How Many Pyramid Schemes Are You In - Right Now? (Hint? At Least 12!)
You’re a network marketer. Doubt this statement? Read on!
The fact that you’re a network marketer (in a variety of pyramid schemes) is true. Doubt this statement? No worries. Most do. When you share doubts with others that you’re not really a network marketer (or in any scheme) you perform an act of network marketing! (Sharing opinions is a network marketing tool LOL.)
Confused? Good! Let’s dive into a topic most people just roll their eyes when they hear or see the words network marketing.
What’s your gut level, instant reaction when you hear or see the words network marketing?
Seriously!
What’s your first thought or feeling that instantly comes to you? Is that thought or feeling primarily positive or negative? Do you base this primary feeling about network marketing on facts (first-hand experiences)? Or, is the way you think or feel about network marketing based on fiction (hearsay or lack of first hand experience).
Three examples of blind card-carrying network marketers.
Example 1: The burned for life former network marketer.
Last night Pat and Chris savored two complimentary meals at Pat’s local favorite diner. (Based on the number of people who said, “Pat sent them!” the owner of the newly established diner happily comp’d Pat two meals to reward Pat for all the recent referrals.) Pat shared dinner with Chris. Chris is Pat’s childhood friend and neighbor. During dinner Pat shares some coffee samples with Pat. Chris knows how much Pat loves coffee! They both enjoy a morning cup (or two) to start their days off in good spirits.
This morning Pat texted Chris to compliment Chris. Pat likes this new coffee blend. When Pat looked for Chris’ blend at their local food coop, Pat came up short! No such blend to be found. Pat (being a persistent soul) tried another premium grocery store across town. Once again Pat’s search for Chris’ blend fails. Damn! Pat likes this new blend and wants more.
Winding down for the evening Pat remembers to dig out the empty coffee sample packet from the trash. A quick google search found Chris’ blend. In less than a couple clicks, Pat was pissed. Apparently Chris’ blend is one of the many products of a massive network marketing company. To place an order the site pointed Pat to a membership sign-up page. (Backstory: Pat tried network marketing years ago. Pat failed miserably even after following every bit of their free training. Pat’s failure to build a profitable network marketing business soured Pat’s opinion of network marketing for life.)
Over coffee the next morning Pat hands Chris a credit card with a request to order some coffee. Chris laughed and asked if Pat wants to join Chris’ company to enjoy wholesale prices. After all, Chris knows Pat already paid for a Costco discount membership. Chris points out that a membership in this coffee company is even better than a Costco card. When Pat orders from Chris’ company, Chris earns a little commission. With a bright smile Chris returns Pat’s credit card. Chris tells Pat to watch for an email containing a link to place a retail coffee order (no membership required). Pat gently tells Chris “Thanks but no thanks. I’m not into network marketing.”
Feeling confused Chris decides to risk confronting Pat with the fact that their free meals down the street happened because of Pat’s past referrals. Referrals are a form of network marketing. While Pat acknowledges Chris’ valid point, Pat firmly tells Chris “friendships are friendships, business is business, I don’t mix the two together.” Chris drops the topic knowing Pat’s mind is made up.
Moral of the story? Most multi-level and network marketing training materials pressure newbies to tap into warm referrals as a lucrative sales tool. The truth about warm referrals is while it may help spur a fledgling sense of success, 85% of warm referrals drop off within six months of registration. Risk-averse family and friends often decline the most well intentioned / reasoned invitations to join a cherished family member or friend’s network marketing business. While family or friends (your warm market) may risk initially hurting your feelings, they may simply seek to limit future (perceived) risks associated with the network marketing industry.
Example 2: Loyalty program fish and baiters.
Dale’s job racks up tons of frequent flyer miles, hotel reward points, car rental points and even credit card cash-back credits. (Dale discovered how to double-dip rewards by paying off a frequent fliers mile rewards card with another card offering end of year cash-back credits.) Dale loves to register with almost any customer loyalty program providing it’s both free and convenient. Dale travels with a stack of loyalty cards to track drinks and meals from his favorite stops as well. Dale mindfully tracks points and card punches (rewards) to enjoy regular upgrades or perks.
Dale is also a generous thoughtful soul. Dale offers Jean (a loyal friend) an all-expense paid first-class vacation to celebrate both Jean’s 50th birthday as well as to thank Jean for all the years Jean watched over Dale’s house, pets, mail (etc.) due to all of Dale’s travels. Dale tells Jean, “Saying yes is doing me a favor! I have tons of rewards points to burn up!”
While enjoying a long beach walk Dale opens up about retiring soon. Based on a close friendship spanning a few decades, Jean knows Dale’s retirement income falls short of what’s needed to maintain Dale’s current lifestyle. Jean asks Dale if downsizing is on the horizon or will Dale look for a part-time job close to home before retiring.
Dale politely changes the topic.
The next day over lunch Jean decides to be more direct with Dale. Knowing Dale’s fondness for customer loyalty programs, Jean shares the details of a thriving work-at-home business based on a reputable network marketing company. Jean would be delighted to help Dale retire early! Jean offers to pay for Dale’s initial membership fee as well as Dale’s first order. Jean covers concerns about money by sharing the fact that the first order is backed by a 30 day money back guarantee. A bit annoyed (that Jean is offering help when no help was asked for), Dale bluntly blurts out, “I don’t do network marketing. They’re all pyramid-schemes! I know you’re trying to be helpful. Thank you. Let’s change the topic.”
Jean laughingly responds by asking Dale point blank: “Do you think I’m a scammer?” Dale politely changes the topic. Given Dale’s generosity (as well as a wish to keep things friendly) Jean drops the subject. A chance to evolve Dale’s attitude toward network marketing will come again one day. Today, Jean decides to enjoy Dale’s company while savoring their lunch on the balcony of their first-class suite looking out over the sea. A suite and meal paid for with Dale’s hotel membership reward points.
Building passive revenue streams is often the bait to building a successful network marketing business. People who believe network marketing is a scam often block further thought or discussions about taking part in network marketing opportunities. Simplicity provides the bait to lure and retain participants into limited loyalty rewards programs. What’s more simple than a quick registration process to start accruing points — right? Frequent traveler loyalty programs (air, auto, hotel, etc.) often:
lack reward incentives for members to inspire new memberships,
reward members based on personal purchases only (no credit for purchases from first-hand referrals),
rewards often apply to upcoming purchases of their loyalty program product or service. (Can you book a flight using earned punches on your local coffee-shop punch card?)
How many loyalty programs do you use — right now?
Imagine how many more points, miles, credits or punches you will earn WHEN these loyalty programs offered additional points, miles (etc.) for every purchase made by anyone you referred to that program, product or service.
Ethical network marketing companies create compensation programs to reward those who help them grow.
Example 3: Attraction via motivation transference. What motivates me must motivate you — right?
Sam’s incentive to dive deep into network marketing started three years ago when Sam faced an eviction notice for too many late rent payments. Sam’s full time salary wasn’t enough to cover increasing credit card minimum payments, utilities and rent. Sam rationalized a need to keep current on credit cards to buy gas to get to and from work. No work, no food, no home — right? In a panic Sam called Sean to beg for a loan. Sean is the one person Sam knew who had the cash Sam desperately needed to avoid eviction. Sean offered to loan Sam six months worth of rent in the form of one check payable to Sam’s landlord. (While Sean trusted Sam’s work ethic enough to offer Sam a loan, Sean wanted to ensure funds went to Sam’s landlord versus Sam’s credit card payments.) Sean’s terms were simple. Sam had six months to earn enough money to pay Sean back as well as keep current with all other bills.
The day after catching up on rent Kelly called. Kelly was all excited about a network marketing business that now pays all the monthly bills. When Kelly invited Sam to a company information party Sam replied, “I’m broke.” (Backstory: Sam likes Kelly. Sam even wonders about dating Kelly. Sam also knew Kelly historically struggled financially as well.) To try to tactfully wiggle out of Kelly’s invite Sam politely told Kelly there’s no time to waste on sales-pitches. Kelly assured Sam the party was all about sharing information. Treat the party like a job interview. Kelly told Sam to leave the checkbook and cards at home. (Kelly follows the company’s sales training that suggests sharing one’s why mixed with company information is more likely to attract new registrations than outright product or service pitches.)
Sam arrived at Kelly’s info party filled with a deep sense of skepticism. By the end of the party Sam eagerly joined Kelly’s company. Why the change of heart? The info party was packed with all sorts of first-hand success stories (high-energy) and good eats! In Sam’s mind a second job would have to work around the day job anyway. Besides, things might turn into something more with Kelly since they’re both single and looking to settle down. The clincher to sign-up was Kelly’s offer to cover Sam’s cost to get Sam’s business up and running.
The short story is Sam and Kelly teamed-up to build a thriving network marketing business in short order. In a few months time (working twice the hours dedicated to Sam’s day job), Sam earned more than enough money to pay Sean back on time. When Sam handed Sean cash to pay back the loan (plus a hefty interest payment), Sean was stunned!
To show Sean more gratitude for bailing Sam out, Sam suggested Sean take advantage of the success already in play thanks to Kelly. Sam shared how they’d work together to repeat the success both Sam and Kelly already enjoy. As Sam outlined what would happen when Sean registers, Sean repeatedly (politely) declined Sam’s offer. Sam wondered out loud, “Who doesn’t need more money?” Sean replied by sharing plans to retire from a cozy career in just two years. With more than ample banked funds, Sean’s not motivated to rustle-up more money.
Obviously motivation plays a vital role in building any successful business. The lure of more money is the wrong bait to attract (let alone motivate) financially comfortable souls into a network marketing business. Souls who are consistently short on cash often transfer an assumption — that anyone can use more money — onto other people. True, a strong need to raise money (unexpected medical / maintenance bills — etc.) will motivate financially wealthy souls into network marketing opportunities. In this example should Sam discover how to help Sean to retire earlier than planned (by building a successful entrepreneurial business) Sean MIGHT just take Sam’s offer up to join Sam’s company.
Enough examples. Time to get real. Time to take a test to see just how often you do network marketing related activities.
Test question 1: You have told (or tell) others about stuff or people? Yes or no?
Yes? You use network marketing tools.
No? Really? Seriously?
Test question 2: If who you told (or tell) follows your advice and purchases what you recommend were you rewarded for that referral?
Yes? Your compensation for your referral is your reward for that referral — a classic network marketing tool.
No? Really? Seriously? Nobody has ever said thank you for your info?
Time for a little fact finding!
Exercise 1: List how many insurance programs are you a member of.
All wage-earning U.S. citizens are required to pay taxes. Taxes are a way to insure funding to pay for public things like roads, water, government salaries.
If you drive a car you must pay for auto insurance.
If you pay for home, health life (which is actually death) insurance — add these insurance programs to the list for this question.
Exercise 2: How many people have / do you share your consumer opinions with?
Step 1: Think of the last 10 people you told about a new food, drink, movie, restaurant, baby-sitter, professional (doctor, plumber, lawn service, etc.) insurance (medical, dental, home owners, etc.)- you name it.
Step 2: recall how you found those people, products or services. Did you learn about it/them from someone else?
Step 3: did folks from step one hire or purchase the product or service you recommended? If so, did you receive some kind of reward for your efforts?
Referrals play a key role in network marketing. Referrals who turn into consumers plays the second key role in network marketing.
Exercise 3: How many frequent purchase programs (also known as loyalty programs) do you use. Common reward programs include flights, hotel stays, car rentals, movie rentals, cash-back programs, meal purchases, cups of tea or coffee or even groceries.
Step one: Look through your phone apps, wallet, purse or drawer where you toss loyalty cards into.
Step two: Sort apps / cards into two stacks.
Stack one: loyalty cards used to collect and redeem stored value. (Frequent flyer, hotel, car rental, coffee / tea shops, grocery stores, etc.). Stack two: relationship cards used to contact people you need something from or wish to offer something to.Step three: recall the rewards received from your loyalty (flights, food, drinks, etc.) Free cup of coffee? Flight? Hotel stay? Referral discount?
This fact-finding mission reveals you are in fact, right now, no matter who you are, what you do (or don’t do), a member of at least one or more (pyramid) schemes where you have tons of people funding a scheme that pays out to people who qualify for a scheme payout.
Now the hard question is: Are you a successful (or poor) network marketer? Let’s find out.
Every ethical scheme succeeds each time participants tell (refer) other people about their products and services. (Exercise 2 above.)
The more you (and those you referred / participate) use their product or service, the more you qualify for more rewards. (Exercise 2 above.)
Successful network marketers receive rewards for their efforts. Rewards like money, products, services, power, privilege or access to restricted resources like larger bonuses, more access to more power, etc.
Poor network marketers receive little or no rewards for their efforts. Sadly, poor network marketers often feel punished for their efforts in the form of ridicule, disdain or out-right rage! (Sounds like Pat in example one above — right?)
So you see, yes, it’s true. YOU — yes YOU — are in multiple pyramid schemes — right now! Period. All employees are part of a pyramid scheme with the president / leader of the company earning the most income. All insurance schemes (for-profit, state and federal), all loyalty / rewards programs are examples of how you take part of a form of network marketing.
My point? The next time someone approaches you about joining their network marketing team — ask yourself these questions:
What are their motives? Are they simply ‘in for the money’ (living large)? Or are they on a mission to be successfully self-employed?
How solid is the product or service? How many awards has this company received over a minimum of a decade. Who awarded these awards?
How many research studies by independent academic sources (e.g. state-funded University level) show their product or service to be of true value?
What are YOUR motives? Do you need money now such that the lure of fast cash will inspire you to loose your cash fast?
Network marketing — when done ethically — helps both the one and the all.