Today’s look at why Mary Kay is just the tip of a pyramid-shaped iceberg — is brought to you by the Investigative Fund, who asked me to dig deeper into the direct sales industry as a whole. I’ve been getting so many great emails from folks who have read the Harper’s story or heard one of the NPR interviews last week and one thing everyone asks is: “So what about [Avon, Amway, insert-your-direct-sales-of-choice-here]? Are they as bad as Mary Kay?”
And one last radio update for you before the weekend! This interview with Tess Vigeland aired on NPR’s Marketplace yesterday evening. It’s just five minutes — much shorter than my other segments and tightly edited (we taped in the afternoon) but if you want a great, fast digest of my Harper’s story and everything we uncovered about Mary Kay, you’ll get it here (transcript and podcast both available).
I spent a fun hour on NPR’s KERA this afternoon, as a guest of THINK with Krys Boyd. The show airs live in Texas, where 30,000 Mary Kay consultants are currently gathered for the annual Seminar in Dallas.
Plus, Mary Kay’s Director of Corporate Social Responsibility, Crayton Webb, comes on for the second half of the show and things get… spicy.
You can listen to the podcast here (click “The Beauty Business” link), and also head over to the show page to add your comments.
When I spoke with Laura Beitler, Mary Kay’s Vice President of Compliance, on NPR’s On Point on Monday, she was quick to emphasize that “absolutely, the majority of our products end up with the end consumer.” But when we pressed her, she also had to admit: “We can’t and don’t track retail sales.”
How can both those things be true?
To avoid falling into the Federal Trade Commission’s official definition of a pyramid scheme, it’s very important for Mary Kay — and all multi-level marketing companies — to insist that their primary goal is getting their products out to retail consumers. But to avoid being exposed as a business where the vast majority of the sales force is losing money, all of these companies have to claim that they have no idea what those end retail consumers are spending.
Industry Claim #1: Nobody is required to buy inventory.
This is true. Antonella even told me so when we did my official Mary Kay orientation: You’re not required to purchase a single thing from Mary Kay beyond your $100 starter kit.
“But,” she said. “There are some advantages.”
Just because you aren’t required to buy inventory in Mary Kay, doesn’t mean you won’t get the hard sell about why you’d be crazy not to buy inventory. My experience and the experiences of the women in my story suggest that you’ll be pressured heavily to buy inventory “if you’re serious about your business.”
In fact, Mary Kay is set up so it seems like the only way you’ll ever make money is through large inventory purchases. If you’re not spending enough on products, the company finds other ways to cost you money, like charging you shipping and only shipping to your house — meaning you spend time and money traveling around to deliver your orders yourself. As Lynne explained on yesterday’s edition of NPR’s On Point, to stay active in Mary Kay, you have to place $200 in wholesale orders every
month. [EDIT: Per Lynne's comment below, it's once a quarter, not once a month. — VSS]
In case you missed it live yesterday, here’s the podcast of NPR’s On Point, which devoted its second hour yesterday to Investigating Mary Kay, inspired by my Harper’s article.
The show was guest-hosted by Wade Goodwyn and in addition to me featured Lynne (one of the women profiled in my story) and Douglas Brooks, a practicing attorney who has litigated numerous class action suits on behalf of victims of multi-level marketing schemes over the past 20 years.
Another coda to The Pink Pyramid Scheme — and more free online content for y’all! The Investigative Fund asked me to blog about why I went to beauty school in the first place, since that is, of course, how I met my first Mary Kay ladies and stumbled on to this story.
Regular readers here might think you already know the whole Beauty Schooled story, but this post is still worth a read — because I talk about the enormous gap between what women spend on beauty ($200 billion in 2009, the year I enrolled at Beauty U) and what women can earn when they sell beauty. As you’ve probably guessed by now, it’s not a hell of a lot whether you’re hosting Mary Kay parties or waxing eyebrows in a salon. And since beauty workers are almost always also beauty consumers, too … there is math here that is just not adding up. Read more.
As a follow-up to yesterday’s announcement about my article, The Pink Pyramid Scheme (which, annoyingly, is behind a paywall online right now — I know!), I‘ve written a companion piece that you can read for free on Harpers.org called “How Mary Kay Sells Women On Having It All.”
Because there has been a lot of talk online recently about that whole “having it all” thing — why women still don’t have it, what “it” even is and whether we want it, and so on. And Lord knows, we’re blaming feminists for plenty, but the fact of the matter is, Mary Kay Ash started promising women economic independence and empowerment back in 1963, way before power suits were trendy. But even as she built up the idea of having it all (and even later wrote a self-help book by the same name), she held firmly to the Mary Kay company motto: God first, family second, career third. Which neatly traps women in traditional gender roles, meaning your only path to empowerment is one that leaves the status quo tidy and intact.
My new cover story, “The Pink Pyramid Scheme” is out in the August issue of Harper’s Magazine.
This is a big one.
I’ve tracked this story for the past three years, since enrolling in beauty school and discovering that most of my Beauty U classmates moonlighted as salespeople for Mary Kay, Avon or another direct sales cosmetics brand. (An early report of my first Mary Kay encounter appeared on the blog back here.) “The Pink Pyramid Scheme” shares their story, along with the experiences of other Mary Kay ladies who have wound up divorced and in debt — some truly brave women who shared their stories with me even though leaving Mary Kay is, for many, like leaving a bad marriage and a religion combined. Think public ridicule, stigma, guilt, and serious emotional and financial fall-out.