3.27.2006

The Flawed Logic of Tool Sales Criticism

"There's no real money in Quixtar, just an elite group of 'kingpins' making all their money from IBOs with tool sales."

I've just paraphrased one of the most common criticisms you'll see leveled by internet sites critical of the opportunity side of the internet shopping portal Quixtar.com.

Given a reasonable application of logic, at least two flaws should quickly be apparent in this criticism.

1) How did these "kingpins" initially become so supposedly influental if the business model doesn't allow anyone to make any "real" money? What, were these happless IBOs so impressed with the would-be kingpin's collection of, say, monopoly money perhaps, that the IBOs sold all they had to purchase their tapes of how to acquire large quantities of monopoly money themselves?

Of course I'm fighting a losing battle with that line of questioning, as Quixtar critics are loathe to admit the prospect of actually making money utilizing a company which pays hundreds of millions in bonus money annually, because the subsequent examination of those earnings threaten to reveal the (*gasp!*) inherent relationship between effort and return.

So let's set aside those apparently inconsequential few hundred million dollars of annual bonus money (closing our eyes and repeating the shrill "$115 gross per year!" mantra) and pretend, as the critics do, that there is actually no money to be made.

If the critics are to be believed then, all it takes to succeed in the "dark underbelly" of the Quixtar business, regardless of your actual product sales volume, is to create your own system of how to be successful and Automagically! you make hundreds of thousands of dollars a year on tapes and function sales.

Uhhh... only one problem with that-- Who ya gonna sell them to? Just how did these non-money-making "kingpins" get so successful at selling tools?

"Well," the critic may reply, "first they created this vast, multi-layered organization of followers. Then," whispers the critic, pausing for dramatic effect, "they sell tapes to them!" (queue climactic music here: Dun-Dun-DUNN!!)

Wait-- you're telling me these people succeeded in creating a vast multi-layered organization of loyal volunteers consisting of thousands of families? That's amazing!

"Yes!" cries the critic breathlessly, "Then they sell tapes to them!" (repeat climactic music here: Dun-Dun-DUN!!! Overlay sound of woman screaming for extra dramatic effect.)

Wait, wait.. please tell me-- how did they manage to succeed in creating this vast multi-layered organization of loyal volunteers consisting of thousands of families?

". . ."

Pardon?

"Um, well," mumbles the critic, "I guess that's what the tapes are about-- how they did that."

Uh-HUH.

So let me get this straight-- no ability to build a vast multi-layered organization of aspiring entrepreneurial families in the thousands means no one to sell tapes to? But with the ability to build that kind of organization, their people are willing to buy their tapes... Shocker.

You've stumbled onto a big mystery there, critic-- what would compell people belonging to a vast organization to buy tapes from the founders of that organization-- about how to build a vast organization? Hmmm...

Gas Station Employee: I'm picking up your sarcasm.
Richard Hayden: Well, I should hope so, because I'm laying it on pretty thick.
-- Tommy Boy


Just taking alone the ability to organize large volunteer organizations of people, this is a highly valued skill-- not only in business but in religious and political circles as well. Take for example, the money paid to the founders of Hotmail when Microsoft purchased the free email service.Gee, Beav! Microsoft certainly could have written their own web-based email system. But what they really wanted was the Hotmail subscriber base-- the large volunteer organization of people. For their ability to organize that subscriber base, the Hotmail founders were paid some $400 Million.

And golly gee whillikers, Wally, imagine the potential if someone actually introduced products and services through those people... wouldn't that really be giving them the business?

Heh...

2) Is there something morally or ethically wrong, for a person who has succeeded in a particular accomplishment, to make money from information that reveals details about their accomplishment?

Recognize any of these names?

Steven R. Covey - Carleton Sheets - Oprah Winfrey - John C. Maxwell - Bill Clinton - Lance Armstrong - Bill Phillips - Richard Nixon - Hugh Hewitt - Oliver North - Malcom Gladwell - Jimmy Carter - Frank Feather - Robert Kyosaki - Hillary Clinton - Dale Carnegie - Victor Frankl - Suze Orman - Glenn Reynolds - Benjamin Franklin - Peter Lynch - Harry S. Dent - Helen Keller - Bruce Berman - Anthony Robbins - Martha Stewart - Donald Trump - Darren Rowse

What do all of these people have in common? This is just a small selection of people who have all published information about their experiences, accomplishments, or expertise. And got paid for it. Heck, even Donald Trump's Apprentices are doing it. And even if the accomplishment is dubious (think John Wayne Bobbitt or William Hung) often the biggest question about the event is who gets to buy the book/recording/movie rights to the story. Even lowly bloggers are getting lucrative book deals these days.

According to the logic of Quixtar critics, none of these people behaved ethically or morally in doing so! (Granted, some of them may have acted unethically/immorally in other aspects, but that's unrelated to them getting published.)

By some obscure, twisted leap of reasoning, these critics infer that the rules for the rest of the world should not apply to individuals who happen to be affiliated with the Quixtar internet portal. On the other hand, it's perfectly ethical and reasonable to publish information detailing how money is made through internet portals like Yahoo, eBay and Amazon-- am I missing something here?

To take their disingenuity one step further, some post information regarding free conference call training sessions by career MLM trainers like Jeffery Combs, Todd Falcone and Dani Johnson, giving the appearence of contrast between a free conference call and the "expensive" Quixtar-related tools systems-- without bothering to mention that these individuals also sell sets of CDs & videos, and charge hundreds to thousands of dollars for seminars and personal coaching-- I thought these critics objected to that sort of thing?

Now, some may take this second point as some sort of admission that the purpose of systems such as World Wide Dream Builders is to make money selling tools. It would take thickheaded obstinence or a flagrant lack of intellectual honesty to ignore my first point, sarcasm notwithstanding, and pretend that this is what I am saying, or to state in the face of multi-million dollar bonus payment statistics, that there is no money to be made utilizing the Quixtar internet portal.

In my last post, I established that, as Quixtar Emerald and above income levels are the real-world equivelent of corporate upper management to executive income levels, it is not reasonable to expect to attain an executive-level income without executive-level performance and leadership. I also established that to excel in any endeaver, there are foundational principles that must be applied. The methodology for applying those principles can be standardized into a system.

Systems designed to help one take advantage of the methodology needed to excel in a particular business model are not a new phenomenon. Quixtar critics, however, expect you do be dumb enough to believe that they are.

Or in the case of some, they expect you to be dumb enough to swallow that line and yet turn around and subscribe to their business model and system.

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5 Comments:

Blogger Leah said...

ok, im not trying to be nasty here, but do u honestly know anything at all about quixtar? i know several succesful people that work with it, no problems, and they are some of the nicest people anyone could ever meet. before you go bashing a company, you have to do some research into the company itself, not just go on what other people say. every company is going to bash the other one so they can get more people to join them over the other. that does not make all the companies bad. you just need to know a little more of the inside runnings before you write an article completely bashing something.

2:02:00 PM  
Blogger anonibo said...

Hi Leah,

Thanks for your comment. I happen to agree with your opinion completely! I'm honestly not trying to be nasty either... if you were to read further than the first line, you would see that I was actually debunking the poor logic offered by critics of the company, and NOT criticising the company or its affiliated IBOs myself.

2:18:00 PM  
Blogger anonibo said...

The system can only work as far is it is applied.

See my post on Competence and Profitability for real-world business theory on that principle.

5:01:00 PM  
Blogger anonibo said...

Ty,

You need to decide first whether you want to compare total results per supplier or total results per system.

Now, I understand that the disadvantage from which you are working is that, in your own little world, the system is the supplier and the supplier is the system.

The Private Franchising system via WWDB is not so limited. Our system works independently of which supplier is chosen for different markets. Even within a particular market, additional suppliers may be brought into the same system, so long as it does not violate any of the terms of the contracts between suppliers.
Take for example, World Wide's CommuniKate service, or the DreamBuilders Internet Service-- both were introduced through the same WWDB system with a wholesale and retail pricing structure, and with a means for individual IBOs to resell at a competitive rate and make a profit.

Or, for example, the same system can adopt to a different market, tailored to the economy of that market. Canada, for example-- Canadian WWDB Diamonds don't earn the same as American WWDB Diamonds, but their lifestyles are still quite good in proportion to the average Canadians.

Likewise, the WWDB system is effective with their chosen international supplier Amway, where the same system has produced Diamonds in the Philippines and South Korea. Granted, in both those markets, the Diamonds there don't make the same in US dollars as US WWDB Diamonds, but their incomes are quite substantial in relation to average Filipino and South Korean lifestyles.

So choose: Are we going to compare suppliers? (i.e. all Quixtar Diamonds across systems)
Or are we going to compare systems? (i.e. all WWDB Diamonds across suppliers)

Magic Math methods (picking and choosing markets and suppliers at your own discretion to fit your own agenda) need not apply.

10:49:00 AM  
Blogger anonibo said...

Actually, after a little review, it looks like you've been pretty consistant on stating that "the system" doesn't work and claiming the number of diamonds to be an indicator of the "fruit" of a system.
However, being that in your world, system and supplier are the same, clarification as to whether you really mean "system" or a some kind of system/supplier amalgam would be helpful.

1:26:00 PM  

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