Are we hoarding information like the Ku Klux Klan?

“The Ku Klux Klan was a group whose power — much like that of political or real estate agents or stockbrokers [fusion_builder_container hundred_percent=”yes” overflow=”visible”][fusion_builder_row][fusion_builder_column type=”1_1″ background_position=”left top” background_color=”” border_size=”” border_color=”” border_style=”solid” spacing=”yes” background_image=”” background_repeat=”no-repeat” padding=”” margin_top=”0px” margin_bottom=”0px” class=”” id=”” animation_type=”” animation_speed=”0.3″ animation_direction=”left” hide_on_mobile=”no” center_content=”no” min_height=”none”][or network marketing recruiters -KK] — is derived in large part from the fact that it hoarded information. Once that information falls into the wrong hands (or, depending on your point of view, the right hands), much of the group’s advantage disappears.” -Levitt & Dubner, Freakonomics .

After telling how the KKK secret membership codes were exposed to the world, making members too scared to use them lest they be revealed as members, the authors describe how another secret exposed drove down the price of term life insurance in 1996. Cause? Internet companies like Quotesmith.com making ALL the prices available to the right eyes – us. The public.

Regular people could suddenly compare and price shop for something whose cost options had been kept secret by the insurance companies. Once all the prices were out in the open, the high priced companies had to come down to match the lower ones – if they wanted any of the business. And they did.

“It is common,” write the Freakonomics authors, “for one party to a transaction to have better information than another party.” This is typically used to the disadvantage of the novice.

This situation leads to many crimes which the authors describe as “sins of information. Most of them involved an expert or a gang of experts, promoting false information or hiding true information…”

Here’s how a network marketing recruiter commits a sin of information.

Consider this common exchange:

Prospect: “So how much does the company pay me on a customer order I bring in?”
Recruiter: 30%-40%.
Prospect: Great! Sounds good…I’m interested.

Information typically kept back by the recruiter (depending on the company pay plan):

1. The percent offered is NOT of the face dollar amount of the customer’s order . The 30% (pick number) is of the order’s “PV” (purchase volume) – a value assigned by the company to product. That might be 50% or 75% of the face dollar amount the customer pays. But this is not known by the new recruit until later.

Here’s why this matters. On a customer order of $100, the prospect thinks they’ll get $30. But in fact they will get 30% of $75 (=PV). That’s only $22.50. Later, when it comes out, the recruiters talk about the “complex play plan, you know, blah blah blah.”

And/or…

2. The percent offered is not paid until AFTER person has done a minimum amount of business (i.e. product bought by them or others). It might be $500, $1.5k (pick number) in business.

And/or…

3. The new recruit is required to maintain certain sales (volume) levels each month in order to get the percent offered. If they don’t, they revert to a lower commission level.

Examples of such hoarding of information abound in our business.

Isn’t it just like the strawberries that look so good from what’s on top? Then you get them home…

In today’s marketplace, there’s a new focus by the avant-garde: being transparent.

Isn’t it time to find people who will not dangle the half truths like those above, just to get someone in? Everyone finds out the truth sooner or later, and I am convinced that this unpleasant discovery of how things really are is a VERY BIG reason the drop out rate is so high.

How much to tell? After all, you don’t want to make it complex on that first date.
So how about this?

How much do I make if I bring in a customer order?

“They pay between 30-50%, depending on your sales. The more you sell, the more you make. You understand that idea, right? (Then this if it applies): They have certain requirements to maintain those percents, but before we get tangled up in our underwear about that part, how about first decide: Is this a product you can see yourself marketing to others, if you knew what to do?”

That’s straight, isn’t it? First things first, yes? You lead with THEIR interest, not your pitch.

Tomorrow’s topic: Scary thought. ‘Twill be posted right here. Can you guess what it’ll be? Hehe.

Use Comments below. I’ll post the winner…hehe.[/fusion_builder_column][/fusion_builder_row][/fusion_builder_container]