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The Death of MLM & Affiliate Marketing as We Know it?

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Lemonade Inc. is getting some attention today with its launch of an ecommerce platform that practically anyone can sell from. The idea is that people can set up “lemonade stands” on social sites like Facebook that sell products from various well-known companies including Apple and Wal-mart.

My first thought is that this is a very dumb, annoying idea. We already have to put up with our offline friends trying to sell us overpriced MLM products and trying to get us to come to “parties” where we are expected to buy something. Now, we are about to face the same thing online.

My question is this–if I want to buy an iPod, am I really going to find a friend and buy it from their “lemonade stand”? If I want to get it at the best price, wouldn’t I set up my own lemonade stand and buy it from myself?

As annoying as I find this whole concept, it just might fly. I find the whole Facebook thing to be very annoying too but obviously most people disagree with me.

Of course, the Lemonade Stand plan is just part of a small but growing trend to do retail in the Web 2.0 environment. And retailing in a Web 2.0 environment sounds an awful lot like MLM (multi-level marketing). When I started selling online in 1999, I began by selling MLM products. We have moved away from MLM products over the years, largely because I have come to understand that the Internet has become a threat to MLM that is going to eventually kill that whole business model unless it evolves dramatically.

Affiliate marketing is another concept that is going to have to evolve or die. It is simply becoming more and more infeasible for affiliate marketing to work in today’s online environment. My guess is that affiliate marketing is going evolve to more and more look like Web 2.0.

I expect someone to eventually figure out how to sell in Web 2.0 environment and when they do, that will represent the end of both MLM and affiliate marketing in their current forms. I will be shocked though if the lemonade stand idea is the answer. It is just too primitive a concept.

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About Greg Howlett
Having launched two multi-million dollar online companies, Greg Howlett has been working in the trenches of internet marketing for over eight years. He currently is the President/CEO of Vitabase. Vitabase is a leading health supplement company, selling hundreds of products under the Vitabase label. Vitabase markets exclusively online, and has built its customer base by providing a unique and cutting-edge online customer experience.

Greg lives with his wife, Marla, and four children in Monroe, GA.

MarketingPilgrim posts WebProNews Writer
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