This Video Explains Which Statement is True: Celebrity Endorsements Improve Marketing or Celebrity Endorsements are a Double-Edged Sword.

In the conventional advertising world, celebrity endorsement is very effective. Among the factors for effectiveness includes the fame of the celebrity, the connection with the product or service, whether or not the celebrity is a user and whether or not the statements of the celebrity appear as truly authentic or merely a “pay for endorsement.”

The use of celebrity endorsement is far less successful in the direct selling industry. In fact, the advertising model for MLM is quite different than conventional advertising. In conventional distribution, such as retail stores, internet or broadcast media, companies pay advertising dollars and endorsement fees to promote the brand. However, in direct selling, the commissions and rewards paid to distributors are effectively the advertising

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Trademark of Herbalife

A Belgian appellate court declared December 3, 2013 that Herbalife is in fact operating in compliance with Belgian law, reports Yahoo! news. This ruling is in response to previous claims by the consumer organization, Test-Aankoop, that the international nutrition company was operating as a pyramid scheme.

Herbalife was established in 1980 and operates in over 75 countries. The company is the world’s fifth top direct selling company, with 2.7 million salespeople in roughly 79 markets, reports mlmlegal.com.

For additional information, read the following articles:

Herbalife:  Belgian Appeal Court: Herbalife is No Pyramid:  Validates Legitimacy: The Next Chapter in Recognition of Personal Use

**See a translated copy of the actual Belgian Court of Appeal Herbalife ruling.

Herbalife Statement Regarding Belgian Appeal Court Ruling

Herbalife: Belgian Court Overturns Pyramid Ruling

Herbalife says Belgian appeals court reversed pyramid scheme finding

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According to an article at MSN’s website titled “Queen Elizabeth’s eating habits revealed,” former royal chef Darren McGrady states that Queen Elizabeth enjoys a bowl of cereal every morning topped with fruits or nuts from her garden, which are stored in one of the most popular direct selling products, Tupperware. Perhaps even the Queen of England owning and using Tupperware products shouldn’t be a surprise considering Tupperware was ranked the seventh largest direct selling company in 2010, with $2.3 billion in net sales.

As one of the largest MLM companies in the world, Tupperware operates in over 100 countries and has over two million salespeople. Tupperware’s top five consumers are Germany, America, Mexico, France, and Australia. The company itself was founded in 1945 by Earl Tupper and grew to be quite competitive with its “burping seal” technology.

The top ten largest global direct selling companies include 1) Avon Products, Inc., 2) Amway,

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The Next MLM Startup Conference Takes Place May 16 and 17, 2013 in Las Vegas

How to Start a MLM Company

May 16-17, 2013 - $195 (Second Attendee just $150) - Las Vegas

PORTLAND, OR–(Marketwired – May 07, 2013) – For more than 25 years, leading industry experts have educated the executives of starting and existing MLM, direct selling, network marketing, and party plan companies on how to structure their compensation plans, legalize their companies, recruit key employees and top-ranking distributors, develop business models, generate leads, fund their business, establish their website and technology platforms, better understand the direct selling industry, and so much more. View the conference flyer page at http://www.mlmlegal.com/srs2.html to learn more.

This is the original MLM Startup Conference — responsible for launching many industry-leading companies — perfected over the course of a quarter of a century to ensure the highest quality of information, the most knowledgeable experts and the most practical advice from practiced experts.

Over the course of two days, attendees will hear from more than a dozen industry experts who have served as “behind the scenes” advisors to many of the direct selling industry’s leading companies. A full list of speakers and their biographies/credentials can be found at http://www.mlmlegal.com/bio.html.

In addition, the conference will discuss the recent analysis article on the role of “personal use” in pyramid and direct selling analysis: “Herbalife: What Short Sellers Missed on the Way to the Press Conference… The Personal Use Issue in Pyramid Analysis; Who is an Ultimate User?”

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Herbalife: What Short Sellers Missed on the Way to the Press Conference…

The Personal Use Issue in Pyramid Analysis; Who is an Ultimate User?

An excerpt from the article and link to the full article at www.mlmlegal.com

Déjà vu, all over again … Yogi Berra

History repeats itself.

The 2012 billion dollar short seller attack on Herbalife, a 32 year old NYSE listed direct seller of nutritional products in 80 plus countries with annual sales in excess of $3 billion, is akin to a replay of seminal challenge to the MLM/Direct Selling model, won by Amway in 1979. In the Matter of Amway, 93 F.T.C. 618 (1979).

In the 1970’s FTC challenge, the criticism went to whether or not the core of the MLM referral selling model was a “deceptive” way to market. In the 2012 short seller attack, along with other criticisms, a principal complaint is that evidence of “substantial personal use and consumption” of company products by distributors themselves, renders an MLM/Direct Selling model inherently deceptive and an illegal pyramid scheme.

Memo to short sellers and algorithmic financial bloggers:

It may be time to reassess.

Some very salient facts and cases may well have been missed in the rush to challenge direct sellers.

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CNBC Senior Stocks Commentator, Herb Greenberg, evoked the expertise of leading MLM attorney, Jeff Babener, in the Commentator’s blog post “How Multi-Level Marketers Dodged a Bullet.”

CNBC – January 9, 2013

In his article, Commentator Greenberg discussed the effect lobbying dollars spent by the Direct Selling Association (DSA) and Herbalife assisted in the exclusion of consultants from the Business Opportunity Rule, enacted by the Federal Trade Commission (FTC).

Attorney Babener’s (editor of www.mlmlegal.com and www.mlmattorney.com) widely read article titled “The New FTC Business Opportunity Rule – MLM/Direct Selling Exemption Recognized” was quoted saying:

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…Last week, I knocked Herbalife for claiming it does a bunch of R&D, but not disclosing the amount it spends on it.

Then, later in the week, without fanfare, the nutritional supplement company updated the R&D section of its website to show the amount it spends on R&D and other stuff… Continue Reading…

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