How to recognize a pyramid scheme

multilevel-marketing

A bit harsh, but John Oliver raises some interesting points in his video on Multilevel Marketing. He point out correctly that if a company relies on recruiting and sales to distributors for the majority of its income, rather than sales to end customers, it is a pyramid scheme. The video talks specifically about Herbal Life, Youngevity (the parent company of Heritage Makers), and some other companies. Note: the language is relatively frank so do not watch this if you are easily offended.

About Mark Mizen

I have over twenty years professional experience in all aspects of photography and digital imaging. I am Chair of the ISO WG5 TG2 committee responsible for physical properties and durability of imaging material and am currently with HID Global working on systems for security printing for IDs, licenses, and credit cards. Previously, I was Director of Digital Development at Creative Memories from 2009 to 2012 and was responsible for the Creative Memories digital products and services. I also established and directed the Creative Memories Technology Center, which evaluated new products prior to product introduction, assisted with production difficulties, and provided technical information to support product sales.
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4 Responses to How to recognize a pyramid scheme

  1. Gracie says:

    Om my goodness! I laughed way to much but it is sad how these companies sucker people!

  2. momfawn says:

    I finally had to quit, but this was really well done.

  3. Ann says:

    So, do you think that Forever falls into the MLM category?

    • Mark Mizen says:

      Forever uses a multilevel compensation plan but does not fall under the pyramid scheme umbrella because a significant part of compensation comes from sales of actual products to end customers. The companies that are MLM pyramid schemes are the ones, like Herbal Life, where the only way to succeed is to recruit others and then to rely on those recruits for income.

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