Sat 3 May 08 · Filed under Pyramid Schemes & MLM, Scam Busting
To many, my fight against Mary Kay Cosmetics is puzzling. Why would I want to waste my time with it? After all, they’re only selling lipstick. It’s a harmless company started by a little old lady 45 years ago who wanted to give women an opportunity.
WRONG! Mary Kay Inc. is anything but harmless, and that’s why it’s so important for me to continue to educate people about the company. They are running a scam that brings in $2 billion in sales to headquarters each year.
Where does this money come from? Often from those who can least afford it. The name of the game is recruiting and frontloading. Bring her in and get her to buy an inventory package of $600 to $4800 right away. (If she doesn’t buy within the first couple of weeks, the chances that she will buy anything at all go down exponentially.)
Start with the largest package and work your way down. All the while, tell the new Mary Kay consultant that she can’t be successful without a “full store” of products. Tell her that if she wants to be at “profit level” and really start bringing in money for her family, she needs a lot of products. After all, you can’t sell from an empty wagon!
Mary Kay is a recruiting scheme. The vast majority of the products sold to the consultants is never resold to an actual customer. Is it because the consultants really don’t try to sell? No! It’s because the products are of mediocre quality and are overpriced. Besides that, women have oodles of choices on the internet and in the stores. There’s just no need to go through the hassle of dealing with a Mary Kay lady, especially when you know that she’ll eventually try to recruit you and never let up!
Here are some numbers and facts that I pulled together for Pink Truth, my consumer education site about Mary Kay. Word on the street is that recruiting figures are way down in the past year, but the below numbers are the most recently reported numbers from Mary Kay Inc.
From Pink Truth:
I thought it would be interesting to take a look at some real figures regarding Mary Kay and consultant turnover. We often hear pro-Mary Kay women (and their brainwashed husbands) rave that there are millions of women who have had wonderful experiences as consultants, so the company must be fantastic.
Now here’s my theory. Are women quitting Mary Kay because it was everything they wanted and more, and because they were making money doing it? Or do they quit because they are dissatisfied and are not making money? I submit to you that the reason women quit being independent beauty consultants for Mary Kay Cosmetics is by and large because of failure in the business.
I do understand that some may be perfectly happy in Mary Kay, but quit because of family circumstances or other reasons. I’m just saying that the vast majority likely quit due to a negative experience.
Over time, Mary Kay has been increasing its beauty consultant count. Now it’s important to note that this is the count of consultants at any given time, such as the year end total. The number disclosed by Mary Kay does NOT include all the women who may have come and gone during the year. Mary Kay simply picks a point in time and says “Today we have X consultants.”
In the United States, there were 500,000 consultants in 2001. In 2005, that number was 715,000. Worldwide the numbers have been growing quite a bit faster. (Hence the push to open new markets like India and the Czech Republic.) In 2002, there were 950,000 consultants worldwide. In 2005, that number was 1.6 million.
Here’s where it gets interesting and where we find out the truth about the number of consultants that Mary Kay Cosmetics churns each year. I’m using United States figures below, because of the disclosures that Mary Kay made last year.
In 2006, Mary Kay disclosed that the company had over 700,000 independent beauty consultants in the United States. This was similar to the 2005 reported figure of 715,000 consultants in the United States. This implies that at the current time, the number of consultants is staying relatively stable. (i.e. For every consultant recruited, one drops out.)
Mary Kay stated in its response to the FTC’s proposed Business Opportunity Rule , that there are 2,400,000 “disclosure opportunities” (meaning interviews) per year. That’s 200,000 women interviewed per month. Mary Kay Cosmetics further stated that there are 40,000 new recruits per month. (Thank God those other 160,000 per month said no… a total of two million women per year who turn Mary Kay down.)
At 40,000 new recruits per month…
That means that during 2006, Mary Kay Inc. recruited 480,000 women in the United States, and 480,000 women in the United States quit. Add the 480,000 quitters to the 700,000 (or so) U.S. consultants on the books at the end of the year, and we’ve got a total of 1,180,000 (yes that’s over 1 million) women in the United States who were “in” Mary Kay at some point during 2006.
What a staggering churn rate, though, isn’t it? Depending upon how you look at it… 41% of the 1,180,000 involved during the year quit. Or of those 700,000 on the books at the end of the year, 69% of them will quit in the following year. 480,000 women churned and burned in 2006.
During 2007, Mary Kay will burn through another 500,000 American women. And in 2008, they’ll burn through another 500,000. And so on every year….
Mary Kay, destroying half a million women’s lives every year.
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MF04 wrote @ May 5th, 2008 at 7:27 am
I don’t understand why people write such negative things about this company. I have been with Mary Kay for 1.5 years and I am very proud of it. I think the people that dislike the company are the ones who gave up and quit because they failed to put the effort in. People want the get rich quick method, and if they don’t get there quick enough, they quit. With any job, you have to work hard for what you want. I am sorry for the ones who chose to give up. I truly believe this is a fantastic, positive company that I am so proud to be a part of and I know I will be successful with it.
99% of women who get involved with Mary Kay lose money. Do you think they’re all lazy losers who didn’t try? Or do you think just maybe there’s a problem with the MK system? You sound like you really need some pink truth! http://www.pinktruth.com
MF04 wrote @ May 5th, 2008 at 8:15 am
I am sorry but I respectfully disagree. I would never call anyone a lazy loser. I do not presume to know what anyone’s personal situation is. Not everyone joins Mary Kay for the money. But I do know this company works and I am very proud to stand behind it. I have seen pinktruth and think that is sad that people who want nothing to do with Mary Kay spend their time writing about it. I choose not to expose myself to such negativity. That’s fine you choose not to like Mary Kay, but everyone is entitled to form their own opinion. ~
Well you may not have used those words, but it was close when you said “… the ones who gave up and quit because they failed to put the effort in.”
And I’ll tell you why I spend my time writing about Mary Kay: Because the scam needs to be exposed. Enough women have lost enough money. Women need to know that they’re getting into nothing more than a pyramid scheme… throwing away money that could be used to feed their families. Enough!
Darlene wrote @ May 5th, 2008 at 2:10 pm
Tracy, I have been in Mary Kay for 9 years, recruited by my neighbor who never went to anything with me. Fortunate for me I am a self starter. I have been #1 in sales and recruiting for all of my 9 years within my unit. WHY? Because I work the business like a business. I never tell women to order inventory they cannot afford, I don’t recruit women who are on the verge of welfare because that would be asking too much of them. I think quite a few women in MK have ruined the reputation of our wonderful company. It is chrisitan based, but not everyone that joins is of christian mentality. People lie, cheat and steal. I have made a choice to not work as hard as I would need to make directorship, however I have a car thru MK and yes its hard making production every month, especially if I don’t sell product. Yes I have chosen to use my own savings to make production for car, is that a choice? YES, I made that choice the company did not make me do that. I think a lot of what is being said is of personal choice. No one can twist someone’s arm and make them order inventory and YES it is important to have product on your shelf or women will go to the mall and purchase their makeup and skin care their.. I don’t agree that our product is overpriced and not good, oh my gosh if you only knew the skin I have changed for the better with this product that other products they were using did not work. I understand where your coming from, I really do but everything good and bad needs to be disclosed. This is about choices and some are encouraged to make poor choices and some good.
Sadly, Mary Kay is far more bad than it is good. That’s why it’s so important to expose it. Ever hear of a wolf in sheep’s clothing? This company has been flying under the radar far too long. It’s got a deceptive and destructive business model. Thank goodness for the internet so we at Pink Truth can educate consumers before they sign up for this money loser!
Karin wrote @ May 5th, 2008 at 3:03 pm
To generalize this company as being “all bad” is fallacious. Mary Kay is a network marketing company, meaning we are each responsible for our own successes or failures. As with anything else in this world, you are going to have a few abusers of the system. However, in comparison with other companies out there, (especially in network marketing/direct sales) MK is closer to the good side than the bad side. You certainly have the right to your opinion and you have obviously not been happy with your experience. I have been an Independent Beauty Consultant for over 11 years and have never experienced the “wrongs” you have obviously encountered. I am sorry that happened to you but taking your experience, generalizing it, and then using that to misrepresent what I do is insulting. I am educated, knowledgeable about my product as well as the industry, and my customers find value in my services. I am also very proud of my team. You can twist my words (as you have above) and put a negative spin on this if you want, but I urge you to allow another point of view to stand. A person cannot make an educated opinion of her own without understanding both sides of the story.
Mary Kay has been telling “their” side of the story for 45 years. It’s time that we stand up for women who need the REST OF THE STORY. Karin, you may be insulted by my words, but I am insulted that you would recruit women into this scam. Pink Truth is not based upon my own experience. It is based on the experiences of the HUNDREDS OF THOUSANDS of women who have visited the site since it was started almost two years ago. There are thousands of stories on the site about the pyramid scheme that is Mary Kay. I hope you’re not proud that 99% of women in Mary Kay lose money? I hope you’re not proud of the fact that the women you recruit into this scam have almost no chance of turning a profit?
Darlene said: “Yes I have chosen to use my own savings to make production for car, is that a choice?”
How much money have you spent to keep “the car” … and what kind of a car could you have bought and owned outright with that money?
ttp wrote @ May 5th, 2008 at 10:17 pm
No matter what you call it, direct selling, dual level marketing, or network marketing, MLM is MLM. It is a flawed system designed to fail 90% of participants. Darlene is buying her “free” car each month to maintain the illusion of success. What else is illusion? MK is not all it seems. I urge you to dare to see beyond the fluffy kumbaya. Do some research. All is not what it seems.
Teresa wrote @ May 6th, 2008 at 1:16 pm
Darlene said: “No one can twist someone’s arm and make them order inventory ..”
Of course not BUT how many times have you been asked to *Stretch*, *Be a Team Player*, and *Invest in your Business* - Remember *Stars drive Cars* ladies!
Frontloading - call it what you want - but it is what it is.
bluepink wrote @ May 6th, 2008 at 10:06 pm
I was in MK for over 5 yrs before I quit as a Future Director. I defended MK tooth and nail in the begining, I was making around $200-300 per week and grew a nice client base. But as the yrs passed I realized I lost more than I gained. As a Director your expenses are higher, so you really have to recruit weekly and front load like crazy if you want to make any kind of money, and in no way is it an executive income. I was in the top 10 list in my unit and national area of recruiting and sales, so I didn’t suck at the business, I quit because I couldn’t lie and manipulate women anymore. So many were losing money, over charging on their cards to make production or win cheap prizes and attention is sad and pathetic and it needs to stop. My Cadillac winning director also realized how brainwashed we were and how little MK Corp cares about sales to the end consumer, only selling inventory packages to new consultants, which is where units makes their real money!
So for you newbees, of course MK is fun and the ladies seem nice and seem to care, but as time goes on and the higher the ladder you go, you find out the real truth about this scam, so the sooner you get out, the less debt you’ll have, the less hurt you’ll be. I’m sure you ladies are not stupid, you were just lied to like me and emotionally manipulated. Do your research and make the choice that is right for you and your family!
It took almost 15 years and 5 cars, offspring, and top ten area standing to finally wake up to the wreckage and havoc that Mary Kay’s “system” hides from the lower Consultant sales force. The name of the production game is new recruits and star orders. We have been reduced to applauding “high weeks” of 200-400 Bucks…and meeting attendance down to 3 to 5 women. No matter how long you are in, if you care about the debt building for your people, you wont be able to pull orders. If you don’t care…you will manage to maintain. Contests and promo’s are out of control all trying to get another order out of someone regardless whether they have been able to sell. Customers cancel appointments and do not reschedle, so recruting is all anyone cares about. To recruit, you have to lie about conditions and your own personal success rate. It is sick. And Nobody talks about it because it is “negative”. That is the insiders view of the Mary Kay opportunity.
MaryKay is like any other company that you might own!! You might have to put lots of money forward to get it started!! And the only way your going to make the money back is by working hard, selling, marketing and recruiting ….on average in the united states all businesses within the first year LOSE money!! I was looking into starting my own business and i realized how much i was going to have to put into it, rent for a building, products, employees…. with marykay i didnt have to worry about that…Also some people may make it in the business and some people may not… its like applying for any other job, if you dont have skills in the position your applying for then need not apply…. alot of people may want to try it and realize sales is not one of there best qualities or maybe after they start they realize they dont have enough time to put into it….If your going to gang up on marykay then why not gang up on every other self employed company…. you negative people just need Something to complain about…. everyone can makes there own choices…. i just wish with all this passion you guys have to bash this company, you guys could be using it for something good…. like feeding starving children or rebuilding houses in New Orleans… theres soo much more important things out there……. open your eyes to the REAL problems of this world…… lifes to short to complain….. at least thats what my mom always tells me!!!
I’m not a guy, buy I’m going to answer you anyway. Wanna hear something GOOD we’ve done? We’ve gotten $1 million back in the hands of women who were scammed by Mary Kay. NOW THAT IS GOOD!
My mom was in mary kay in the late 80’s early 90’s - My mom is not bright, but fortunately my dad went to harvard. I have done well, very well. My mom never sold shiznit and tried with her socializing skills to do so. We had a house full of mary kay crap that she ended up giving away or disposing. What a total joke.
Those posters above who support Mary Kay sound like the classic MLM brainwashed, giving money to “make the car” - you poor pathetic souls. Being self employed with your own business is not the same as being a tool within an MLM system. Self-Employed folks don’t buy massive inventory to start - there is no need to do so when working as a service consultant.
Think about it - you might need -maybe- 100$ worth of product to demonstrate to others. Anything more than that and it is a pure outright scam. MK should be -giving you- inexpensive sales and demonstration kits.
Please, don’t be another suckah !
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