History of MLM

August 30, 2004 by Dane | 6 Comments
In MLM, Posts

Dave Stone: “Network Marketing, or MLM, first began around 1947 in the US with a company called the California Vitamin Company which became Nutrilite which evolved into Amway (1959) and then into Quixtar in 1999. Considered the granddaddy in MLM, the popularity and notoriety of Alticor (parent company which owns Amway and Quixtar) have been both a boon and Achilles heel simultaneously. Still, hundreds and hundreds of other companies developed a business model and occupy the MLM frontier.”

Comments

peter caputa on August 30th, 2004 at 9:39 am

i consider network marketing more of when people sell their products at hosted parties (by networking)…eg tupperware.

Is that incorrect? if so, what do you call the tupperware thing?
Yvonne DiVita on August 30th, 2004 at 4:44 pm

Quixtar is a legitimate business… and a successful model of online shopping. It sure makes my life easier. MLM is only worthwhile if you understand that it’s a business model, not a get rich quick scheme. And, you don’t HAVE to add people to your line of sponsorship, if you aren’t inclined to…you can still take advantage of the savings on products as well as the use of those products…at Quixtar, the products are outstanding. True entrepreneurs should consider MLM, do their homework, interview successful members, talk to some unhappy members, and make a careful decision before becoming involved. MLM is like any other business…you get back what you put into it.
Chuck on August 31st, 2004 at 8:12 am

In reality, any organization with a hierarchy is “multi level”. When Lee Iaccoca ran Chrysler, he made money based on every car sold. The guy at the local dealership made more money on the cars he sold personally, but not money on every car the organization sold.

But the point is well taken that MLM as we know it started with the Nutrilite product.

Sadly, it morphed from distributors actually making money selling product to distributors selling dreams and recruiting others to buy overpriced goods and services that no ordinary price conscious consumer would ever pay for unless there was a “dream attached”.

I hope the advent of affiliate marketing on the web change things. Personally, I wouldn’t join an MLM where the distributor could not make a recurring monthly income through autoshipments of product alone. That’s the definition of a legitimate MLM anyway. In the age of affiliate marketing, I’d want something where I could market products online and earn a decent commission for my efforts. Then if someone joined as a distributor, so much the better… but income shouldn’t be dependent on “selling the dream”. There have to be real competitively priced products attached…
Business Opportunities Weblog | History of MLM on August 30th, 2005 at 8:25 pm

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Jim on November 6th, 2005 at 5:50 pm

Sorry, Dane, but you are wrong. Ever hear of the California Perfume Company? It was launched in 1886 and is today known as Avon. Watkins also seriously predates the California Vitamin Company/Nutralite/Amway/Alticorp myth that was launched by some over zealous Double Diamond at some Amway convention.

You should conduct more research, pal, before you purport yourself to be an expert on history.
Dane on November 6th, 2005 at 7:37 pm

Jim, you are correct Avon was founded much earlier than Amway, but Avon didn’t start selling selling via MLM until the 1950s.