Thursday, July 3, 2008

Mary Kay is a Scam!

Any marketing blog should cover a company that uses the networking, party plan for success. Admittedly this plan works, however it does not work for the hopeful housewife, or hopeful entrepreneur, or better yet the person who want out of their dead end corporate job.

I admit, Mary Kay makes good makeup, but this is not how they make their money. They make money on getting you to become an Independent Sales Representative. The kit only costs $100 and you get a ton of products for the value. After you join someone higher in the food chain will encourage you to carry inventory. I met on girl that had about $6000 dollars in inventory. Are you kidding? It takes years to sell this amount of makeup, no matter how wonderful of a product you are sell.

The way to success in a pyramid scheme of this type is to recruit and encourage inventories, 24 X 7. Mary Kay is now to to the point where they are giving bonuses for recruiting alone. What is interesting about this is if you study control systems, you learn to put monetary incentives around the actions you want your reports to follow. Mary Kay does this very well. I won't sign up.

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