A spot to discuss in-class topics

Attentive Sixties J-School Students Attentive 21st Century Media Students

Monday, August 02, 2004

Merrimack College CM 401A "The Sixties"

The Green Tea company you're talking about has quite a presence on overnight talk radio, please don't ask how I know this! The promoter is essentially interviewed about the amazing qualities by the "host". This product does everything imaginable!

I didn't know about the underlying structure, though. This sure looks like Multi-level marketing (AMWAY, Mary Kay, Avon). The sooner you're in, and the more people you persuade to join, the more money you make.

Companies make their money by selling the product to sales staff, not the customers. A salesperson buys the product in wholesale quantities at "wholesale" prices, plus shipping, and then distributes it to customers.

So the salesperson has a gross of Green Tea in their apartment, bought and paid for, and then sells it on. The company has already made a small profit, not just broken even. Any procedes from further sales are divided between the seller and the company.

The distribution of these profits depends on how many rungs below top management you are. The person who recruited you gets a cut, so does each additional level of recruiter above them, on up to top. The seller has to find people to buy wholesale from them to make any money.

You soon use up all your friends and family if you put in the effort required to make it work. Having had friends involved in this, you soon learn to screen their calls, which suddenly spike upward. While a 30-cent roll of TP is nice, I don't need a crate of it.

Tread carefully here!

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