Dude, I'm your friend. Not your customer.
There it was: a message in my Facebook inbox from a college acquaintance I hadn't heard from since grunge was a thing. Her greeting started out friendly enough ("Been a long time!"), but took a weird turn: something about her "new supplemental business" and "great monthly income." She went on to let me know about her "amazing" anti-aging products, and their power to eradicate turkey neck.
Wha? I haven't heard from you in years, and out of nowhere you're talking turkey neck? You don't find this awkward? (And BTW, I'm not that old. I have a preschooler, dammit!)
That wasn't the first time I'd been fooled by a friendly message sent my way. When I first moved to a new town, I started getting evites to parties, only to open the invite and realize.... Oh. That kind of party. One time, I thought I was going to a regular party, and when I got there, was ambushed with a lengthy sales pitch, held hostage while sampling protein shakes. I consoled myself with the free wine.
Now, thanks to social media—and the ability to spread your sales message at any time—the party never has to end, as Virginia Sole-Smith reports in her investigative story in the June issue of Parents magazine, "The Truth About Selling From Home."
The proliferation of sales pitches in my Instagram and Facebook feeds makes me weary, even though I have to concede that I have bought a few products this way (largely out of a sense of obligation to support friends). I don't think anyone is arguing that products sold via MLMs are by default low-quality. Some are excellent—I purchased one of my favorite necklaces this way.
But ever since social media has made the behind-the-scenes practices of MLM consultants a little more transparent, I couldn't help noticing a few trends. Friend A posts about products she has for sale. Friend B, who also happens to be selling the same stuff, chimes in about how awesome they are, usually followed by another friend or two rhapsodizing about the products. I couldn't help wondering: With several local friends as "business owners" with the same company, how are they not cannibalizing each other, assuming anyone—aside from them—is buying their wares?
My colleagues at Parents, who likewise had friends or family involved in MLMs, were wondering: Is anyone making money? If there is such a thing as a good multi-level marketing, or direct sales, company, how do you spot it? With millions of people's time and money at stake, we really wanted to know, and spoke to experts who have studied the business structure of MLMs and their practices for decades. We also found a few brave women who spoke candidly about their experiences with MLMs—the sometimes-humiliating un-success stories you're not likely to ever see in your newsfeed.
The truth about MLMs is bleaker than I thought. The average direct-sales rep earns $750 a year, a figure that hasn't changed since 1980 (when the original movie "Fame" was a thing). That's before expenses. So your friend who's posting about her business may have also shelled out significant cash for a business "starter kit," training, a conference, or new product lines as they became available.
Since every MLM is a little different (both in terms of what they sell and how sell, whether the focus is on parties or not, etc.), we took a facts-based approach with our article: what to watch out for before signing on to any MLM. To focus on any one company in particular wouldn't make sense, as we saw time and again sales reps insisting their company was different. Instead, by reporting the red flags, someone involved in an MLM could ask herself if any of them were familiar—and help inform anyone considering joining a friend's "team." What are some of the bad signs?
* An insistence that there's "no requirement" to buy products, but a lot of unofficial pressure to do so? Red flag.
* Autoshipping products to your home? Red flag.
* The real money's in recruiting? Red flag.
Knowing what I know now, I wish more than ever my friends would stop spamming my feed.
Time and money aren't things we moms are getting back. So I no longer feel bad for declining invites to sales parties, leaving group messages that push deceitful and grandiose promises, and generally being super skeptical. When I see an article, even if it's from a reputable publication, posted about a mom whose company rewarded her with a luxury car, I wonder, did the company really "award" her that sweet ride? Or rather, is she on the hook for a hefty car lease payment if she doesn't hit her sales target for that commission period? These are questions worth exploring before peddling enticing success stories before everyone's eyes.
Researching a company carefully before jumping in, or getting out of one after regrettably losing time and money, isn't, as some recruiters are quick to say, "being negative."
It's being smart.
Gail O'Connor is a senior editor at Parents.