everyone wants to be richer and need more than their current circumstances, and a PSS (their PSS) would be the solution. It quite took the wind out of their sails when we said we didn't aspire to great wealth and we were very happy with the dailiness of our lives and the ordinariness our circumstances.

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  15. Some parts of this are misinformation; multi level/network marketing is not the same as a pyramid scheme. Pyramid schemes are illegal. There are some fab companies that you can do great in and there are so many benefits and opportunities. One of the best things I ever did!

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  16. I had a friend who got roped into Nerium and now she is no longer a friend. It got to the point where the only time she would contact me was when she wanted me to buy something and the constant bombardment of "miracle" pictures which obviously weren't taken in the same light or same angle coupled with claims that the cream can cure acne scars AND cellulite plus amazing tales of how I can have a free iPad and Lexus car (even though she doesn't have them yet), not to mention the overpricing of the products so that the top tier can rake in their money really turned me off. Plus Nerium contains oleander (in a proprietary formula of course) which is toxic and would be absorbed through the skin. The company refuses to publish their "research" in reputable medical journals, only through their own website. The business model is flaky. It killed our friendship, which is a shame, but she made the choice.

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  17. My friend is a new convert to MLM and her constant facebook posts, complete with before and after photos, and details about her paydays are off-putting to say the least. After a few years of Tupperware, Avon, etc., I vowed never to attend any parties, or participate in any purchasing of products from MLM. If so many people are making money, the product must be so cheaply made. I can do better purchasing elsewhere.

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  18. I signed up to sell the pink brand because I like their skin care and mascara and I hate paying retail. I sell to friends and family for my cost and don't expect to make millions. That said, I don't go out and post about the products or how people need to have parties or sign up. I realize that I'm not the norm but that's my 2 cents. LOL.

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  19. Not only do I avoid these MLM like the plague, but it seems the people who are trying to get every one involved can speak of nothing else! Every facebook post, conversation or interaction with most of these people is all about getting you to buy their peddled wares. It's as if they exist to do nothing else. While some can be more subtle and human in their daily interactions - sadly most are not and continue to drive non-participants away. Thanks for putting this out there-- this is becoming more and more annoying!!

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