Serious Lessons From Recent MLM Failure...
Sometimes we learn more from failure than success. Let's take the recent MLM failure of three companies. Efusjon, Buzzirk Mobile, and iJango. And let me make it clear that when I say "mlm failure," I'm not saying the companies have gone under, but have simply had massive public image "crash and burn" experiences.
First of all, Efusjon. Efusjon launched with a ton of hype, a unique story, and guns blazing. You may have heard of the Facebook application growth strategy that is the reps primary pitch. Unfortunately, the truth is there is NO Facebook connection. According to Rob Towles, Efusjon President, the following statements about Efusjon are all completely false:
1. The owner of Facebook is involved with Efusjon- false.
2. Microsoft is involved with Efusjon-false.
3. Efusjon has an exclusive contract with Facebook- false.
4. The Efusjon compensation plan has 300-500 patents- false (the plan has no patents.)
Next, let's talk about iJango. Also had a ton of hype, and a unique story based on a connection to Google. Unfortunately, the BBB investigated the claims, and here is their statement:
"In promotional statements made by iJango representatives online, iJango claims that their business has "partnered with the Google" in order to "become the biggest Network Marketing company online." On August 6th, 2009 BBB contacted Google regarding their affiliation with iJango and the Google Press Team provided the following statement:
"We are not affiliated with that company. Our trademark team is looking into this issue, thanks again for bringing it to our attention." End quote.
Furthermore, according to clicksniper dot com, the founder of the company, Cameron Sharpe, is a long term scam artist, fraud, and deadbeat dad.
The last example is Buzzirk Mobile. Very hypy, great story, and rapid growth. The company was supposed to deliver a complete mobile plan including internet for $69.95 a month. But just a few months into their rapid growth, the provider, Zero1, has pulled out, citing breach of contract. Shortly after that, Laptop mag did something unprecedented when it rescinded the CTIA award they had presented to Buzzirk Mobile and Zero1 just a few months earlier. It's the first time in their 18 year history of giving the award that they have rescinded one.
Laptop Mag: "Effective immediately, we are rescinding the Best of CTIA Award given to Zer01 Mobile at April’s CTIA Wireless 2009. We’re taking this extraordinary step, because of serious ethical questions that have arisen about the company. We can no longer endorse its service and therefore are compelled to warn our readers to avoid it." End of quote.
Here's the bottom line:
1. Good hype isn't a good reason to join a company.
2. Any company that claims connections to Google, Facebook, or other large, well respected company needs to be thoroughly researched. These types of claims are rarely true.
3. "Getting in early" rarely leads to business success. Long term business success comes from long term business models.
It's sad that so many people lost money in these three companies, but we live in a "buyer beware" world where we all need to savvy and do thorough research before joining a direct sales opportunity.
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Dave Sherwin is the co-founder of the Lighthouse Marketing System, Blogger, and writer. Get tons of great, FREE tips and marketing mojo at his blog: