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Market America Investigation

In the course of our researches, we always check online sales portals like Amazon and eBay. There, we find more unbiased customer reviews than the ones supplement companies choose to put on their product websites. That way, we get a balanced idea of how people who’ve bought those supplements feel about their purchase.

Recently we were looking into the Isotonix range from Market America, and were surprised to see how many people were selling products from that range on both Amazon and eBay.

And we were even more surprised to see how many other Market America products were being sold there, such as their Isotonix and TLS Weight Loss Solution ranges.

What startled us most, though, was the number of multiple bottles of Market America products that were on sale there: it looked like people had ordered bottles in bulk and decided not to finish what would have been a very long course of that particular supplement.

Had they given up on their long-term supplement course, or was there something a little more sinister going on? We love a mystery, so we looked a little closer at Market America and their supplements … and this is what we found.

Market America

WHAT’S THE COMPANY?

Market America sells literally thousands of proprietary products through its website, including tonics, weight-loss programs, health tonics, supplements and household cleaners. The most popular (and profitable) of which is the Isotonix range of supplements.

Founded in 1992, Market America is the brainchild of multimillionaire JD Ridinger and his wife Loren. After Ridinger’s fifteen-year learning journey through the direct-selling industry, which included working with Amway and Legacy International, he and Loren started off by selling ‘cheap costume jewelry and ersatz weight-loss products’.

Loren started up the Motives and fixx cosmetic lines, which have had endorsements from such figures and Eva Longoria and Kim Kardashian.

SOUNDS GOOD – WHAT’S THE CATCH?

Other names we’ve heard people say were mentioned by Market America were those of Warren Buffett, Bill Gates, Amazon and Yahoo. They were just mentioned, apparently, but they did leave those less inclined to check things out to assume that they’ve all been involved with the company one way or another.

To start with, Bill Gates, Amazon and Yahoo weren’t exactly closely linked with Ridinger: they were actually early investors in Shop.com, which was then sold to Market America. As for Warren Buffett, we couldn’t find anything at all to link him with the company in any kind of way.

There are other little niggling issues, such as allegations from the Securities and Exchange Commission of the company’s violation of federal securities laws. Although there wasn’t any kind of admission or denial, Market America did promise never to do what they did again.

One catch is the problem with the product: the quality of Market America supplements is, we’ve discovered, the same as that of products you can pick up in your local health food shop for half the price.

But a very big catch is the way these products are sold: yes, you can buy them from the Market America website, and you’ll see many affiliate websites linking to it. These could be sites belonging to medical professionals around the country wishing to add to their bottom line, or those of not-so-independent Market America distributors (often referred to as UFOs, or UnFranchise Owners).

So we went to the Market America site and looked up ‘The UnFranchise Business – a proven plan for your financial success’. Reading through the initial paragraph, we saw ‘There are two ways to earn income’. Basically, there’s the ‘gross retail profit by servicing the needs and wants of 10-15 Preferred Customers’. And then there’s the option to ‘duplicate your efforts by creating a sales organisation with others doing the same’.

And then, not too far below we found the diagram headed ‘Three ways to earn income’.

OK, so that was confusing, but there’s more confusion to follow later on, when we take a very quick look at what’s in Market America’s operations manual.

So what is ‘The UnFranchise Business’, anyway? Well, Market America prefers its name to be linked – however indirectly – with the concept of franchising, rather than being seen as a multi-level marketing operation. Even though that’s exactly what it is. You could even go so far as to call it a pyramid scheme. But more about that later.

WILL THEIR PRODUCTS HELP ME LOSE WEIGHT?

Good question.

While we were looking through Market America’s most recent TLS Weight Loss Solution blog, we couldn’t help remembering some years back when Dr Oz got himself an official wrist-slapping – together with a lawsuit – for promoting a couple of alleged weight loss products.

One of these products was Garcinia Cambogia, which he heralded as the kind of supplement you could take and watch the pounds fall away without having to take any kind of exercise. How appealing did that sound?

And the other product was Green Coffee Beans, heavily promoted on the Dr Oz show by someone who dressed up to look like a real doctor.

This was the guy who’d arranged things so that anyone googling Green Coffee Beans would land on one of his Green Coffee Bean websites. And there, they’d buy one of his green coffee bean products. These products were made from all the green coffee beans he’d bought up from other suppliers, leaving them with very little stock of their own to sell – if any. How ethical does that sound?

It sounds much less ethical than the people who’d written the second clinical study about green coffee beans: the first version didn’t hype those beans as much as people selling them hoped. The second version told the world just how awesome these beans were, without being altogether honest about it. But then the people who’d written that second version made their ethical decision and retracted it.

And now we’re back to the present day. Just out of interest, what do you think the most recent TLS Weightloss Solution blog is telling Market America distributors to push – sorry, promote?

It’s not just Garcinia Cambogia. And it’s not just Green Coffee Beans. Yes, folks, this edition of the blog is promoting (fanfare, please) TLS Green Coffee Plus Garcinia Cambogia.

There’s the slight possibility you could lose weight with this product … but then again there’s also the absolute certainty that at $39.95 for a 30-day supply, over time you’re going to end up a lot lighter in the pocketbook.

WHAT’S THE PROBLEM WITH THE COMPANY?

Jon M Taylor, President of the Consumer Awareness Institute, refers to a study of MLM companies like Market America which shows that ‘99.6% of new distributors’ results end up in financial loss’.

And Market America are upfront and honest about the fact, albeit only in the tiniest of tiny print right at the back of their recruitment booklet.

The biggest problem is that Market America is different from other MLM operations in that instead of having one downline, it’s got two. That means distributors can’t make any money unless both their downlines have performed according to the rulebook each month.

Or, as Market America itself says in an operation manual, quote:

Failure to meet the Three-Q-Date Period requirements—150PBV ordered and Form 1000 submitted—will cause accrued Group Business Volume totals to be flushed (erased to 0) and accumulated Personal Business Volume to be purged erased to 0) [sic] from the distributor’s BDC(s).

Got that? Good.

Translated into plain English, that means if Market America distributors haven’t bought or sold enough product in a given period of time then their bonus – that’s where all their best income comes from – gets withdrawn and, strangely enough, finds itself getting redistributed elsewhere. It’s hard not to assume it gets handed out further up the upline. A lot further up.

The odds are definitely stacked in favour of those at the very top of all those downlines, as much as they’re definitely stacked against the newbies lured by promises of an average $60,000 annual income, but who haven’t read the small print.

First off, those newbies have to find at least $139 just to join Market America, plus $399 for the starter kit. And then there’s the initial product purchase which was around $700 last time we looked (well, you’ve got to buy products from somewhere to sell them on to your customers).

And let’s not forget the regular ongoing monthly payments for products and web support. Plus the annual fee just for being part of Market America.

Then there are other costs to take into consideration: newbies need to attend presentations and other events featuring appearances from some of those considerably fewer than 1-3% Market America personnel who make much more than the $1,000 referred to earlier.

And in fact they make much, much more than the ‘average’ $60,000 a year touted. Then again, they’re much further up the Market America upline than the average distributor.

Local events, whether they’re just cult-like get-togethers or proper sales training seminars, can cost $30 or more to attend. Regional ones are a bit steeper at $100+, and as for international events, those would be priced at $500 or more. So let’s not even think about travel and accommodation costs here.

But that’s just for selling the product.

We mentioned the downline aspect of Market America earlier on, and how it differed from other MLM operations in that rather than just having one downline to depend upon for meeting your monthly sales quota, there are two.

Essentially, that’s halving the chances of actually making any money because both legs of the downline have to perform appropriately for any bonuses to happen.

And where would you get your downline from? Friends, family, co-workers, strangers on the street – anyone capable of drawing breath is a potential downliner and basic recruitment targets.

You can lose a lot of friends that way.

Some complaints online (and there are lots and lots of those) include the number of people you’re required to try and place in your downlines. One bitter ex-Market America distributor wrote on ripoffreport.com that they were expected to find 300 people – a week.

CONCLUSION

What we’ve discovered during our investigation makes for depressing reading.

Personally, we’ve only been approached just the once about joining an MLM business, by a then friend who’d just been converted.

She’d even brought her sponsor – the woman who’d got her into the business in the first place – to help her try and convince us this was the best business since the dawn of time, and now was the time to join.

And the sponsor Would. Not. Stop.

We asked the sponsor – several times and very politely each time – to drop the subject, but she kept on trying to convert us, so we had to ask them both quite firmly to leave.

We’d really liked our friend before this happened, and we’ve never heard from her since. But as we’ve said before, in this business you can lose a lot of friends. And – as we’ve seen – you can lose a lot of money, too.

So we’re not too impressed by this kind of business in general, but we’ll let someone who went into Market America and managed to come out the other side in one piece has the final word:

Don’t be fooled into thinking MA is a way to “own your own business. It’s not. Don’t be fooled into thinking other people who failed at it must have done something wrong. That’s the furthest thing from the truth. The statistical fact is (look at the tiny print on the back of their recruitment booklet), only 1-3% of people make any profit (that doesn’t mean good money). Right there should be a sign that this is a scheme. I thought I could make something legit out of it in my approach, but even that was stifled by their business model. It was impossible to do and every financial gain works in their favour, not yours.

Be warned.

END

Disclaimer: Our reviews and investigations are based on extensive research from the information publicly available to us and consumers at the time of first publishing the post. Information is based on our personal opinion and whilst we endeavour to ensure information is up-to-date, manufacturers do from time to time change their products and future research may disagree with our findings. If you feel any of the information is inaccurate, please contact us and we will review the information provided.



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