Mark Yarnell's article in The Central New York Business Journal

Acturial professionals, take note! That means insurance agents, financial planners, wealth managers, ...
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Another MLM Fairy Tale from an Industry Outsider
By: Mark B. Yarnell

18th September 2009

I've had about enough self-righteous opinions from financial-sector capitalists who, perhaps embarrassed about their own performance, insist on criticizing legitimate professions.

One such asset manager, David John Marotta, took a shot at multi-level marketing (MLM) or network marketing recently in this journal (Aug. 28 issue, column entitled, "The False Lure of Multi-Level Marketing"). And his analysis was so flawed, unsubstantiated, and preposterous that I simply couldn't let it slide. Like so many other self-appointed pseudo-experts, Mr. Marotta evidently decided to hold court outside his own domain and, in so doing, embarrassed himself and his profession.

David is probably a wonderful asset manager, but I humbly suggest that he leave multi-level marketing to the experts.

In case you missed his column, here are a few of his bits of wisdom.

"MLM is a non-sustainable business model because it simply provides a product that has been marked up in price."

Sorry David, but last year alone, as a matter of public record, Amway did $8.2 billion in sales and Mary Kay, Herbalife, and Primerica (which operates in financial planning itself!), each generated in excess of $2 billion. Those are just a few examples of companies that have been extremely profitable for dozens of decades. So much for non-sustainability.

Oh, and by the way, on planet earth every product that is for sale has been "marked up in price." You see, David, that's how capitalism works. According to your bio, you do fee-only financial planning. Your fee, David, is a mark-up. Instead of anything tangible, you mark up a service that may help people or wipe them out financially. Either way you make money.

Among other things, David goes on to assert that MLM is "not really a business," "we offend our friends and families," create "no real value," and "endlessly recruit hopefuls who churn at the bottom of a pyramid," while "only those positioned at the top" collect big checks. He closes by calling our profession a "distraction from a genuine vocational calling."

Mr. Marotta offered not one shred of support for his Wikipedia-style distortions. Why? Because his ramblings lack credible research and support.

As a best selling author, I've met thousands of wonderful men and women since 1986 who, like me, joined established MLM companies at the very bottom and became wealthy through hard work and perseverance. We started with no money, special skills, or credentials and delivered superior products and services to people all over the world by word-of-mouth advertising. Many of us have earned millions over the years and given huge amounts to charities and multiple worthy causes.

My international MLM business has taken me to every continent. Unlike financial planners, we don't just sit at home and collect fees by moving money around, we build international distribution organizations that allow common people with very little capital to prosper based on their own hard work and character. Many of our products and services are far superior to the crap from overseas that people purchase from big-box superstores.

David closed with the following delusional comment, "There are hundreds of legitimate business opportunities available for entrepreneurs who want to build companies that provide real value." Sorry David, but you need to read a few books by legitimate writers. There are no options for millions of boomers who have been hammered relentlessly into horrible debt loads by unconscionable casino capitalism just in time for retirement. Others have worked diligently for decades only to have their assets "managed" into oblivion by people in your world.

Many have seen their assets converted from 401(k)s to 201(k)s by people in your profession. The only time I turned over $300,000 to an asset manager it was down the toilet in three years thanks to stupid, high-risk investments. Fortunately, I've managed the bulk of my MLM income over the years and have been comfortably semi-retired since the late 1980s.

There are good people and bad people in every profession. I'm going to assume that David is more like Warren Buffet than Bernie Madoff because ignorance is not always an indication of malice. So, David, why don't you pick up the phone and ask Mr. Buffet why he calls MLM a great field. Better yet, ask him why he owns The Pampered Chef. He might be able to teach you why so many experienced asset managers regard MLM with respect.

I'd like to end by thanking Adam Rombel, editor-in-chief of The Central New York Business Journal for his professional integrity. In an age when many periodicals pander only to special interests, his journal is obviously engaged in presenting both sides of issues. It's refreshing to have access to a legitimate journal with no hidden agenda or stereotypical biases.

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Mark B. Yarnell is author of the Random House bestseller, "Your First Year in Network Marketing," and former contributing editor to Success magazine.

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Reminder: Freelife GoChi's unnecessary sensationalism

As a refresher of an earlier post. Freelife is still at it with their unjustified "Time Magazine" hype... & this time its with their re-branded Himalayan Goji... the GoChi. How "original".

Spread the news folks: there is NO SUCH THING as a Time Magazine "superfruit of the year"!!

Click on the direct Time Magazine weblink below & you will see that the "superfruit" mention was merely 4 lines among a much bigger article which had nothing to do with the famous title "Time Magazine's XXX of the Year".

For a review of the earlier post, here it is.

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Find a niche & the market will come to you!

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Freelife unnecessarily employing sensationalism

It appears that FreeLife, supposedly a reputable network marketing company, is over-hyping its product even at the corporate level -- deliberately toying around with the impression given by Time Magazine's famous phrase "XXXXX of the year", and going to the extent of unnecessarily adding in words like "Number 1".

In Time Magazine's article "A Taste of the Future", July 16th 2006, the goji berry was simply mentioned as a feature of New York City's 52nd Summer Fancy Food Show -- talking about foods that one might see retailing during the year.
As shown below, the Time article merely said "...this year's breakout was..." without any celebratory fanfare as they would state for, e.g., Time Photo of the Year.

It is just normal text in a small box!

" When 2,200 food purveyors gathered at the 52nd Summer Fancy Food Show in New York City last week, the 160,000 food products on offer ranged from the ridiculous... to the sublime... Here's a peek at what could be showing up on your grocery shelves.

SUPERFRUITS
In the produce world, some fruits have better health credentials than others. So-called superfruits flavored everything from pomegranate-blueberry lemonade to açaí energy bars. This year's breakout was the Himalayan goji berry, said to be a source of energy and longevity. The berry made several appearances, most successfully in Himalania's trail mixes and snacks. "

!?!?!
"Time Magazine" ... "Number 1" ... that's some big ego talk! The product is great. Great. So, ride on the good human testimonials, but cut out the unjustified hype!
Freelife is conveniently leaving out the last sentence (shown above) in all their marketing -- which actually talks about a different brand of Goji products. LOL.

FreeLife even took it "one notch up" on their website:
"Last July, the Los Angeles Times wrote a tremendous article on the goji berry. This July, TIME magazine, the world's largest news magazine with over 28 million monthly readers, has just named the Himalayan Goji Berry as the breakout superfruit of the year! Referring to the Himalayan goji berry as a source of energy and longevity, the July 24 article was focused on those superfruits that have better health credentials than others. And the Himalayan goji berry was the Number 1 breakout of the year!

As we have said from day 1, Himalayan Goji Juice will become a billion-dollar brand and the most successful functional beverage of its kind because it has great history, great science, gives more great results, and tastes great. No other product in the marketplace can make that claim and now no other product in the world can state that TIME magazine called their unique ingredient the BREAKOUT SUPERFRUIT OF THE YEAR!"

Being mentioned in Time is great! But why hype it up unless the intention is to...

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updated link (January 27th 2007): FreeLife Corporate using the Time article again
" 7. The media attention that FreeLife, Himalayan Goji Juice, and the goji berry have received over the past year has been incredible. This year, TIME magazine called the Himalayan Goji Berry the "Super Fruit of the Year" "

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This Blog a Case of Journalistic Fraud??

Views on MLM from a reader

It looks like an individual who claims to be gainfully employed as a professional journalist isn't really carrying out fair reporting practices in his/her widely read weblog.

We'd dare say it borders on journalistic fraud -- where facts are blatantly omitted for the purposes of sensationalism.

You be the judge!
Here was our second letter to this "journalist"... perhaps missing out on other facts already presented in our first letter:

"hi xlx,

hope you didn't miss out on our earlier comment on this post.

do post it, as well as this one... it is merely for readers to make a proper evaluation of opinions expressed.

readers should really see this webpage, www.networkmarketing.uic.edu , and judge for themselves if there are legit classes out there.
(the course is conducted by Harvard ed Professor King.)

only ruthless MLM leaders sell the "easy money" angle.
these are likely the very same people who fail(ed) in their MLM ventures...
simply because most / all who join them marketing the "easy-ness" instead of marketing the products, do not see beyond their perceived short-term gains, which are virtually unattainable to most ordinary folks.

let's talk about traditional work:
all organisational structures are pyramid-like.
and, all successful sales & related work are paid in commissions to the sales team.
so, are these 2 traditional work processes "illegal"? ... we think not!

at the end of the day, legit Network Marketing is a sound concept of business marketing of proven (& competitively priced) products to consumers and/or business-owners.
one has to do his/her own due diligence to eliminate companies/individuals who are out to deceive.

regards."

It is only because of stubborn old-fashioned mindsets like these individuals' that common folk who don't know better get presented tainted "news" via "creditable" mediums like newspapers.
Sigh!

Beware, people!
Find out your own truths.

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NO MORE juice/vitamin/cosmetic/household "stuff"!
There's just one too many!!

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A "Working Plan"

Okay... before we continue with farther elaboration of positive company characteristics to look out for...

...here's the first rant of this blog as we all proceed with our lives inside & outside network marketing throughout the Far East - Thailand, Malaysia, Singapore, Brunei, Philippines, Indonesia, Hong Kong, Vietnam (Viet Nam), Myanmar (Burma), Laos, Cambodia, etc.

Have you heard the term "working plan" used loosely & frequently (with regards to compensation plans)?

What is the definition of a "working plan"?

Simple really... one that requires one to work till he / she drops.
Essentially, that's what it means... shoot us an email if there's more to it...

Aren't we marketing our products / businesses with the hope of retiring after the fundamentals of a formidable network are built?
It simply defeats the purpose of getting involved in network marketing if one still has to "work till he drops".

Let's do some elementary school math...

Does a 2-person frontline plan make sense effort-wise as compared to a mandatory 3 or 6 or 10-person or any other width-only plan as it goes in unilevel / matrix plans?
Or, is more really the merrier?

Do not forget that in order to meet a company's commission & bonus payment requirements, an intended 6-wide or 10-wide frontline network is required...to be 6-wide or 10-wide and no less.
Otherwise, one will be penalised by the company without fail, and lose out on being fully compensated for product volume their network had generated.

Lets first discuss about each networker's first level...
...and also proceed in this discussion with the above 4 types of networks.

Right away we can see that a 2-person frontline plan comes up champs.
That's only 66% of full effort needed by you as compared to a plan requiring 3.
33% effort of a plan requiring 6.
& only 20% effort of a 10-person unilevel plan.

Let's look at the networker's second level.

Level two consists of 4, 9, 36 & 100 people respectively.
That's 44% effort,
11% effort,
& 4% of effort required by you as compared to a 3, 6 or 10-person plan.

Finally, to not make this too lengthy, lets look at the networker's third level.

Level three will consist of 8, 27, 216 & 1000 people respectively.
That's 30% effort,
4% effort,
& less than 1% effort needed by yourself as compared to a 3, 6 or 10-person unilevel plan.

By "effort", we are referring to the time, resources & energy spent in sponsoring each individual in one's network.
And the additional effort needed in supporting each individual in your downline (be it in business, product, motivation or relationships wise).

Although the numbers of one's network add up quickly in a larger width-wise network, there is no benefit / motivation for individuals in your organisation to assist one another in the larger numbers of sideline individuals' businesses or difficulties.

e.g.
In the case of a 10-person unilevel, each networker (i.e. you) has the responsibility to support each of his 10 sponsored distributors.
Each of these 10 would be primarily concerned in expanding their own network of 10 (& downwards) and have no incentive to support the other 9 sidelines which belong to his Sponsor (you).

The numbers of distributors for you to support simply pile up the deeper you get with no incentive for anybody to help anybody-else from the many sidelines that have formed in such a complex network.

This is where group cohesion comes in, with senior networkers encouraging cross-lines / side-lines to interact & support one another.
But, seriously, what is the point?

Wouldn't one be likely to assist willingly with individuals that directly matter to them??

In a 10-person unilevel, if the 100 people in level 3 need support, it is truly provided by only 11 people. (i.e. their immediate uplines & yourself)

In a simple 2-person network if there are 100 people who need support... support will be willingly (& perhaps automatically) given by 50 people (or more, depending on the network's dynamics) because of the depth of the network.

With greater support readily available for each distributor in a binary in times of need, which compensation plan better fits the seemingly derogatory term "working plan"??
You tell us.

In our opinion, a working plan where you work till you drop with much fewer opportunities to take a break, is one that promotes width.


Note: we've yet to bring in the fact that in the case of most small-width plans, additional sponsored individuals (beyond the minimum required 2 or 3) are placed below other downlines, hence proving to these downlines that their network is indeed growing.
This "spillover" serves as motivation, if nothing else.

Even in traditional companies / marketing teams which payplans do not feature such "default" business dynamics, the leaders have been attempting to "force" spillovers just to "show" business momentum. A lot of the time, this action flouts their (traditional) company's business policies & procedures, and puts their business at risk of being terminated when their commission cheques run big enough.

(This is not possible / encouraged in some plans. Which means downlines are pretty much are on their own in building a network. This leads to situations where if downlines meet obstacles in finding their own many individuals to sponsor...they'll more than likely drop out. It is a sad but true fact.)

Nonetheless spillover aside, for a comp plan to work successfully, do your part to spread the word to the minimalist 2-person (or 10. <-- haha, if you still insist on participating in such a plan.) frontline and watch the network work its dynamics.

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Do WITHOUT the juice/vitamin/cosmetic/household "stuff".
Find a niche & the market will come to you!

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& Be First!