Community//

How the COVID-19 Pandemic Has Fueled a Network Marketing Surge

The heartache resulting from the coronavirus pandemic is seemingly without end. In the United States alone, millions have been infected and hundreds of thousands have died. The economic impact has obviously been considerable as well. Businesses have been shuttered. Layoffs and furloughs have skyrocketed, and recovery has been incremental. In July the unemployment rate fell […]

The Thrive Global Community welcomes voices from many spheres on our open platform. We publish pieces as written by outside contributors with a wide range of opinions, which don’t necessarily reflect our own. Community stories are not commissioned by our editorial team and must meet our guidelines prior to being published.

The heartache resulting from the coronavirus pandemic is seemingly without end. In the United States alone, millions have been infected and hundreds of thousands have died.

The economic impact has obviously been considerable as well. Businesses have been shuttered. Layoffs and furloughs have skyrocketed, and recovery has been incremental. In July the unemployment rate fell for the third consecutive month, to 10.2 percent, after climbing to 14.7 percent in April. That was its highest since the Great Depression, when it is estimated to have reached 25 percent.

Even more troubling is the fact that the unemployment rate only takes into account those who are actually still seeking jobs. Those who have stopped trying — “discouraged workers,” as they have come to be called — fall into a separate category. It is estimated that those who fit that description rose in number from 405,000 in February to 665,000 in July, according to a CNBC report.

If there’s one thing that’s evident from these economic shifts, it’s that the stereotypically “stable” corporate job is anything but. 

For many in need of alternative sources of income, network marketing — also known as multi-level marketing (MLM) or direct marketing — has been hailed as a promising option

Its value is enticing: work from home, set your own schedule, and build a revenue stream that rewards hard work and outcomes instead of winners of corporate politics.

Network marketing consultant Eric Worre argues that there has “never been a more opportune moment for people to work in their homes than right now” and points out that technology only increases the ability of network marketers to peddle their wares. And when questioned by Vox as to whether it might be insensitive or opportunistic to woo others to such business ventures during a pandemic, he had a ready response.

“My intention was not to be opportunistic,” he told that outlet. “It’s more along the lines of saying, ‘In the face of this circumstance, we have a unique benefit that other entrepreneurs don’t have, and you can help people looking for help working from home.’”

Even before the pandemic, network marketing was a $35 billion business, according to Time Magazine. AARP, in the preface to a 2018 study, noted that the industry was in fact amid something of a renaissance, as a result of social media marketing and MLM’s expansion into Asia and Latin America.

It is clear, however, that the pandemic has further hastened network marketing’s rise. A study conducted in June by the Direct Selling Association (DSA), an MLM trade group, showed that 51 percent of the 51 companies who had been surveyed had improved their bottom line during the pandemic. A subsequent survey showed that number rising to 59 percent.

This is not unusual during an economic downturn. Time Magazine cited a DSA report indicating that in the wake of the 2008 recession, the number of network marketers increased from 15.1 million in 2008 to 18.2 million six years later.

The circumstances associated with the pandemic make MLMs particularly attractive; as Worre said, what better time to work from home than now? 

Time Magazine offers as an example Beachbody, which markets dietary supplements and on-demand workout videos. With exercise facilities forced to shut down during the pandemic, the number of subscribers to Beachbody on Demand increased by 33 percent over a three-month period beginning in mid-March. Company CEO Carl Daikeler estimated that some 600,000 fitness classes were being viewed every day.

Moreover, the number of Beachbody “coaches” — i.e., those eligible to recruit others to the company — had increased by 141,000 from March 1 to July, raising the total to 405,000.

The reasons for network marketing’s appeal in economic downturns are simple: MLMs don’t require large start-up costs and they buy back unsold inventory. 

With an easy entrypoint and relatively low risk profile, network marketing has long proven attractive to entrepreneurial types or frustrated corporate employees seeking an alternative — or entirely new — revenue stream.

While stories of bad MLM companies have marred the industry’s reputation, many trusted MLM companies abound — and it’s actually rather easy to distinguish between the two, as with a pyramid scheme, no actual product is sold.

It is also worth noting that network marketing is deeply rooted in American culture, with such companies as Avon, Amway, Tupperware and Mary Kay dating back to the 1960s. In fact, the aforementioned AARP study concluded that one in 13 Americans participates in one form of network marketing or another in the course of their lifetimes. 

Given recent events, however, that number is once again rising. More and more Americans of every stripe are finding network marketing to be an appealing option — not just as an alternative revenue stream, but as a more stable one as well. 

In some ways, network marketing represents a lifeline in the face of a health, economic, and unemployment crisis. Those who hold tightest understand it is a promising means to secure their financial future.

    Share your comments below. Please read our commenting guidelines before posting. If you have a concern about a comment, report it here.

    You might also like...

    Community//

    7 Ways Working from Home Has Made Businesses Better for It

    by Tim Guga
    Erin Lowry / Thrive Global
    Thriving Wallet//

    I’m Still Semi-employed, but My Income Has Taken a Big Hit Due to the Pandemic. I’m Really Stressed. Help!

    by Erin Lowry
    covid-19 substance abuse
    Community//

    A Tale of Two Epidemics: Substance Abuse Disorder and COVID-19

    by Karina Schultheis

    Sign up for the Thrive Global newsletter

    Will be used in accordance with our privacy policy.

    Thrive Global
    People look for retreats for themselves, in the country, by the coast, or in the hills . . . There is nowhere that a person can find a more peaceful and trouble-free retreat than in his own mind. . . . So constantly give yourself this retreat, and renew yourself.

    - MARCUS AURELIUS

    We use cookies on our site to give you the best experience possible. By continuing to browse the site, you agree to this use. For more information on how we use cookies, see our Privacy Policy.