A core strategy of Multi-level-Marketing (MLM) is positive thinking. It has a clear message: You are the only person responsible for your success and it ignores the real fact-based challenges.
Want to get rich by working from home? Earn money and have time for family and friends? Multi-level marketing (MLM) companies promise a great business opportunity for everyone, offering cosmetics, nutritional supplements, essential oils, household products, lingerie, insurance policies, or lessons about cryptocurrencies and forex trading. By selling these products to friends and family members and recruiting others, anyone can earn a side income or, even better, get rich and avoid the 9-to-5 grind. At least, that’s the promise.
For most, however, this dream remains unfulfilled. Three-quarters of participants earn nothing or lose money, despite investing an average of 13 hours per week (DeLiema, Shadel, Nofziger, & Pak, 2018) and straining relationships with friends and family through relentless social media posts about the „great business opportunity“ and „life-changing“ products. So why do distributors keep buying products, trying to sell them, and recruiting others? A core reason is that MLMs teach participants to “think positive.” Despite financial losses, damaged relationships, and countless unpaid hours, they are told that if they maintain a positive attitude, manifest their dreams, and keep working hard, success will eventually follow.
This “stay positive” mantra is central to MLMs, reflecting a broader societal trend: the belief that individual willpower alone determines success. Countless self-help gurus, life coaches, and influencers echo this idea, telling us that we have the power—and the responsibility—to shape our destiny.
This article examines MLMs to illustrate how excessive positivity can turn toxic, benefiting others while harming the very people it is meant to help.
From tupperware to financial freedom
While most people might not be familiar with the term MLM, many will remember their mothers or grandmothers having Tupperware, and they might own a few boxes themselves. In its early days, MLM was synonymous with direct selling, where women hosted parties for household products (Tupperware) or cosmetics (Avon), and men went door-to-door selling insurance (DVAG, ErgoPro, SwissLife Select) or vacuum cleaners (Vorwerk). Today, MLMs have expanded significantly, with companies offering a wide range of products such as nutritional supplements, beauty products, household goods, and even educational services. More importantly, MLM distributors do not only earn by selling products/services. They are told that good money can be made by recruiting others. Whoever manages to build an own large group of motivated distributors, is promised financial freedom and the life they have always dreamed of. Because, as a famous MLM slogan goes, “I’d rather have 1% of 100 people’s efforts than 100% of my own.” (J. Paul Getty)
Positive thinking or toxic optimism?
MLMs have numerous issues (Groß & Martin, 2023), as evidenced by the hundreds of ‘Anti-MLM’ YouTube channels and the more than 840K members of Reddit’s anti-MLM community. Distributors often invest more than they earn, dedicate many hours each week, and risk alienating friends and family members who do not appreciate having their social relationships being used for economic gain. But why then, don’t distributors quit quickly? Why do they continue to invest time, money, and personal relationships for months or even years?
A key reason is that MLMs employ “positive thinking” as a core strategy. Through small and large meetings, social media, and self-help literature, distributors are led to believe that their success is entirely up to them. They are bombarded with motivational slogans like “Success is the ability to go from one failure to another with no loss of enthusiasm” (often attributed to Winston Churchill) or “In MLM, every ‘no’ brings you closer to the next ‘yes’ that changes your life.” Whatever the slogan, the message is clear: You are the only person responsible for making your MLM ‘business’ successful. And if you fail, it’s your fault.
Thus, in the context of MLMs, positive thinking becomes toxic as distributors are encouraged to adopt and maintain an overly optimistic outlook on what they can achieve. Whatever problem they encounter, they’re told that it’s their thinking, attitude, and behavior that need improvement: Do you think the product is too expensive to sell? No, you just haven’t tried hard enough, so you need to try again. Do you believe that no one wants to be recruited? No, you just haven’t met the right person for your group, so don’t complain, just keep going. Are you upset that your family is annoyed with you talking about financial freedom all day long while you don’t have enough to cover your share of living expenses? You just haven’t distanced yourself enough from their negative thoughts; repeat your affirmations of success to rid yourself of their negative influence.
Whatever is experienced, described, or observed as a problem is reframed as a problem created by the individual. This belief is well-expressed by another frequently used MLM slogan: “Life has no limitations, except the ones you make.”
The limitations of MLMs that positivity can’t fix
Having a positive outlook on life seems like a good thing to most of us. Those who are constantly depressed or anxious may struggle to motivate themselves and might even find it hard to get out of bed in the morning. However, certain core aspects of MLMs remain unchanged, regardless of positive thinking. These are real, fact-based challenges that distributors face—no amount of wishing, thinking, or visualizing can alter them. Here are four examples:
First, spending instead of earning. MLMs present distributorship as a ‘business opportunity’. Naturally, setting up any business requires an investment. However, a major problem with MLMs is that many distributors are overly optimistic and, as a result, invest far more than they ever earn back. Initially, they might purchase a small starter kit to try out the products and show them to friends and family. But soon enough, their recruiter tells them that “true believers” invest more—for example, €3,000 into a “quick-start package.” This package is touted as offering a higher discount, more products to showcase, and proof of serious commitment to the business. After all, as one MLM slogan says: “Buying products is optional, but so is success.”
Additionally, to receive commissions on the purchases and sales of those they’ve recruited, distributors often need to keep buying products or pay a monthly fee. And, of course, running the business supposedly requires attending and paying for seminars, meetings, appropriate clothing, or even leasing a car to project an image of success. Positive thinking, combined with the “fake it till you make it” culture prevalent in MLMs, convinces people to invest far more than they will ever earn back.
Second, recruiting. In MLMs, most of the promised money comes from recruiting others. However, finding recruits is difficult, and only a select few can be at the top of a large downline. Despite all the marketing hype, the mathematics are clear: If each person recruits six others, and those six recruit six more, after just 13 rounds, the entire world population would be insufficient, as pyramid scheme calculations demonstrate (Wikipedia, 2024). As a result, MLMs either collapse or, more commonly, most participants simply lose money while feeding the few at the very top who do earn on the many below them.
Third, retailing. Retailing enough products to make a profit is also often enough challenging. While social media is filled with enthusiastic posts from distributors, MLM products might simply be overpriced, not unique, or simply ineffective. Although not all MLM products are of low quality, the industry is infamous for pushing products that would not succeed in traditional retail environments, such as overpriced wellness gadgets or questionable educational platforms. Yet, distributors—trained in relentless positivity—are encouraged to overlook these red flags. They are taught that their failure to retail is due to insufficient effort, not product quality. This constant pressure to stay positive distorts their perception, leading them to believe they simply haven’t found the right customers yet. In such a system, distributors cannot afford to question the products themselves. They are told to maintain a positive mindset and keep on trying.
Fourth, social relations. Approaching, or even pressuring, friends and family to purchase (large) quantities of products they may not want and never be able to sell—or that might take years to use up—is socially problematic. At the very least, it often creates discomfort for friends and family who do not appreciate being dragged into economic transactions uninvited. MLMs, however, use positive thinking to encourage distributors to brush off these awkward situations and the frustration of their loved ones. The famous slogan “Don’t let anyone steal your dream” motivates distributors to persist in approaching people for both retailing and recruiting, despite the social strain it causes.
The downside of optimism: How MLMs exploit positive thinking
Can someone think and behave too positive? In the context of MLMs, the answer is clearly “yes.” While the long-term consequences of excessive positive thinking for MLM distributors have not been thoroughly researched, evidence from media coverage and studies on the cult-like culture of MLMs suggests several harmful effects:
First, toxic optimism increases spending and thus financial losses. There is nothing wrong with trying something new, and working from home with a micro-business sounds appealing. Risks are part of life, but in the case of MLM, thorough bookkeeping instead of positive thinking, would allow distributors to make more realistic assessments of product or service quality, the costs involved, and the time spent. This approach would help them invest their money based on concrete data rather than on unrealistic expectations and the hope that their dreams will materialize.
Second, MLMs can lead to social isolation. When distributors quit, their MLM “colleagues” often reject them as quitters, negative thinkers, or whiners. Those who leave are blamed for not being positive enough. As a result, former distributors often lose their MLM friendships. In addition, relationships with non-MLM friends and family members may be hard to repair after their attempts to recruit and sell to them. This leaves ex-distributors with a double loss: they feel abandoned by their MLM network and have a hard time to reconnect to those who they tried to involve in their MLM-dream.
Third, MLMs can damage self-esteem. Many who leave after earning little or nothing still believe they failed because they didn’t work hard enough. They may have internalized the narrative from their former MLM recruiters and colleagues, believing it was entirely their fault. This can be especially harmful to young people, who may lose confidence in their abilities.
Fourth, MLMs can create emotional harm. After quitting an MLM, life may seem dull and unfulfilling. When MLMs make lofty promises (“life-changing,” “break free,” “escape the rat race”), especially to young people, returning to a “normal” life can feel disheartening. After experiencing the excitement and hope of being part of an enthusiastic group, everyday obligations—like getting up on time, pursuing education, or doing household chores—can feel pale in comparison to the glittering life MLMs showcase at large events and rallies.
Fifth, MLMs shift blame to the individual. By blaming distributors who might continue blaming themselves, MLMs absolve themselves of responsibility for their own poor financial outcomes of their distributors. Distributors’ status as self-employed allows MLM companies to dodge social responsibility for offering competitive products or services, providing transparent income disclosures, or reforming their compensation systems to distribute earnings more equally instead of funneling the investments of many to create high earnings for a few at the top.
Positivity as a cover-up to a broader societal trend
A famous MLM slogan claims, “Your mind is infinite; it’s your doubts that are limiting” (Robert Kiyosaki, known for the Rich Dad Poor Dad series of personal finance books). This encapsulates the core strategy MLMs use to keep their distributors investing money, time, and social relations by teaching them to stay relentlessly positive. This helps MLMs to shift the focus away from their own systemic flaws that cause financial losses, social frustration, and emotional distress among (former) distributors and their friends and family members.
In how MLMs use positive thinking to hold individuals responsible for organizational and systemic problems, they reflect a broader societal trend. In his book Tyranny of Merit (2020), philosopher Michael Sandel describes how our society has become an “exaltation of human agency,” an overly individualistic belief that one’s successes are solely the result of one’s own efforts. Self-help books, gurus, life coaches, and countless influencers tell us today that we can create our reality, transform ourselves, and take control of our lives. While this can be inspiring and uplifting, when failure is entirely privatized and systemic problems are framed as individual shortcomings, alarm bells should ring. Beyond a positive attitude and the drive to “get things done,” we need a clear view of reality—including the reality that companies, self-help gurus, and influencers may preach positive thinking primarily to benefit themselves.
References
DeLiema, M., Shadel, D., Nofziger, A., & Pak, K. (2018). AARP Study of Multilevel Marketing: Profiling Participants and their Experiences in Direct Sales. AARP Foundation.
Groß, C., & Martin, H. (2023). MLM Explained. The facts about multi-level marketing, network marketing, and direct selling. https://repository.ubn.ru.nl/handle/2066/290373: Radboud University Repository.
Sandel, M. J. (2020). The Tyranny of Merit: What’s become of the common good? : Allen Lane London.
Wikipedia. (2024). Pyramid Schemes. Retrieved from https://en.wikipedia.org/wiki/Pyramid_scheme
Dr. Claudia Gross, PhD in Business Administration, Magistra Artium in Sociology and Philosophy, Assistant Professor for Organisational Design and Development, Institute for Management Research at Radboud University in Nijmegen, the Netherlands.