Could it be the old school duo of aggressive recruiting and big income-promising is wearing thin? Even abroad?
NuSkin is only one of many big MLM companies seeking to boost their flagging U.S. sales by going abroad.
1. NuSkin reports that 50% of its business comes from Japan alone. They entered China with high hopes in 2002, but now, have to pull back. The Daily Herald notes:
Truman Hunt, the company’s president and chief executive officer, said new Japanese and Chinese management teams are implementing plans to boost business in those markets.
“At the end of the third quarter in Japan, we began launching aggressive sales initiatives focused on distributor recruitment,” said Mr. Hunt.
They’re not the only one looking abroad to keep things alive for the old school mlm.
2. Amway‘s business in the U.S. has been on the decline for several years, based on my conversations with some major distributors. Amway’s (Quixtar) business is mostly abroad – especially in Asia.
3. Herbalife, another one of the big MLM companies in the US, reports in their last 10-Q that approximately 80% of their sales come from outside the US.
Has the relentless focus on recruiting and the non-stop promises of big income (which virtually no one attains) finally done them in here?
Easy income promises notwithstanding, distributors leave faster than the recruiters can bring them in.
And the old school solution hasn’t changed: bring on more “aggressive sales initiatives focused on distributor recruitment” (with promises of big financial success). Is that the best they can do?
Is there a lesson here for the rest of us?
NuSkin has been in Japan since 1993 or somewhere close to that. It’s huge there because they love the products. Asians are for more concerned about skin health than we are in the US.
But I hear you about old school recruiting. I received this in my Facebook Inbox the other day:
Your profile caught my attention and you seemed like a friendly, outgoing, and motivated person. I was wondering if you would be interested making full time money working part time working with a Fortune 500 Marketing Company. We are partnered with companies such as Verizon, Cingular, General Electirc, Dish Network, Travelocity, and many more. The potential is this company is endless and this is a real business. If you are interested in making some money let me know, and I can give you some more info. Thanks.
Can you say SPAM?
Walter Reade (from Wisconsin)
I agree with Walter re “old-style”, it’s time for Networkers to take another step up in professionalism, and that is happening. In Amway/Quixtar there are some large groups shrinking, and sales may take a hit with the recent terminations, but not working? Look at the summary of 2006 Quixtar New Qualifiers on amwaywiki –
New 60FAA Founders Crown Ambassador: 1
New 40FAA Founders Crown Ambassador: 1
New Founders Crown Ambassador: 1
New Triple Diamond: 1
New Founders Executive Diamond: 2
New Executive Diamond: 4
New Founders Diamond: 9
New Diamonds: 19
New Founders Emeralds: 41
New Emeralds: 66
New Founders Sapphire: 27
New Sapphires: 130
New Founders Ruby: 1
New Ruby: 103
New Platinums: 847
This was just *new* pins for one year. Not exactly “on the decline” and not exactly “virtually no one” making big incomes.
Network Marketing is alive and well, but like any other business, if we don’t change with the times, we die.
ibofightback, without telling us the average income ranges of these levels, how do we know that people are making “big” incomes? What level is considered “big”?
Also, I went to the link you provided and most of the names on the list look Japanese or Chinese to me. This just proves what this particular blog post is about.
“If you would be interested making full time money working part time working with a Fortune 500 Marketing Company.”
How can people keep saying this when they themselves are not making even part time income, much less full time money working part time?
Are we just a nation of liars then? Or just people who pay no attention to the meaning of the words we use?
Rox, good point.
Roxanne, average incomes for some of these levels are posted on thisbiznow.com, however they’re outdated as Q* has pretty much doubled North American incentives. Diamond for example has an average income of $150,000/yr, but they’ve now added a biannual bonus of $500,000 for qualifying every month out of two years. Average for Platinums was $50,000/yr, but there’s been huge bonuses added there as well. Average income for Founders Executive Diamonds and above is >$1,300,000 last figures I saw, and there’s *new* ones at that level and above every year. New Founders Crown Ambassadors (been new ones every year) get, in addition to all the normal bonuses another one off bonus of $1,000,000.
Also Roxanne, those are only North American Qualifiers, there is way way more internationally.
Kim said: How can people keep saying this when they themselves are not making even part time income, much less full time money working part time?
One thing I’ve started doing — and it is something that Kim and Roxanne and others have stressed in previous posts and comments — is to outline exactly what a prospect would need to do to earn $500 a month. (For example, find 20-25 customers.)
For most people, an extra $500 would make a big difference, and it is something attainable to them, i.e., they can immagine getting there.
I ask if they think they could do what is needed. Most can see themselves finding some customers.
This approach is ethical and effective.
Walter Reade (from Wisconsin)
ibofightback and others who respond with general income “position averages” for your company that no one can verify:
Robert Scoble makes an interesting observation about “coming” software or future tech stuff: “DO NOT TRUST THINGS THAT THEY WON’T SHOW ME WORKING.”
If you want to give income numbers, provide a company site link showing some specific data, i.e. 1% of our 3 million reps are at X position which earns $.
That will go a long way to adding credibility to your comments here.
Saying there are say 25 people at the top level means little to anyone. We all know 95% of people drop out of the business, so no one expects success numbers to be high.
But unofficial numbers with no context mean nothing to anyone, sorry. Especially when someone says “bonuses” are added to positions – that looks as though extra money added to inflate the incomes associated with certain pay positions – income that was not there before.
Are we a nation of liars? Well, not sure about a nation, but we are, as a whole, an industry of liars. Wake me up when that stage is over, if ever!
Ethics is sorely missing in our industry and it does puzzle me.
When I was in corporate America, we didn’t talk about our incomes, and I’m not sure why we feel compelled to do so in our industry.
The only reference I ever make to my own income is one published in our company newsletter so it is documented by the company and not me just spouting off at the mouth.
I’ve been on MySpace lately creating a presence and I am AMAZED at the spammers there on the business forums who are hiding behind “making BIG $$$$$$” and the like.
And who buys into it and believes them?
Provide value, do as Walter is and show people exactly what has to be done to make $500 a month in your program and then let the rest work itself out!
Glad to be here among the ethical networkers!
MLM WAHM Training
Years of secrets, 3 who get 3, easy money, anyone can do it (hurts me to even type this stuff) has left dead bodies everywhere. Thank goodness for the New School and those of us working to give back credibility to the industry (which I still believe in.)
The only people who acknowledge techno-babble terms like Double Ruby Diamond Super Star Royal Ambassador Whoevers are people within that company. It means nothing to normal people. Truthfully, I don’t care about their title or how much they are making – I care about helping people and how much I am making. I prefer getting loyal customers and out of those will come distributors who love the product and want to sell it.
It’s interesting that other countries that opened up to MLM are starting to re-evaluate their decision because of scam artist and bad MLMers (one in the same?). The old school solution of bringing on more “aggressive sales initiatives focused on distributor recruitment” (with promises of big financial success) will only result in more dead bodies no matter which language its spoken in.
So what if I’m one of those people who made 5 Million in the business? That has absolutely no bearing on what the newbie will make even if they’re in a binary with overflow potential from a huge powerleg. They still have to get off their behind and WORK to build their profit leg. That’s why it’s called NetWORK marketing, isn’t it?
About the China connection, I’d be careful about putting anything on my face that came from China these days. You could seriously end up needing “new skin” with all the “interesting” ingredients showing up in dog food and children’s toys lately.
Unfortunately, it looks like you almost have to sign up foreigners to get any work done anyway. Sad commentary on the “American work ethic”, huh?
I heard a trainer tell us to watch infomercials if we wanted to learn how create “persuasive” websites and materials to recruit with and he gave The Total Gym with Christy Brinkley and Chuck Norris for example. Watch that sometime and count the times they say, it’s easy and anyone can do it, etc… The reason they say those things is because it works! That has got to be the oldest infomercial on the planet but apparently, they’re selling alot of them! 😉
Its going to take a really rude awaking before companies like NuSkin will realize that its time for a change in how they do business.
Seems to me any network marketing company would seek to find better ways to generate revenue outside of focusing on recruiting because those growth strategies are what bring regulations down on them.
Regarding Herbalife, this is an instance of “selective” reporting. When you realize that Herbalife — a product driven company — has spread good nutrition to 65 countries around the world, it’s no surprise that 80% of the company’s sales come from outside the US.
I don’t keep my finger on the pulse of the company (as I should), however I do know that we have had multiple consecutive quarters of continued strong growth — both in product sales, recruitment & RETENTION. Our stock is traded on the NYSE (HLF)and continues to rise in value.
In short, we are healthy world-wide. Our CEO, Michael O. Johnson, is continuing Mark Hughes dream and leading a strong, vibrant company.
I love you Kim, but please don’t pick and choose stats that suit the topic. People need to see the whole picture.
In my opinion, MLM companies and uplines should de-emphasize PUSHING you to have the mindset of an “invite all the people you know” philosophy, when these people in the first place retain a “get a job” approach. It gives the MLM company bad publicity, thus causing sales to decline. As Kim says, those involved in network marketing should disclose everything and guarantee nothing. No matter how good your product is, if your company gets bad press, no one will dig out their wallet and give that credit card number. Look what happened to all the American auto makers, Ford, GM, and Chrysler. In the late 70s and 80s, several cars they made didn’t last as long as those made in Germany or Japan, like the Toyotas, Hondas, Mercedes Benz, or BMWs. When consumers picked up on American cars being a piece of junk, everyone jumped the bandwagon by going foreign when it comes with purchasing cars. I’m currently in this audience as well.
American cars are getting much better with the help of foreign automakers. GM working with Toyota and Saab, Ford working with Mazda, and Chrysler working with Mitsubishi.
The same goes with MLM companies. All it takes is one black mark and that MLM company takes a big beating. I don’t want to mention names, but I recommend that you Google the company names and check it out yourself.
As I learned from Ms. Stud, the only thing you should concern yourself is marketing your product to an audience based on your experience. For example, if you can solve the Rubik’s cube at an average time of 90 seconds, which I do (the best solvers do it within 15 seconds) and you want to offer your way of solving it, then market your service to those who want it. In the case of weight-loss products, you market those to those looking to lose weight.
Don’t let the MLM company you work with stop you from marketing your product/service because that company is facing some challenges. The big picture we should focus on is to help other people make their lives better.
I love the new school teachings, however sometimes I personally think that this forum gets sidetracked on tangents. Network marketing is an industry just like automotive, software, computers, healthcare, real estate and the list goes on. Our business industries for the most part are global, and for those that think not,just need to watch the business news to confirm this.For our great country to stay competitive we need to be globalized. For the network marketing companies with long term vision, they need to be expanding globally as well. Nuskin (NSE),a 20+ year old company is presently operating in 45+ countries. Your article has taken out of context a few of the business facts that surround the complete story. Nuskin has been operating in China for several years with retail storefronts, waiting for the government of China to allow the direct sales model in country. Recently this model was passed into China’s laws, and Nuskin received their direct sales certification. With this new model allowed in China, the need for the hundreds of retail locations are no longer necessary, therefore these locations are closing, along with this comes leases that need to be eliminated and personnel that don’t want to transition with the new model will be reassigned or leave, their choice. Along with the transition in China of course there is a department in Utah, the company’s headquarters, that was their to support the China market that in turn will need to be reassigned or leave, again there choice. As with most companies that close storefronts, (Kmart, Lord &Taylor)to name a few, their are long term leases that must be mitigated and therefore charged off the companies books. I’m sure that this is happening in China for the company. Although this company’s business is strong and growing, as a company traded on the NYSE they must disclose all financial matters hence the business article you are referring to. Keep in mind also that this company’s stock is held by 150 mutual funds, not a small feat in todays business landscape and a monumental feat for a network marketing company. With all of the negatives clouding the industry, I believe as new schoolers we should be espousing the positive every chance we get, maybe then we can collectively elevate the public’s opinion of our industry.
Kim, one of the links I provided was to a corporate site with the percentages you talk about. Of course, as you mention, when you talk about percentages you have another problem of definition arise – percentage of what? Everyone who signed up? That tells us nothing when we know the majority who sign up do little to earn an income. “Active” IBOs? Quixtar uses a ridiculously broad figure for “active”.
Personally I quite like the MonaVie income disclosure document. Fairly sensible definitions and quite clearly laid out.
I,for one,will >STILL< put NSE up against A-N-Y of the MLM/direct sales competition out there regarding what company to join. The facts speak for themselves(keep in mind that the article is only relating to 'company employees' being reduced(among other things in China);it has >>nothing<< to do with the distributor force and the associated business opportunity itself). For one thing,how many other 5A1 Dun and Brandt Street-rated MLM's out there(>I-F any<)have currently 500+ >NON-employee< millionaires(including 20+ who have made over 20 million dollars)?? The answer is a resounding N-O-N-E! Also, in just 23 years,NSE has paid back to the distributor force commissions totalling over 5 BILLION(with a >B<)DOLLARS! What about your MLM company? And,how many 'Stevie Award(s)' has y-o-u-r MLM company won? NSE has won 2 to brag about! NSE is definetly the company to get involved with hands down!
Joe — You make excellent points about NuSkin. It is a solid company that has done a lot of great things.
Just curious . . . what is your pin level with NSE?
Walter Reade (from Wisconsin)
Distributor;then again,we all are that title at minimum(regardless of company)…
Several people have said things that most others would skip over to just see the negative aspects of…what I mean is, this industry has some negative connotations to it, but, mlm companies like Amway (which I am not a distributor for)have done things for people that in my opinion far outweigh the monetary benefits. I know people who never made a more than a few dimes in their mlm business (no matter which one it was, and there are many) but, who gained so much socially, mentally and otherwise. Several including Kim have mentioned the $$, well, if you are here reading this chances are that you have tried one or more mlm’s and have either worked your butt off till you were able to make money or you quit. Sometimes working hard and recruiting your family and friends isn’t the right way to go, BUT, they are adults…they have to make the same decision you did. I get so sick of hearing people bad mouth one company or another…I would say most have some good to them, if you don’t like one imparticular, stay away. But, don’t be impartial like Kim has been, and then start your own mlm business and then go after all the people you have trained or all the people that your trainees have sent your way for good impartial info, only to possibly lose them because of Kims new company. Quoting: The only people who acknowledge techno-babble terms like Double Ruby Diamond Super Star Royal Ambassador Whoevers…this shouldn’t matter to anyone…I think it’s great that decades ago, a name was placed on each level a person can attain, just the same as mlm companies do now…if you really don’t care what anyone else makes, then it really doesn’t matter what they name their distributorship levels. If we all play fair and use attraction marketing to broaden our prospect or customer base, we will all have plenty of downline to go around (without having to fight with one another or bad mouth each other). By the way, I appreciated what Walter has said, and what Barbara and Melinda had to say, Melinda hit some points right on the head!If we are all honest about our biz op and we do our best to be good network marketers, we all win….those who join and those who don’t join.
We’re not the only industry or profession that has unethical behavior going on. It’s not the industry it’s people who carry on with unethical behavior and that gives the industry the reputation.
It just seems that Network Marketing has taken a beaten for so long.
Now though we’re seeing this great migration going on aren’t we with more and more popular business leaders like Robert Kiyosaki, Donald Trump recommending or endorsing our profession and some even getting involved in it like Warren Buffet, so we’re not hearing the common phrases like “is this a pyramid?” we used to back in the old days.
In fact, we’ve got marketing tools we can use now to show the third party endorsements from these leaders and I highly recommend using them.
It’s up to each individual network marketer to conduct themselves with professionalism out there locally and online. As far as companies go it’s up to the distributors to make sure that the management teams are held accountable.
In some cases this may be tough because many of the larger companies are more what we may call ‘MLM Corporate’. These larger company management teams may not listen to their distributor force so we distributors may not have much say in the policies they implement.
It’s more of a “because we say so” mentality.
This is being projected only from experience after over fifteen years in this profession so it’s just a professional opinion.
As far as check showing or income claims go from what I’ve experienced over many years is that this is not something favorable to the regulators. I was with one of those larger companies in the 80’s when this happened and remember the class action suit brought against them.
Back then we were placing ads in newspapers with actual dollar amount earnings potential.
If someone ask you what we earn that’s a different story. What is frowned upon is posting earnings online by email or on a website or actually copying checks and showing them at public meetings.
Many companies including ours, have ‘average’ income earning statements on their company websites.
If someone asked, I tell them I earn a full time income in Network Marketing. This is my full time career and it’s treated like a real business and has been from the beginning.
Just a note on a comment above from Joe –
And,how many ‘Stevie Award(s)’ has y-o-u-r MLM company won? NSE has won 2 to brag about
While saying well done to NuSkin, I’d note Amway has also won at least two.