Multi Level Marketing – Is it Legit?

Multi Level Marketing

Multi Level Marketing
Multi Level Marketing

Multi Level Marketing is something which you will often come across if you are working in online marketing.

But what is it?

There are many definitions of Multi Level Marketing available online. Many of them are geared towards the particular MLM which is looking for recruits and will make it appear to be all things to all men, as it were.

Here is a definition from Wikipedia:

“Multi-level marketing (MLM) is a marketing strategy in which the sales force is compensated not only for sales they generate, but also for the sales of the other salespeople that they recruit. This recruited sales force is referred to as the participant’s “downline”, and can provide multiple levels of compensation.”

Sounds good so far doesn’t it?

You can see the full article on Wikipedia.

Can I earn an income from MLM?

MLMs ask their members ( called IBOs or Independent Business owners) to recruit other members, frequently their family and friends, who are in turn required to recruit other members.multi level marketing

Recruits are promised a whole new way of life with an income that will change their lives!

Thus I would recruit five people who  each recruit 5 people and so on. This all sounds deceptively easy!

In theory money is earned from the recruitment of other members, and also from sales of products. The products are purchased from the company wholesale by the person depicted by a blue dot in the diagram above. Blue dot then sells them to the people in his downline making a profit for himself. They then sell them to their downline and so it goes on.

These members supposedly go on to sell the products to customers, again adding to the price to make their own small profit, but the selling price is always fixed by the company.

In many MLMs the sale of products takes second place to the recruitment of members.

So can you earn a good income from MLMs?

In an article by Robert L Fitzpatrick, “The 10 Big Lies of Multi Level Marketing”, he states:

“For almost everyone who invests, MLM turns out to be a losing financial proposition. This is not an opinion, but a historical fact.”

He then goes on to say that with regard to one of the largest MLMs, Amway,”…. the average income of all Amway distributors is about $40 a month.”

Could you live on $40 a month?

You can see his full article here.

My personal experience with MLMs

I have been involved with MLM. I am an eternal optimist, and I wanted to believe all the hype I was told. In other words, I was gullible!

My introduction to the world of MLMs was to be invited to a social evening by a friend. I was not told  that there was any more point to it than that. I was confronted by a group of uncomfortable-looking people, none of who I had met before apart from the host, who I did not know very well.!

multi level marketing
uncomfortable-looking people

We were then introduced to the speaker who proceeded to inform us that we had been invited to hear about a great opportunity which we would be crazy not to join.

He told us that we would easily be able to make a great amount of money by introducing other people to this “great opportunity”. There were a few “products” dotted about the room, but very little emphasis was placed on the selling of these, it was all about finding people to join in.

One by one the “guests” made their excuses and left, and on this occasion so did I, saying that I would “think about it.” The host was not at all happy about this, and we were all given lots of “bumph” to take away and digest.

It was a very uncomfortable occasion.

I did subsequently join in a different MLM. It seemed a far better proposition than the previous one. At least the products seemed good, and they did prove to be so, although very much on the expensive side.

I did make a certain amount of money from it, but most of that was eaten up by the purchase of promoting literature and products, and by so-called educational CDs. In addition we were told that in order to succeed we must attend meetings once a month and weekend conferences four times a year.   The speakers there all emphasised the great life that the company enabled them to lead. Of course, they were at the top of the tree, earning the largest commissions!

All those meetings were quite expensive to attend. After a while it became clear to me that I was spending more on all those things than I was actually earning, and really not getting very far. Even the people at the top had to “qualify” every month to maintain their high commissions. I became disillusioned and I left.

My experience is not unique!

I have spoken with a good many people who have been in multi level marketing at one time, or are even still in it, and with very few exceptions their experiences have been remarkably similar to mine. We all agreed that it is the people who have been one the companies for the longest time who are making the greatest commissions, and they depend entirely on the “little” people to provide those commissions!

Is Multi Level Marketing ethical?

multi level marketing

MLMs are legal in a number of countries, including most of the US and in the UK, but is it really ethical?

Can it really be ethical to virtually “dupe” prospects into joining the companies when they themselves know very well that very few of them will ever make a penny?

Can it be ethical to try to persuade someone to join when the only reason is that without more people joining there would be no more commissions?

If you have read this far, then I will leave you to make your own judgement.

Would I recommend MLMs?

If you are still wondering whether to join an MLM, then I suggest that you do as much research as you can on that company. That will not always be easy, as they are not at all willing to discuss probable earnings, only what they consider to be possible – a big difference.

If you would really like to create on online business with a really sound foundation, may I suggest that you look my post on the free training available with Wealthy Affiliate.

I am willing to grant that somewhere there may be an ethical MLM, but in my opinion the majority of MLMs are a BIG FAT

multi level marketing

If you have any opinions or comments on this post, I should love to see them. Please post them in the comments box below, and I will reply to you as soon as I can. Thank you.


multi level marketing


8 thoughts on “Multi Level Marketing – Is it Legit?”

  1. Brings back memories! MLM Hawkers are always surprised when I tell them no thanks, been there, done that, it doesn’t work for the little people. It really only works for those at the top, and for anyone who wasn’t there in the beginning, I have yet to see that it works. Never again. Good article, Chrissie!

    1. Thank you so much for your comments Margie.
      It is quite true that MLM only seems to work for people at the top,
      although I am willing to grant that there may be some exceptions.
      If you or anyone know of any, I would be very interested to hear about them!

  2. Every online MLM I have ever tried have all been scams because you have to pay to become a member of the opportunity and then pay more money for the products before you can promote.

    Even if you just decide to become an “affiliate” of some of these MLM’s, you’ll still be charged monthly for building “their” business. It’s a complete scam! HA HA.

    Robert L Fitzpatrick sure is right and $40 per month would be a joke!

    Thanks for your article, and MLM really is an unethical model, in my opinion.

    I’ll look into Wealthy Affiliate for sure 🙂


    1. Hi Neil

      Many thanks for your comments. I totally agree with you about MLMs, and your experience with them definitely tallies with mine! Maybe there is a good one somewhere, but I don’t know of anyone who has found one!!

      They just suck in gullible people and then spit them out, poorer but hopefully wiser!! Not an ethical business plan in any way, as you say!!

      I hope that you have now looked into Wealthy Affiliate, and that it is a good match for you. Here is the link again:

      Thanks again for dropping by

      Chrissie 🙂

  3. I can really relate to your experience with MLM. I was involved with a health and nutrition mlm for a several years before I realized that it wasn’t for me. (I’m a bit hardheaded! LOL) Anyway. I did make money but most of that money was re-invested into advertising and products (most mlm’s require you to keep products on hand). Some people do have success but I hated knowing that I was earning off of the hard work of my down line. I felt unethical. So I left the company.

    Like you, I discovered Wealthy Affiliate where I learned how to make money with a website. It is the real deal!

    1. Hi Wendy,

      I agree that no one really gains from MLM except the people at the top, and that is what makes them scams in my eyes. I think you did the right thing.

      The great thing about Wealthy Affiliate is that it teaches the right way to set everything up for success, without charging you the earth for that help!

      Many thanks for dropping by

      Chrissie 🙂

  4. Hi Chrissies,

    Thank you for a great post. I am not feeling good about Multi Level Marketing. But I am really feeling good about Wealthy Affiliate (WA). Compared to MLM, WA surpasses it on so many levels. As someone who has joined WA, I can say that it is one of the most reputed business model out there.

    1. Hi Rodney

      I totally agree with you. I felt all the while I was in an MLM that I was being conned in some way, and I am so glad I am no longer there!

      Wealthy Affiliate gives all that is needed to learn about the right way to go about Online Marketing as you say, and of course it is a completely scam-free environment.

      Many thanks for your comment

      Chrissie 🙂

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