How Direct Sales became dominated by Pyramid Schemes and MLM’s

How Direct Sales became dominated by Pyramid Schemes and MLM’s

For many years the idea was that Direct Sales would prevail as the most effective method of communication with past, present, and future clients and customers.  For those of us who have been involved in the Direct Sales Market, the years have seen many strong changes that some view as the death of this marketing mainstay.  Before I get tarred and feathered, please allow me to explain how a structure with as much earning potential as direct sales has been degraded to a near death marketing method.  The mismanagement of campaigns, the overbearing approach of the salesman, and the overall view of direct marketers has the field looking like it’s on the way out.  The MLM and Pyramid scheme mentality has taken a decent profession and once again made it as comical as the cartoon “I work my way through college” door to door guy.  The domination of these token groups has splintered the marketing world into one that will likely destroy the Direct Sales method for another generation.

The primary thought of the MLM’s is to hire lots and lots of small time individuals that have no possible way of producing well for themselves.  I don’t say this trying to insult the members who have found themselves on the bottom of a pyramid scheme, it’s just that this is the position where the management would rather you stay.  This structure keeps one mass moneymaker,perhaps a mid-level supervisory group and a  much larger group of bottom feeders to support them.  In the MLM structure there is absolutely no desire(contrary to what they preach) to elevate the position of anyone working for them.  If you have a lot of guys, working for barely anything, they will continue to do so, and keep you without any competition.  It’s impossible for your employees to improve their position if you prevent them from doing so.  For years the MLM’s have tried to propel the image of wanting to increase their employee numbers to support wealth: this is only true if they actually are selling and making wealth at all levels… which doesn’t consistently happen.

Marketing Campaigns, whether direct or through other mediums, have always run the risk of having improper management.  Direct Sales and Marketing is usually at the top of peoples list for effective communication methods, but is usually used in a way that is counterproductive to bring in new customers.  Consider the AT&T  UVERSE and the Verizon FIOS system marketing campaigns that are being waged on local levels.  In most cases, they employ the exact same parties to sell their platform that their competition is using in parallel markets.  While contracts usually prevent the sales group from mixing markets, the same groups are usually leading the charge for apposing companies.   Proper management would not include funding the marketing of your competition in companies like 20/20Communications/Companies or Stampede Marketing when both are contracted to lobby against you product in apposing areas.  20/20Communications contracted in Warrenville Illinois to sell the UVERSE while selling the FIOS System in Tampa.

While the marketing and campaign management companies have always had a reputation for blatant solicitation, in recent years they have effectively branded the entire trade as one of scam artist and hustlers.  On an individual level, the usage of “Hard Sales” and “Strong Arm  Techniques” have become more and more staple as companies have demanded more and more conversion from the sales teams.   Large Corporations have gone to such extremes of adding quality control methods to prevent salesmen from cheating the system.  AT&T requires its sales force to have a quality control call for every sale… the problem is that it’s rigged in such a way that it’s easy to walk the purchaser through the Control Measure.  The purchaser has no clue what they’ve agreed to, the salesman ads another $10.00 to his check, and the main company can easily claim that the person was informed of the items they purchased.  It’s impossible to assume that this doesn’t cause problems.

In Savannah and Chicago 20/20 Communications had to move markets because of the massive amounts of buyers remorse AT&T was receiving from their sales techniques.   The Corporate home companies have done what they could do to wash their hands of the mess, but the problems are still catching up with them as well.  Regardless of their attempts, the scams have continued and have all but been encouraged my senior and mid-level leadership of the marketing groups.  Regardless of the quality control methods being invested in by AT&T and others, the scamming has continued and damaged the branding of both the main company and the marketing group that was contracted by them.  The problem is, when they are in the field selling the item, it’s the Parent Company shirt they’re wearing, not the one with their marketing service logo.  Ultimately, the short term gains in sales are not worth the long term discrediting that is endured by the Host Company.

I’m writing this today with the realization that AT&T cut ties with 2020 while several other companies utilize them still.  Several MLM structured sales groups are still out there killing the long-term structure of businesses across the corporate structure.  Their methods make for quick and responsive gains from the consumer, but also ensure the depletion of viable customers.  If dealing with a Direct Sales Campaign, one should consider the marketing methods wished to represent the Parent Company.  If the methods of and MLM sales group do not match your own, then it would be advised to bypass them for a more professional marketing strategy.  The age of social marketing and seo through web development are opening new doors for marketability.  If the holders of the Direct Sales marketing methods aren’t careful, they will completely transform the marketing world to website and social media marketing.

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