Nairobi News

Multi-level marketing is not a new phenomenon in Kenya. Tupperware, GNLD, Tiens, Mary Kay cosmetics and many others are all multi-level marketing companies and, although the uptake has been slow despite the goodies and huge returns promised, there has been  progressive growth.

The economies of Taiwan, Malaysia and America are greatly driven by multi-level companies transacting billions of dollars every year.

The same can be achieved in Kenya if regulations are drawn to control the operations of such companies and if residents are receptive to it.

There is an emerging trend now where groups of people form companies, come up with their own strategies then buy products from firms that use multilevel distribution channels and sell them independently.

Lifeplus Investment group is an example of a company that has taken multi-level marketing to a whole new level locally.

While scouting for different avenues to make investments in 2012 the company settled on capitalising in multi-level marketing.

They chose to partner with Forever Living. 

Speaking during the interview, Julia Kibore, the manager of Lifeplus, said Forever Living health and nutrition products offered them a great opportunity to do lucrative business.

“The market for these products is ripe and we are continuously experiencing growth such that our members are able to make $1,500 (Sh127,500) every month,” says Julia.

Lifeplus operates independently but gets its products from Forever Living. They have their own marketing plan and recruit and register members independently. These members are under Lifeplus and not Forever Living. The group now boasts over a 1,000 members.

Reason for growth

So why opt for this kind of investment?

“Our market research showed that Forever Living offered the best products and so we chose to begin our business with them before exploring other avenues,” Julia clarified. In her opinion, Forever Living offers the best compensation plan.

“In this business we are able to realise over 1,000 per cent profits in one year and in the process make a handsome income,” she says.

Forever Living products (and GNLD and HerbaLife) include weight management, health and nutrition supplements, and cosmetics. 

For products to move, companies using the multi-level marketing model of distribution like Lifeplus offer training to the members to equip them with marketing and sales skills.

However to move sales, individuals need to be aggressive, persistent and knowledgeable.

“For multi-level marketing to work, there must be a product being sold. The minimum criteria is that there should be a credible product and secondly, that the product does what it says it will do,” says Daniel Musembi, a business manager in a blue chip company.

“The product experience is very important and determines whether the MLM will succeed or not. When there is no product being sold, that is just a pyramid scheme to swindle the poor. Multi-level marketing has been highly successful in Asian markets and it should be successful if we use it here because it is basically the same principal.” 

Although the business environment for network marketers is not favourable in Kenya, individuals like Julia and Joyce Waweru — the team leader of Tiens — say that the local market is changing heart for the better.

“Ignorance of the masses is the number one problem in our business, but slowly we are enlightening Kenyans that multi-level marketing is a worthy investment and not a pyramid scheme as some claim,” says Julia.

And she should know. Her specialty is marketing (she is the principal consultant at Marketing Solutions Limited) and has been to the US on attachment with a Fortune 500 company where she discovered that marketing, backed by technology, was the secret to the success of many American companies.

Need for Kenyans to embrace MLM

With the high levels of unemployment in the country, Mrs Waweru suggests that multi-level marketing could be the remedy that Kenya needs. She points out dignitaries like Moody Awori, Ida Odinga and Marsden Madoka as some of the bigwigs involved in multi-level marketing business. 

To become an agent of companies like GNLD, MaryKay, Oriflame, Forever Living or Tiens, one requires a certain amount of money for registration.

Unlike employment, this kind of business will give a person the liberty to work from any area and do things on their own terms.

“The business has zero risk and acquires no operational cost but only effort to make money,” says Mrs Waweru.

Ignorance, lack of information and low regard for multi-level marketing are the main reasons blamed for the slow uptake of the model and products locally.

“Some of world’s biggest economies thrive on multilevel marketing, if the right policies are put in place to guide the market, to protect consumers and agents and ensure that these companies pay taxes, then there will be more money to inject into the national GDP,” says Waweru.

Identifying a legit MLM

For those open to the idea of joining network marketing, identifying a company with a strong system is key. Check on the background of the company, to know how successful they have been in terms of growth rate.

Find out about their financial status and how long they have been in the market and how well established they are.