Community Marketing: Rip-off Or Reliable?

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The Chronicle

Yoliswa Dube-Moyo

“Would you like to be paid to do the shopping?” was a pickup line used by an Elamant member who recently wanted to recruit members for the Worldwide Membership Benefits Club and Consumer Insights company.
Of course, this seems like an easy way to make money.

“If your answer is yes, click on my inbox and I’ll tell you how,” the slogan continued.

The $ 200 you get every month after you join is not only tempting, it sounds like an easy way to make money.

Elamant apparently collects point-of-sale data from buyers and generates revenue through targeted advertising for dealers and marketing partners around the world.

All you have to do is collect purchase receipts and pay for them. However, in order to be eligible to get paid for the receipts you have collected, you must pay them a subscription fee of $ 100 each month. If you manage to recruit the number of people you want, there is no subscription fee and you will receive $ 200 every month.

Receipts must be from selected retail stores.

Elamant is growing in popularity in Bulawayo as more and more people try to make an extra dollar.

The Covid-19 pandemic has made it all the more urgent for people to track multiple streams of income.

The pandemic has affected the cash inflows of many companies, which has made network marketing more attractive.

In addition to Elamant, there is also Longrich, who works according to the Multi-Level Marketing Strategy (MLM), in which the salespeople both for the sales they generate personally and for those of the people they include in the plan be compensated.

Longrich manufactures, among other things, health and everyday products such as toothpaste, body wash and sanitary towels.

Other networks include DreamTrips, Money In Crew, and Avon – the list is endless.

MLM Companies That You Can Make Money From Two Ways; By selling products or by recruiting members, significant numbers of people, especially women, have poured money into promises of huge rewards.

“My name is Sabelo Ncube. I am based in Gwanda. I’m a senior manager at Elamant, making $ 1,200 a week and $ 200 a month from receipts. I heard about Elamant from my executive Tracy Moyo last year but wasn’t interested as I had lost a significant portion of my hard earned USD to other networks, ”Ms. Ncube said in a testimonial to encourage other people to join To join Elamant.

She continued, “I was added to a particular Elamant presentation in March of this year, and honestly, at the time I just thought it was a waste of time. Little did I know that on April 14, 2020 I said yes to Elamant, it would change my life. “

“I was registered as a member on April 14th and within five days I had three people under me. I pushed and pushed and in less than two weeks I had broken the rank of consultant and now I have the rank of senior manager, “said Ms. Ncube.

MLM, also known as Pyramid Selling, Network Marketing, and Referral Marketing, is a controversial marketing strategy for selling products or services where the MLM company’s revenue comes from a non-employed workforce who sells the company’s products or services while the die Income of the participants is derived from a pyramid-shaped or binary commission system.

Although each MLM company has its own specific financial compensation plan for paying out income to its respective participants, the common characteristic of all MLMs is that the compensation plans are theoretically only paid out to participants from two potential sources of income.

The first is paid directly to their own retail customers from sales commissions of participants. The second amount is paid out of commissions based on the wholesale purchases of other distributors below the participant that those other participants have recruited into the MLM. In the organizational hierarchy of MLMs, these participants are referred to as their own downliners.

Ms. Caroline Dube, who has benefited from Money In Crew, said on another MLM network: “Money In Crew is real. It’s not a pyramid scheme, but a club-like situation where nobody stays at the top. It goes into rotation and once you hit the highest level of $ 468, you will be kicked out of the system and you can start over. “

To join Money In Crew, it takes $ 13 and two people to recruit. The $ 13 can “grow” up to $ 468.

However, for some, MLM networks are a big red flag. They believe they are Ponzi programs to milk people of their hard earned cash for no real benefit.

A few years ago, hundreds of people invested in Geozing Pawnbrokers, led by George Zingane, who was later acquitted of $ 4.2 million in fraud after the pyramid scheme collapsed before the investments achieved the promised 35 percent return on investment provided.

Geozing pawnbrokers had become so popular that customers took out bank loans and sold their cars and homes to invest.

Despite the risk that their money will not be sown on fertile ground, people are still borrowing money to join MLM networks.

The promise of financial freedom drives most to join in the face of recruiters who testify of building homes and buying cars with proceeds from the networks.

“I’ve benefited so much from Elamant even though people think it’s a scam. I get paid for the receipts I submit and I am very happy with my investment. I’m not officially employed, so this money goes a long way towards satisfying my daily needs, ”said Sandra Moyo, who has reached the consultant level in the network.

MLM sellers are expected to sell products directly to end users through relationship referrals and word-of-mouth marketing. Most importantly, they are encouraged to recruit other salespeople to join the company’s distribution chain so they can run down. Line distributor.

However, there is some stigma attached to the networking marketing business, especially with multiple levels that can be characterized as pyramid schemes.

“I don’t do pyramid schemes. Anything that forces me to pay money and get people to join is a scam, ”said Mduduzi Ndlovu.
The allure of network marketing is that a person with lots of energy and good sales skills can build a profitable business with a modest investment.

The Common Market for Eastern and Southern Africa (Comesa) recently warned consumers in the trading bloc to beware of pyramid schemes that cheat people off of their hard-earned money.

In a statement, the Comesa Competition Commission (CCC) said its attention had been drawn to the activities of a system called “Crowd1” which is being marketed as a multi-level digital company and is being studied in some countries.

“The Comesa Competition Commission (CCC) advises consumers in the region to look out for pyramid schemes that encourage people to join others and, for a fee, recruit others to make money,” the block said.

“Consumers are therefore advised to exercise caution when using Crowd1 and also to do research on companies they want to invest in to avoid losing their hard-earned money.”

The CCC said the commission found authorities in the Philippines and Namibia found that Crowd1 members made money by recruiting others and that the organization has since been banned in Namibia. In the Philippines, the authorities are said to have given Crowd1 an injunction to operate without a license.

A good rule of thumb, according to the U.S. Federal Trade Commission (FCC), is that single-tier network marketing activities are usually more reputable than multi-tier systems where employees make money based on the number of distributors they hire.

Some reputable examples of one-step network marketing activities are Avon Products, Mary Kay, and Excel Communications.

Last month, the police and the Reserve Bank of Zimbabwe cracked a pyramid scheme operating in Harare, claiming they were providing financial services without the required license, in violation of the Chapter 24:20 Banking Act. They searched the offices of KWD Digital Marketing and arrested dozens. KWD promised people that if they deposited money with them, they would double their investments within a month.

At the time, National Police Deputy Commissioner Paul Nyathi said the programs were being carried out in Bulawayo, Gweru, Kwekwe, Mutare, Masvingo and other urban centers.

“These are fraudulent investment programs where existing investors get returns, not from real market investments from their funds, but from contributions from new investors until the program fails to attract new investors and collapses,” said Asst Comm Nyathi.

“If someone promises you unrealistically lucrative financial returns within a short period of time, it is likely a fraudulent system and further due diligence, including a review by the authorities, is always advisable. These companies engage in banking (taking deposits from the public) in violation of the Banking Act (Chapter 24:20). Section 5 of the Banking Act prohibits anyone from conducting banking transactions unless that person is licensed as a banking institution under the Act. “

Anyone considering joining a network marketing company should do their research before making a decision and consider the questions: Was this an opportunity to make money selling products or recruiting others? What is the company’s founders’ track record?

Are you personally enthusiastic about the products? Are people you know enthusiastic about the products? Is the product being advertised effectively? Do you see a relatively quick path to winning or a long time on the water? – @Yolisswa

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