Pretty TLDR; but will probably save you a lot of future trouble...


There has currently been a lot of brouhaha on MLM, specifically the resurgence of binary network marketing companies in the Philippines. I’ve long kept my opinions on this business strategy to myself, as I’ve a couple of relatives who are members of such companies. But I feel it’s about time I share my take, so here’s my 10 cents worth.

Firstly, let me point out something quite off with this type of “marketing”. I don’t know why but it seems that this strategy is built upon the premise of potential recruits being infinite. The reason why I say this is that if you look at it closely, even with the population of the entire Philippines as a recruitment base, a perfect binary tree where everyone has a down line, can only go 27 levels deep. Even with the population of the entire world you can only go 33 levels deep, before you run out of recruits.

Here’s proof:

h = log2 (n +1), where n = number of nodes / members; h = height/level of tree
h = log2(91,983,000 + 1) ; Philippine 2009 census data
h = 26.454

h = log2(6,697,254,040 +1) ; 2008 WB population data
h = 32.641

Some skeptics may now be saying that binary trees can’t be perfect in the real world. I concede to that fact. But when you think about it, the best way to get the maximum number of people to earn in the company is a perfect tree. And besides, who doesn’t want their recruits to have recruits as well? Or maybe some leaders really don’t?


Secondly, being that these are marketing companies and that they employ “word of mouth” to gain more recruits. It absurd to see that they’re basically going against the premise of marketing: to reach the most number of audiences with good opinions of the organization. For a person to break even via recruitment, he would have to have people below him not being able to. And marketing studies show, that a person who has had a bad experience of something tells an average of 7 persons compared to 3 persons of someone who has had a good experience. To show clearly what I mean let me illustrate with another example.

Let say in a certain company A, you need to pay 8k as membership fee. And for every 500 and for every pair you get 1k. With this, the lowest person in a tree to break even would need to have at least 4 pairs or 8 people under him who hasn’t. Think about it.

This is also a part of the reason, why I say this type of marketing is based on the premise of infinite number of recruits. Some will say, that getting the product packages that come with the membership, has already made the person break even. Right, the reason why people join this type of network marketing is to sell overpriced stuff. And that these packages aren’t just there to be able to skirt the existing law.


Thirdly, because everyone in the world is only separated by 6 to 12 degrees, sooner or later you are going to start competing against someone you know for recruits. So when these “leader” say “we’ll be helping each other out” they’re actually saying: “we’ll help you, but we’re not promising to compete against you for recruits”. How convenient. So when you really ponder about it your main competition is your immediate cross-line. Next would be your direct up line, as he will almost always put a recruit on your strong side to maximize his income, well that is if you are on his weak side. Wow, this is how they help each other, nice. Now could you stand doing that to your friends?

Fourthly, when you first come to these pep rallies. They tout their business as can be handled as a “sideline” to your day job. Ask then those leader there why they’re there almost 24/7 if it were that easy. They make it sound so easy compared to regular jobs; people in this type of business even abhor regular paying jobs. Stick it to the man they say. But in the end of it all you’re just really working for the company owners, selling their wares for free if I may add or 13% commission at best when you match a pair. Wow, that’s some way of sticking it to the man.

I could enumerate a ton more reasons, but surely from the few I illustrated you can see that this type of strategy is based on half truths; illusion peddling; a naïve belief that the recruit population is infinite. Ofcourse there are those who have earned mega bucks, but we now all know that group is measly compared to those who haven’t touched any single return. If you can stomach that, you probably have very cold heart and an extreme love for cold hard cash and deserve everything that’s coming to you.