MLMs: Pyramid Scheme or Something More?

in #business8 years ago (edited)

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I have always loved natural medicines (including psychedelics) and the plant world, but until a few years ago I was a very "typical guy" who thought essential oils were just something that women put in their bath to smell nice! Little did I know how powerful and potent these little plant collaborators were and how they were going to change my life...and I certainly had no idea the type of business model I was entering and how controversial it would be for certain people.

I actually came into the essential oil world in a strange way. I was on the board of a charity serving indigenous wisdom cultures (the Q'eros of Peru and the Tibetan Buddhist lineage) and the conversation came up regularly of how many creative, spiritual, ethical people there were in our community who were not really financially stable themselves. Of course, this limits the amount of good that can be done in a charitable sense. I've found it fascinating how creative people often put themselves last, and never really build a financial foundation from which to give back.

This led to us deciding collectively to do some kind of business together, aiming to create financial independence with the specific goal of enhancing our community's ability to give back philanthropically, and before long the idea was raised of exploring dōTERRA Essential Oils.

My initial reaction was "why would we get involved in a pyramid scheme?!?!" - as I had yet to grasp the difference between ponzi schemes and authentic network marketing. But I began to use the oils, fell in love with them, and looked deeper into the business model and saw massive potential.

I remember having an uncle involved in a company called Nutrimetics in Australia when I was a kid. My mum would order all of her skin care cream from him. I think he kept it in his garage :) Still all seemed very harmless and customer-care oriented. Certainly a far cry from the way MLMs are portrayed in mainstream media and tabloid news programs.

It's cool timing for me right now, as its a similar feeling I got recently when I joined Steemit - "Wow. This is a model that actually works. It promotes values I am aligned with. I love the product. I love being rewarded for supporting people and helping them succeed!"

In fact, I suspect that many in the Steemit/crypto world would be more open-minded to non-traditional business models than those in my everyday life. Clearly, the economic/commercial system that we live in is not working for most people, and finding alternatives, that create residual income is an urgent conversation to be had as a community.

There are so many myths about MLMs (Multi-Level Marketing) , some may be based on disreputable companies from the past, or in present times. But its weird the amount of hostility that MLMs attract, when my experience has been quite the opposite. I've found it to be an awesome business training ground. The principles of success in the MLM world are the same as in every other business or creative field - it is passion, integrity and consistency that lead to success!

One of the myths that many have about MLMs is that those at the top continue to earn forever off new recruits, while doing very little. I have found this to be patently untrue. In a great network marketing company, there is a glass ceiling for earning without achieving. What is rewarded is building real leaders, helping others in their personal development, and changing lives. To me, this is the business should work.

Another misunderstanding is the idea that we are constantly recruiting distributors for our business, and that we only seek out customers in order to turn them into distributors. Again, totally false. Almost everyone we enroll in our company will only ever be a customer. I would say 97% of all our enrollments are just people who want to use the product for their health and for their families. Of course, the business opportunity is also there for them if it feels right, but it is in no way expected. Our main priority is serving our customers with ongoing essential oil education and support.

We do this through thriving private Facebook pages that we add our customers to when they enroll. This is a safe space that they can ask questions and share experiences and articles. Its a warm space where people can bring genuine emotional or health questions to their community and get answers.

As we have risen in the ranks in our company (reaching "Diamond" rank last year - average earnings for this rank $10-$15K/month) we have done it by forming real relationships with awesome people all over the world. We now have teams in Hong Kong, Australia, Canada and the US, and I can honestly say I LOVE the teams I mentor and support. They have become dear friends. And much like Steemit, it is the relationships that create the success.

Mentoring has become a central part of what this business is about. Each week I check in with our various leaders. My job is not to "push" them to succeed, but to help them set goals that feel right for them, and then to help them confront any belief systems that might get in the way of them achieving their goals. It is very intimate work and I feel honored to be trusted to work with my team leaders in this way.

Lastly, dōTERRA's own commitment to philanthropy has been game-changing for me. Seeing a billion-dollar + company set up a powerful non-profit ( https://www.doterra.com/US/en/healing-hands-foundation-about ) that embeds giving back to every country where they source their oils from proves to me that it is possible to think ambitiously and generously at the same time! They have established long term partnerships with charities like Days for Girls (helping women in underdeveloped countries get washable feminine hygiene kits), Operation Underground Railroad (helping rescue children from sex slavery here and abroad) as well as building schools, hospitals and fresh water wells in locations of need.

For me, our dōTERRA business is one of the several businesses that are operating successfully for our family creating a diverse revenue stream, but also one I am very proud of and feel in alignment with. I like being an advocate for natural health, philanthropic giving and an entrepreneurial mindset!

You can learn more about about oils biz at https://www.ben-lee.com under "essential oils"
Follow me @benleemusic for daily blogs, videos, music, thoughts and dreams

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That's an interesting take on the negativity around MLM's and congrats on Diamond Level.
And I do like the edginess around giving back to communities in need, but I can't get my head around the extra markup you pay to fund the higher tier royalties.

It still feels like a missed opportunity to really make an impact in the world. So I wonder if it's possible to build a similar business without the MLM tier system and associated upselling and hype.

You've seen the possibilities, and know there's a market so what's stopping you from creating your own essential oils business minus the MLM.

Then finding like minded distributers that want to buy wholesale, knowing along the way that a percentage of profits are feed back into worthy charitable projects across the globe.

But that's just me thinking out loud.

The world is open for business.

It just takes the right business person to take advantage of it.

Interesting thoughts! Firstly though your question "if it's possible to build a similar business without the MLM tier system" assumes something negative inherent to the business model, which I disagree with. I was talking to my friend Amanda Steinberg, founder of Daily Worth, and she was telling me "I love the MLM model. There are so few entrepreneurial models open to people without qualifications or entry costs". I echo these sentiments. So I actually find the model innately awesome if it is done ethically. Secondly, "the extra markup you pay to fund the higher tier royalties" is not really true or any different to the markups around general retails etc that fund retail space, marketing or corporate wages. For instance, a high quality, non-MLM Frankincense oil is around $84 online. dōTERRA's Frankincense is $69.75 so the argument doesnt really hold water from a consumer perspective. Finally, I have no interest in R&D, sourcing, distribution etc - my passion is education and mentoring - so the idea of starting a company from scratch in this realm is about as appealing as starting a new blockchain social media site - I'd rather just join Steemit and capitalize on the amazing foundational work already done by those who know better than me! Best, Ben

Very informative post, enjoyed reading it. Thanks for sharing, @benleemusic! ☺

Thanks so much

Ah nutrimetics. I used to love that stuff. This is good insight into MLM and your essential oils business. It's clearly something you are passionate about, which comes through in your writing. It's nice to see you are having success with it.

I'm open to anything as long as I feel it in my heart!

Good one Ben, your a very interesting Guy -David

Gotta think outside the box!

Nice to know it's not entirely evil! My first experience with MLM stuff was pretty negative (and it's going to take me a while to dredge it out of the depths of my memory as it was a long time ago so not going to try XD) and that tainted everything that came after, from the Tupperware and "adult product" parties that some of the people I knew would throw, and even to some of the other gymnastics parents (who are not in my immediate little group of friends but that I still know because they're there every week) who sing praises about some essential oils that they use (possibly the same ones as yours). I might not just automatically run when I sense its presence now :)

goatsig

When someone tries to "sell" me on something they are passionate about - I actually take it as a sign of respect - that they see me as a worthwhile prospect! I would feel insulted if they didnt pitch me :)

Awesome. Yes my main intention is simply to enjoy the oils. That’s feels so clean to me.

I share the oils with every which other person I come
Into contact with.

You’ll even find me I cafe’s having coffee and popping oil on the wrists of the waitresses (consensually of course ☺️ Hahah)... but when they go to ask where to get the oils I feel like this heaviness come over me like I had ‘tricked’ them and this weird energy arises.

We’ll see. I like feeling like people know my sincerity.

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