Thursday, October 3, 2013

Alarms Raised at Colleges Over Pyramid Allegations of MLM Vemma

Vemma Product Photography and Ad
Vemma Product Photography and Ad
(Photo credit: themichaelminer)
Vemma is a potions company that two years ago created "Verve" energy drink and came up with a strategy to get college kids (and for a while, high school kids) to promote it as brand partners, which is just another fancy name for affiliate (i.e. consultant / distributor / member / whatever). However, they need to buy a case, then try to sell it.  And they're lured in with promise of "easy sell, everybody needs energy drinks" and rewards such as "free car" (with a lot of fine print).

Energy drinks are not what they cracked up to be, and Vemma reps are making a LOT of potentially misleading claims, like their Verve is "healthy" (and other energy drinks like Red Bull and Monster are not). It's been analyzed that they contain roughly the same amount of caffeine, the primary active ingredient, so any claim that Vemma's drinks are healthy(-ier?) is unfounded. Caffeine can kill people, and proliferation of energy drinks made that even more widespread.

Previously MLM Skeptic have covered the energy drink market, and found it to be in a world already saturated with conventionally marketed products (namely Red Bull, Rockstar, Monster, etc.) and thus viability is in doubt.

Now we find Verve pushers basically making up bull**** about how *their* drink is healthier than other drinks when it contains the same active ingredients, in the same portions and thus is just as dangerous.

But Vemma's Verve is doing something else: burning through participant's pocketbooks. And most participants are college kids (who have little enough money as is)

According to Vemma's own "income disclosure statement" of 2012, 75% of its reps makes less than $1327 a year.

US "brand partners" (i.e. affiliates) are expected to buy a 2-pack, EVERY MONTH. They arrive at your house whether you order them or not through "autoship". They say it's for your "convenience". It's more like they just want to automatically take money from your bank account.

And you are rewarded for YOUR PURCHASE of Vemma products (the points are even called "rewards points"). You are NOT being rewarded for SALE of those products. This is in direct contravention of the Webster vs. Omnitrition dicta decision: MLM rewards must be based on RETAIL SALES of the products for it to fulfill the Koscot test.

What's more telling is out of alleged 50K "brand partners" less than 500 had qualified for car... According to the CEO himself.... Is that EVER? Or just current? Even if we assume it's "current", that's <1% of reps

You'll see a bunch of defenders on the NYPost article engaging in every thing from victim blaming to "demand for parity", from cult speak of success to negativity avoidance... the bad arguments documented on this very blog.

It's clear that Vemma has wandered far from its roots to provide liquid nutrition, and had morphed into a recruitment scheme where they subsist on recruiting new vulnerable teens with lures of "free car, easy sell", and slam them with autoship every month until they quit or actually find more vulnerable teens like themselves to create a "sales team" and break even (leaving his downline to either quit or replicate the system).

And that, is a very dangerous practice.

What's more, Vemma has a reputation of being loose with the truth. Its CEO was quoted multiple times claiming stuff that are untrue, such as "NBA had vetted Vemma". And its reps, brand partners, whatever, is also fast and loose with the truth, making bogus claims about Verve being healthy compared to other energy drinks, and other potentially liable bogus claims.

What's worse is Vemma is now attracting people from herbalife, who were encouraged to leave before the FTC investigation, as Herbalife now is actually watching what its affiliates say about Herbalife and its products and how they are recruiting downlines (and Vemma is doing NONE of that). MacDougall, former Herbalife rep, one of "Founder's Club" member, now at Vemma, had stated that she felt handcuffed at Herbalife. Clearly, Vemma don't give a **** about what sort of potentially bull**** its reps say / use to wrangle more "brand ambassadors".

The fact that they at one time allowed high school kids, yes, minors to promote energy drinks should give you pause as well. It wasn't until some loud complaints that its CEO cancelled the practice, but he's NOT kicking out the kids either. Those already in will STAY IN.

So be VERY careful about joining Vemma. You will be fed a bunch of baloney, then your wallet emptied, then be told it's your fault.
Enhanced by Zemanta

No comments:

Post a Comment