Introduction to Amway MLM Compensation Plan
Hey, guys, it’s Brad here again, and this time I’m here to apologize. Specifically, I want to apologize to my readers in states that border the Atlantic or Pacific Ocean. See, I spent a good portion of a previous review throwing shade on the two coasts of the United States (specifically, I was reviling a certain multi-level marketing company for failing to offer opportunities to people in most Midwestern states), but I recant some of my previous statements, because one of my favorite movies just would not be possible without the parts of these United States that border the sea and the parts that border the shining sea. Barton Fink is the story of a writer, played by John Turturro, who gets fed up with the literary scene in New York City in the 1940s and goes to seek his fortune in Hollywood as a screenwriter, but when he gets there, he is in for a big shock. New York was full of pretentious snobs, but the writers in Hollywood are abrasive, ostentatious, and cynical about their craft and their audience in a way that Barton could never imagine. He has no idea how to interact in a world where things aren’t what they seem.
Barton’s only friend is Charlie, his neighbor in the hotel where he plans to stay until he gets established. Charlie, played by the peerless John Goodman, is a long-winded insurance salesman from the Midwest. If you think John Goodman and John Turturro are entertaining when they are on screen together in The Big Lebowski, you should see their screen chemistry in Barton Fink. Charlie is the quintessential classic American salesman, and he can converse fluently and inoffensively about anything while showing absolutely none of his true emotions as only Midwesterners can. As a salesman, he is well traveled but none the more worldly for it. It’s really a sight to see; Charlie enthuses about his favorite movies and gives unsolicited sales pitches for insurance while Barton listens wordlessly with wide-eyed dread.
Of course, things go from bad to worse for Barton once Charlie enters his life. Without giving away too many spoilers, Charlie helps Barton dispose of the body of a woman who has died mysteriously in Barton’s bed. By the end of the movie, the hotel where Charlie and Barton are staying has gone up in flames, and all that is left of Charlie is his loud Midwestern salesman chuckle.
As I mentioned in a previous post, when Roger Ebert died, he was at peace with the future of film criticism, since the Internet had placed film criticism in the hands of the people, and Barton Fink is a movie that has become the focus of many blog posts. One subject that blogging film enthusiasts love to debate is whether Charlie, John Goodman’s character in Barton Fink, is the Devil.
The Devil is a Midwestern salesman? There’s a scary thought. But here’s a scarier thought. 97% of people who get involved in multilevel marketing (MLM) end up in a worse financial position than they started. If you want to end up in the 3%, you have to choose your moves carefully. That is why I am writing this blog, to help you make informed choices about your MLM ventures. My goal for 2016 is to review as many MLM companies as I can and tell you the pros and cons of each. Today, I am reviewing Amway.
Amway and its business opportunity
Amway (short for “American Way”) is the granddaddy of MLM companies. It predates the term multilevel marketing by many years. It was founded in Michigan in 1959 by Richard DeVos and Jay Van Andel. DeVos and van Andel entered a lot of business ventures together; they experimented with different products and business models until they found success with a household cleaner called Frisk. Today, Amway sells all kinds of products, from household cleaners to cosmetics to vitamin supplements. It has become an American institution. There is nothing really special about its products, but it has a loyal customer base, so much so that saying you hate Amway is like saying you hate Wal-Mart. You can complain all you want, but it’s not going anywhere. There are enough people out there for whom using Amway products and trying to improve their financial situation through Amway’s business opportunities is a way of life and has been for generations. To give you an idea of how big of a company Amway is, it once broke its own record for biggest corporate donation to the Republican Party in American history.
Amway’s longevity is to its credit. Think about how much the profession of being a salesperson has changed since Amway was founded. You might be too young to have ever met an old-time salesman in real life, but do you remember John Candy’s character in Planes, Trains, and Automobiles? Will Ferrell’s character in Everything Must Go? A gentleman and a schlub, the salesman of yesteryear was all things to all people. Amway is a holdover from that era that managed to survive even as the world changed? We no longer have door-to-door salesmen hocking multi-volume encyclopedias, but we still have Amway. Likewise, we no longer have dinosaurs, but we still have crocodiles and cockroaches.
Review of the Amway compensation plan
If you operate in certain circles, you are probably already familiar with some of Amway’s products. You may have even seen them in your house when you were a kid because parents may even have bought them, long before you had ever heard the term MLM. If you have ever seen Nutrilite vitamins, Artistry cosmetics, or Legacy of Clean household cleaners, those are all Amway products. Like so many MLM products, there is nothing special about Amway’s vitamins, cleaning products, and cosmetics, and you can buy much cheaper ones that are just as good, but they have name recognition. One of the things that makes Amway such an attractive MLM is that there are so many products to choose from. Whatever kinds of products are in demand in your own warm market, you can distribute those.
The other thing to commend Amway above other MLM companies is the flexibility of its business opportunities. It costs money to join Amway, just like any MLM. A starting membership with Amway costs $62, which is one of the lower MLM membership fees out there. The great news is that being an Amway member does not require you to recruit any other sellers. If you want to, you can just be a pro-sumer. A pro-sumer is an Amway member who takes uses his or her Amway membership to buy Amway products at wholesale prices but does not engage in any of the network marketing aspect of the business. Not only that, but an Amway membership entitles you to discounts on lots of non-Amway products, as well. Having an Amway membership but using it only as a pro-sumer is a lot like having a Costco membership, for about the same price.
When it comes to the network marketing side, Amway also doesn’t stand out from the crowd. There are the commissions and bonuses based on the Adam recruits Bertrand, Bertrand recruits Claude thing. There are the Diamond and Platinum levels where you can supposed earn six digits in annual income, but which, realistically speaking, no one ever reaches. There are the training videos. And there is the ugly truth that at least 50% of Amway Independent Business Owners (IBO) don’t make any money.
What makes Amway’s business model special is that you, as an IBO, have complete freedom over how you choose to distribute and market Amway’s products. If Tupperware parties are your thing, pass the pigs in blankets. If social media is more your style, click away to your heart’s content. Selling to people at church, email marketing, selling through your personal website. Anything goes. You get to use your business talents in your own unique way. And if you don’t want to sell at all and just use Amway as a way to get discounts, that is a valid path to financial wellness, as well.
Advantages and disadvantages
- Amway has been around a long time. It has staying power. As MLM companies go, it is a cockroach among 8-tracks.
- There is a mobile application for placing orders and online business management.
- The controversy over whether Amway is a pyramid scheme has come and gone. It has been shown to be no better and no worse than so many other companies.
- Amway has a well-known image as a Christian company, and that is a major plus in some markets. If your warm market is looking for a less secular alternative to Windex, Amway is just the MLM for you.
- Amway’s wholesome image shields it from the sleazier sides of an MLM scheme. If you go to an Amway meeting, you do not have to worry about getting hit on by drunken, married MLM reps.
- You can still get the discounts even if you do not want to sell.
- Amway wears its conservative politics on its sleeve. You already know that an Amway event is not the place to show off baby shower pictures of your pregnant sister and her pregnant wife. If you know this, but you insist on going to the Amway meeting and showing the pictures, anyway, you have a lot to learn about being a salesperson. Allow me to recommend some movies to you.
- Amway sells a much wider variety of products than most other MLM companies. That gives you more choices and more opportunities.
- Even better, Amway does not dictate to you the specifics of selling. It doesn’t force you into Tupperware parties when you know deep down that the real way to make money is to sit on your keister in front of Facebook, Amway is not going to interfere with your good judgment. In that regard, Amway treats IBOs with a great deal more respect than most MLM companies do.
- You probably won’t make money. That is true of most MLMs, and it is true of Amway.
- Amway wears its conservative politics on its sleeve. If you live in a blue state, your association with Amway may not endear you to your neighbors.
- This is not to single out Amway, since this is true of almost every MLM, but Amway’s products are overpriced in the sense that you can get cheaper ones at your local supermarket. Anyone who wants to buy vitamins can either buy them from the supermarket or apply for the Amway wholesale discount themselves.
- There is the element of buying products in bulk. Unless you want to use the products yourself, that probably means that you will get stuck with a basement full of unsold merchandise.
Make no mistake. Amway is Middle America. It is probably the most generic MLM company out there except for its focus on the Middle America market. Its beauty is its flexibility in terms of products and marketing strategies. No matter which avenue you want to use to sell Amway products, Amway gives you the freedom to do it. The question is whether the company’s culture fits in well in your warm market. If you are a soccer mom in a landlocked state and you want to sell Amway products, knock yourself out. If you are a reiki therapist on a vegan cooperative down the road from the site of the Woodstock music Festival, Amway may not be your best choice of MLM company.
Okay, if you must know, my absolute favorite Midwestern windbag salesman moment in pop culture is the ending scene of an episode of Roseanne, where Dan (played, once again, by the immortal John Goodman) imitates his father’s incessant sales patter, which Dan has had to listen to his whole life. But even he’s got nothing on me. If you want to hear straight talk about MLM and how to avoid being part of the unlucky 97%, call me now.