Network Marketing... where's the catch? — Business marketing , digital marketing , direct sales , , , network marketing — Marketing in Lebanon
Sunday, March 30, 2008

Network Marketing... where's the catch?

Is it a good use of direct sales and word-of-mouth marketing? or another means of deceiving customers?

This thing is all over the place! I just got two proposals this week to join such "networks". It sounds odd, it kind of is.

Apparently is a new trend that has been spreading like cancer on my previous university campus... Or so have I heard from a fellow alumni and current member of this network. OK, so my source is not the best there is out there! ...But I would not be surprised.
First I thought it was a smart way to sell gold. Our Brand management teacher, from South Africa, was explaining to us a couple of weeks ago how almost impossible it is to market mines. According to her, the best way to gain more money in these types of industries would be to increase the production efficiency. The product being hard to differentiate with a "brand" and having strict standards, is the same produced everywhere. Well, maybe not.
This just might be the added value some NEW consumers would be interested in. I think it's fascinating. Of course in the long run, the point of the game becomes the game itself and the gold becomes the tool of the trade... but it's still smart.

Furthermore, I have just received an email from an old friend, check below:

Hi Friends,
it looks like a real MLM ( Multi layer marketing ) profitable money. It is an Emaraty site called "" this site OFFERS you $50 as u register to it, then when you invite people to it you get $10 dollars on each person, and when your friends invite others u get $1 dollar on each person.
All this money is transfered to your account thru Western Union.
All what you have to do is click on this link and register (keeping the real address confidential because it involves my friend's username.)

Yes, yet another Network marketing website. well if you think of it... it does get the customer highly involved! ... and isn't that the current global marketing orientation?


Nadim said...

actually in reference to tht, the gold mine thng is actually a scam, and plus its illegal in most of europe and the states. its called a pyramid scam. its a really a good idea in which a lot of ppl will fall for. but the longer it takes you to join, the more chances of you getting ripped off become. mostly cuz the lower u down u go the harder it becomes for you to convince more ppl to join. if i remember correctly it started it out over here with a 600$ joining fee, and if u recruit 2 or 3 ppl u get 300$ back, etc etc.
now i dont know about you, but personally i thnk you'd have to be an idiot to join up, but apparently teh world has its share of idiots otherwise the scam wouldn't work

Unknown said...

I was actually thinking about it... if it is actually possible for you to get your money back trough such a system, it would be financed by the amount of cashflow generated. As long as the pyramid continues to grow, you're safe. But, can it actually be indefinite? I doubt.
If you consider the amount of cash, this could actually function in a model similar to a banking system....

Anonymous said...

Hello Nadim;

Being the fellow Alumni Youmny referd to in her post. I'd like to tell you that not only idiots join this network! Some moment-abusive people do! Though I'd agree with you that such people are exploiting other 'idiots' at the bottom of the pyramid. Hoping that bottom would be too deep (several levels below)and totally disconnected from their surrounding social network!

I'd also agree with you in full that this particular network seems to be a scam! I labeled it that way the 1st time I was introduced to it, and I referred to its members as 'mentally inferior'! But later on, when I realized how fast the epidemic is spreading, and that there is a considerable revenue behind it, I joined willingly. Later investigation proved to me that the company is "virtual". No trace for the company was found in the land where it was stated to originate!Nor for the name of the owner!

Yet, several levels already joined below me, almost all of them returned their capital! Some of them ordered gold and received their orders!! I see no reason for this network to stop unless a legal or media issue appears to prove it is a scam, or all people in a country have joined (irrespective of financial capabilities). ppl will still join when they see their close-others have made large profit!!!

On the other hand, representatives of the company claim that GMI is being registered in the Ministery of Finance! I am waiting for paper proof of this!

My explanation would be that they noted this scam is so profitable to them that they decided to 'legalize it'!!!

Don't be deceived by the large amount of commission they give, simple Math might illustrate they are making much more significant figures :)


Anonymous said...

Good day Youman
Yes, these pyramid schemes are illegal in several countries but people do make money out of it - the trick is to get in as quickly as possible
There are however legal versions called multi level marketing and it is used by global companies as well. many direct marketing companies use this concept to trade in product and create profit opportunities right through the 'pyramid' for particiapting customers cum sales people
I am just always amazed at people's creativity!

Dany Moussa said...

In fact i joined GMI few months ago and i made about 3000$ so far and received my item after request as well as my friend who's making 600$/week.
The difference between a pyramid and network marketing is the product. Everyone has the right to be afraid of it. but when the product is found the company becomes totally legal.

Anonymous said...

My name is samer salha LAU computer engineer , and i want to offer 1000$ for any one who prove for me that gmi is a scam , i wish i can hear a proof! , but facts speacks: how a scam live for 9 years ?, how verisign protect a scam? , how largest database for busness talk about goldmine as an existing and registered company?,how Andre roshan the owner can win a court case on an abuser who tried to abuse gmi as a scam ? how the norway embassy in kalalampur say that this company do exist and registered and legual?can anyone answer me ? or when facts speaks idiots shut up? microsoft is a scam then ;)

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