7 Things I hate about MLMs and Direct Marketing CompaniesLast week, yet another friend quit an a direct marketing company. After a year, she’d made $100 but after asking, I found out she’d spent far more than that getting started and got into more than enough fights in the process. Why? I could just chalk it up to the cold call Indian telemarketer meets door-to-door Austar salesman style of the average distributor but it’s not as simple as that.  Direct sales (or party planning or multi-level marketing) is a one size fits all solution that actually doesn’t fit most, meaning the majority of distributors end up leaving with a bad taste in their mouth.

 

 

  1. Without the right skills & support it just doesn’t work. Unless you have a background in sales or marketing, a big network so you’re not fightng your friends for sales and a supportive upline, you won’t get far without serious hard work. And unlike a day job, you’re not even guaranteed an hourly rate while you’re in training.
  2. Saturated markets. When you sign up friends as distributors, you’re creating your own competition and the more people who get involved, the less chance mutual friends will know who to buy from. There are only so many people interested in buying and with multiple distributors in small areas, the best (or best known) salesperson will get the sale. 
  3. It makes your friends feel guilty or overwhelmed. When you become a direct sales distributor, you’re encouraged to contact friends, set up meetings, have parties. The only problem is, unless your friends have a real need or interest in the product, they’ll likely end up feeling guilty if they don’t buy from you, which can impact your friendship. General pressure is never as good as specific problem solving, so they’ll end up stressed instead of impressed by what you’re trying to sell.
  4. Loving a product doesn’t mean sales. You may love the product, but that doesn’t mean all your friends will. It’s hard to guarantee a targeted market when that might mean networking well outside your comfort zone. At some point, everyone will have enough of those products for the time being or not have enough money to buy more – the dollars add up when you tack on the extra profit that needs to be distributed to you, your upline and the company.
  5. There’s no off the clock. Especially for rookies with no marketing background, it’s easy to become obsessed with steering conversations to products, looking for people to talk to about products or figuring out ways to increase sales. Once again, this can scare friends away.
  6. It’s the only way people know to work at home. Just as not everyone in the world has the skills to become an electrician, not everyone has the skills to be successful in sales and marketing. Unfortunately, many people aren’t aware of the hundreds of other freelance or work from home jobs available which are much more suited to their skillsets.
  7. Most people lose money. Most direct sales companies require a small investment up front, but there are plenty of upsells along the way simply to have enough products to show potential customers. Unless you’re serious about putting in a 38 hour week, you can quickly end up with out of date products and no extra profits to cover them. 

 

I have some friends who excel at direct marketing – and those are the friends I buy from. They don’t pressure me, but they’re there when I want a product. The problem is, I’ve seen far more people quit direct sales, than stick with it. Most of the companies have great products, but the people who sign up to sell them think it’s a real job, as opposed to a home business opportunity which takes some serious work to develop into a business.

I’ve spent the last five years working closely with WAHMs, freelancing and seeing the many varied opportunities available for people who want to work from home. Just like any job, it’s about choosing something you enjoy, you’re good at and isn’t just the first well advertised opportunity that comes along.