What is the current status of MLMs?
MLMs = "multi-level marketing" companies, which is essentially a euphemism for "pyramid scheme." These are flat out illegal in many countries, but are, notably, quite legal in the US.
They used to be huge in the 2010s, but I don't hear much about them anymore (granted, I haven't been on social media since 2016). I know several IRL people who got into them, and I even regrettably bought products from some of them before I really understood what they were or how they worked.
I recently read Hey, Hun by Emily Lynn Paulson who was toward the top of the pyramid at Rodan + Fields.
In the book she mentions that algorithmic changes from social media companies ended up downgrading a lot of MLM postings, which cut off oxygen to the cycles of recruitment that these companies rely on. For example, Rodan + Fields moved to an affiliate model in 2024.
I'm curious about what the MLM landscape looks like right now.
- Are MLMs still common?
- For those of you on social media, do you still get recruitment and sales messages?
- Have they changed their tactics or models?
People don't have to limit responses to just those questions -- consider this a general MLM discussion topic where anything related to them is fair game.
From my experience MLMs still operate at relatively small scale but have little room for growth - because they've been so heavily stigmatized, no reputable investor will touch them since it's trivially easy to cross the line into an illegal pyramid scheme without diligent oversight.
And I wonder if the less reputable investors have found crypto to be more lucrative, and therefore syphoned away the other end of the spectrum?
I think so. Back when I worked at the MLM, production, inventory and shipping ate up a lot of the money. Now they can just sell meme coins..... I do believe that some of those stories of "wow this teen rugged people for $50k in 5 hours!!" is a form of advertising for the platforms themselves: pump up some story, lure greedy people who think they can do the same, take their tiny transaction fees to start their own meme coin, watch them go nowhere and laugh. Sell shovels, not pan for gold
That's a good point - the get rich quick market is much more saturated now than in 2010, thanks mainly to crypto.
Anecdotes only:
(today) Judging by /r/antiMLM, yes they are still common. Go to any home and Garden show or baby show or kids (equipment) swap and I bet there will be at least one booth
(few years ago) An extended family member was doing Primarica. It so weird to pay money to fly and hotel in to get pumped up to lose money.
(months ago) Saw on Facebook that Epicure is suddenly gone, leaving all their people with stuff they can't sell. Reddit post from someone unrelated to me here
(2019) DropOut miniseries Total Forgiveness featured a super cringe MLM segment; the young people seemed to know exactly what it was immediately, which implies the existence and knowledge of MLMs is alive and well.
My hatred for MLMs is only slightly less of that towards education fund
scamsgroup plansEdit: my first programming job was for a (now defunct ) MLM, circa turn of the century. I implemented the algos for how they calculated the weekly cheques, but I wasn't involved in sales / training. Can confirm their training specifically targeted the women and elderly.
I already knew it was sketchy but my disgust for Primerica exploded when they recruited my wife's best friend. Not only was she suckered in on training she couldn't afford but she was a terrible financial manager who was on the verge of losing her house. But now she was 'certified' to give financial advice?! Made zero sense - she was the last person who should be giving advice.
She lasted about 4 months before Primerica decided she wasn't feeding them enough new suckers.
MLMs thrive on the naive. In the internet age it only takes a second to Google your favorite ripoff company and read the comments from past victims.
It is not uncommon in my city to be approached by people recruiting for MLMs, mainly Amway. Usually it's a young person in their 20s at a supermarket striking up conversation with strangers. The pitch is pretty obvious, "I like your shirt!", "Are you new in town?" - Things that most strangers wouldn't say to each other around here, especially while grocery shopping lol. I've never been approached like this, but we think my wife was once. I can't imagine these tactics are very effective, but MLMs are still out there trying.
I have a little historical tale about my experience with MLM people, not about the current state of them.
Years ago, when I was much younger, my wife and I were approached in a supermarket by a stranger. He was very friendly and made small talk. Then he asked if I ever wished I had more money and if I had any free time. I said sure. (Keep in mind that I was younger and pretty naive). So he gave me an address and said there would be a meeting there for people who wanted to make money in their spare time.
I went to the meeting. It was about some household products like soaps and detergents. The products had various names. The meeting was about how much money you could make, especially if you just got your friends to join. Then sometime near the end they mentioned the word Amway.
Even in my naive state, I didn't know much but I knew I didn't want anything to do with Amway and I noticed how they hid the name for most of the meeting. I had a few friends who had sold it for a while and they were very annoying. I also would sometimes be contacted by someone I hadn't seen for years and they would start talking about it. In general, most people knew that Amway was kind of a scam and generally disreputable. So I left, but one of the organizers gave me some cassette tape (yes, this was long enough ago that people used cassette tapes) that was apparently some motivational propaganda.
So I never had any intention of getting involved, but the guy who bugged me in the supermarket would call me every week or so. At that time of my life, I had a tendency to be non-confrontational and kind of passive-aggressive. So I never told him no directly, I would just be evasive and not commit to anything. Eventually he got very upset with me and asked for his motivational tape back and said he was tired of wasting his time with me.
Later I realized it was very funny that my passive-aggressiveness and conflict avoidance was absolutely the best way to annoy this guy and get him out of my life.
Now I have way better boundaries and more skepticism about strangers who are too friendly and pyramid schemes.
I've never been approached by anyone about an MLM since, except I know someone that had parties for one of them that sold things like candles and oils or something.
They still exist, but I've effectively removed all those people from my life because if they can't talk to me without pitching a product I am not interested in that friendship
One thing I've noticed is a lot of smoothie storefronts that seem to just be Herbalife or other MLM sellers. And that's a weird thing. They just mix powders not actually use fruit or whatever ala Smoothie King. They stand out because their add-ons are things like "fat reducing creamer" (not low fat) and there's zero fresh ingredients.
I was walking past the new Adidas store here in Vancouver, and for some reason in the window they have co-branded Herbalife t-shirts on all the mannequins. Struck me as odd, since I thought they were universally known to be a pyramid scheme but I guess they’re still out there.
Herbalife is a major sponsor of the LA Galaxy MLS team, for which Adidas makes the jerseys. Might explain that collab.
Franchise owner's side hustle maybe?
LuLaRoe is still in business, still doing affiliate marketing, and even selling its leggings on Amazon. There's a good summary of their shady practices here and via a couple of documentaries. It's a classic pyramid scheme/religiously-inspired marketing cult - not unlike Amway, but pitching comfy, cute mom clothes sold by comfy, cute stay-at-home moms.
I'll admit I've picked up a couple of pairs of thrift-store LuLaRoe leggings and they're not terrible. But I couldn't imagine anyone would buy them at the original prices, and I can only sympathize with the sellers stuck with the most hideous patterns, or defective ones.
There is a podcast called "The Dream", which is worth listening to, especially the first season.