When Sara Balanuik started selling weight-loss products for a multi-level marketing business, she felt like she was kicking goals.
The single mother was trying to make a living as well as manage her weight, depression and anxiety.
“All of which was promised to be addressed through the program,” the 32-year-old Canadian says.
Multi-level marketing (MLM) schemes, such as Doterra and Amway, are a form of direct marketing that distribute products or services through salespeople who are not employees of the company.
It typically relies on salespeople to recruit additional members.
“It started off really good, as I lost a bunch of weight and was feeling good inside. I had signed up 30 people in the first couple months and was ‘making ranks’,” says Sara.
But things began to stagnate after she recruited all her family and friends who could afford it — a common theme.
Sara felt uncomfortable with her upline’s suggested tactics to make more sales, and quit, but was ashamed to admit defeat.
“I was mad, and embarrassed and confused,” she says.
“I hustled hard but was still not a successful boss babe, as was promised.”
Anna Jenkins is a senior lecturer in entrepreneurship and innovation at the University of Queensland’s School of Business and has studied failure. She says being open about it goes a long way to help others.
“Having people share their stories and normalise the experience means it’s less likely people will feel ashamed,” she says.
“They realise this is just what happens when you do an MLM.”
Sharing “failure” stories could also help push the industry to improve, says Maire O Sullivan, a lecturer in marketing at the Cork Institute of Technology who has studied MLMs.
“The growing public discomfort with the business model is the best bet to force change in the industry, to push companies to crack down on exploitative and toxic practices at the very least, and unsuccessful sellers have been instrumental in that.”
Sara says her upline (consultants in levels above you) laid guilt on her whenever she didn’t meet targets.
“They basically said you earn as hard as you work. If you aren’t earning, you aren’t working hard enough.”
It’s that kind of messaging that leaves people feeling ashamed when they don’t make it in direct selling, explains Dr O Sullivan.
“Of course nobody loves to think about their failures. But I think with MLMs a big part of the issue is the ‘power of positive thinking’ language.
“This kind of thinking has been termed ‘toxic positivity’. It may make participants blame themselves and thus feel deep shame at their failure.”
Sara says she was being asked to go back to people who said they couldn’t afford the program to get them on board “by any means necessary”.
“[For example] tell them to borrow money from family or friends under the pretence that once they saw results and signed five people up, they would make their money back.
“Or tell them to get a credit card specifically for this purpose, and tell them that they’ll have their money back before the first bill is due.”
She says being asked to put people “in a financial bind” to hit targets was the final straw.
Has your experience with MLMs been different to Sara’s? Share with us: email@example.com
‘You didn’t fail, the business model failed’
Dr Jenkins says people who don’t succeed in multi-level marketing should not feel responsible because it’s a business model that sets people up to fail.
She says often people who sign up feel passionate about the product and invest a lot of time, energy and money. That makes it hard to separate themselves from the failure.
“So much of our self-worth and self-esteem is tied to what we’re doing,” Dr Jenkins says.
Sara says becoming involved in an MLM turned her from a struggling single mother into a struggling stressed single mother.
“I wasn’t making any money, but was still on the hook to coach the many people I had signed up.”
Telling her loved ones it didn’t work out was hard, not to mention the public fallout.
“After months of pushing this product every day on my page, I wondered how many of my naysayer friends were laughing at me, saying ‘I told you so’.”
Dr Jenkins says because the business model relies on recruitment, those feelings of shame are heightened.
“It’s so dependent on peer-to-peer selling. You need to be telling your friends that you are doing it.”
She says while you might feel people are scoffing at your failure, this is more likely coming from your own understanding of the stigma attached to MLMs.
Dr O Sullivan says people like Sara sharing her stories helps to bust the “relentless positive narrative” about the industry.
“It is very, very important for all potential sellers to make themselves aware of the statistics around MLMs. Only 1 per cent of people make a profit, per Dr Jon Taylor’s work for the Federal Trade Commission.”
ABC Life in your inbox
Get our newsletter for the best of ABC Life each week
This content was originally published here.