Skepticism

Social Media, Pyramid Schemes, and Essential Oils: Don’t Get Scammed!

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Transcript:

Like all human beings with Internet access, I am of course contractually obligated to be on Facebook. Yes, it’s evil, yes, it’s probably going to hasten the downfall of intellectual society, and yes it’s mostly a place for elderly uncles to post racist minion memes, but here we are. How else will I keep up with what’s going on in the lives of people I went to high school with but never planned to speak to again once I left?

And what are those high school friends up to? Well, the ones who didn’t leave our small town are mostly busy with side hustles. What’s a side hustle, you ask? Jeez, you have a lot of questions today, hypothetical audience member. At first I thought a side hustle was a way to make money during your off hours — for instance, when I was a full-time copywriter I would make extra money by being a freelance writer on the side. Side hustle!

But it turns out that when people on Facebook and Instagram use the term, they mean the opposite of making money. They’re talking about posting images with inspirational text and desperately begging people to join their chosen multi-level marketing scheme.

If you’re on social media and you’re also following friends from high school, you probably know what I’m talking about. If you only follow friends you made in the past five or ten years, you might not know because people with real friends who they chose for reasons other than sharing fifth period algebra generally do not shill these products. If they did, all their real friends would eventually unfriend them and then they’d be left with only people they met in high school. See how it works?

If you’re not aware, multi-level marketing schemes are basically modified pyramid schemes. In a pyramid scheme, you make money by recruiting people beneath you. If I get 7 of you to give me $1, I make $7. Then each of you have to find 7 people to give you $1. If you do that, you have made $6. Sounds good until you realize that there are only so many people on the planet, and you will reach the limit extremely quickly, to the point that anyone who joins after a level or two is going to lose money.

For that reason, we call them a scam and they’re illegal. To get around this, pyramid schemes simply had to add a product. It’s the exact same thing, only now there’s an alternate way that you might be able to make money — not just from recruiting people, but by selling the product. But the money you make from selling the product is so slight, and the products themselves are so expensive and poor quality, that you hardly make any sales and if you do you hardly make any money. Plus the company will make you buy products to show your “customers,” so you will likely lose money. But there’s a chance you can sell enough terrible products to suckers in order to make money, so for that reason it’s not technically illegal. But in reality, people suckered into joining multi-level marketing quickly realize they can’t make money by selling the products, so they fall back on the true point of the business: recruiting more suckers to join under them, making that good ol’ pyramid structure.

Of course, as I pointed out, the pyramid doesn’t make 99% of the people in it any money either, so these people end up losing money, and often deep in credit card debt. To make matters worse, they end up driving away all their friends and family members, since every hangout turns into a chance to recruit new suckers, and every Facebook comment is a sneaky way to convince people to join the sinking ship.

MLMs have been around since Avon in the 1930s, but they’re seeing a renewal thanks to social media’s ability for people to both pester their friends and family constantly, not just when they see them, and also for their ability to reach beyond their circles to pester absolute strangers.

That’s why I’m making this video — to try to warn those of you who don’t know, or have friends and family members who may not know. MLM shillers can be devious, promising wealth that will never actually happen — every time one of these companies posts their income statistics, it usually turns out that 99% of people make absolutely nothing, which means that since they all have to pay (sometimes thousands of dollars) to buy in, they actually lost money on the venture. The other 1% got in before the market was saturated and still make next to nothing. Consider Young Living, an essential oils company, where in 2016, the average member lost $1,175. Additionally, people peddling essential oils will tell you all kinds of lies about their products — they can be extremely dangerous to children and pets and should never be ingested, but their sellers will tell you they can spice up your cooking and cure your kid’s excema.

I don’t want to single out Young Living so I’ll also mention DoTerra, another essential oil scam. In the makeup realm it’s not just Avon and Mary Kay anymore, but companies like Younique putting out garbage products at 10x the price you’ll find at Ulta. Rodan + Fields pushes “skincare” including a lash-boosting serum that is the subject of a class action lawsuit due to its tendency to permanently change the color of your iris and cause other truly fucked up things to happen to your eyes.

There are even clothing companies in on it, like LulaRoe that convinces women to buy boxes and boxes of hideous clothes with no say in what pattern or sizes or styles they get — whatever garbage the company sends, the suckers are expected to sell. And they have to compete with all the other LulaRoe “consultants” out there, many of whom are now going out of business and offering their garbage at half-price in a desperate attempt to recoup some of their losses.

MLMs are a disgusting, predatory scam that particularly prey upon stay-at-home moms and people with disabilities, promising them the opportunity to pay their rent just by posting on Facebook. It’s a lie. Don’t fall for it, and try not to let your friends and family fall for it. Let them know the facts, and reply to posts on social media that are shilling these products. Here are some red flags to look out for on Facebook and Instagram:

  • Asking people to DM to learn how to make loads of money but not mentioning the business
  • Way too many emoticons
  • Calling everyone “hun”. I don’t know why, but it’s a thing.
  • Hashtags like #bossbabe, #sidehustle, #entrepreneur, #workfromhome, and #smallbusiness

Here’s the thing: entrepreneurs with small businesses actually run their businesses, choose their products to sell, make the profit from those sales, market themselves, and pay their employees. Don’t fall for it!

 

Rebecca Watson

Rebecca leads a team of skeptical female activists at Skepchick.org. She travels around the world delivering entertaining talks on science, atheism, feminism, and skepticism. There is currently an asteroid orbiting the sun with her name on it. You can follow her every fascinating move on Twitter or on Google+.

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2 Comments

  1. I actually wrote a comment “millennials are criminals” a while back. It was basically that, due to the economy we inherited (China shock, then the 2007 crash), many millennials are resorting to selling homemade merch for their favorite series on YouTube. (It all falls apart for the same reason pyramid schemes do: Only so much money to go around.) I didn’t even think about pyramid schemes, though.

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