Success for Sale
by Nat Cheung | May 10, 2020
*names have been changed for anonymity
Michelle* leaves me a voice message. She must be on a bus or coach; I can hear faint noises from the engine. She sends me a text:
“We are in Mexico
On a trip from Arbonne
Having a blast.”
Michelle is a National Vice President at Arbonne, a multi-level marketing (MLM) company that sells vegan health supplements and cruelty-free beauty products. Anyone who signs up to sell Arbonne’s products becomes an Independant Consultant for them. An NVP is the highest level that an independent consultant can reach. Consultants work to a strategy, or ‘SuccessPlan’, which is dependant on the team of consultants that they recruit under themselves, dubbed a ‘SuccessLine’. The game is to earn commissions from them and help them rise through the ranks too, moving ever closer to promotions, company holidays, or the elusive white Arbonne-branded Mercedes-Benz.
By definition, multi-level marketing relies on participants recruiting friends who themselves recruit more participants, until they resemble the nefarious sister of the MLM – the pyramid scheme. In the UK, the Competition and Markets Authority says that, by definition, pyramid schemes (which are illegal) “depend upon new members being recruited to pay in”. In the US, the Federal Trade Commission (FTC) defines a pyramid scheme as generating income “based mostly on how many people you recruit, not how much product you sell”. But these definitions create a conveniently grey area which allows financial compensation to fly under the radar. This allows companies like Arbonne to rely on payment in kind – such as an all-inclusive holiday in Tulum, Mexico.
Arbonne only rewards recruitment when sales goals are met, and, in doing so, avoids the label of a pyramid scheme. But the top-level consultants earn extortionately more than their low-level counterparts, funnelling revenue in a way not dissimilar to pyramid schemes. Team leaders have the right to take thirty-five percent from their recruits’ revenue in commission; consultants are then encouraged to invest what money they have left back into Arbonne stock. In 2017, Arbonne and five of its executives faced a lawsuit in California, in which the lead plaintiffs called the company a “pyramid scheme masquerading as a direct seller”. The case was brought after a series of complaints from consultants who had earned nothing, or even lost money, under the MLM scheme. An independent investigation into Arbonne’s 2017 and 2018 income disclosure statements reveals that 88% of participants had made either net-zero profit or a net loss. Only 301 people, which corresponds to only 0.178% of all the Arbonne reps in the US, made a five-figure salary every month. The case was dismissed in 2018 after an undisclosed settlement.
Last October, dietary supplement company AdvoCare was ruled an illegal pyramid scheme by the FTC. In an official press release, they stated that inflated income claims like those seen on Arbonne’s income disclosure statements are a “hallmark of an illegal pyramid”. AdvoCare failed to take consultants’ expenses into account on their statements; Arbonne goes even further by failing to include data from any consultant who didn’t make a profit. The difference between the legal Arbonne and illegal AdvoCare is that in the case of the latter, consultants have to spend between $1200 to $2400 to be promoted initially, while, in the case of the former, promotion is based on product sales and the earnings of a consultant’s chain of recruits. Arbonne is perhaps better at toeing the legal line which AdvoCare has crossed.
Previously married to an Advocare consultant who is still in the scheme, Adam* blames MLMs for “stealing away his wife and his girlfriend”. Like the other women I talked to, she struggled with her body image and was a financially vulnerable twenty-three-year-old when she joined. Investing in the $500 starter juice cleanse seemed like a good idea at first. But, with the mounting pressure to upscale her venture from the woman who recruited her, she applied for a credit card and racked up $5000 in debt without Adam’s knowledge. He attributes her choices to their environment at the time: “Spokane, Washington has a large military presence (which I know to be a factor) due to the air force base and army reserve base there. There are three major colleges in the area as well, so MLMs are pretty common.”
Between military wives, suburban mums, and college students – three groups which dominate the MLM demographic – he felt that his wife was in constant contact with eager colleagues, who offered the gushing support that he was too skeptical to give her. Eventually it turned into an echo chamber of – to borrow his phrase – “the ‘anyone who doesn’t support your dreams doesn’t belong in your life’ argument”.
Don’t be fooled: Arbonne’s consultants are very self-aware. They have addressed every doubt already raised in this article on their Instagram stories. They admit that they’ve been judged and lost friends. Every current or previous Arbonne participant I interviewed told me that it took them months of consideration before they finally committed to signing the Arbonne contract. Lucy*, a law student, dwelled on the decision for five months. For Savannah*, a Canadian dancer, it was three years. For Michelle, the highest ranking of the three, it took six. Savannah, twenty-two, says that her epiphany moment was realising that “the universe had asked me to look at this opportunity and go for it… all I had to do was block out the outside voices and listen to my own.” Lucy claims that she did it for her “self-growth”. For many of these women, their decisions to join Arbonne were made at a time of emotional vulnerability. What they’re selling isn’t just herbal moisturiser and protein shakes, it’s a lifestyle available by subscription. Arbonne’s high-risk investments are marketed as a lifeline – potential consultants are told to “get empowered”, “gain the support of an incredible community”, and “live the life of [their] dreams”.
That life is the dream of a generation – the tenacious, hard-headed entrepreneur, perpetually grinding to break away from the corporate machine and become their own boss. Scrolling through the #Arbonne hashtag on Instagram, there are plenty of testimonies about dropping out of college and quitting your day job to do Arbonne. That feeling of independence is enough to outweigh the risks of MLMs. It’s not that our generation has become unaware of those risks; it’s more about the fact that the definition of ‘legitimacy’ in business has become more accommodating. I ask Lucy whether she would put her title as an Arbonne District Manager on her CV. She replies positively: “Yeah, because this demonstrates to law firms that I am commercially aware and can interact with clients.” I bring up this issue with Michelle. She directs me to an IGTV video she made with her father, Michael*, and assures me that, since he’s worked in corporate finance for forty-five years, he knows what he’s talking about. “It really is the smartest business model out there,” he says of MLMs, “not just for people sitting at the top of the ladder, but for the people who continue to build that ladder.”
Michael adds that, to a generation more dependent than ever on e-commerce, the MLM business model has never made more sense. The requirements of maintaining a brick-and-mortar business – which normally takes up 12% to 15% of costs – are removed. Each consultant is their own influencer for their own products, with full control of their own sales cycle. Michelle even calls it a “start-up that only costs you $79”. That entrepreneurial dream and fantasy of fame takes away the sour taste of having to pay to work.
Consultants argue that many of their costs go towards products they would have needed to buy anyway. As Michael stresses: “You have people using the product themselves and educating people about how it works, and that relationship is the absolute strongest asset of this company.” This gives us a clue as to why many notorious MLMs (like Herbalife, AdvoCare, or Amway) sell health-related products. Health and body image are intimate issues. When a consultant like Michelle tells me one-on-one that the products have improved her gut health and muscle gain, and posts pictures of her own body to prove it, it seems like she’s giving me authentic advice, rather than a rehearsed pitch. She talks frankly about money too:
“To be clear, I didn’t need the money. I have a six-figure income with my job at SoulCycle. It really came down to the fact that I was already using these products. The brand, and the business, fully aligned with my values.”
It makes sense that Michelle thrives in direct selling, otherwise called “network marketing”, as a Senior SoulCycle instructor and Lululemon ambassador with 17.1k followers on Instagram. Her feed is typical of influencers and other high-level consultants: Californian beaches, tanned skin, ab gains, and motivational quotes. She seems to have the network, image, and steady income required to be successful in this business. In her opinion, though, she’s nothing more than a “natural connector”. “I’ve spent seven years building my network as a fitness professional, so I’m just utilising that network,” she says. “Having a network is essential, and if you don’t have one, you have to build one.”
“Having a network” is an unrealistic prerequisite for those who are investing in the program for extra income. If you aren’t from an affluent background, it is much harder to find people willing to spend £47 on ‘Pomegranate Energy Fizz Sticks’. Ex-consultants Madison* and Sarah* signed up when they were both twenty years old. They say that all their peers felt immense pressure to find a side hustle to save up for their student loans. Their socio-economic status proved to be a psychological obstacle; not only did they lack the capital to build up stock, Madison says, but, as a self-confessed “broke college kid”, she “would have felt so terrible asking other broke college kids to buy stuff”. Both women chose not to renew the yearly fee which consultants pay to sell Arbonne products after one year, even though Sarah had already lost £750 by then. Michelle, touting her six-figure salary on social media, might believe that “Arbonne is a level playing field and anybody can get to the top,” but the people who need the money the most are rarely the ones profiting.
The Arbonne girl lives a life that very few can afford. The legality of MLMs is illusory when, in real terms, there is so little to distinguish them from an illegal pyramid scheme. It’s an industry that lends itself to financial and emotional exploitation, and is both economically and politically problematic. Especially for young women, raised on the narrative of the Girlboss, MLMs suggest that they will elevate their consultants to the status of the women they respect. To those who feel left out of that modern narrative of female empowerment, MLMs present another chance at doing and becoming something of their own. But founding one’s own business is not cheap at all. When women pressure other women to ‘join the hustle’ and subscribe to new lifestyle choices in the name of empowerment, it indulges a narrow but self-assured kind of feminism that comes from a blatant place of privilege. Later, Savannah sends me a DM saying: “You should definitely consider the opportunity yourself since you now have all the info :)”. I firmly turn her down.∎
Words by Nat Cheung. Art by Wei Kai Ng.