Multi-Level Marketing, frequently referenced on the social media platform TikTok, signifies a business model that relies on a network of distributors to sell products or services. Participants earn income not only from their direct sales but also from the sales of individuals they recruit into the network. These recruitment practices are a defining characteristic of this business structure, differentiating it from traditional retail. For instance, a distributor might sell skincare products directly to consumers while also recruiting others to become distributors themselves, thereby earning a commission on their recruits’ sales.
The prevalence of discussions surrounding these business models on TikTok stems from both the opportunities and the potential pitfalls associated with them. Proponents often highlight the possibility of financial independence and flexible work arrangements, while critics raise concerns about the high failure rates, deceptive marketing practices, and potential for pyramid scheme-like structures. Historically, these business models have faced scrutiny from regulatory bodies due to concerns about consumer protection and the sustainability of the revenue streams.
