Welcome to the Team...

I first encountered this cosmetics MLM when a young friend added me to her new MLM group on Facebook. I don’t normally like people adding me to groups unasked. I was about to say ‘Thanks, but no thanks’, but she was selling a liquid lipstick which actually looked like it worked, and came in heaps of colours, and I wanted to support her. So, I said “OK, maybe I’ll just order one or two things.” I had never heard of the company before, and really didn’t know anything much about MLMs.

She sent me my order, with a lovely handmade thank you card. I found the lipstick worked well for me, and I found myself ordering more colours. My friend did suggest once that I could join the company to get a discount, but she was not pushy. I kept buying more colours, and after a few months started to think about what she’d said about signing up to get a discount. Maybe I could do that, and sell some to close friends as well. I started to research the business, but back in 2016 there wasn’t any information online that was critical of this company, and I failed to research MLM as a business model in general, unfortunately. My Google searches for ‘company name + scam’ only came up with videos and articles proving how it wasn’t a scam. I was already wary of companies like Amway, Avon and Tupperware, but this seemed to be a ‘modern version’ of those old school MLMs. Surely it would be OK? (Spoiler alert: it wasn’t.)

I read their terms and conditions carefully. I read the distributor’s contract. I thought I understood them. (Spoiler alert: I didn’t). I signed up.

I was quickly added to about five different private or secret Facebook groups for distributors for this company. Lots of training videos to watch, prepared by the women higher up the ‘triangular structure’ (not produced by the company). I really had very little idea what I was getting myself into. But wooo, lotsa makeup! To qualify for the decent discounts, you had to order a lot of stuff, like hundreds of dollars worth. So, I did. I was ‘congratulated’ for making these orders, as if I’d had success selling this stuff — nope, I’d just bought heaps!

I was a (proper) small business owner, so I already knew that I needed to track my expenditure as well as any income. And I was spending a lot, placing an order of hundreds of dollars at least once a week. Heady days. The company kept bringing out new products, almost weekly, plus I needed to build up a stock of testers, stuff for my personal use, as well as stock to sell. After all, as the near-holy founder said, ‘you can’t sell from an empty wagon’. Although their official documents say you didn’t have to front load (carry heaps of stock), it was actively encouraged in the private distributor groups.

My friend (now ‘upline’) and I had both had been in religious cults in the past, and soon after joining we both noticed the cultish red flags.

The things it was OK to say. The things it wasn’t OK to say. The loaded language. The thought stopping clichés. #BossBabe. The incredibly wrong ‘science’ they posted about their products. The initial love bombing by the ‘sisterhood’ which quickly turned into a bad remake of Mean Girls. The pressure to front load and recruit. The ‘three-foot rule’ (if any woman was within three feet of you, you should talk to her about makeup and then the company, with the goal of booking a party). Toxic productivity. Toxic positivity. The Secret and law of attraction. There were (artificial?) stock ‘shortages’, driving panic buying, while the company kept onboarding new distributors (clearly the flood of sign-up fees was filing their coffers). Their answer to pyramid scheme allegations was the classic ‘Pyramid schemes are illegal, hun, and we’re not doing anything illegal, are we? So we’re not a pyramid scheme!’.

Oh, babe. Saying it don’t make it so.

Because we saw the red flags, and trusted our gut feelings, my friend and I didn’t get in too deep. We still liked many of the products (not all … but you couldn’t talk about those). Sure, I had fun organising occasional ‘makeup parties’ for my friends, who sometimes brought their friends too. I sold quite a lot of makeup. I never held parties at other people’s homes, nor was I trying to recruit a team under me, although I did do the cringy approaching strangers all over the place, to see if they wanted to buy makeup from me or book a demo (which never worked, by the way). Some embarrassing moments there. I ended up with about 60 actual end customers, from my friends and their connections, and one ‘downline’, an acquaintance who asked to sign up under me. My friend never pressured me. But neither of us was trying to make this into a serious business.

I was shocked, however, when I finally was due my one and only commission payment from the company, based on what my downline had purchased (NB: these commissions are based on what your downline distributor buys from the company, not what they sell). It was for around $100. The company would happily hand over $10. But would they give me the full amount, the other $90? (Spoiler alert: Nope.) I had to place an order of over $250 for products myself before they would send me the whole $100 commission.

This tactic is called ‘pay-to-play’, and it’s rife in the MLM industry. To ‘earn’ your commissions, trips, cars, and higher ranks, you have to place orders every month (with varying quantity requirements) and (for rank advancement and bigger rewards like the car and cruises) you need to have more members join your downline. No wonder distributors ended up with cupboards full of makeup and skin care, and accosting strangers in Target.

After about six months I realised, by having an honest look at my Excel spreadsheet, that I had spent waaaaaay too much. Around $13,000 on the products, business cards, signage, packaging, postage, catalogues and so on. The decision to stop ordering from them was easy, thankfully, as I was already pissed off with them, from their awful behaviour behind the scenes, antiquated operating procedures, and awful compensation scheme. I focused on selling the stock I had accumulated. My membership ran out six months later. The company doesn’t allow you to discount more than 15%, but once I was no longer a member I sold at ‘illegally’ deep discounts. It took over another year to sell everything, but I did. I even managed to make a minimal profit, thankfully, but that is only because I was tracking my expenses, and knew I had to stop ordering, get out, and sell everything I had left. I wasn’t emotionally tied to them, so leaving was easy. It’s not that simple for many, though.

Thankfully my friend got out even before I did, and we remain fast friends. I was lucky — unlike so many distributors, I didn’t come out financially ruined, with friendships in tatters. It’s the only time I was glad of my previous cult involvement. From my experience I gained an insider’s view of the MLM industry. I saw first-hand what a damaging and predatory business cult it is. I know what they do in the shadows. They turned me into an anti-MLM activist, and I use this knowledge to educate and warn others, lobby for change, and help those damaged by this grotesque ‘industry’.

 
~Crownless Princess