International Law

Seth Godin Endorses MLM

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According to Seth Godin, the new marketing secret, is something all multi level marketers knew about years ago.  So is Seth endorsing MLM for these hard economic times? Not an April's Fool's joke.

• "This, in two words, is the secret of the new marketing.
  
• Find ten people. Ten people who trust you/respect you/need you/listen to you...
  
• Those ten people need what you have to sell, or want it.
  
• And if they love it, you win. If they love it, they'll each find you ten more people (or a hundred or a thousand or, perhaps, just three). Repeat."
  

Doesn't this sound like the class pitch in any pyramid scheme; you find two people, who each find two people, who ...?

So, is Seth endorsing MLM?

No, and the key differnence is the next line, which I left out, in which Seth says:

"If they don't love it, you need a new product. Start over.

Your idea spreads. Your business grows. Not as fast as you want, but faster than you could ever imagine."

Where MLM fails a business model for distributing goods is that when the network fails to sell the goods, the ten trusted people don't love it, MLM doesn't deliver a new product: it morphs into selling the opportunity to sell the bad product.

Exactly how selling the opportunity to sell a product, which doesn't sell except with the rider that you can sell the opportunity to sell it, is an attractive proposition is a marvel of our decision making apparatus.

Rotten oranges won't sell, but you can dress up the opportunity to sell rotten oranges and sell the opportunity - especially if you call the opportunity a "franchise", with a proven business model.

Contrast the standard MLM model driven by recruitment and what Godin is pitching.

The seductive appeal of find ten people who find ten people, who ... crashes into the hard reality of "you need a new product, start over."

Godin explains more about this in his book, Tribes: We Need You to Lead Us

Full post as published by Misleading Advertising Law on April 02, 2009 (boomark / email).