Felicia Lew has a pretty cool day job. The 30-year-old Chicagoan is a veterinary oncologist — she once successfully treated a zoo penguin for melanoma and got to see it at Connecticut’s Mystic Aquarium afterward. Yet, after spending nearly a decade training for her profession, she felt isolated. So this July she began a side hustle: peddling clothes on Facebook through a multi-level marketing company called LuLaRoe.
“For me, it’s about, yes, the money, but it’s more about being able to reconnect with friends that I lost track of over the past eight years of studying,” she says. And: “To connect with people I may not have ever been able to connect with.”
LuLaRoe is a direct sales, multi-level marketing company, or a company in which people sign up to buy inventory from the parent organization, sell it on their own, and earn commission from recruiting more salespeople. Multi-level direct sales have been around since the days of Avon ladies, but the strategy has become especially popular in recent years. Since 2011, the number of Americans involved in direct selling companies — nearly all of which have a multi-level structure — has grown almost 30 percent, according to the Direct Selling Association. In 2015, about one in 16 Americans worked in multi-level marketing.
LuLaRoe, which was founded in 2012 and is based in California, sells mostly women’s and girls’ shirts, skirts, dresses, and leggings in a dizzying variety of prints. Sellers sell both in person and through an elegant set of rules about posting and commenting on Facebook and Instagram. The company is just one of an array of newer, women-oriented multi-level marketing ventures, including Thirty-One Gifts (bags and totes), Scentsy (candles), and It Works! (“toning” skin wraps). Like many of these companies, LuLaRoe is driven by a peculiar, positivity-focused corporate culture, and promises big money to those who sign up. And while LuLaRoe itself would not provide specific numbers to Pacific Standard, nearly 80 percent of multi-level marketers are female, according to the Direct Selling Association.
These companies promise to help women connect with each other and their families in ways that traditional corporate jobs don’t. “The team is actually probably one of the most supportive places you’ll ever find,” Lew says. And yet critics say that the few numbers that companies have made public suggest the proportion of sellers who are actually profitable is less than 1 percent. In the past several years, unflattering stories about multi-level marketing companies have made the news, including the years-long showdown over whether the supplement-maker Herbalife is a run as a pyramid scheme. The Federal Trade Commission even has a webpage dedicated to helping would-be entrepreneurs distinguish between multi-level marketing and pyramid schemes.
So, do these shopping programs work as advertised? Or are they poor deals that shoehorn only too well with the way girls and women are taught to share and, after all, to not think too much about money?
Stacie Bosley, an economics professor at Hamline University in St. Paul, Minnesota, sees merit in both sides of the debate. Bosley has served as expert witness on behalf of the Federal Trade Commission, in a lawsuit alleging the Vemma Nutrition Company, a purported multi-level energy-drink seller, was actually pyramid scheme.
The company was ultimately barred from paying commissions and recruiting new members, cornerstones of its multi-level structure. Yet, unlike many who study multi-level marketing, Bosley isn’t necessarily against it. It’s just that its traditionally feminine values worry her. Multi-level marketing companies that target female sellers often emphasize cooperation over moneymaking, she argues. Working for a cooperative company can feel good, but also cause sellers to “process their experience differently and think about the social returns and worry less about the financial returns,” Bosley says. “I’m hesitant to suggest it’s advisable for a woman to rationalize her experience through her social returns at the expense of significant financial losses.”
Bosley walked me through how the risks and rewards LuLaRoe offers those who join compare to the company’s competitors. Among the positives is the fact that, unlike some, LuLaRoe doesn’t require sellers to buy more inventory after the first batch, so folks don’t get themselves more and more in debt to headquarters.
In addition, sellers — “consultants,” in LuLaRoe parlance — don’t have to recruit more people to make money. They are certainly rewarded if they do. Every wannabe consultant must sign up with an established seller and every time she buys inventory from LuLaRoe, her recruiter earns a commission. Once a seller recruits enough people and her sales team orders a minimum number of pieces of clothing every month, she starts getting a small percentage of the company’s profits. Bigger checks come for those who recruit the most.
(All the details about LuLaRoe’s structure come from the half-dozen consultants who agreed to speak with me. Shortly after I started reaching out to the company and its sellers, one seller told me that, during her last training call, LuLaRoe leaders told them not to speak on behalf of the company to journalists.)
Bosley points to other factors that might make the company riskier than otherwise similar multi-level programs. LuLaRoe requires an unusually large initial investment for a multi-level marketing company, about $5,500 for the starter set of clothes. A Christianity Today article about multi-level marketing from last year cited typical buy-ins as in the hundreds of dollars. Kaeli Amato, a seller in Arlington, Washington, opened a new credit card to afford her introductory box. “I was literally nauseous about it,” she says.
There don’t seem to be enough concrete protections against market saturation — the company doesn’t prevent two people who live very near each other from both becoming sellers, although it does maintain a map that would-be sellers can study themselves. “Too many consultants” is a common complaint among LuLaRoe’s Glassdoor reviews.
Until recently, the company emphasized extraordinary outcomes that are belied by the less-than-1-percent profitability estimates from prominent multi-level marketing critics such as Robert Fitzpatrick and Jon Taylor. In July, lularoe.com included testimonials from a consultant who said she supported her family with LuLaRoe after her husband was laid off, and from one who said she went from barely being able to afford food to looking at houses and vacations.
By September, those testimonials had been removed from the site. There was “no specific reason” they were taken down, Nikki Santillana, LuLaRoe’s lead communications coordinator, says. “We’re constantly updating our website,” she says. “It was just to keep the content fresh.” (LuLaRoe otherwise declined to verify facts for me such as how commissions work, how much consultants earn, and what the cost of the buy-in package is.)
Unlike some other multi-level marketing companies, LuLaRoe doesn’t fully disclose what its consultants earn on its website. In general, however, the vast majority of multi-level marketing sellers earn only a few thousand dollars in revenue from their work a year, as Christianity Today reports.
Overpromising results is against Federal Trade Commission rules, though some argue that multi-level marketing companies regularly flout the law.
But how do those doing the selling feel? The stories LuLaRoe sellers tell show that, despite the risks, consultants see direct sales as a smart solution to real problems in their lives.
Amato joined LuLaRoe after quitting her job as a medical assistant last January. “I was just staying home with the kids. I shouldn’t say ‘just.’ I was super busy with three kids,” she says. The first time I call her, she’s in her car, talking to me over Bluetooth, on her way to pick her up her children from her sister’s. The second time I call, she’s on a walk with all of them, aged six, four, and 18 months.
Amato set out with a goal of earning an extra $500 a month, to help make up for the fact that she had stopped working. Now she does about $2,000 in sales monthly, she says, on items whose profit margins range from 35 to 50 percent. “But aside from the money, it just gives me something else to focus my mind on,” she says. “Something more adult.”
The set-up recalls the Tupperware parties of the 1950s, and the market too. The Tupperware Corporation was a direct-sales pioneer, and many companies still use its innovative tactics today. In 2014, Marketplace described “the kind of woman Tupperware recruited — and still does — to sell its product: A wife and mother who wants to earn money without sacrificing the home life.”What she misses about her job is talking with the patients, whose exams, shots, and blood draws she would prepare. Now, she gets to talk to new people at home-shopping parties, where she brings her inventory to the house of a “hostess” who has invited friends over to look at Amato’s wares. The more her friends buy, the more free clothes the hostess gets from Amato.
Of course, in the time of the first Tupperware sellers, job opportunities were much more limited for American women. Selling and hosting Tupperware parties were the dawn of better options: They gave women a source of income, taught them new skills, and gave them space of their own to socialize. But the parties also reinforced women’s roles as homemakers whose most important job was shopping. In her book, Tupperware: The Promise of Plastic in 1950s America, Alison J. Clarke calls Tupperware selling “a pragmatic, if compromised, alternative to domestic subordination.”
Sellers themselves have never seen it that way. Many of Clarke’s interviewees saw selling as empowering, a view both Tupperware and LuLaRoe encourage. “I believe in you and you can do it are the basic principles guiding LuLaRoe today,” the website reads.
“It’s hard staying home all day doing kid stuff and house stuff,” Amato says. “LuLaRoe makes me feel like it’s keeping that working side of my brain alive.”
Tiffany Cook is Felicia Lew’s sponsor and trainer. In her Facebook sales group’s photos and videos, Cook has waist-length, blond hair and big glasses. Over the phone, she’s so energetic, I hang up feeling caffeinated by proxy. More than 22,000 customers follow her Facebook group, “Tiffany’s Secret VIP’s!!!!”
“There are more people in my shopping group than there are in my town,” says Cook, who lives in Bullhead City, Arizona. In addition, she estimates there are about 1,200 “girls” in her sales family — women she has recruited, her recruits have recruited, and so on down. (In contrast, Amato has four recruits. Lew has zero.) Cook says the last “bonus check” she received — money earned from her recruits, not from selling clothes — was more than $87,000. Her bonus checks are now consistently larger than her sales ones.
Some people seem to get a lot out of purchasing from their friends, versus trekking alone to the nearest Kohl’s. “An economist would say you need to take into account the social returns as well,” Bosley says. “There is a place for this in the world of women, it seems.”
Tupperware parties arose “in a period of increasingly alienated commercial activity,” Clarke argues. Direct selling provided a balm, “a form of exchange that maximized social interaction.” The 2010s have also seen radical change in how we sell and buy. After a decade of steady growth, e-commerce now makes up about 8 percent of America’s retail sales. In the past year, Americans spent an estimated $380 billion shopping in the lonely blue glow of their computer, tablet, and smartphone screens.
LuLaRoe Facebook sales offer the convenience of purchasing online, plus something more. Consultants often hold sales just once a week, for 24 hours, which encourages everyone in the group to do it at roughly the same time. “Set your alarm and come shop with me!” Lew writes in one of her Facebook group posts. “PJs and wine optional but highly recommended.” In between sales, Lew puts up questions for her followers to answer in the comments. One recent post asking what outfit she should wear to dinner garnered 74 (unhelpfully divided) replies.
Cook is Mormon — one of the first things she did after college was go on a mission to Taiwan. Perhaps it’s no surprise that LuLaRoe’s founders are also Mormon. The Church of Jesus Christ of Latter-day Saints often encourages mothers to stay home with their children, and, as a result, Mormon women are less likely to work full-time than their average American counterparts. Mormon women are more likely to work part-time and more likely to identify themselves as housewives. Multi-level marketing companies like LuLaRoe can fit in this picture better than other jobs.
In a YouTube video she posted in October of 2015, Cook explains that, after she had their second child, her husband, an optometrist, wanted her to become a stay-at-home mom.“He didn’t want me to have to work anymore,” she says. “I quickly found out that I’m the type that — I’m a go-getter. I really enjoy making money.” That’s why she joined LuLaRoe. Later in the video, she calls her desire to earn her own income “selfish.”
“MLM allows Christian women to engage business, community, and family at once, in a way that the current work-home divide doesn’t allow for, at least not as seamlessly,” Christianity Today editor Kate Shellnutt wrote in the magazine in 2015. “As long as MLMs are regarded by conservative Christians as a more honorable option for women than a normal part-time or full-time job, these organizations will continue to attract women within the church at significant rates,” Jen Wilkin, a minister in Texas, told Shellnutt.
The LDS touch is light in the company’s promotional materials. Videos mention “blessings,” but don’t talk about God, for instance. But the founders’ faith shows through in another important way: The clothes are designed to cover women up. “All the clothing is modest in our eyes,” Cook says, “so we can wear it and we can feel cute.” Lew offers another reason for the clothing line’s signature long sleeves and skirts. They’re supposed to be comfortable and “flattering” for plus-size women. “They’re never like, ‘I can’t wear that because it doesn’t have sleeves and I don’t like my arms,’” Lew says.
Many feminist thinkers have embraced the idea that women of every size can wear clothes of any style they want. They shouldn’t feel the need to cover up because they don’t look like conventional fashion models. When I ask her if she’s aware of that strain of thinking, Lew says, “If you like things tighter, you can size down.”
The problems my LuLaRoe sellers were looking to solve are real and widespread. In a 2013 Pew survey, half or more of working moms and dads said they had trouble balancing their responsibilities. One-third of parents felt they didn’t spend enough time with their children. Yet even when it’s economically feasible, having a parent quit work entirely isn’t always the best solution. The history of women’s rights in the United States demonstrates how crazy-making exclusive home-making can be. With their flexible hours and work-at-home structures, multi-level marketing companies like LuLaRoe promise the best of both worlds.
As for Lew, who’s childless, what she hoped to fix was just as real, if less well-documented, than the difficulty of “having it all.” When she moved from the West Coast to Tufts University, for vet school, she only knew one person there. When she moved to Marblehead, Massachusetts, for specialized training, she didn’t know anybody. Still, she felt she had little other choice. “With residency, it’s so hard to get one, people who restrict themselves to certain areas don’t get one,” she says.
She soon found herself friends only with vets, other students brought in from afar by their ambitions. To make outside friends, she tried joining Meetup groups, but, she says, “I never got the guts to go by myself. I found it a little scary.” She thought about picking up an activity like rock climbing, but found that difficult without a partner. Now, she’s moving to Chicago because her boyfriend got a job there. She landed a job, too, but hopes to expand her LuLaRoe work in the Windy City to include in-home sales.
“Are any of you wonderful ladies located in Chicago or know people in Chicago?” she wrote in a recent post. “You’ll be able to stop by and go shopping in my home very soon!!”
Psychologists have long documented Westerners’ aversion to mixing private, personal relationships with work, moneymaking, and other “public” activity. But for many, that’s exactly the value of multi-level marketing companies like LuLaRoe. For me, I’m not sure what to think of these energetic, loving women opting to solve the big problems of modern female life by joining a company with LuLaRoe’s particular view of women’s empowerment. How is that we have no better solutions than companies that replicate a model that was radical in the 1950s? Should women have to invest $5,500 for a space for adult interaction?
To be sure, the women I talk to seem happy with their choice, which they’ve all made in a much less constrained time than Tupperware America. I just can’t help but hope there will be better choices in the future, whether it’s more extensive parental leave and childcare policies, or just a sweeter, purer way of making friends.