MLM and Network are Pyramid Schemes

Recently one of my associates was in the process of a business presentation for our network marketing program and the person they were presenting to replied, "network marketing is an pyramid scheme!" My associate froze and then completed the conversation and then spoke to me. I asked her, do you know what a pyramid scheme is? She said only that it is illegal, but that was all. I asked her do you think your prospect knows what it is? She said she didn't know. I replied that there's a 99.99% chance your prospect doesn't either.

Now this response from a prospect is not unusual, in fact it happens quite often because our news media when pyramid or ponzischemes as in the news fails to properly describe what they are. The result is folks hear this and then when we do what we do they think we are doing the same thing. If we don't know what they are, how are we going to correct this misinterpretation? If we can't answer this question we lose the prospect because they think we are trying to lure them into an illegal activity. Nothing could be further from the truth! But the prospect doesn't know that. We then have the responsibility to educate the masses and assure them what we are doing is 100 percent legal. Here's a brief explanation of one of the 5 examples that the FTC cites to look for as a sign of a pyramid scheme; "Pyramid schemes advertise that they are in the "pre-launch" stage, yet they never can and never do launch. By definition pyramid schemes can never fulfill their obligations to a majority of their participants. To survive, pyramids need to keep and attract as many members as possible. Thus, promoters try to appeal to a sense of community or solidarity, while chastising outsiders or skeptics." For more information on this subject the FTC(click on FTC) has a great site dedicated to his subject. Here's how I would respond to a prospect or anyone else that throws this at you. My response is as follows. "No we are not a pyramid scheme, we have a viable product and our success is not solely based on recruiting people into this business. We can sell our products to health food stores and other entities that wish to present our product to the public." That's it, keep it simple and don't attempt to insult the prospect's intelligence because this is really an honest question thanks to the misrepresentation of what these schemes are to the public.

Network marketers have a tough job and the more we educate our associates the better prepared they are to answer questions like these. Remember, knowledge is power, once we harness that power the more successful we will be!