Originally published at: https://boingboing.net/2018/12/27/how-pyramid-schemes-work-and-w.html
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Pyramid schemes are awful, and if I could just recruit two of you to help me stop this scourge, and you could let just two of your friends know, we’ll have them beat in no time.
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I’m too smart to fall for a pyramid scheme. I make my money by participating in a reverse funnel marketing opportunity.
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For those who don’t want to watch the whole video, here are his steps toward building a Ponzi scheme:
Step 1: Find a Product (a worthless high-profit “premium” luxury product that serves as a placeholder for the actual cash)
Step 2: Make a Payout Plan (making sure most of the money goes to the top)
Step 3: Sell a Financial Fantasy of independent busines ownership (“anyone can do it!” “just hold on, success is around the corner, any day now!” Always be marketing.)
Step 4: Target Key Audience Groups (unsophisticated family & friends, young people, and poor people)
Step 5: Training, Attempt, Failure, Big Morale-Building Event Loop (repeat again and again with recruits to keep them in the cycle)
Step 6: Cut Off Bad Apples (accept but then misdirect and discredit criticism from disgruntled marks)
These tactics, with slight variation, will also be familiar to those who’ve studied how cults, televangelists, and the GOP work.
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The video claims that a good pyramid scheme should target young people (because they’re gullible), and poor people. I wonder if that’s correct. Almost always when I see spam advertising this stuff, everything about it suggests (to me) that they’re aiming at a middle-income, middle-aged-or-older demographic. In fact, that seems to be true of spam in general: the key references point consistently to an aspirational white middle-class Baby Boomer lifestyle, to the values of people who have a bit of disposable income and way too much time to watch TV. If I could sum up the target demographic in two words, I’d say “Trump voters”: I see a ton of spam that uses the dog-whistles of American conservatism to pitch products, but practically nothing that uses equivalent liberal tokens.
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With pyramid schemes, what I see is them selling that aspirational white middle-class Boomer lifestyles to people who don’t and will never have a snowball’s chance in Hell of ever achieving it: young people under age 35 and poor people. The “family & friends” pitch is a different scam, based on pity and personal trust.
Prosperity gospel Xtian preachers and the GOP have a different target audience of suckers. They’re promoting bogus nostalgia and ungrounded fear of The Other in addition to the illusion of somedayrealsoonnow prosperity, so they’re better off trying to draw in the elderly and the white middle-income middle-aged demographic.
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Oh, there are…
https://behindmlm.com/mlm-reviews/oxo-worldwide-review-magical-hologram-stickers/
“Magical” and pseudoscientific woo is a MLM goldmine.
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The original victim of a pyramid scheme
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“Mummy?”
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Are you my mummy?
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I have wondered about this. How are these not illegal? Did we not ban them?
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I sometimes tell people that they remind me of the tragic hero in Sophocles’ most famous play.
(Idea stolen from a book, but too good to pass.)
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I once had a friend of a friend try to suck me into an obvious pyramid scheme while I was job seeking; I remember literally cocking my head to one side, and asking him directly “Are you fucking kidding me right now?”
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I’ve seen it isolate people from friends and even family who avoided someone trying to sell forward the con they got suckered into. It really is a despicable “industry” that at best screws someone not rich out of valuable time and money and at worst ruins lives.
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Like I said, it was a friend of a friend, one whom I already considered ‘shady as hell’ and not to be trusted. But after that, I was like “Oh, so you think I’m stupid too…”
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