MLM Pay to Play – UNETHICAL!

As social media has become more popular, so too has the pay-to-pay schemes cooked up by network marketing “influencers” and trainers.

Several years ago, I got a front row seat to how this works.  A very well known social media influencer approached the owner of a new company.  The influencer asked to be paid $4,000 per month for an endorsement.  The owner couldn’t see any long term benefit to this arrangement, so the endorsement was declined.  Shortly thereafter, the influencer went on social media and denounced the company as a SCAM!

The owner of the company was forced to take immediate action to protect the business.  Fortunately, the influencer was successfully “encouraged” to remove the offensive posts.  Sadly, this kind of unethical and outrageous behavior is becoming commonplace.  And it’s not just just limited to a few social media influencers.  Trainers have gotten in on the action too.

We recently got a tip that a well-known trainer was asking people to “sponsor” an event for $10,000!  And what exactly does a person get for that kind of money?  An introduction on stage in front of 500 people and bragging rights of being “endorsed” by a big name.  Is this some kind of SICK JOKE?

Every time you see a big influencer give an “endorsement” – BEWARE!

The big names in the industry don’t do ANYTHING for free.  In their mind, they’ve earned the right to be paid big $$ simply because they’re well known and they believe companies NEED them.  This mentality is POISON to the industry.  People should be able to count on fair, honest recommendations from people they like and trust.

If we want network marketing to have a better reputation – it starts by demanding influencers fully disclose their arrangements with the company.  These disclosures are commonplace with television personalities and it needs to be equally common in network marketing.

Help us to help you!

Do you know of a trainer or social media personality engaged in pay-to-play?  Tell us about it!  Let’s rid the industry of this unethical behavior.  Comment below.

4 weeks ago

7 Comments

  1. I am in no position to speak for Rod Cook, but based on my dealings with him, I doubt he would ever paint with a brush this broad.

    And the most interesting part is that you probably don’t even see the irony.

    1. As one of the industry influencers – I’d love to get your input on which part of the article you felt was too broad of a brush. Are you okay with consultants, trainers and other influencers demanding money for more positive press? Should extortion be legalized? Is it unfair to demand that influencers disclose the fact that they’re paid by a company for their endorsements?

      While I will never claim to speak on behalf of Rod, my goal is to keep the good guys honest and shine a light on people doing things that could potentially damage the industry.

      Also – I’m fully aware of the “irony” you referred to. I am not encumbered by any company and I’m definitely not trying to protect any relationships. There will never be any pay-to-play reporting on this site as long as I am the editor.

  2. This was the broad brush that I was writing about:

    “Every time you see a big influencer give an “endorsement” – BEWARE!”

    Just my opinion, but absolutes like this serve no one.

    At the same time, controversy sells. When Rod and I were full steam ahead, writing multiple times a day without pulling punches, the traffic was insane. I’m ashamed to say, I haven’t updated MLMBlog.net in quite some time. I burnt out on focusing on the negative side of an industry that has been so good to me.

    But hey, no one is perfect and if I went back and looked at all of the blog posts I wrote over the years, there would be a lot of cringing. Writing on a regular basis is not a job for the weary so I promise not to simply show up to critique every word.

    I wish you the best of luck!

    1. I appreciate your comments Ty. This blog will always be an open forum and I welcome and even appreciate criticism.

      I don’t think it’s a secret that Rod often had a vested interest in writing articles without ever disclosing that interest. He wasn’t alone. This sort of thing has been commonplace for years with everyone giving each other the wink and the nod before looking the other way.

      We’ve outgrown the old model of doing business. Social media has changed everything. People have an expectation of transparency. I don’t take issue with people giving endorsements – so long as any financial interest is disclosed. The details of that arrangement don’t need to be made public. A simple “Company X is a client” would be adequate. If an endorsement is given without any financial interest – that should be stated clearly as well.

      With regard to cringe-worthy posts – there were many of those that were removed while curating the vast number of articles Rod had written over the years for the “new” site. I’ll do my best to prevent any future editor from needing to do the same.

  3. Hello. I regret that our introduction must be in the form of a criticism, and that I haven’t been more active in this discussion regarding your “succession”. But the rest of the world (to which some clients seem to equate their importance) will just have to wait for a moment. I’ve got to get this off my chest.

    You stated in the blog post above:

    “A very well known social media influencer approached the owner of a new company… asked to be paid $4,000 per month for an endorsement… was declined… (then) went on social media and denounced the company as a SCAM!”

    And…

    “We recently got a tip that a well-known trainer was asking people to ‘sponsor’ an event for $10,000! (in return for) an introduction on stage… and bragging rights of being ‘endorsed’ by a big name. Is this some kind of SICK JOKE?”

    Then you opined…

    “Sadly, this kind of unethical and outrageous behavior is becoming commonplace. And it’s not just just (sic) limited to a few social media influencers. Trainers have gotten in on the action too… People should be able to count on fair, honest recommendations from people they like and trust… it starts by demanding influencers fully disclose their arrangements with the company.”

    Then conclude by asking…

    “Do you know of a trainer or social media personality engaged in pay-to-play? Tell us about it! Let’s rid the industry of this unethical behavior.”

    But… (you know nothing positive ever follows the word “but”, right?)

    If you are going to post anonymously, thus without any accountability, then for all intents and purposes doesn’t this exempt you from having to make these same disclosures? How can we ever know what conflicts of interest you have without knowing what your interests are?

    And how can you offer us any protection from these charlatan “influencers”, or “rid the industry” of this unethical behavior, if you withhold their identities from us? How is only describing their dirty dealings while choosing to keep them anonymous not essentially protecting them from exposure?

    I completely agree that, “If we want network marketing to have a better reputation – it starts by demanding influencers fully disclose their arrangements with the company.” In fact, this is demanded by federal law. But as the MLM industry’s newly proclaimed “Watchdog”, shouldn’t you be calling out those deceivers who are “poisoning” the industry, so we all know who not to trust and support?

    Rod certainly had no qualms with this.

    Thanks for listening. I sincerely wish you the best in your new venture.

    Len Clements
    Founder & CEO
    MarketWave, Inc.

    1. Len – First off, I sincerely appreciate your feedback. You’ve been a leader in the industry for many, many years and I respect what you have to say.

      The laws have changed substantially since the wild-wild west days of the internet. Bloggers can now be sued if they write something that is considered defamatory or damages the reputation of a person/business. When reporting nothing but documented facts – there’s very little a company or person can do from a legal perspective. When I offer up my opinion about an event and name individuals that allegedly did something inappropriate – that’s an invitation for a lawsuit. That’s why I didn’t name the individuals in the article. My hope is that the specific individuals will read this article and stop the shenanigans.

      My approach to cleaning up the industry might be a little different than the way Rod approached it. More often than not, the problems in the industry aren’t happening in a vacuum and they’re not isolated to 1 or 2 people. The examples I gave in this post could have been any number of different people. Chances are, you’ve seen or heard this stuff discussed in back rooms. My goal is just to put a big spotlight on the general activity and hope that it stops. If it doesn’t – I’ll turn up the heat.

      With regard to accountability – I didn’t ask to be considered for this role. I think Rod respected me for my passion for the industry and commitment to staying in total integrity. There have been people speculating that there’s a profit motive in running this site. Let me assure you – that’s not the case. There are no ads and no hidden agendas. I think you’ll see a very even hand when it comes to articles I write. If my name were to ever become public, the first reaction everyone would have is “Who’s that?” followed by an internet investigation that would confirm my reputation for integrity in all of my business dealings.

      Given your passion for the industry, I would love to have your continued input. You can reach me directly at themlmwatchdog@gmail.com any time.

  4. Successor,

    Just a quick FYI… Even anonymous bloggers can be sued. In Amway .vs Woodward the 9th Circuit was very clear, that in commercial speech, the First Amendment doesn’t hold water, and the courts can unmask you.

    They can also demand, the hosting cmpany turnover all documents to who actually owns the website.

    You might reach out to Kevin Thompson, who was representing Woodward at the time for deeper details.

    As for the article above, I think the article raises a great point. However, Social Media Influencers, just like offline influencers are paid for their endorcements all the time. A friend of mine Scott Harrison, founder of Charity Water, started his carreer as an influencers promoting night clubs.

    I think there is a big difference between a paid endorcment, and a “Pay to Play” offer. The BDAs that are given out inside the direct selling industry fit the mold of Pay to Play. Now I do agree with you 100% that if this influencer, later went to the net and trshed the company, he should be held accountable.

    And, when it comes to trainers charging $10K for sonsorship. Well that has always perplexed me. I don’t really get either side of the equation on this one. Maybe it’s because I hate sitting in the front of the room. I would rather get to one side or the other, or high above the crowd and dig into some solid nuts and bolts education, not watch a bunch of frontrow folks talk the whole time.

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