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Economics, Politics, Legalities, Ethics and Sociology of Pyramid Schemes / Multi-level Marketing.
The False Profits Blog, published by PSA President, Robert FitzPatrick, is a sane, rational and fact-based forum. Read, get podcasts, make comments, subscribe.

"Failed" MLMers Are Herded to Monavie

by Robert L. FitzPatrick

© 2008 Robert L. FitzPatrick

The MLM scheme that is reaping the benefit of the increased vulnerability of consumers, who already lost at least once in another MLM, is Monavie, a MLM promoter of bottles of $40 fruit juice. Amway, Nuskin, Usana and other MLM victims are flocking to Monavie. led not only by MonaVie’s claims about “extraordinary” income and miracle fruit juice benefits, but are being personally guided by trusted upline leaders from other MLM schemes. Some of Amway’s top schemer’s and “tools” promoters, for example, are now guiding their followers over to Monavie.

The results of their move to Monavie, like millions of others seeking redemption in yet another MLM offering a “great opportunity,” are all too predictable.

See the chart that shows the devastating losses caused by Monavie. It shows a transfer of millions of dollars from hundreds of thousands of consumers who join at the bottom to a handful of Monavie schemers at the top.

For a preview, consider these stark facts:

-- The top 1% (0.77% or 1 out of each 130) received 65% of all the Monavie commissions. These commissions came out of the pockets of those at the bottom.

-- The bottom 91% of the entire Monavie sales force, received no company payments at all!

-- Of the 9% who did receive a commission check, the bottom 99% of them earned on average only $59 a week, before product costs and all business expenses.

-- The average income of the bottom 99% of all Monavie distributors was $3.75 a week before all product costs and business expenses.

These amazing Monavie figures need to be repeated! 91% earned zero. Of the 9% that earned something, 99% of them earned only $59 a week on average, before all product costs and business expenses.

And. most walked into this financial pit directly from other MLMs, such as Amway, where they had “failed.”

Why have so many "losers" in other MLMs walked right into another money trap where the very same "endless chain" income promise, absurdly overpriced products, and predatory "tools" scams lay in wait for them?

There is a counter-intuitive rule in the world of scams. It is that the easiest person to fleece is someone who has recently been fleeced.

Wouldn’t the previous loss cause the consumer to be more vigilant, plus experienced now? Sadly, for many, no. To the contrary, stronger motives and forces drive consumers, once burned, to fall again, often harder. Those forces – anger, disappointment, shame and confusion – instill in many consumers a burning desire to rectify their plight, to redeem themselves in their own eyes and to their friends and families. They must prove themselves right.

One other factor is at work. This one is even more disturbing. It is that many consumers, once burned, do not understand that they were in fact the victims of a scam, a calculated money trap. Rather, they believe – as they were told by the promoters – that they had “personally” failed in a viable, legal, even excellent income opportunity; hence, their shame and the need for redemption.

With this great need burning in their souls and the false impression that they had previously wasted a tremendous opportunity, these consumers are easy marks for multi-level marketing pyramid schemes and Ponzis. They are, in fact, even more vulnerable to the deceptive lures of “unlimited” income than other people who may have greater financial needs. The needs of these “burned” consumers go much deeper than money.

Every year, this scenario is played out among millions of people who move from MLM to MLM. They accept the earlier promoters’ stories that they had screwed up a wonderful opportunity and they now believe the next group of schemers’ stories that they can make a success in this next one.

In their minds, their earlier failure was either caused by not following the plan closely enough or not investing enough time and money. This time they will do it right and won’t quit, they say to themselves. Some believe their earlier failure was only in choosing the wrong MLM. This time they believe they have found the right one. Opportunity is at hand! Seize the day! Their ship has finally come in! They have found the secret. They are among winners, this time.

This page last updated on 10/24/08