Anti-MLM groups are gaining traction on social media, threatening a reputation revitalization for the channel
By: David Bland
Editor’s note: In this month’s Special Report, we bring a difficult topic to the attention of executives in the channel. While the “anti-MLM movement” is gaining ground, it is uncoordinated and without leadership. By analyzing the growing anti-influencer communities on social media, we hope to enlighten readers as to the different types of direct selling content and which platforms are most susceptible to targeting, so companies can take action with more informed and effective counter-strategies.
Of course, our purpose here is not to alarm, but to educate. As one industry veteran recently told SSN, “We certainly have a responsibility to listen to and evaluate the concerns, and often the criticisms, expressed by adversaries. When we clearly demonstrate the quality of the products and services made available to customers through direct selling brands—as well as the support provided to those who acquire and retain customers—we win as direct selling companies, our social sellers and business partners win, and, of course, the customers who choose direct selling brands win because of the quality and service they receive. That result is going to be hard for the adversary to attack.”
Simmering since the early 2010s, an active and highly vocal anti-multi-level-marketing (MLM) movement has exploded in popularity over the past several years, and evidence that it is catching on in mainstream culture—especially with Gen Z—has industry leaders and executives worried.
Over the past decade, the direct selling channel has fully embraced social media, which has led to enormous growth and a reshaping of the entire model.
But that success is a double-edged sword. Leveraging the same online platforms that have propelled direct selling through economic ups and downs, the anti-MLM movement is focused on disrupting the channel and is now an entrenched cultural phenomenon, attracting hundreds of thousands of followers across the various social media platforms.
This grassroots crusade against direct sellers has weaponized “MLM” as a catch-all buzzword to tag every social selling company, regardless of structure, as an anathema to be ridiculed, avoided, and even outlawed.
The startling rise in online negativity focused directly on the direct selling model has not gone unnoticed. Joe Mariano, president of the Direct Selling Association (DSA), says there is increasing awareness of this problem at direct sales companies.
“There is a growing recognition and realization amongst very senior-level executives that we can’t bury our heads in the sand and ignore what’s really driving the resonance of some of this,” Mariano says. “You may have a social media critic or a group, and they may be selling T-shirts or whatever it is they’re doing in order to get clicks and revenue from that site, but that would not resonate if people’s experiences (with direct selling) had been universally positive. And so that is one of the things we have to deal with.”
Ryan Napierski, chairman of DSA and president and CEO-elect of Nu Skin, asserts that the best strategy for meeting industry criticism is to keep the focus on customers.
“As an industry, we have always faced criticism, and technology has the power to amplify and coalesce voices exponentially. The best way to meet criticism is for us to focus on and address the needs of our customers.
“As we remain committed to operating with integrity and holding ourselves and others within our industry accountable to high standards of conduct, we will meet criticism with compassion and naysayers with continued success,” Napierski concludes.
Spike in Anti-MLM Media Coverage
The intensity of the anti-MLM movement’s voice reached a crescendo of sorts at the end of 2020, having gained national coverage in both print and television media by cheering and amplifying news of TikTok’s surprise ban on all direct selling content, as reported in last month’s SSN.
The reports continued as The Atlantic and Newsweek both ran feature articles in December 2020 quoting anti-MLM groups on social networking platforms and linking to their YouTube channels, Facebook groups, and subreddits. The Atlantic ran a follow-up story a month later blaming the pandemic-induced shift to e-commerce for the recent network marketing backlash and rise of the “YouTube vigilante.”
Such prominent national media attention generated a flurry of secondary anti-MLM coverage from local news stations and newspapers as well as from alternative media outlets such as Huffpost and Buzzfeed, whose TikTok-ban story included an embedded anti-MLM TikTok video that has since been liked or shared over 36,000 times.
By “meme-ing” their anti-direct selling doctrine with trendy hashtags such as #antiMLM, #pyramid, and #hunbot (a reference to the stereotypically insincere “Hey Hun” greeting of a recruiter), the anti-MLM movement has achieved viral growth and is firmly embedding its sardonic phraseology and slang into the everyday vernacular of critically important direct selling demographics, particularly Generation Z.
Recruiting the Anti-Recruiters
Negative portrayals of network marketing companies by popular media have been around nearly as long as the businesses that they lampoon. Tongue-in-cheek sendups of Tupperware parties, Avon ladies, and door-to-door encyclopedia sales have been a relatively harmless source of public attention for direct sellers for decades.
However, modern, interconnected social media platforms have given disgruntled direct sales distributors and customers a massive stage with global reach to, ironically, recruit followers, and, in some cases, profit from their self-titled “anti-influencer” mission: To bring about the end of all recruitment and network marketing-based business models and companies.
While the anti-MLM movement is now ubiquitous across virtually every online social platform, YouTube clearly has the greatest reach and engagement. This platform is ideally suited to facilitate the rise of anti-MLM personalities as well as the amplification of the worst examples of unethical and illegal sales tactics.
The algorithms used by many of these platforms—Facebook especially—are designed to suggest new groups that may be of interest to a particular user, based on pages that person has interacted with, groups their friends belong to, or other personal data that has been collected such as gender, age, location, or pages recently visited. Thus, someone who has never viewed an anti-MLM message on their own page may be steered to one of these groups by the platform itself.
YouTube: The Epicenter of the Anti-MLM Movement
With over 2 billion users each month, YouTube is a critically important marketing tool for direct selling businesses and their distributors, and it also serves as a “home-base” of sorts for the anti-MLM movement.
Many of the group’s negative long-format videos consist of channel owners giving running commentary on team Zoom video calls hosted by top direct selling distributors. In many cases, the channel owner will curate the worst examples of unscrupulous sales and recruitment tactics in these group video meetings to convince their subscribers that direct selling is predatory.
Particularly damaging examples of these “leaked” meetings show seasoned distributors pressuring new members to utilize blatantly illegal tactics to increase sales and recruitment. In one video viewed over 600,000 times, a distributor coach urges the new members on the video call to make product health claims to cancer patients. In another video, a seasoned distributor tells new members of her “7-figure” income.
Intensifying Compliance Is Key
The amplification of such wild claims is creating headaches for direct selling compliance professionals. “Video is fast becoming one of the riskiest marketing methods for direct sellers,” says Ashley Tober, vice president of FieldWatch Client Operations at compliance monitoring firm Momentum Factor. “During the pandemic, in-person meetings went almost exclusively online, and because it is so challenging for compliance teams to properly monitor hundreds of hours of online gatherings, many serious claims can slip through.”
Tober suggests companies dedicate additional resources to tackling videos specifically. “It’s a huge undertaking,” she says. “In larger companies it can’t really be done manually.” To help meet the demand, her firm recently released hi-speed, video claims-monitoring and will soon launch Zoom integration.
Anti-Influencers Gain Status
On YouTube, credibility of the content provider leads to high visibility. A few of the anti-MLM personalities on this platform have received the “verified” check mark from YouTube, boosting their image as pseudo-celebrities as well as their chances to earn significant compensation from YouTube for drawing traffic to the website. One such channel has a recent anti-MLM video drawing 231,000 views since it was posted just 40 days ago.
The channel hosts frequently make requests to their viewers to submit content, reinforcing YouTube’s position as a clearinghouse for the weaponized amplification of the direct selling channel’s corporate communications, distributor messaging to potential customers, or team video conferencing.
The anti-influencer movement is now utilizing several online e-commerce and affiliate avenues to profit from their message.
The YouTube earnings calculator at influencermarketinghub.com reports that a single video with 200,000 views per month could earn the channel owner between $1,000 and $15,000 per year, depending on engagement rate. Several of the most popular anti-MLM personalities on YouTube show total view counts that could net five-figure payouts on an annual basis.
Other examples of monetization of the anti-MLM movement include online “merch shops” selling anti-MLM T-shirts, car decals, coffee mugs, and an assortment of items branded with pyramid logos, “#hunbot” stamps, and other catch phrases that members use to identify themselves and spread their message.
Anti-MLM podcasts are also beginning to appear that offer varying membership levels for sale.
Positive References to Companies Are Often Banned
While far outnumbered by pro-direct selling groups, a casual search of Facebook groups containing the phrase “anti-MLM” revealed a multitude of groups with over 1,000 members each, with one group listing 22,000 members. Virtually all of the anti-MLM groups on Facebook are private groups.
Social Selling News conducted an analysis of two private Facebook groups with subscriber counts of 2,500 and 9,100, respectively. After joining the anti-MLM groups and observing several weeks of activity, it became clear that these communities are fiercely moderated; any positive reference of direct selling companies or their products, even within the greater context of a complaint about that particular company, is purged.
Observations Within Anti-MLM Facebook Forums
The most consistent aspect of these Facebook groups is the demographic of the members; over 95 percent of the posts within each of the two observed group were made by women. The great majority of them appeared to be from Generation Z.
Another striking observation within the groups is the high number of individual companies that are singled out for derision. The first 50 posts in each group contained negative commentary about 20-25 different companies.
The top anti-MLM search result on Facebook is The Anti-MLM Coalition. Founded in 2017, this is “An international group of activists who are doing our best to educate everyone about MLMs, and help those negatively affected by them.” The page displays a link to a Change.org petition to “ban MLMs from Facebook” that has logged 4,100 signatures in the 14 days since it was released.
Reddit: The Gateway for the Movement
Reddit users, who recently took on Wall Street hedge funds by “squeezing” short sellers, were also important in casting the Anti-MLM story.
Reddit’s r/antiMLM group has accumulated a formidable 693,000 followers since its creation in 2011. Posts on this subreddit consist mostly of testimonies and screenshots of unwanted contact from direct selling distributors and have moderate levels of engagement.
This subreddit features a dedicated search tool titled, “Is this an MLM?”, for users to enter company names. If the company entered is a match for their list, the screen flashes “Yes!” and the user is shown links to the Wikipedia page on MLMs, The Anti-MLM Coalition homepage, and John Oliver’s 2016 HBO segment mocking multi-level-marketing, which has been viewed 27 million times on.
The front page of this subreddit also has a resource list with links to popular anti-MLM media content from Netflix, Vice, and various anti-MLM podcasts and web pages.
Thus, the power of Reddit within the anti-MLM ecosystem appears to position the forum as a gateway into the movement—introducing potentially hundreds of thousands of uninitiated Generation Y and Z’ers to the cause with tools and references to persuade them that all direct selling companies are MLMs or pyramid schemes using a virtually endless stream of negative testimonials and memes, along with a directory of anti-MLM media links.
Anti-Influencers Using the Strengths of Social Media to Their Advantage
Social media apps are amplifying the anti-MLM message in three important ways:
Co-opting and advancing the “influencer” movement, where the personality behind the message becomes as influential as the message itself.
Providing a global platform to collect and broadcast isolated instances of illegal and deceptive marketing practices to hundreds of thousands—or, potentially, millions—of prospective direct selling customers and enrollees within the channel’s key marketing demographics and portraying these behaviors as the “industry norm.”
Conditioning subscribers to react negatively to any direct selling content, product, or public brand sighting, regardless of how innocuous the message is, or how well a product may be working for that person.
The “anti-influencers” of social media are creating an environment where the specific product or even company being derided becomes of secondary importance to the fact that it represents “MLM.” Some of these group discussion threads go so far as to discuss brand alternatives to the direct selling products that the commenters like but are pressured to discard because they are made by an “MLM.”
Preparing a Positive Response to Counter a Questionable Foe
DSA President Joe Mariano points to the challenges the channel faces with this form of meta-level assault on its reputation.
“We need to specifically address this phenomenon with a reputational campaign at a global level—not just in the U.S., but with our World Federation,” Mariano explains. “The campaign will have to address, not the general kind of public perception issues that we have always had out there—pyramid schemes or those kinds of things—but rather we’ll have to specifically address this phenomenon of social media and the growing anti-MLM and direct selling movement on social media and recognize that we cannot ignore it.”
Sociologists teach that there is psychological reward for being a part of a group, for being a part of a trend—as the interactions in these anti-MLM groups make clear.
The movement has tapped into this cultural reality, creating the camaraderie that comes from a sense of community amidst the vitriol that permeates the various channels and accounts of the group.
However, Mariano suggests that it is worthwhile to consider that various segments of the movement may have inauthentic origins and questionable motivations for spreading the anti-MLM message.
“I do think, based upon our initial research and analysis, that what we’re dealing with is not completely an organic movement—people who are truly unhappy—but rather it is discreet individuals in groups with their own agendas, sometimes financial, sometimes otherwise.
“But, what we’ve seen in other areas, clearly, is that those kinds of movements and activities on the part of the discreet groups—whether they be small groups of individuals, bots from Russia, whomever they might be—they can ultimately become something much larger than what was originally put out there. They can have an impact on an election. They can create social chaos. They can affect the financial markets. They can motivate people to take significant social action,” concludes Mariano.
Regardless of motivation or origin, the hive-mind of the anti-MLM movement has become a cultural fixture for the time being, competing for the same consumers’ attention as the marketing departments of billion-dollar direct selling companies and honest first-time distributors for network marketing startups.
The anti-influencer leaders and agitators in these online forums do not distinguish between FTC-compliant companies and those that violate established law. They do not give a pass to businesses with perfect Better Business Bureau ratings or Direct Selling Self-Regulatory Council (DSSRC) certification. Rather, the anti-MLM movement wields the hammer of singular purpose, and every direct selling business, representative, and product, to them, becomes a nail.
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