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Home / Success & Failure  /
Masterful Mindshaking Insights From Experiment M
multi level marketing

Sometimes the path is obvious but the courage to get on the right one isn't

It probably looks like I have a fascination with multi-level marketing.   I wrote an article about it.  I devised an experiment to test it.  And now I'm writing a third piece to discuss the masterful insights I gleaned from performing the experiment.  My conclusions remain unchanged, especially in light of the results of my own spin at Experiment M.  I know now that I would never ever join another MLM to spread the "opportunity."

Experiment M resembled a classic chain letter on the surface.  One of my respondents pointed this out and asked me to prove it wasn't.  The form of Experiment M, the form of any MLM for that matter, resembles a chain letter.  You craft a message which you pass on to X number of recipients and convince them to do the same.  This spreads the reach of the message geometrically. 

The message can be benign:  "Forward this note of happiness on to ten people within 24 hours or you will be cursed with bad luck for 3 years."  Or it can involve a sales spiel:  "Join up with our incredible organization for $50 annually and spread the message to all who could benefit from our products and services." 

What's thought of as a chain letter contains emotionally manipulative stories – the promise of bad luck if you don't pass it on is one such example – and often the promise of getting rich quick.   Chain letters asking for money and dangling the pocket of a huge return are illegal in the United States and Canada, though I doubt anyone would actually enforce this statute most of the time.  Experiment M wasn't a classic chain letter or illegal by these measures.  There was no emotional heartstring pulling or the pressing of people's buttons to get them to act out of greed.  I intentionally talked down the likelihood of a huge payout, predicting ahead of time that most people are armchair activists.   I outlined the math and what someone could potentially make, but warned that this outcome was probably not achievable given most people's behavior. 

Each person who participates in Experiment M invests US$8.  Everyone's mission is to find 8 people who can pay them $1, thus recouping their investment immediately, and then get these same new enrollees to advance $2 and $5 to the recruiter's "upline."    The $2 and $5 are the most important part of the equation, as I will discuss a bit later.

I knew if I contacted just 8 people, it was not likely all 8 would participate.  So I contacted 24.  I chose the potential recipients with care.  I excluded family members for a few reasons.  I felt there was too much overlap in our respective networks.   People already recruited would be re-emailed by other family members freshly recruited.  There'd potentially be too many Experiment M e-mails floating around out of familial obligation to me, and I considered there might be an unspoken backlash against me for "trying to get rich on the quick."  I also didn't think the particular family members I'd send the e-mail to would be very good at recruiting 8 additional people. 

Instead, I e-mailed several good friends who I didn't think would judge me one way or the other.  And some casual contacts with vastly different networks than my own.  This would better insure the Experiment M e-mails were spread to the four corners of the globe.  Three of the recipients were not native English speakers.  I didn't think they'd participate due to the extra work involved.  They'd have to translate my letters into their native languages in order to pass them on, and it probably wouldn't be worth their whiles.

I had my own feelings about whether certain people would perform, but unless I was 99% sure they'd be offended or not do it, I sent an e-mail anyway just to get back a response.  About ten on the list were people I hadn't seen in over 7 years.  I used the letter as a catch up e-mail and used the first few paragraphs to mention some specific updates about myself and what I was up to.  I segued into Experiment M in the third paragraph.  Every e-mail was personalized.  I took pains to close the e-mail with a low pressure pitch:  "Humor me here.   I want to add a chapter to my book to document results.  Technically, Experiment M should be a success for everyone who participates because the investment is low and only personal contacts are solicited.   If you don' t participate, I'll likely contact you in another week to follow up and ask why, but I won't judge you for it or beg you on hands and knees to reconsider.  I'll just include your input in the follow up chapter to explain people's general motivations for not taking part.  E-mail me if you have any questions."

Fearful that my e-mail would be ignored if it were too lengthy, I kept it to under the equivalent of one page of text.   The details of Experiment M itself were included in a link.  I did this on purpose, so I could track how many of the recipients actually took the time to read over the experiment.

The results were astounding – and not in a good way.  Of the twenty-four people I sent the e-mail, none participated.  Four visited the link.  And five responded.  The four link visitors were not fully among the five respondents.  One visited who did not respond, and two responded who did not visit.  The bigger offense, in my opinion, was the nineteen who didn't even bother to send me a brief reply and offer a platitude why they wouldn't bother participating.  I think I was owed that small courtesy.

Two people whom I consider very good friends wrote back friendly responses.  A childhood buddy replied," I don't think I will be participating in the experiment. I just don't have the time or energy to ask my friends/contacts even for a buck.  If you want, I'll be happy to donate $8 to the cause, but that would be the end of it."  A college buddy offered, "I don't feel comfortable asking my friends for money in this fashion.  To be honest, it makes me look a little foolish.  One other reason I'm not interested is because it's about trying to get rich quick.  Let me be clear though, that I don't think any less of you for trying it."  A very interesting response came from a friend in India:  "I can invest $8, but would not use my credibility to get 8 friends. Probably if the investment were higher, I might have used my credibility, but in that case I would have never invested." 

The college friend added that he thought my experiment wouldn't give me an insight into MLM's.  "It's kind of like telling someone they are getting a placebo but you want to see if it has any effect on them anyway."  I don't agree with him here.  A placebo has no effective medicinal component, so it resembles, in no way, the medicine being tested.  Experiment M's recruitment and payout worked very similarly to existent MLM operations.  But this is a moot point.  This friend stated he had no interest in MLM's.

The common thread among the few replies is that no one felt comfortable asking people they knew for money, if only for a buck.  I would say this is not a completely truthful answer.  People generally have no problem asking immediate friends or family for cash if it involves some kind of charity or good cause sale.  They would have little problem, I imagine, asking $8 for something truly valued at $4 if they could tell the purchaser that the money was going to help fund their child's school's new gymnasium.  The seller is then not benefiting directly off the buyer while the buyer hopefully derives some benefit, but possibly none, from the product purchased at an inflated price. 

I kind of understood people's hesitation to hit up their network because I had dithered for 2 months before I finally sent out my Experiment M queries.  I told myself I couldn't act like everyone else if I wanted results different from everyone else.  What was the worst thing that could happen?  I felt a sense of relief after sending out the e-mails, knowing I'd overcome that resistance. 

The crazy thing here is that, unlike a real MLM with its huge buying demands, joining fees, and possibly average conventional products, all Experiment M involved was asking 8 friends to give you $1 and pass $2 and $5 on to others, with the certainty, if everyone recruited 8, that you'd have a downline of over 300 people by the time your name ascended to the top spot to collect $5 from all.  One hour's work to make over $2,000, hardly a millionaire's payout but a lot better than most people's hourly rate. 

One friend, recall, offered me the full $8. I could have easily forwarded on the $2 and $5 to my upline per the experiment.  I refused.  His offer, while appreciated, would not have satisfied the experiment's full terms.

Because Experiment M involves TWO bits of salesmanship.   The first is using your credibility to convince 8 people you know to invest $8.  I think nearly all of us could successfully extract $8 from 8 people and manually redistribute $7 of that to our uplines.  But that's only less than half the job.  The second bit of salesmanship, the clincher in Experiment M's success, is convincing these 8 people who've invested  --- they'd see it as donated – to repeat your actions and do the same. 

If this were a real MLM with a real "opportunity," I would lend my support to the 8 in my downlline by sitting in with them as they recruited their own 8 members.  I would help them utilize their own networks to build their own downlines because all of us are enriched.  Experiment M offered an opportunity as well.  Without a reward (or punishment), why would anyone be motivated to act?   Experiment M's opportunity was that one could multiply his investment by over 250 times.  This is not the sort of thing that should require a hard sell and upline support.  In fact, with more people in the room encouraging a potential recruit to participate, potential recruits would start to feel like it was a scam.

I comprehended from just the few respondents and the bulk of non replies that the reason most people fail at MLM's isn't because the products are overpriced (though they are) or that the buying demands are too crippling (though they often are).  It's because most people are too afraid or too proud to ask other people for money!    

I should clarify.  The childhood friend of mine who offered to donate the full $8 makes a very good living as a salesman so, clearly, he is not afraid to ask people to hand over much larger cheques.  But he asks people to hand over money in exchange for a product with some determinable market value.  He generates leads by attending trade shows and mailing out query letters.  Anyone willing to cut a deal with him responds to his inquiries or asks him questions at his trade booth.  There is nothing for him to be afraid of because the serious customers come to him.  My friend just needs to devise a proposal that meets their demands to get them to hand over the money.

No one magically comes to you to be part of your downline.   You have to be aggressive and ask for the cash, and few, even if they won't admit it, have the tolerance or skill to do it.  They would rather not turn $8 into over $2,000 with a whole host of excuses why:  not enough time, don't want to risk the friendship, would look foolish, fill in your own.

MLM's have a bad rap, no doubt, which I am sure tainted my queries negatively, but the real deal killer is people's behavioral patterns.  If more people than not had no issue with asking their friends for small sums of money, then how could anyone fail? 

In my initial query to all twenty-four, I announced I would follow up within a week.  I decided to end the experiment without a follow up considering that 19 out of the 24 didn't even bother to acknowledge my original e-mail.   A follow up would look desperate and, though it might get some to offer me an $8 "donation", it wouldn't be enough to persuade them to establish their own downlines, the far more important component of Experiment M.  I concluded it was better to quit while I was ahead.

You need strongly motivated people with solid sales skills to ever have any hopes of succeeding at MLM.  To recruit such people, you need to be one yourself.  But if you really do possess the skills to succeed at an MLM, do yourself a favor and use those skills to succeed somewhere else. 

If you liked reading this, consider:
 Which Universe Is The Best One?
 Fragmentation Of The Titans
 The Complete Article Index