Shills operate not only in in-person situations but also online.

Shills operate not only in in-person situations but also online.

A “shill” is a hired person (or organization) who publically assists in inciting enthusiasm for a company and/or their products in order to encourage the general public to join a MLM company as a consultant or to purchase products/services. “Shills” are typically very closely associated with the company who hires them to deliberately give spectators (for example in an audience scenario) the impression that they are a passionate consultant or customer, when in reality they are secretly working for the company they pretend to endorse.

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Each direct selling company has its own rules about what distributors can say and do on the internet. It is common for MLM companies to closely guard their trademark(s) and the company has the right to regulate the usage of all of their media, whether it appears in print or online.

The internet has opened up incredible opportunities for both MLM companies and distributors. However, at the same time, MLM companies often wrestle with these opportunities. For instance, some MLM companies will provide a location on their homepage for distributors; some will require a link from the distributors’ homepage to the company’s main website. And, in some cases, direct selling companies won’t allow distributors to promote the company’s product or opportunity (compensation plan) on the internet at all. There are two reasons for this. If the company name appears on each distributor’s homepage then search engine results will produce thousands of “hits” on distributors’ websites instead of the company’s homepage. Amid the thousands of searches, MLM companies may be concerned that people won’t be able to find the company’s homepage.

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People often ask, “What are the top two reasons why MLM companies fail?” Many have speculated. However, we have been in the direct selling industry for a long time and the answer may actually surprise you. The reason for a company’s failure is not necessary always a legal one, which may sound odd coming from a seasoned direct selling attorney.

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