April 16, 2024

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Multi-Level Marketing Scheme It Works Is Thriving on TikTok

  • A multi-level marketing company called It Works is spreading on TikTok.
  • Insider found 22 users selling the products to hundreds of thousands of followers on the platform.
  • The products are scientifically dubious and potentially dangerous, according to a health expert.

A multilevel-marketing company has been operating on TikTok since at least October 2020, with young women making bold claims about how “skinny coffees” and diet supplements helped them

lose weight

in an attempt to recruit others to the scheme. The company, It Works, had its account itworkshq banned by TikTok at the beginning of April, a few days after Media Matters released a report labeling the company “predatory.”

Despite this, Insider found 22 users still selling the products to hundreds of thousands of followers on the platform.

It Works’ products are scientifically dubious and potentially dangerous, according to health experts, and most people involved in this kind of multilevel marketing find it impossible to earn any sort of meaningful income.

TikTok announced it was banning content that promotes multilevel-

marketing companies

with new policies announced in December 2020, but researchers have found that the platform is struggling to enforce those rules. It Works is one of the most popular MLMs on the platform, but it’s just one example of a bigger problem — that millions of people across the world are facing economic difficulty and turn to schemes that are unlikely to ever make them anything but a financial loss.

“The number of people who make money is minuscule, it’s statistically insignificant,” Robert L. FitzPatrick, the author of “Ponzinomics, the Untold Story of Multi-Level Marketing” and president of consumer organization Pyramid Scheme Alert, told Insider.

The revenue from average salespeople ultimately filters up to a small group concentrated at the highest levels of these companies.

“This tiny little cadre of people at the top of these schemes who are rolling in money,” FitzPatrick said.

It Works MLM content is reaching millions on TikTok

Insider found 22 individual accounts, all women, selling It Works products and posting recruitment videos, as well as one active brand account affiliated with the company. Some It Works sellers have thousands, or even hundreds of thousands, of followers. One saleswoman, Yordanka Perez, has 446,000 followers and 2.5 million likes on her videos.

It Works also freely exists on Instagram, where its main account has over 63,000 followers, and on Facebook, where over 87,000 people like the page, and nearly 97,000 follow it. Facebook and Instagram did not respond to Insider’s requests for comment.

Women who are part of the scheme post video after video about their apparent weight loss, often using the same messaging and background music. They urge viewers to “Message COFFEE on Insta” to learn more about “the best switch I ever made” as they dance around to trending music on the app. Messaging “LOSE” or “CHANGE” on these users’ Instagram profiles will direct customers to several products distributed by It Works, including skinny coffee, weight-loss gummies, and diet smoothies.

It Works sellers sometimes attempt to boost their views by adding trending hashtags to their videos and taking part in viral trends. Other videos feature weight-loss claims with before-and-after photos of customers who claimed to have used the products. In one video posted on April 6, a seller named Karen Asprilla shows an old picture of herself, in which she says she was a size 14, “bloated all the time, and not confident at all.” In a subsequent picture, she claims to now be a size 8 and full of confidence, then encourages viewers to text a number in her bio for more information.

Another one of Asprilla’s videos, which has over 400,000 views, shows her holding up a jar of gummies next to a caption that reads, “How I lost 4 pant sizes without any crazy diets.”

Asprilla had posted a few videos of TikTok dances and simple videos of her life before her content morphed to focus on It Works full time. Other accounts, like that of a prominent It Works seller called Fanny Carmona, who has 11,000 followers, appear to have been set up specifically for distributing the product because its posts are specifically geared toward It Works.

Asprilla, Carmona, and Perez did not respond to Insider’s requests for comment. It Works also did not respond to Insider’s requests for comment.

Registered nutritionist Graeme Tomlinson told Insider that there is no evidence that any of It Works products actually work, and they could, in fact, be “extremely harmful.” It Works reps claim the skinny coffee gets rid of food cravings, but Tomlinson warned that suppressing appetite when we’re hungry can lead to disordered eating.

“If we are hungry, it’s usually a sign we need to eat and we should respect that. Drinking coffee to suppress appetite (whether it works or not) is highly disordered,” Tomlinson said.

Other It Works sellers promote gummies, which they say will shrink your stomach, a claim Tomlinson says is not based in science.

“Technically, replacing food for these gummies could result in weight loss, as you’re stripping calories, but this is a highly disordered and extremely dangerous intervention and mindset,” Tomlinson said.

As for the “skinny wraps,” body wraps that also claim to reduce stomach fat, Tomlinson says they may lead to temporary water loss, not long-term changes to the body. He believes all the It Works products are potentially dangerous because they could lead to disordered eating if people trust them rather than addressing overall diet and lifestyle.

TikTok’s ban on multilevel-marketing schemes doesn’t appear to be working

TikTok is aware of the company, having banned its main page, and put warning labels on certain search terms associated with its products. But the platform appears unable to keep up with the number of individual accounts actually promoting the products and keeping the company going with more recruitment and publicity. Videos under the hashtag #sknygummies, which promotes the use of It Works appetite suppressant gummies, have 2.5 million views.

Media Matters, a media-watchdog nonprofit, posted a report on It Works on March 30, saying the company was targeting “young, low-income women” and exposing them to “possible physical and financial harm.”

Media Matters researcher Olivia Little, who wrote the report, told Insider that It Works appears to be the largest MLM company operating on TikTok, but there are others thriving on the platform.

The general appeal of “miracle” weight-loss products and the popularity of weight-loss content on TikTok means companies like It Works do extremely well on the platform, Little said.

“It’s predatory on multiple levels — not just financially, but it can have real negative consequences to a user’s health,” Little said.

TikTok is “far more reactive than proactive” when it comes to moderating MLM content, Little added, often taking down content only after it’s been brought to the company’s attention by external researchers or reporters.

“It starts with the fact that they’re not even shallowly enforcing their own basic MLM rules,” she said. “They’re dropping the ball on detecting and removing more complicated and coordinated MLM schemes on their platform because they haven’t even addressed the basics.”

A TikTok spokesperson told Insider the app’s community guidelines make clear “that we do not allow anyone to exploit our platform to bring about financial or personal harm.”

“This includes multilevel marketing,” they said. “We use a combination of technology and human moderation to find and remove content that breaches these guidelines.”

Three videos featuring It Works products, flagged by Insider, were removed by TikTok, with the company saying they violated guidelines about illegal activities and regulated goods, and constituted multilevel-marketing content.

How companies like It Works suck people into multilevel marketing

Awareness of MLMs and the financial damage they can do is spreading. There’s an active user base of over 760,000 people on the subreddit r/AntiMLM, where the community swaps stories, shares red flags, and warns each other about the tactics recruiters are using. Blogs like Hannah Martin’s Talented Ladies Club share the personal experiences of people who have gotten out of MLMs, such as one woman who said the most she ever earned was £140 ($182) in a month, though she usually only took home somewhere between £20-60 ($26-78) in commission.

FitzPatrick looked into the history of MLMs in his book, following its genesis back to late 1970s and early eighties.

“You get a sense that it was literally picked up and catapulted into the mainstream with the most powerful institutions in America at that time,” he told Insider. “It was a philosophical, economic, and political wave about honoring and exalting the market as a savior of all problems.”

While estimates of how many people are involved in MLMs in the US range between 6 and 50 million, it’s almost impossible to keep up with the number because the turnover is so high, FitzPatrick said. Most people don’t make it a year, he said, but they are immediately replaced by someone else.

“It’s a cumulative churning process for people joining, being solicited — aggressively solicited — and then being involved for a year or so,” FitzPatrick said. “We’re looking at an enormous phenomenon here.”

However, the numbers of people involved are increasing thanks to the relative ease in setting one up, and a boom during the coronavirus pandemic.

Entrepreneur Mark Pentecost founded It Works in 2001, and by 2014, the company claimed to be pulling in $538 million annually. In 2015, Insider’s Molly Mulshine visited the company’s main office in Florida after seeing its weight loss products advertised on Facebook and Instagram. After speaking with several distributors, she concluded that the vast majority of It Works salespeople earn “nowhere near enough to live on.”

In its 2021 Income Disclosure Statement, It Works revealed ​​85.24% of all distributors earned an average of $57 per month; 2.12% earned $277 a month; and 6.84% earned $390 a month. Just 0.09% were top earners, raking in $20,806 a month. The company notes in small print at the end of the report that those figures do not include expenses incurred, and income disclosures for MLMs are notoriously unreliable and often inflate earnings.

William Keep, a professor of marketing at the College of New Jersey’s School of Business who has studied MLMs for many years, told Insider these companies persist regardless of individual success at the sales level because people are always going to be attracted to an opportunity to make fast money.

Keep said that the people making the most money got in early, and the people who join after are simply funneling money to those at the top of the pyramid. People who get involved later see other sellers who have been in the business longer reaping rewards, so they believe their dreams are within reach.

“It wouldn’t work if a person said, ‘I need you to keep trying for another six months because I need to make another $5,000 off of you,'” Keep said. “Instead they say, ‘I know how you feel. I’ve been in that situation. I’ve seen so many other people like you and with just six more months, you’d be surprised what can happen.'”

As for why people keep joining MLMs, Keep said it’s because we inherently want to trust others. There’s also a great deal of shame associated with joining a business that promises to make you a successful entrepreneur and then losing money.

“If someone rips off your credit card or steals your identity, you feel like a victim,” he said. “The MLM is going to try to make you feel like you didn’t succeed because it was your fault.”

This story was updated on April 20, 2022.