subject: Network Marketing Common Objections Part Two - MLM is a Pyramid Scheme [print this page] I just laugh when I hear this objection and very often I want to say "oh, you are looking for a pyramid scheme, well than you're going to love this". Seriously, MLM/Network marketing is not a pyramid scam and it is a sign of ignorance that some people believe it is. We need to educate them to improve the reputation of our industry.
According to the Fair Trade Commission, "Pyramid schemes now come in so many forms that they may be difficult to recognize immediately. However, they all share one overriding characteristic. They promise consumers or investors large profits based primarily on recruiting others to join their program, not based on profits from any real investment or real sale of goods to the public.".
Thus, a pyramid scheme has no real products or services and just uses the money of those new to the system to pay those at the top. It is true that MLM has a pyramid structure but there are real products and services. Additionally, many people who join MLM companies do not actively look for new distributor, they just enjoy the products. Lastly and in my opinion most important, every company in the world, except for solo companies, are pyramids with those at the bottom making money for those at the top. In most companies it can take years to move up but in this business if you work smart, are enthusiastic and willing to work, you can become the top of a large team below you within a short time.
You do not believe me that normal companies are pyramids. Than please take out a piece of paper. In the middle of the page towards the top, write CEO. Now below the CEO, write in three VPs in a straight line. Now below the VPs write in 4 managers again in a straight line. Below is what your diagram should look like.
What does this shape look like to you?..... I think you get the idea.
The main problem I have with a normal company versus a Network Marketing company is that in most companies you have no control over how much money you make (unless you are in a 100% commission position). You are at the mercy of those who decide your salary which is often based on arbitrary criteria or even worse, based on how much your boss likes you. However, in a Network Marketing company you are rewarded by how big you can build your business below you. The reward system is laid out clearly and you there is no limit. No one can come up to you and say, sorry we cannot pay you that commission because you would make "too much" (when I worked in the corporate world, I had this very experience and thus have a bitter memory).
Next time someone ask you, "is this one of those pyramid thing", do not forget to look them in the eye and say, "oh, you are looking for a pyramid scheme, well than you're going to love this".
Network Marketing Common Objections Part Two - MLM is a Pyramid Scheme
