Chickens, eggs, leaders and products

I’m not fond of the “chicken or the egg” riddle.  It’s a trick question with no right answer. One can’t exist without the other.  In the multilevel marketing industry, there’s a similar riddle: Which one comes first, leaders or product?

In network marketing, there’s a growing divide between MLM distributors and companies.  There’s more litigation against distributors, more angst and more finger-pointing.  The speed of innovation is making it challenging for companies to provide leaders with competitively priced items, long term. And distributors are more transient than ever looking for shinier lures.  It’s tough out there now, there’s no doubt about it.

Back to the riddle…  Leaders first or products first?  Distributors will say “Without us, nobody would buy your stuff.  We’re independent contractors, not employees!”  Companies say, “Without us, you’d never have a network. I dare you to try building a following with a business that stinks!”

The answer

They’re both right.

Suppose a leader enrolled in a business that sold $1,000 rolls of paper towels.  We’ll call this business “BRAWNEE WANABE.”  There’s nothing special about the paper towels, they’re just the kind that can…..you know…..wipe up spills and stuff.  On sale for $1,000 per roll.  And suppose the BRAWNEE WANABE website is awful.  The checks rarely arrive on time and when they do arrive, they sometimes bounce.  And there’s no street address for the company, the company owners are anonymous and there’s not a shred of support for the field.  Suppose Dexter Yager, one of the most prolific networkers in history, decides to hang up his Amway business and join BRAWNEE WANABE.  Do you think he’d maintain his downline for long?

The product matters.  The company matters.

“But I own the downline! I worked hard to build it!”  This is what distributors argue, and it’s a good one.  But did that downline develop solely because of their leadership?  Or….did it develop with their leadership PLUS with the branding and support provided by the company?

The Truth

In reality, the relationship between a leader and company is a tightly knit partnership.  It’s like a goldfish in a tank partnership.  The goldfish grows to the size of the tank (I’ve heard).  If the tank is small, the goldfish stays small.  If the company is awful, the leaders will never be able to build a sustainable downline regardless of talent.

On the flip side of the coin, the companies absolutely NEED leaders. Without leaders, there’s no product sales.  Leaders build up the value of the brand in conjunction with the company.  They’re vital.

So which one is more important, leaders or companies?  It’s a loaded question.  They each rely on the other for their existence.  Yes, companies can get new leaders and leaders can get new companies.  But for a program to really work, companies need to provide cutting edge value daily and leaders need to remain committed, even during the rough patches.

  • http://www.MarketWaveInc.com Len Clements

    Great products can genuinely create very successful leaders. Great leaders can only make you think they have great products.

    “Transitory leader” is an oxymoron.

    Len

    • http://www.themlmattorney.com/about Kevin Thompson

      Transitory leader is absolutely an oxymoron.  There’s too much of it going on right now.  I think great products coupled with great pay plans attract the RIGHT kinds of leaders. So in this sense, maybe that’s the answer to the riddle?  Company first, leaders second?  It’s sort of like an “If you build it, they will come” sort of thing.  

      • Doug Boyce

        1. Product,2. Company, then Leader. Without the Product you have Nothing.

  • http://mlmhelpdesk.com troydooly

    Kevin, you always have a logic way of explaining a complicated
    situation, and I want to thank you for that. I believe if both
    distributors and companies will realize their relationship is a lot like
    a marriage and less like a one nightstand, they will start
    communicating with more partners, instead of trying to negotiate just a
    short term business deal.

    Living An Epic Adventure,

    Troy Dooly

    • http://www.themlmattorney.com/about Kevin Thompson

      Yes!  Very good point (and analogy).  Instead of treating it like a marriage, they’re tossing their partner when recruitment slows down just a tad.  As Richard Brooke has said, in most cases, the leaders always regret leaving their first company.  When you promote something as “the best thing ever” and then promote something else as “the best thing ever,” eventually the credibility wanes and there’s no business left.        

  • Richard Bliss Brooke

    Great article Kevin.   I love the fish tank/fish relationship