Similarities between Influencing and MLMs

First, let’s talk about what an MLM is and what someone in a MLM company does. If you are not familiar, MLM stands for Multi Level Marketing. However, people within MLM companies will try to avoid calling their company a MLM because of the “negative stigma” around the acronym. Instead, they might call it: Direct Marketing, Direct Selling, Social Selling, Network Marketing, Referral Marketing, an E-commerce business, and the list goes on and on. As people catch on to their new, misleading names, they will create new ones. All of which are just synonyms used by the reps as a form of deceptive marketing to try to recruit others into their company.

Multi Level Marking companies have been around for decades. Some have been around so long and have gotten so big that they’ve even become somewhat of a household name. Tupperware, Mary K, Avon, and Cutco/Vector Marketing are just some examples. Then there are companies that are so new and are still forming as we speak, that you may not have even heard of them yet. Such as, Awakend, Elomir, Savvy. And of course there’s all the companies in-between. All this to say, you’ve most-likely had an experience with a MLM in one form or another. Even if you didn’t know it was an MLM at the time.

Now, what does someone in a MLM do? MLM reps wil boast about how great the products in their company is and how wonderful it is to be their own boss. But the truth is, when someone joins a Multi Level Marketing company, they become a 1099 employee or independent contractor. Meaning, they are not an owner of a business. They do not just assume ownership of the company they join. Let’s use Beach Body as an example. If I become a Beach Body “coach”, as they call their reps or distributors, I do not automatically become an owner of Beach Body. In fact, there are still limited allowances. Such as not being allowed to share workouts or meal plans… Even though many reps do.

As a 1099 employee, the goal should be to make a livable wage from commission of product sales, right? Wrong. According to the FTC, 99% of people who join a MLM will lose money. There are several reasons for this, such as having to purchase a starter kit, low commissions, over saturated markets, and the biggest reason being recruiting. Someone in a MLM company might try to convince the people they are recruiting that it’s possible to make a supplemental income in a MLM company just by making sales. And while you can earn commission, most companies lock higher commissions and bonuses behind higher ranks and they only way to reach those higher ranks is to recruit others into the company.

If the MLM pays you based on recruiting new distributors, it’s operating as a pyramid scheme. That is Per the FTC, a federal agency Protecting consumers and competition by preventing anticompetitive, deceptive, and unfair business practices.

So how are MLMs similar to influencing? People in MLMs will often try to appeal to aspiring influencers by suggesting or out-right stating that you can become an influencer by joining their MLM. When you become a rep, distributor, coach, or whatever made-up title they’ve created, they promise coaching that will help you grow your social media, scale your business, become your best self, and help millions of people do the same.

An influencer is someone with a large presence in a specific niche or industry and has influence that makes them a useful launching pad for brands.

Anyone can become an influencer just as anyone can join a MLM.

However, influencing is not for everyone. And in my opinion, being in a MLM shouldn’t be for anyone.

In order to grow your audience it is highly suggested that you niche down. Create valuable engaging content, engage with your target audience, and grow your audience over-time. But if you know me, you know I refuse to be put in a box. I’m here for the chaos. And if you are too, why haven’t you hit subscribe yet? (wink) (ding)

You don’t need to have a massive following to get started.

On the influencing side, brands will work with influencers of many sizes. A micro-influencer is the size most will fall under and covers accounts with about 1,000-100,000 followers. Anyone with 100,000-1M is considered a macro influencer and above 1M is celebrity status. Brands will work often with micro influencers. They types of collaborations you can land will depend on your follower size and engagement rate, but typically 1,000-5,000 will land more product collabs, or free product in exchange for posts, and you can start earning money, or at least more money per post around or after 5,000. In my experience.

For someone in an MLM, you don’t need to have a big following, but a loyal following is key as you’re often encouraged to make a ljist of 100 people to try to pitch “The Opportunity” to. AKA – recruit.

It is helpful to grow a large and loyal following.

Both an influencer and MLM rep will want to grow their following… But for different reasons.

A MLM rep might try to grow a larger and loyal following in order to recruit more people into the MLM so they can make more money based on the work of those under them and try to rank up in the company. This is because rank ups tend to be based on volume, the number of recruits under the rep and their reps, and sales, personal purchases and purchases make from the people underneath them.

The MLM rep is NOT compensated for the many posts, reels, stories, lives, team calls, etc. they are highly encouraged to do. All their money comes from sales or recruiting. So they often spend hours and hours creating free advertisements for their company.

As an influencer grows a larger following, they can land larger brand deals and make more money, hopefully working less. The money goes straight from the brand to the influencer and is based on the work the influencer did or the content the influencer created for the brand.

Brand Deals and Affiliate Marketing

While we’re talking about brands, let’s talk brand deals and affiliate marketing.

Affiliate marketing is defined as, “a marketing arrangement by which an online retailer pays commission to 3rd party for traffic or sales generated from its referrals.” by Oxford Languages.

Influencers utilize brand deals and affiliate marketing to earn money and leverage their social media following. Affiliate links are great because you can have them posted and truly make commission just from someone using your link or code. Affiliate links aren’t always my favorite as they can sometimes feel like free advertisement, especially if no one uses your link or code, but affiliate programs can come with great perks like free product either one time, periodically, or monthly. Free swag. Social media mentions. And sometimes they turn into brand deals.

Brands deals are pretty straight forward as they are often times free product and monetary compensation in exchange for social media mention, creation, or whatever.

I think one of the important parts to mention with affiliate marketing and brand deals is that it doesn’t restrict the influencer to only work with that brand. In some cases, brands might request influencers not to work with competing brands while working together, but not always, and the terms can be negotiated.

However, with a MLM, more often than not they don’t allow their reps to work with other MLM companies. Again, this is not always the case, but is often the case. Take Monat for example. They don’t allow their reps to work with other MLM companies and you cannot post about competing hair care and body products while actively promoting the brand.

In a MLM you do have your own website for your customers to purchase from, which could be likened to an affiliate link, and they can make commission from their sales, however, commission amounts are usually determined on the size of their team, not their sales. Therefore, the goal is usually to recruit, not just to make sales.

Community

People often join MLMs due to the promise of a loving, and welcoming community of like-minded people. However, this “community” is often built with people you’re in direct competition with which can lead to animosity. The community often love-bombs new recruits, meaning to lavish (someone) with attention or affection, especially in order to influence or manipulate them, and pretends to love and care about them until they begin to question the MLM, their upline or mentor, or they decide to leave. That’s because these friendships are often conditional. They are counting on their recruits to do well and do as they say in order to rank up in the company and earn themselves more money.

As an influencer, you might find yourself a part of a few different communities. One of which being the one you made yourself of other people in your niche who you engage with and or engage with your content.

Another community an influencer might be a part of is an influencer community. Whether they found this community naturally or with unethical growth practices. We’re going to talk about some of these practices here in a minute, but I also get into them in my Mercedes Spills the tea video which you can find here. (Link to Mercedes Spills the Tea).

Regardless, it’s great to network with other influencers you can learn from, share contacts with, and refer each other for different collaborations. The community and friendships can be beautiful and mutually beneficial, but similar to a community within a MLM their can be competition, bad vibes, and of course gossiping. But that is true of any community.

False Engagement

As I touched on in my last segment, there are inauthentic practices within the influencing world. Not all influencers do these practices, but in my experience, many, and especially the bigger influencers, do. One unethical practice, in my opinion, is the use of engagement groups or engagement pods. These are comment threads or chat groups where influencers like, comment, save, or any combination of the three, on each other’s posts in order to “boost” their engagement and “beat” the algorithm. What this really results in is false engagement that will immediately drop after you leave the groups and ultimately hurt your account. Honestly, you can look at my instagram account to see what I’m talking about. Scroll back a while and compare my likes to my posts from a few months or so ago to now. Even though my likes were higher, my insights never matched and I felt guilty because it seemed obvious my likes and engagement weren’t ever real.

Likewise, people in MLMs often comment or engage on each others posts ot make their content and opportunity look like it’s more popular than it actually is. Like some influencers, they do this to beat the algorithm and try to appeal to new victims – I mean prospects. Typically, all this does is create a closed community or echo chamber where the only people they interact with are other people within the MLM.

Constantly Living on Social Media

Influencers and MLMers both spend their lives glued to their phone and putting their lives on social media. In my experience, and per the recommendations of self-proclaimed influencer experts, many influencers spend all day engaging, following, creating content, sharing their lives on stories, reaching out to brands, and more.

I, myself, spend so much time on my phone every day that I felt like all I ever told my daughter was, “hold on, honey, Mommy is working.” So much so that my daughter, Kiara, would grab my phone and say she was working like Mama. This wasn’t just my experience, but the experience of other influencer friends I have.

Likewise, people in a MLM are often glued to their phones working on social media and cold messaging tons of people in hopes that maybe one person will say yes. Even though they will boast about time freedom or sometimes location freedom, the truth is they spend all their time working on the “business”. Even putting the business before their family… Who the business was supposed to open up more time for…

Time Freedom

Even though influencing can take up a lot of time and sometimes feels like it can take over your life, it doesn’t have to. The methods I used at the recommendation of accounts larger than mine are the unethical, frowned upon methods that are time consuming and ultimately hurt your account in the end.

Even though I felt a pressure to use these methods to grow my account, to grow on social media, you don’t have to use these methods. In fact, I highly suggest you don’t. Haha. The truth is that the influencer gets to decide how much time they spend on their account each day engaging with their target audience, growing their account organically, and creating content. There are lots of tools an influencer can use to make this easier and to spend less time on it day to day.

You might say that the amount of time someone in a MLM spends working “their” business is a choice, but the reality is if they don’t put in all their time working the business they are shamed, sometimes publicly, by their upline or other people within the MLM. They are led to believe that if they aren’t making money or recruiting enough people, it’s their own fault for not working hard enough.

Unlike my experience as an influencer where I did have full autonomy of my choices and time spend on growing my account, the brain washing, in my opinion, that goes on within MLMs convinces people that the only way to truly get time-freedom is to put in all the work now until they reach the top ranks which is nearly impossible for most people. That’s because, in my opinion, the model is designed for most people to fail.

Sunk-Cost

The Sunk-Cost Fallacy is, “the phenomenon whereby a person is reluctant to abandon a strategy or course of action because they have invested heavily in it, even when it is clear that abandonment would be more beneficial.” That comes from Oxford Languages Dictionary.

For me, I was reluctant to stop putting my sole focus on influencing and instagram because I had spent nearly 4 years doing so. I spent nearly 4 years growing my account and while I wasn’t making great money, I was making enough to sustain myself, help out with groceries, and even kids presents for the holidays whether I bought them myself or got them from collaborations. I knew that from taking a step back from influencing, I would be saying goodbye to all those things but taking care of myself and my mental health was worth it. Of course, I also had the full support of my husband and family who were here for me no matter what I decided. This made my decision so much easier.

The decision to leave an MLM is not as easy. There are a lot of costs to being in a MLM. The cost of a starter pack, which is usually a package of products, samples, etc. and everything you need to get started with your “business. The cost to stay active every month. In a MLM there is usually a monthly personal volume requirement to stay active or receive a paycheck. Yes, you have to pay every month in order to get paid. The yearly cost of the “free” website where your customers can order products. The cost of time. When in a MLM you’ll often sacrifice a lot of your time trying to get your business off the ground, to grow, keep growing, or even just to sustain your business. Plus the time of all the leadership training and whatnot. So when someone starts to think about leaving a MLM they’ll think, well I’ve already invested all this time and money, I can’t quit now. Plus, all my friends know I do this, and are probably in the MLM, I don’t want to seem like a failure. That and they have their uplines telling them on every training that if you quit, you failed, if you don’t make any money, that’s your own fault for not working hard enough. They start from the beginning planting the seed and shame so it feels like a huge deal to get out of the MLM. It becomes a cycle of shame and guilt and some people dig themselves so deep it truly seems impossible to get out.

Recruiting

Finally, let’s get on to the biggest difference of them all: Recruiting. In a MLM the goal is to recruit more people into the MLM in order to grow. In fact, your success in the MLM depends on it. People become dollar signs and just a means to grow and advance your own ranks.

As an influencer, I’ve never had to recruit another influencer, nor do I want to.

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