Some testimonials

• Definitely worth the money. As a matter of fact, after 30 minutes, I think I got my money’s worth. I found out that my business plan was not legal and by the end of this, I’ve learned all the tools and information to make this work. It’s a really good program.  Zach Taylor
• Thank you for the most crucial information supporting my Party Plan Business. This 2 day class was exactly what I needed! Great job by everyone! Absolutely every aspect of my business was covered. Thank you again. Cheryl Wollrab
• I was amazed at the information. I thought it was going to be a broad stroke event to get you with different vendors. I was very surprised to see all of the targetted topics, how in depth they went into discussing very important issues, for anyone whose considering getting into the MLM business as a startup company. Mike Duke

At the end of each day, from 5 until 8 pm, you’ll have the the opportunity to meet with conference speakers for 30 minute appoints at no additional cost! Add the six hours up and you’re easily walking away with over $1,000 worth of consultation.

Register Now

Starting at just $199 per ticket, the value greatly exceeds the cost of a ticket. Purchase a ticket here. Information is the only asset separating you from your competitors. If you’re not satisfied with the program, we’re offering a 100% guarantee, no questions asked.  Join us and we look forward to meeting you. Our agenda is loaded with information specifically chosen to advance your business. Check out the full Edge agenda.

Some more testimonials

• It’s been a very good conference really on the nuts and bolts of trying to figure out how to turn a company into an MLM. I think these people are very talented and knowledgeable and will really help you to build your business and help you to move forward. Susan Averett
• Jay, Kevin and all other other speakers provided us with great information, in-depth, thorough, and painted a perfect picture for us so that we have a good sense of what we’re getting into. I want to thank all of them for their time, their effort, and for providing myself and my wife with the information that we need to go forward with our company and make it grow. Thanks a lot. Stanley Chang
• As a former distributor, as a board member for a large network marketing company, as now an owner of a network marketing company myself, this conference has been extremely helpful. Great speakers, great content, A to Z, everything that you need to know as a startup. Brad Doyle
• Attending the DS Edge was different from any other MLM conference I had been to before. I’ve been to other conferences, They try to sell you services, they do give you information, but the difference with this one was we actually left with actual steps, tasks we can take, things we can get done to make sure we are successful, so I highly recommend it. It was a great use of time. Bethanie Nonami

In the video, I talk about three exciting things: Google Plus, ViSalus’s stellar growth and the Direct Selling Edge conference.

Google Plus

It’s an amazing platform, period.  If you’re not on it, I strongly encourage you to create a profile and get started.  If you’re on it, scroll over to the top right corner and add the MLM Attorney + Page to one of your circles.  The main reasons why I think it’s amazing: first, it’s driven more by “what you’re into,” not “who you know.”  There’s a strong difference and if you don’t understand it, you will once you play around on the platform.  It’s so easy to connect with people that share your interests, so no more awkward friend requests.  Second, it’s already influencing search results, which is important for anyone with a website.

ViSalus kills it.

I recently wrote about this.  ViSalus’s success benefits the entire industry for four reasons.

Direct Selling Edge conference.

We’re bringing it back!  The first event was spectacular and we’re making this one even better.  Jay Leisner and I are hosting the MLM Startup conference event in Las Vegas on March 8 and 9.  Click here for tentative details.

The 4-minute mile was impossible...until Roger did it.

The rising tide raises all ships.

MLM company, ViSalus recently announced a seven-fold increase in sales from 2011!  They must not have heard the news about the sour economy.  They grew from a solid $34 Million in 2010 to a stellar $231 Million in 2011.  This sort of growth is fantastic for the network marketing industry in general.  Regardless if they’re a competing business, their success matters for multiple reasons.  

Increased Visibility

First, as the heading suggests, their success increases the visibility of the network marketing industry.  Blyth, a private equity firm, placed a very successful bet on a small MLM company a few years ago.  The bet paid off…big time.  It’s a great testimony to the geometric possibilities for growth that the network marketing industry offers.  Another example of venture capital throwing their hat in the network marketing arena, Sequoia Capital invested $37 Million in party plan company, Stella and Dot, last year.  With more capital in the industry, the level of play increases, which benefits everyone.

Customers Volume Supports Growth

Second, ViSalus grew substantially while focusing on customer sales.  Sure, they recruited a lot of talent this year.  But they’ve also maintained a great customer to distributor ratio.  Purportedly, this ratio is 7 to 1, customer volume to distributor volume.  Customer volume is vital for stability, not only for ViSalus and its investors, but for the industry in general.  There’s too many companies that live by four principles:

1) Recruit distributors
2) Teach distributors how to buy for self-consumption
3) Repeat steps 1 and 2
4) Teach distributors about steps 1 through 3

This leads to a terrible sales culture dependent on hype and opportunity driven demand.  Assuming worst case scenario that ViSalus’s ratio was 1 to 1, it’s a demonstration that growth does not need to occur at the expense of customer sales.  Customer sales can support growth, as evidenced by ViSalus’s hockey-stick growth. Customer volume and distributor volume are not mutually exclusive goals.

Healthy Market

Third, this growth occurred mainly in the continental United States.  Think it’s tough to build in the American market?  

Those who care the most win

Fourth, their success demonstrates the awesome power of person to person marketing.  There’s nothing unique about weight loss.  But combine an age-old solution to an age-old problem and mix it with a personal, human touch…it dramatically changes everything.  While network marketing is certainly about selling unique and innovative products, at the end of the day, it’s really about connecting with people and influencing them to honor simple commitments.  And when good commitments are honored over time, the results can dramatically change lives and build emotional bonds.  ViSalus is not world class at selling weight loss shakes, they’re world class at creating an encouraging culture, one that gets people to honor commitments.

So if you get good at creating culture and “delivering happiness,”  you’ll build a loyal tribe regardless if you have the latest magic pill.  Do not try to out-ViSalus ViSalus and do not try to copy Amway or any other company you think is cool.  If you fake it, the market will find you out.  Be authentic, bring your unique style to the equation, solve a real problem and slowly build emotional connections with your customers.  Care about your customers!  ViSalus and Blyth’s success proves that good decisions compound over time.  The barriers have been obliterated.  If you’re an executive for a network marketing company, there’s never been a better time to engage than RIGHT NOW.

“Trent “Never Say Never!” Jackson has been an outstanding distributor for several years for a wellness MLM called “Mind Your Business.”  He’s built a $2,000 per month income, he’s diligent, ambitious, personable, attends all of the meetings, never missed an autoship, shows a great plan and throws fabulous demo parties.  With all of the MLM startups in the industry these days, they all want committed guys like Trent.  Later, Trent gets approached by his good friend, Geoffrey Gullible, and gets pitched about “Dewey Cheatham & Howe” business.  DCH is the latest and greatest cash investment program.  They’re an MLM with a unique selling proposition: they sell dollar bills for fifty dollars.  With each distributor that goes on a three dollar monthly subscription, the sponsor gets a substantial cash prize each month!  Trent is interested.  He thinks to himself, “Wow, if I can only transfer 20% of my MYB downline, I could be making some serious cash with the DCH compensation plan.  There’s no better business than one that sells cold, hard cash!”  Trent starts making some phone calls to people in his downline, he tells people about the awesome DCH pay plan and he talks a little trash about his other MLM.  He says, “Everybody wants money, and we’re selling it!  Who’s coming with me?” He’s successful in recruiting several key leaders from MYB and the rest is history.  Mind Your Business’s compliance department hears news of Trent’s behavior and calls a meeting.  What should MYB compliance do about Trent?  Do they lead with grace or should they lay down the law?  

Educate or Terminate

As crazy as it seems, these are the kinds of choices compliance departments make everyday in the MLM arena.  An entrepreneurial spirit, usually the greatest character trait that leads distributors to join a company, can sometimes be a challenge for MLMs seeking to retain the interest of a multi-talented group.  Regarding Trent from our fact pattern above, compliance departments will need to decide if they want to terminate, suspend or simply warn him about his behavior.  And doing nothing is always an option, too.  In my experience representing dozens upon dozens of MLMs, young and old, I see a common question when addressing compliance issues: do we educate or terminate?

In my opinion, compliance departments should be designed to serve two important functions: education and protection.  First and foremost, they exist to train distributors of the proper behavior when marketing the product and income opportunity.  When the sales force is properly educated, it leads to good behavior in the field, which leads to fewer complaints and better longevity for the company.  Secondly, when their education efforts fail with certain people, compliance departments exist to levy penalties to  protect the companies from legal troubles.  Remember when your father would say, “It’s for your own good…”  That’s not the case here.  When distributors get disciplined, it’s done for the good of the business.

Distributor Discipline

If you’re reading this as a distributor, I’ll share with you the top three reasons that lead companies to take corrective action.  Reason number one: distributors soliciting people in their downline for another MLM.  When a company provides support for its distributors to build the business, the distributors are positioned to learn the identities of a lot of people they never would have met but for the opportunity offered by the company.  The company has a legitimate interest in preventing its downline from being raided by other companies offering sweetheart deals to key leaders.  In the “Mind Your Business” scenario, Trent was leveraging his contacts in his MYB downline to build his Dewey Cheatham & Howe business.  It happens a lot in the space.  Reason number two: distributors making aggressive product claims, usually on unauthorized websites.  In their zeal to build a large business, some distributors can become too aggressive with their product claims i.e. “This pill cures cancer!”  If the company does nothing to curb aggressive claims, regulators will attribute the wrong acts of the field to the company.  If there’s a pattern of wrongful conduct and zero enforcement, it’s a recipe for problems.  Reason number three: distributors making aggressive income claims.  As with reason number two, in their haste to create momentum in their downline, distributors might resort to over-inflated income claims i.e. “earn millions of dollars in days with our new, revolutionary pay plan!”  It’s not common across all companies; however, it happens enough to where companies uniformly issue policies designed to prevent the behavior.  When regulators attack a company, they almost always quote distributors making aggressive (and unauthorized) income claims.

Survival of the Smartest

As the saying goes, “An ounce of prevention is worth a pound of cure.”  The best way for MLM companies to orchestrate solid behavior in the field is through proper education.  And education starts with having clear standards published in the polices and procedures.  I know, I know….nobody reads the polices and procedures.  But when there’s behavior occurring that reflects poorly on a MLM, it’s always best when a company can cite a specific provision in the policies and begin the education process.  I always compare the policies and procedures to the US Constitution…people might not have it committed to memory but it’s always in the background influencing behavior.  Clear policies is a good first step with education.  Secondly, companies should consistently communicate important standards to the field through all of its communication channels.  As an example, if a MLM is selling a supplement with an anti-inflammatory ingredient, they need to habitually remind the field to refrain from marketing the product as a treatment for arthritis.  As the great Napoleon Hill wrote, “Any idea, plan or purpose may be placed in the mind through repetition of thought.”  Without measures designed to lead to education, companies should never be surprised when there’s consistent bad behavior across multiple downlines.

What about Trent?

So what should we do about Trent, our protagonist from the fact pattern above?  Do we show him the door or extend some mercy?  In my opinion, I would advise the company to lead with grace, not law, and try harder to understand.  If Trent actually violated the agreement and caused harm to the business, the company should approach Trent with a cooperative spirit and try to meet with the intent of strengthening the relationship, not weakening it.  After all, Trent was and remains a committed distributor for the company, which makes him a valuable asset if he could get back on track.  If Trent refuses to get in compliance with the agreement and continues to solicit, termination might be appropriate.  If he acknowledges the behavior and makes a statement that he’ll get back in compliance, he should at least get a warning or a temporary suspension if the harm was strong. By handling all distributor disputes consistently and fairly, good companies can create a history of conduct that they can show regulators in the event they get in trouble for distributor misdeeds.  When a company says “We never condone this kind of product claim,” it’s always more believable when there’s a history of enforcement that backs up the statement.

Patience

Companies should never forget that for most distributors, it’s their first attempt at owning their own businesses.  They’re going to make mistakes and mistakes are part of the learning process.  If the company is too strict with their policies, compliance will never be an issue because all of the distributors will take their talents elsewhere.  And distributors should always remember that they’re engaging in a partnership with the MLM company.  As with all partnerships, there’s some giving and taking, which means distributors should trust their company and listen accordingly when the company is trying to curtail some behavior.  It’s a delicate balance between the company and the field when trying to enforce standards.  It’s more art than science and the ones that get it right enjoy decades of prosperity.

• Strategies he employs to amass such a large following on his Eric Caprarese Fan Page (over 18,000)
• History in the industry
• The role leaders play in moving product versus developing other leaders
• Key decision points for all young distributors as they grow in the industry

Eric’s message at the end is powerful: anyone can do it.  It’s true, you’ve got to partner with the right people and the right company.  But if you do your homework and find a leader worth following and a product that stirs your passions, anything is possible.  If you have any thoughts or comments, please share them below.  And if you think Eric did an awesome job, hit the Like or the +1 button for me, will ya:)  Thanks.

If you want to stay in touch with Eric , subscribe to his personal website, Eric Caprarese. Follow him on Twitter: @ericcaprarese “Like” his fan page: Eric Caprarese Fan Page

In network marketing, there’s a growing divide between MLM distributors and companies.  There’s more litigation against distributors, more angst and more finger-pointing.  The speed of innovation is making it challenging for companies to provide leaders with competitively priced items, long term. And distributors are more transient than ever looking for shinier lures.  It’s tough out there now, there’s no doubt about it.

Back to the riddle…  Leaders first or products first?  Distributors will say “Without us, nobody would buy your stuff.  We’re independent contractors, not employees!”  Companies say, “Without us, you’d never have a network. I dare you to try building a following with a business that stinks!”

The answer

They’re both right.

Suppose a leader enrolled in a business that sold $1,000 rolls of paper towels.  We’ll call this business “BRAWNEE WANABE.”  There’s nothing special about the paper towels, they’re just the kind that can…..you know…..wipe up spills and stuff.  On sale for $1,000 per roll.  And suppose the BRAWNEE WANABE website is awful.  The checks rarely arrive on time and when they do arrive, they sometimes bounce.  And there’s no street address for the company, the company owners are anonymous and there’s not a shred of support for the field.  Suppose Dexter Yager, one of the most prolific networkers in history, decides to hang up his Amway business and join BRAWNEE WANABE.  Do you think he’d maintain his downline for long?

The product matters.  The company matters.

“But I own the downline! I worked hard to build it!”  This is what distributors argue, and it’s a good one.  But did that downline develop solely because of their leadership?  Or….did it develop with their leadership PLUS with the branding and support provided by the company?

The Truth

In reality, the relationship between a leader and company is a tightly knit partnership.  It’s like a goldfish in a tank partnership.  The goldfish grows to the size of the tank (I’ve heard).  If the tank is small, the goldfish stays small.  If the company is awful, the leaders will never be able to build a sustainable downline regardless of talent.

On the flip side of the coin, the companies absolutely NEED leaders. Without leaders, there’s no product sales.  Leaders build up the value of the brand in conjunction with the company.  They’re vital.

So which one is more important, leaders or companies?  It’s a loaded question.  They each rely on the other for their existence.  Yes, companies can get new leaders and leaders can get new companies.  But for a program to really work, companies need to provide cutting edge value daily and leaders need to remain committed, even during the rough patches.

I had the distinct honor of interviewing Shannon Denniston as part of a new series.  I’m calling this new series “Distributor Spotlight.”  I’ll be occasionally interviewing MLM distributors, young and old, to obtain their perspectives on the industry and hear about their positive experiences.  As a MLM lawyer, it’s important to share information about the companies experiencing challenges from regulators and class action attorneys.  It’s easy to have tunnel vision and only focus on the train wrecks, such as the FTC vs. BurnLounge case.  But there are plenty of positive stories that deserve attention too; hence, the new Distributor Spotlight segment.

Shannon Denniston has been in network marketing for 15 years.  He has a great testimony about the benefits of the industry.  During the interview, I ask him the following questions.

• What’s your philosophy on marketing your business on Facebook?
• What are the benefits of networking with distributors from other companies?
• What did it take for you to make the uncommon commitment to actually win in network marketing?
• What are some factors prospects should consider when joining a company today?

During the interview, Shannon shared several factors a prospect should consider before joining a new business.  I’ve listed a few below.

• Competitively priced products.
• Great customer support.
• Policies and Procedures WITHOUT a non-compete.
• 35% to 50% payout on dollars collected.
• Leadership in the company with field experience.
• Privately owned instead of publicly traded.

Stay in touch with Shannon on his facebook fan page and subscribe to his “Marketing Tips” newsletter at http://www.ShannonDenniston.com.

New features.

• Subscribe to comments via email. When someone leaves a new comment in an article, you have the option of being notified via email. I never see these email addresses, so there’s no bait and switch.
• Threaded comments.
• Social buttons.  It’s easier to tweet, “Like” and “+1″ each article.  If you like the work, share the love by hitting one of those buttons.
• Easier navigation.  The old categories made no sense.  The new categories are listed above and I’m going through my old articles and tagging them accordingly.
• The contact and MLM newsletter forms are cleaner and built easier to use.
• Testimonials! The new testimonials page is much cleaner.  I’m proud of this page.  It’s very important to me for clients to have a great experience.
• New site map with a good diagram of the content.

Take care and if you have any suggestions on how to make this platform better, I’m open for suggestions.