Are the money-driven reps still in control?

In the 90’s, NSA‘s top recruiters sold water filter packages of $5,000 – $125,000.

The money-driven top bananas pulled in tens of thousands of dollars per month selling those big product packages. At meetings with thousands of newcomers, hundreds of reps lined up each night for the chance to tell their rags to riches stories on stage.

Money was unbelievably good. Those who couldn’t sell their product or get anyone else to buy in were belittled as complainers, uncommitted and negative, or small thinkers who couldn’t see the big picture. (I was in those meetings.)

Understandably, the company didn’t put on the brakes – it was good for them, too. Millions of dollars were rolling in each month. But when too many people complained they’d been talked into buying product they couldn’t sell or get a refund for, the regulators stepped in. Tens of millions of dollars in refunds and fines were paid out by the company. Today they’re very customer focused.

Enron also had a fabulous run because of their money-driven energy traders. Their management too, became very rich. And the stock zoomed. But the energy traders who led the charge were discovered doing all manner of unethical and illegal things, and the company collapsed when those stories were told.

The company’s stock price tanked and eventually, so did the company. The chairman, Key Lay, convicted of fraud last month, died of heart failure last week.
Quixtar is also discovering what money-driven reps have done to the image of their company. Not being strong enough to put a stop to these practices (by terminating the offending reps) is one of the biggest reasons Quixtar‘s reputation is what it is.

Who hasn’t heard a story about those business meetings where no one will tell you what it’s about until AFTER you get there – so fearful are they that people wouldn’t come if they knew.

In an interesting post yesterday (thanks, Ty), Robert Scoble notes that Quixtar is trying to shore up its image and declining sales.

Unfortunately, the image of any network marketing company is created primarily by the reps in the field. If the money-driven types are allowed to continue to hype and misrepresent income, and how easy it is to earn it, dead bodies will continue to litter the network marketing landscape, bringing down not only the companies who condone this behavior but the whole industry as well.

For things to change, the incentives need to change. For example, how about some big rewards and recognition for those who bring and take care of regular long term customers?

So long as big recruiters get the most stage time, the most recognition, the biggest rewards and the most access to the company management, the image of our business will remain what it is…

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Kim Klaver

1 Comment

  • Your assessment is very correct. The field reps do the most damage, but isn’t that how they (and we) have been trained by marketing pinheads and the dunderheaded management for whom they work? Yes, the offending reps need to be terminated, but will that solve all of the problem? Will the zombie not rise from the grave again to spread its particular disease across the landscape of NM? With the FTC threat hanging over them I’m sure many of these marketing wizards will climb back into their coffins for awhile, but my money is firmly bet on their re-appearance as soon as they figure out a way around the new rules (if there are any new rules). I think you’ll see a disguised class of NM companies show up in a year or two, without the 3X7 forced matrix or the weak/strong binary legs. Instead, you’ll see more of a direct sales-affiliate type of business that some legal eagle designed to circumvent the new laws. There are already a number of them out there. Then we’ll be right back where we started, fighting against the tide of recruiting evangelists who only care about the number of recruits and not numbers of customers. Those of us who give a damn will have to continue demanding that our companies change or change companies. But until someone establishes a set of ethics and rules of engagement and forces all NM, MLM and DS companies to adhere to them, I think we’ll just be whistling in the wind. Perhaps if there are enough of us, we can form a co-op type of NM company that delivers on its promises, rewards not only customer recruitment, but customer service, and tells distributor prospects the truth about what it takes to just survive in this business we’ve chosen. So, until that happens, the money-driven marketing pinheads and their zombie field leaders will still rule. And that’s sad, isn’t it?

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