Hundreds of thousands of people are selling health products as "independent distributors." Product lines typically include vitamin supplements, weight loss formulas, fiber-containing snack bars, and/or herbal remedies. NCAHF receives so many inquiries about such products that it has developed some general caveats.
Consumers Beware:
Prospective Distributors Beware:
Multilevel marketing entices unwary people
with the "sweet dream of success."
MLMs are driven largely by greed. The idea of working hard for
a while, building up a substantial down-line sales system, and
watching the money roll in, is appealing, but is "too good
to be true." Literature of the NuSkin company claimed that
distributors could make $5,000 to $10,000 per month, but 98% of
all distributors earned an average of $38 a month [1]. Even the
well-established Amway company has not been able to deliver on
the sweet dream for most of its people. The company has 14,000
employees, and over 3 million distributors internationally, and
global sales of $7 billion, yet, the average monthly gross income
of Amway representatives is less than $90 [2]
Some multilevel marketing programs are illegal pyramid
schemes.
A focus upon new distributor recruitment in hopes of sharing in
their commissions can cause multilevel marketing programs to become
illegal pyramid schemes. An important legal criterion is that
in pyramid schemes, most of the products become inventory in the
hands of hopeful distributors instead of being bought and used
by consumers. Thus, the unwitting, hopeful distributor may be
victimized twice. First as one stuck with goods that have little
chance of being sold, and second, as one stigmatized by having
been a part of an illegal business operation.
You may unwittingly become involved in quackery.
A master in the art of quackery could not have devised a more
effective way to turn ordinary people into quacks. First, studies
have consistently shown that the primary marketing route for multilevel
schemes--word-of-mouth via friends, relatives and neighbors--is
the most common way people come to try quack remedies. Second,
using testimonials as proof of effectiveness is quackery's most
common means of persuasion. A basic tenet of salesmanship is that
to succeed you must believe in your product. Successful salespeople
wanna-bes are told to become users so they can say "it works
for me!" Third, quacks encourage the faulty validation of
personal experience. Placebo effects alone are enough for a highly-motivated
person to find something positive about the product. In the case
of herbals, the naturally-occurring drugs that many herbs contain
may give users a high, exert a tranquilizing effect, or produce
some other pharmacological reaction. The drug-effect combined
with the "sweet dream of financial success" cause users
to make exaggerated claims for their products. Although individuals
may control the extent of the claims he/she makes, it is easy
to be deceived by one's lack of medical knowledge and personal
zealotry. Fourth, distributors are often taught to defend the
company against alleged "persecution" by the FDA or
others engaged in consumer protection. This type of siege mentality
is another well established attribute of quackery.
You may pay a high social price.
Because multilevel marketing is aimed at friends, relatives and
neighbors, a distributor can easily become persona non grata.
Eisenberg [3] reported on a woman who became so aggressive that
she was thrown out of a PTA meeting. It took her a year to restore
her good name in the community. Before becoming involved in multilevel
marketing, you should consider how much value you place upon your
good name. A short-term financial gain may not be worth what it
cost in long-term loss of social status. (*see "The mess
called multilevel marketing," Money, 6/87).
Doctors who become distributors may be guilty of unprofessional
conduct.
Distributors who are health professionals can easily abuse the
unequal doctor-patient relationship by exerting undue influence,
a form of unprofessional conduct. Also, many MLM companies eventually
run afoul of the law. When they do, distributors are likely to
be stigmatized. In common-sense terms this is known as: "if
you want to dance, you must pay the piper!" Some professional
groups specifically prohibit members from selling products directly
to patients. The unavoidable conflict of interest that is created
by a situation in which a health care provider profits directly
from a patient is obvious. Just how perverse financial self-interest
can be was shown by a physician who told a Registered Dietitian
that if she did not recommend the brand of vitamins that he was
selling, he would no longer refer patients to her for dietary
counseling. Dietary counseling was one of her primary jobs at
the hospital, and a lack of patient referrals could mean loss
of employment for her.
Teachers and coaches who use their positions to influence
students and athletes abuse their social status.
NCRHI has received numerous complaints from parents, students,
former students, and athletes whose teachers and/or coaches have
attempted to recruit them as customers and/or distributors. Some
teacher distributors have become so deluded that they have used
parent-teacher conferences as opportunities to sell products alleging
that these would improve the student's academic performance. The
lack of ethics of such conduct speaks for itself.
References
© 1998 National Council Against Health Fraud. With proper citation, this article may be reproduced for noncommercial purposes