What if the FTC is Right about Network Marketing?
If the CEO of a network marketing company was appearing on the TV talk show Dr. Phil, the doctor would turn and say to him as he frequently does to those who struggle to cope with the reality they are living in, “Okay you are right, so how’s that working for you?”
Since the FTC announced the AdvoCare settlement the reaction from most industry executives, attorneys, and industry experts has fallen under a common theme, the government is wrong, they don’t understand our industry and AdvoCare and their thousands of distributors are the true victims here…not the people the government purportedly are trying to protect.
The people who have worked long and hard and vested their careers in this business, me among them, know we are right, and the government is wrong! But it begs the question, so how is that working for us?
If you come from the perspective the government is wrong then you approach the problem from a different perspective with a different set of solutions than if you consider the premise the government may be right.
You don’t solve a problem when you don’t recognize the fact that you are not the one in a position on how to define it. The government’s less than flattering definition of network marketing is not a perception problem…the government has made it our reality.
The government and the public have a similar perspective
One must also ask themselves why is the government’s negative perception of network marketing more often than not in alignment with the public’s view and becoming more deeply embedded in our culture?
Whether it be political comedian John Oliver’s now-infamous 30-minute rant on Network Marketing (https://youtu.be/s6MwGeOm8iI)
Kirsten Dunst’s network marketing character on the new Showtime TV series “On Becoming a God in Central Florida” (https://youtu.be/FspH0_DY4yQ),
Or the 1999 film comedy “GO” ( https://youtu.be/OkdLWuCRe0c) whereby a Network Marketing dinner party has become an all-time cult classic, the line between perception and reality has increasingly become blurred!
At the heart of our self-inflicted perception problem is our compensation plans. Yes, we pay people for selling products. And yes, we pay people to recruit people to sell our products. Yes, I said it, and if no one can hear you in your office, you should say it out loud too! Because while we don’t say it…the government and the public are saying it…and both have said it in powerful and distinctive ways.
We can certainly argue very passionately and convincingly on how there is nothing inherently wrong with paying people to find other people to sell our products and once again we would be right. And once again I ask the question, so how is that working for us?
The government’s answer is to work more aggressively in taking legal action against us and the public’s answer is to work in other popular alternative income opportunities.
Yet, our resistance remains strong. We continue to see binary compensation models that are hard to explain in the court of public opinion, never mind the legal arena. Companies are continuing to sell upfront product packages with fast start bonuses and deftly encourage people to purchase a certain amount of product to get paid every month.
Many company's initial answers to this growing threat from both the reality of the government’s legal action and the accompanying public perception are to better police distributor's behavior, utilizing new and sophisticated technology. Also, companies have taken steps to educate and train their sales force to elevate our professionalism, inspire people with a stronger moral and ethical code, and hire attorneys to scrutinize our marketing plans to ensure compliance.
Should we change the rules, change how we enforce them or change the way we think?
If Prohibition couldn’t change the behavior of people who like to drink, then why do we believe we can change the behavior of distributors who are drinking the Kool-Aid from compensation plans that are still not far removed from no money down real-estate schemes?
For years, at the C-level suite, I have heard compensation plans drive behavior! If that’s true, and I believe it is, then the only answer to this quagmire, is to change our compensation plans. Not change them to be compliant but change them so the unending wrath of government intervention finally stops, along with network marketing being used as a cultural punch line!
In the movie “Fight Club,” the number 1 rule of “Fight Club” was not to talk about “Fight Club.” Is Network Marketing the new “Fight Club”? Policing and training our distributors more on what not to talk about, instead of what we should be proud of!
Other fast-growing gig economy income opportunities have demonstrated there are several new variations on the psychologies of attraction associated with income opportunities. It is no longer limited to Napoleon Hill’s “Think and Grow Rich.” Today, people are more satisfied thinking about an incremental change for additional income. They are not looking for opportunities to work harder to reach an unimaginable lifestyle but looking to finding a second income that allows them to work less and have more time to enjoy their friends and family. The certainty of income has become more attractive at the front door of a part-time opportunity than using their time to chase a dream of uncertainty. The dream is still on the roadmap, but people don’t believe they should wake up to earning an additional $10,000 a month.
Opportunities with E-commerce, Incubators Kickstarter, GoFundMe and the overnight app success marketplace are where many people believe they can turn an idea into a career.
What is unique about network marketing is that you can turn a part-time income into a full-time opportunity that can surpass your current position. It is difficult to do that with Uber or Airbnb.
Network marketing can attract people in the front door with more realistic and relevant compensation plans on the front end and use our ability to grow people into the backend of a full-time opportunity.
The FTC is not right about network marketing at the core of who we are and what we can do for people, but if we respond as if they are right, we have an opportunity to be the next best opportunity in the new gig economy.