ACN video phone malarky update

I sent Francis a letter. It was the least I could do.

Hi Francis,

Thanks for your time yesterday, but I have to tell you honestly that ACN seems like a bit of a dead end for someone with your skills. As someone who has graduated from an entrepreneurship program, you should know that ACN’s business model is antithetical to the idea of entrepreneurship (except, of course, for the owners), and a bit of napkin math would show you that such models exploit the vast majority of people involved as resellers.

A good business idea is worth doing properly. Employing people, paying them a wage, guaranteeing them an income in return for their skills. ACN guarantees nothing and anything more than a cursory examination of the marketplaces in which they compete would tell you that they’re highly competitive and have very low margins, therefore the chances of success are extremely low. Only the first one or two levels in any decent sized market (say, more than a few million people) are likely to make any money.

You say there’s no risk, but actually there’s a lot of risk.

$500 = initial financial risk.
MLM = risking your relationships with friends and loved ones.
The fine print = risk that, if your customers don’t pay, you are personally liable for their debts.
Hours spend trying to sell to your family and friends = risk that time won’t pay off financially.

There are also a multitude of conditions under which your commission can be revoked, and the commissions structure is designed such that it incentivises growth of the reseller network far more than growth of the customer base. At a depth of around 7 levels, the outgoing commission claimed by the reseller hierarchy is around 10.25%, which is a non-competitive level compared to retail and jeopardises the ability of ACN to even make money – unless the point of ACN is to make money by getting resellers to sign up at $500 a pop.

ACN isn’t in the business of selling telecommunications products (or at least that’s secondary). They sell people the idea of a dream – to work from home, to get a guaranteed linear (or, worse, exponential) reward for effort, to be their own boss, to generate passive income. In order to sell this vision, they strategically withhold information about the costs of being involved and the specifics of the technology. And aspirational, naive people want to believe this dream so badly that they sign up.

I feel sorry for them.

All the best,

2 thoughts on “ACN video phone malarky update

  1. Dan,
    Thanks for sharing your insights on this business. I spoke with a representative today and I’m always suspicious when there is a failure to provide specific information. You have confirmed my initial reaction. In a time when so many folks are looking for work after loosing jobs, this type of marketing is doing a real disservice to honest people. Thanks for sharing

  2. Have you tried the product-video phone, well I tried and I can see my loveones that was far away w/o the hassle of opening the computer? And its real time, I am paying my landline anyway why not take this opportunity to used the technology.

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