My ebook: Journeys with the caterpillar

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Journeys with the caterpillar: Travelling through the islands of Flores
and Sumba, Indonesia
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Tuesday, April 03, 2007

Where have all those MLM stars gone?

Towards the late 90s, a revolution was taking place in India. There was more confidence in the air then you can sense now. Our spirits were rising, and what were driving such enormous changes were rather simple wares: foreign soaps, deodorants, talcum powders and perfumes. Men were reported to be making thousands outside their usual salary; housewives were getting new respect in their home and in the neighborhood as they had become working women overnight. If you entered any house, you could see a smooth operator talking to a group of star-struck women; the perfumes, deodorants and soaps scattered all around. Yes, Multilevel marketing (MLM) was just being introduced to India and companies like Amway were becoming household names. Frequent conferences would be held, even in small towns to baptize the new members, where energetic evangelists would spell out the dream of MLM converts controlling the earth through natural selection. The stars of MLM were even flown to Hong Kong, Singapore, etc. for short trips, raising the neighbor’s envy levels even higher. Some parents had even started to relax their constant pressure on children to study hard asking them to build relationships instead.

But as with anything good, this boom too faded away, all too soon. Amway’s sales in India have stagnated over the last three years at around $130Mn. MLM companies have faced a series of legal challenges in India and other countries for allegations of deploying pyramid strategies (Pyramid schemes are distinct from MLM such that they offer compensation to a member whenever he gets a new recruit and they charge an entry fee from every new recruit). People still have to work hard to save for retirement and we rarely hear of our earlier stars: the MLM agents, now. How did this happen? Of course, as the network of members spread, new members found it very difficult to make any money. Also worsening traffic situation in cities ensured that men had little time to spend after work, Saas-Bahu serials enticed housewives to rather stay at home, and fast spreading supermarkets were storing a wide variety of perfumes, deos and soaps now.

Incidentally, last year at Boston, an Indian approached me outside an Old Navy store (typical shopping place for Indian workers). He claimed to be running his own firm and was over-enthusiastic to have a long chat with me. We exchanged numbers and one weekend he came up to see me. What I thought would be just a social meeting turned out to be a once in a lifetime business opportunity. He showed me the stars, convinced me that I was toiling for peanuts, and that my first million was just around the corner. And then he gave me the catch, I would have to buy $100 worth of groceries every month (of course at discounted price) from his firm’s online store. When I said that I would rather buy my groceries from India where I would go back in two months, he didn’t get the point. But I got the point, though it was sad to see the back of a person who someday may indeed become a millionaire.

1 comment:

Anonymous said...

Ineresting blog. Have you heard of Believe. I think its only coming out in Utah. It's a comedy about MLM that looks pretty funny.

the video clips are good