If you are a woman between the ages of 18 and 45 and are active on social media, there is a likely chance that you have received some type of direct message sounding something like this: “Hey girl!!! I just followed you and I noted you are SO pretty!!! [string of emojis] In fact, I could use a beautiful and confident lady like you on my team!!! For the low price of [unreasonably high price] you could join a group of awesome ladies being their own bosses!!!” The account that messaged you is likely to be a young woman, possibly with children, who is using social media to be a direct salesperson for a multi-level marketing company, more commonly known as a “pyramid scheme.” Multi-level marketing is a business concept in which a company relies on lower-level members to sell and distribute products as opposed to directly selling their own merchandise. While you would have to go to a storefront to buy something from a more traditional company, if you would like to purchase something from a multi-level marketing company, you would have to directly contact a salesperson to make a purchase.
As of recently, multi-level marketing strategy companies have come under fire for their similarity to pyramid schemes. While pyramid schemes are illegal, multi-level marketing is still a legal business strategy. The fine line between multi-level marketing and pyramid schemes lies in how they recruit new salespeople. Usually, multi-level marketing companies will reward sellers who recruit more salespeople with monetary bonuses to incentivize sellers to purchase supply to sell. A multi-level marketing company is classified as a pyramid scheme when more emphasis is placed upon recruiting than the distribution of product. This recruitment practice is where these abrupt DMs come into play.
According to MLM News Report, out of the top 50 multi-level marketing companies by revenue, many of these are within industries that target the demands of women. For example, Avon, Mary Kay, Nu Skin, and Rodan+Fields are all within the top 10. Similarly, DoTERRA and Herbalife, both associated with essential oils, are top revenue companies as well. A total of 37 out of the 50 listed are associated with either the beauty, supplement, clothing, or essential oils industries — industries that are primarily associated with women.
The fact that multi-level marketing often targets women is harmful simply due to the fact that according to the FTC, 99% of sellers end up losing money when they invest in multi-level marketing. When multi-level marketing companies and sellers target women on social media by spreading false promises of empowerment like “be your own boss!!!” and “make money all from your phone!!!” they are actively trying to manipulate women into losing money. Furthermore, these tactics often target vulnerable women such as new mothers, stay-at-home mothers, military wives, and women within conservative religious groups (most notably Mormon women) who may want a chance to prove they can achieve business success but have limitations placed on them by familial responsibilities and restrictions. These groups of women are people who usually have limited contact with the world beyond their immediate home/surroundings and are willing to take a risk if it means a chance to achieve something without having to sacrifice their responsibilities. However, these women often end up losing money in addition to being silenced by the company for fear of complaints getting out dissuading others from being recruited into the company.
While these companies often market themselves as a group of ambitious and goal-oriented people helping each other get rich fast, the reality is that these are often groups of vulnerable women fighting a losing battle. No matter how much they try to recruit or push product, the reality is that they will most likely lose money in the long run. So next time you get that “Hey hun!!!” DM, it’s probably in your best interest not to respond.
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