Thursday, January 23, 2014

The Real Reasons Why Network Marketing Needs Reputation Management

It's interesting how the topics in this blog suggest themselves: why network marketing needs reputation management. It's not because there's a bunch of "meanies" out there... though there are. It's usually because they have some actions that looks shady, and people will point that out.

Recently, a company called BidForMyMeds was reviewed on BehindMLM. The company employed a whole slew of questionable conduct, including listing some other company's management as if it's their own, and implying a far tighter integration between the two companies than there actually is.  The truth is BidForMyMeds is a marketing company that markets BidRx through MLM. However, BidForMyMeds at many times implied that they are BidRX, and borrowed various BidRX media as if that is them.

So Oz / BehindMLM published the review with the questions, wondering if BidForMyMeds is really authorized to by BidRX as it is not behaving ethically. Within hours, Oz was sent a "cease and desist" email by BidForMyMeds' lawyer who demanded the review be taken down. Oz, who knows his rights, put the threat online instead, with even MORE questions and other information received, revealing that BidRX has multiple marketing partners, none of them pretended to be BidRX. And the MONTHLY fees ($7) that BidForMyMeds charged is almost 300% the cost charged elsewhere for BidRX ($2.50), and so on and so forth. AND if you pay even more ($17), you can benefit from recruiting other people who also pay the monthly fee.

That alone takes it into the potential pyramid scheme territory.

Then Kevin "The MLM Attorney" Thompson posted an entry on his blog about Cease and Desist.. cited Oz's reaction, then discussed when C&D should be used, and when it's an empty threat.

In the comments is a Mr. Jonathan Gilliam of Momentum Factor, touting their reputation defense can deal with "online Meanies".
...Our reputation defense team similarly serves
at the front end of a company's need to "do something" to combat online
Meanies. Lawsuits as you know are often just too distracting, involved and
expensive for some CEOs.
The good news is, companies CAN
defend themselves, often without the Meanie even knowing, via online
suppression strategies...
In other words, he just spam-commented a lawyer's blog with an ad for his firm. :)

And he basically claimed that he can "bury" negative comments through "suppression", which may or may not involve shill reviews. :)

But what's *really* surprising is what sort of people would employ Mr. Gilliam's firm...

Now to be fair to Mr. Gilliam, his firm offers a WIDE VARIETY of services to network marketing companies, so the following "What People Are Saying" quotes are probably NOT a result of reputation management 'success stories'.

But it's interesting that of a few quotes that Mr. Gilliam offered, at least two of them have quote controversial histories (and possibly a few more).

Out of the six quotes offered by Mr. Gilliam's customers, two names caught my eye: Terry LaCore, and Bill Starkey.

Terry LaCore, of LaCore Enterprises (Texas), is a long-time player in the network marketing world. His name got dragged through the mud a bit when it was revealed (partly by me) that he was a hidden partner in Rippln, something that claimed to be a new way to earn money, but is now just about dead. There's also a bit about his past when he was apparently involved in some corporate fraud and settled with the SEC back around 2008. He later founded bHIP and advocated for distributor rights when some of them jumped ship from Amway to bHIP and Amway sued them for leaving with trade secrets, and he paid for the defense (and won, when Amway realized they retcon the IBO agreement)

Technically Mr. LaCore should not need reputation management, and one cannot bury court records and such. Apparently later his PR firm recommended that he publicize his side of the story and that is actually the right way to do it, but I don't know if it has anything to do with Mr. Gilliam.

As for Bill Starkey, who runs iWowwe, he was recently famous for hiring Dawn Wright-Olivares, formerly CMO of Zeek Rewards ponzi scheme as his chief marketing officer.

Frankly, I don't see what is the attraction of hiring a Ponzi schemer as your CMO... Dawn's Only accomplishment was being elected MLM Person of the Year held by BusinessForHome, Ted Nuyten's website, mainly because most Zeekheads were asked to go stuff the ballot box. That made Ted's website a joke for months. Dawn also recently coughed up 8 million, the ill-gotten gains she got from Zeek, as part of plea deal.

Seems reputation management can only go so far... You can't save a client from shooting him- or herself in the foot, but you can dress up the wound... maybe. But bury the evidence of stupidity and shady behavior? Doubtful.

Frankly, the *real* reason why network marketing needs reputation management is its serious LACK of self-policing, and weak to non-existent FTC enforcement, that allowed various pseudo-MLM companies into their fold, and allowed the existing MLM companies drift into the legally gray area between legal direct sales and illegal pyramid scheme.

But the best way to "spin" the negative news is not to fight it, or bury it, but "take it over".

Kathie Lee Gifford
Cover of Kathie Lee Gifford
Any one remember Kathy Lee Gifford linked to sweat shops?  Back in 1996? You don't? Good! Because HER reputation management worked. She took over the issue, called attention to it, emphasized her innocence (I didn't know), THEN pushed authorities to investigate and make things better, even appeared with then President Clinton on this issue.

She took over the issue, and end up being regarded as a champion for anti-sweatshop, exactly the OPPOSITE of what she's accused of.

Too bad most issues in network marketing can't be handled this way...

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  1. I think this is worth reading, BTW.

  2. Are you familiar with IBOFightback? He's Amway's #1 shill. Not sure if he did it, but he was thinking of starting a reputation management business.

    1. I've seen his posting before, when David Brear and I were discussing Amway and he kinda butted in with his... propaganda. :)

  3. There's this episode of Chicago Fire where one of the firemen gets involved with a Pyramid Scheme. Season one, episode five. Ever watched it?

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