From: noring@netcom.com (Jon Noring)
Subject: Selective Disclosure (was Re:  LOOKING FOR GOOD MLMs (?) )
Organization: Netcom - Online Communication Services  (408 241-9760 guest) 
Date: Tue, 13 Oct 1992 01:38:23 GMT

In article lpj@col.hp.com (Laura Johnson) writes:

>Why do Amway distributors often talk to you for many minutes about
>"this great business opportunity" without ever saying "Amway"?
>
>When people do this, it makes me think that YOU are thinking, "If she
>knows what this organization is, she wouldn't be interested." THAT in
>turn makes me think that I SHOULDN'T be interested. It also puts MLM'ers
>in the same class as Jehovah's Witnesses (who sometimes use the same 
>tactic). If I'm NOT interested, and I already know that I'm not, 
>you're wasting both our time.
>
>So what do you say, folks? If you use this "technique", why?  Is it that
>your MLM has such a bad name that you EXPECT people to walk away if you
>tell them too soon? What's the deal?


Laura Johnson brings up probably the main difficulty in building a marketing
network in one of the well-known MLMs, such as Amway (as an example).  There
are some principles that I've discerned that will help in understanding the
answer to her inquiry.  My answer will be long and arduous.  The answer will
not please everybody - even some MLMers may question it.  In summary, there
is no simple answer here and I wouldn't be surprised if it brings up more
questions than it answers.

First of all, I have observed that *all* MLMs, once they get big enough,
develop a negative name recognition among a significant fraction of the
population.

Those who oppose MLM, that is, those who do not like that kind of marketing
and who are very vocal about their opposition, will say that the people are
getting 'smart' and have finally 'pegged' that business for what it really is -
a scam.

On the other hand, those people who hold positive views of legitimate MLMs
(including many who themselves don't personally participate in an MLM) would
counter that the negativity is unfounded and stems from two sources:

1. unethical or unwise business practices of some distributors/organizations,
2. the extremely vocal negative statements of the most radical of those who
   oppose MLM that I just described above ("well-poisoners" as Walt Disney
   called them).  MLM is a very visible business, more so than any other, so
   it elicits the most public and vocal opposition from the "well-poisoners".

I believe that most name recognition negativity stems from those radical
anti-MLMers (we see them here all the time on the net), but I'll be the first
to admit that some of the negativity has come from the practices of unethical
distributors as well (fortunately most large MLMs have very strict codes of
ethics, and these unethical people are eventually purged, but not before
damage is done).  How you therefore view prospecting techniques first of all
depends on what you believe *the source* of the negative name recognition
comes from.

Now let me describe another principle, and this one comes from practical human
psychology.  I call it the "Steel Door Principle".  This principle, which I've
verified over and over again during the process of expanding my business,
states that most people, when they hear or see something, will search their
memory banks for some type of emotional association.  If the associated
emotion is negative, they will tend to tune out any further information since
it would be a waste of their time (best described as a steel door dropping in
their mind - all the logic of Immanuel Kant will never be able to pry this
steel door open once closed).  If their emotional association is positive,
they may want to get more information if it piques their curiousity.

Another principle that guides MLMers is their belief that the business they
represent is honest, moral, ethical and legal, and profitable, and this in
part stems from them having taken the time to check out the facts about the
business and then forming an opinion (the principle of specific knowledge).
Of course, those who don't like MLMs for whatever reason would counter that
these misguided souls have been given misinformation, that is, that they have
been duped in some way and that if they only would get more information from
the right sources (that is, from the anti-MLM crowd) then they too would be
enlightened and quit that immoral endeavor.

Anyway, this principle is the one that is probably most controversial.
Combined with the other two principles, a MLMer will come up with the
following logic (the opponents would say that the logic is flawed, but I'll
let them show where it breaks down):

1.  Because I've looked closely at this business, I see that it is a great
    business, and if others see it as I see it, then they may want to get
    involved also - if they see that it would meet some need in their life.

2.  But, if I drop the name of the MLM too early, before giving them specific
    information, then there's a good chance that the "steel door" principle
    will take effect and I will not be able to share with them my information -
    and they will make this negative decision before getting all the facts.

3.  Thus, I must give them information about the business, but without giving
    them some name upfront that will give them an emotional, rather than a
    factual basis for making a decision.  And I must do this in a way that is
    not negative or misleading otherwise they won't want to be involved with
    the business for this very reason (this is the tough part of building a
    successful MLM - opponents would say there is no way to do this,
    proponents, such as myself, believe that there are ethical ways to do this).

Now, for point three above, those who support MLM would call the curiousity
approach a process of selective disclosure;  opponents would call it deception.
But is it deception?  For those of us who hold the facts we do about this
business, the answer is no.  In fact, many, including myself, would justify
this with the statement that telling them the name before the facts would
actually be misleading them since they may come to, what we believe to be,
incorrect conclusions about the business.

Again the above paragraph is not complete without giving specific examples
from my business to support my contention that selective disclosure is moral
and ethical if done properly.  Whenever I show the plan to someone who does
not have the name 'Amway' associated with my presentation (actually many do
know it's Amway because I tell them - I've developed an intuition as to when
it's o.k. to tell them it's Amway before seeing the plan), I will always ask
them the following question at the end of the presentation:  "If I told you
that this was Amway, would you have even sat down with me in the first place
to get the information?"  The answer is usually no about 3/4 of the time.
Then I ask: "Did what I just show you jive (or correlate) with what you
believed Amway to be before my presentation?"  Again, the answer is usually
"no" about 3/4 of the time.  I finally ask them if they are excited about the
actual details of the program, and would be interested in getting more
information - well over 90% say yes (I believe most are sincere).  Of course,
I don't sponsor over 90% of the people I show the plan to (it's around 20%),
but I feel good because most of the other 80% who finally decide not to get
involved become very supportive of MLM, and from this positive view (because
of the power of specific knowledge principle), I've had many good referrals
from this 80% "not for them" group.  In summary, this actual experience in
my own business has confirmed to me that selective disclosure is moral and
ethical provided it is done correctly and that no deceit or distortion of
the actual facts is done.  Successful selective disclosure then becomes an
art that is learned from upline who are already successful at it.  Ray Kroc,
in building the McDonalds empire, was a master at selective disclosure to
his owner/operaters.  Many have thanked him for not revealing right away
all the picky details of getting a McDonald's franchise going, otherwise
they would have decided not to go ahead.

Anyway, this is a very controversial area, and I would not be surprised if
my answer will generate more questions, uncertainties, etc.  It is just too
darn difficult to cover all of my bases with only an hour to write this.  I
look forward to comments from everybody, even including those who do not like
MLM, who I sure will have a field day picking apart this long answer with
a surgeons knife.  :^)

Jon Noring

-- 
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