Key Insights
Essential data points from our research
99% of people who join multilevel marketing companies lose money
The top 1% of MLM distributors receive approximately 83% of total commissions paid to all distributors
73% of those who participated in MLMs either lost money or made no money at all
Approximately 50% of MLM representatives drop out within the first year
Nearly 90% of MLM representatives leave within five years
65% of MLM participants work at it for less than 10 hours per week, contributing to turnover when returns are low
74% of direct sellers in the United States are women
6% of direct sellers are under the age of 25
Direct sellers aged 25–44 make up 43% of the total MLM demographic
In 2020, the Direct Selling industry generated $40.1 Billion in retail sales in the United States
There were 7.7 million direct sellers in the US in 2020
Global direct selling sales amounted to approximately $180 billion in 2019
Almost 50% of MLM participants felt they had been misled by the company regarding their chances of financial success
31% of MLM participants incurred credit card debt to finance their business
The success rate for gambling in Las Vegas is significantly higher than the success rate in MLMs
Attrition & Retention Rates
- 1Approximately 50% of MLM representatives drop out within the first year
- 2Nearly 90% of MLM representatives leave within five years
- 365% of MLM participants work at it for less than 10 hours per week, contributing to turnover when returns are low
- 4By the year 2010, the retention rate for Nu Skin entry-level distributors was roughly 14.6%
- 5A study showed 95% of MLM participants quit within 10 years
- 6The average duration of participation in an MLM is often less than 2 years per participant
- 7For Herbalife, the retention rate of non-sales leaders was roughly 52% in 2013
- 840% of MLM hopefuls quit after only a few months due to lack of sales
- 9High distributor turnover requires companies to constantly recruit; some companies replace 100% of their sales force every few years
- 10Only 12% of people who join an MLM are likely to stick with it for more than 3 years
- 11In 2017, Herbalife reported a retention rate of about 66% for their sales leaders
- 1239% of former MLM participants cited "awkwardness" with friends and family as a reason for leaving
- 1340% of MLM participants quit because they did not make as much money as they expected
- 1435% of participants dropped out because they disliked selling to family and friends
- 1553% of MLM participants state the company’s representation of financial success was "not too accurate" or "not at all accurate"
- 16Many MLMs experience an annual churn rate of 50-70% among their distributors
- 1718% of people dropped out due to aggressive recruitment tactics required by uplines
- 18Roughly 1 in 3 former MLM participants left because they found a better job elsewhere
- 19Only 1 in 10 MLM participants survive long enough to recoup their initial investment
- 2026% of former participants said it took too much time for the amount of money earned, leading to attrition
Interpretation
These statistics make MLMs resemble a recruitment treadmill, where many join but most quit within months or a few years because earnings, time demands, and awkward pitching to friends rarely match the hype, leaving only a small fraction who ever recoup their investment.
Demographics & Motivations
- 174% of direct sellers in the United States are women
- 26% of direct sellers are under the age of 25
- 3Direct sellers aged 25–44 make up 43% of the total MLM demographic
- 419% of the U.S. population has been involved in some form of direct selling or MLM
- 51 in 13 adults has participated in an MLM at some point in their life
- 6Hispanics comprise approximately 22% of the direct selling workforce in the US
- 744% of MLM participants have completed some college or have a college degree
- 866% of people join MLMs primarily for supplemental income rather than as a full-time job
- 933% of those who have been part of an MLM did so to get a discount on products for personal use
- 1052% of MLM participants are married
- 11The southern United States has the highest concentration of direct sellers at 44%
- 129% of participants joined because a friend or family member recruited them
- 13Participants with a postgraduate degree make up about 12% of the MLM workforce
- 148% of direct selling participants are African American
- 1541% of people join an MLM for the flexibility of schedule
- 16Millennials are the largest generational group in direct selling accounting for over 35%
- 1790% of MLM participants report they are satisfied with their experience regardless of financial outcome (self-reported via DSA)
- 1816% of MLM participants have a household income of over $100k
- 19Only 4% of participants considered MLM their primary source of income upon joining
- 2023% of MLM participants are between the ages of 45-54
Interpretation
Far from the flashy get-rich promise, U.S. network marketing reads more like a predominantly female, often millennial-driven side economy where people chase flexibility, extra income, or product discounts, most say they’re satisfied despite only a tiny fraction relying on it as their primary paycheck, and participation is clustered in the South and among those with some college.
Financial Success & Profitability
- 199% of people who join multilevel marketing companies lose money
- 2The top 1% of MLM distributors receive approximately 83% of total commissions paid to all distributors
- 373% of those who participated in MLMs either lost money or made no money at all
- 4Only 25% of MLM participants reported making a profit
- 5Of the 25% who made a profit, 53% made less than $5,000
- 6The median income for Amway distributors in 2021 was roughly $766 per year
- 7In 2020, 89.8% of Arbonne consultants earned a median annual income of $206
- 8Average earnings for Herbalife distributors in the entry-level rank were roughly $200 in a typical month
- 995.9% of Nu Skin's US active brand affiliates earned an average monthly commission of $32 in 2020
- 10Less than 1% of MLM participants profit after accounting for expenses
- 1147% of MLM participants reported that they lost money
- 12Nu Skin reported that 16.48% of Active Brand Affiliates earned a commission payment in 2021
- 13For Rodan + Fields in 2019, the median annual income for Entry Level Consultants was $348
- 14In 2018, Isagenix reported that 88.6% of members were Product Introduction Rewards Only members with average annual earnings of $907
- 15Monetat's income disclosure shows 94% of Market Partners earned an average annual gross income of $183 in 2018
- 16Young Living's 2019 disclosure showed 88.8% of distributors earned an average of $3 annually
- 1733% of MLM participants reported making less than $500 profit in their entire time with the company
- 18Only 0.05% of MLM participants earn $100,000 or more annually
- 19Beachbody coaches in the lowest rank (74.8% of all coaches) earned an average of $438 in 2019
- 20Scentsy reported that Group 1 consultants (83% of total) earned an average annual commission of $183 in 2020
Interpretation
Joining an MLM is like buying a ticket to a raffle rigged in favor of the house: nearly everyone loses money or earns only a few hundred dollars a year, the top 1% grab roughly 83% of commissions, and only about one in two thousand participants ever reach six figures.
Industry Revenue & Market Size
- 1In 2020, the Direct Selling industry generated $40.1 Billion in retail sales in the United States
- 2There were 7.7 million direct sellers in the US in 2020
- 3Global direct selling sales amounted to approximately $180 billion in 2019
- 4The Wellness category represents the largest product group in MLM sales at 34.7%
- 5Cosmetics and Personal Care make up 29.6% of all MLM sales in the USA
- 6The United States is the largest direct selling market in the world with 20% of global sales
- 7China is the second largest market for direct selling with 13% of global sales
- 8There are over 119.9 million independent representatives involved in direct selling globally
- 986.7% of U.S. direct selling sales occur person-to-person
- 10In 2015, the direct selling industry contributed $183.7 billion to the global economy
- 11Household goods and durables account for 12% of global direct selling sales
- 12Asia-Pacific region accounts for 44% of global direct selling sales
- 13Direct selling retail sales increased by 2.6% in the US from 2018 to 2019
- 1474% of direct selling firms in the US are privately owned
- 15Approximately 15% of total US retail sales in the wellness category come from direct selling
- 16Korea is the third largest direct selling market with 10% of global sales
- 17Services (financial, utilities) account for 2.6% of MLM sales in the US
- 18Sales through party plans account for approximately 24% of direct selling revenue
- 19Direct selling companies paid out roughly $65 billion in commissions globally in 2019
- 20Since 2010, the direct selling industry has grown from $132 billion to $180 billion globally
Interpretation
The direct selling world reads like a blockbuster: roughly $180 billion in global sales, nearly 120 million named representatives, and booming wellness and cosmetics categories centered in the United States and Asia Pacific, yet that impressive headline revenue often masks modest per‑rep paychecks and sharply uneven opportunities.
Legal, Regulatory & Risk Factors
- 1Almost 50% of MLM participants felt they had been misled by the company regarding their chances of financial success
- 231% of MLM participants incurred credit card debt to finance their business
- 3The success rate for gambling in Las Vegas is significantly higher than the success rate in MLMs
- 4Herbalife agreed to pay $200 million in 2016 to compensate consumers to settle FTC charges of deceptive practices
- 515% of those who incurred debt for an MLM declared bankruptcy or lost their home
- 6According to the FTC, an MLM is an illegal pyramid scheme if the primary source of income is recruiting rather than product sales
- 797% of MLM income disclosure statements are viewed as "deceptive" by consumer watchdogs because they exclude dropouts
- 863% of MLM participants said they were encouraged to buy more inventory effectively "loading" them with debt
- 9AdvoCare paid $150 million to settle charges of operating an illegal pyramid scheme in 2019
- 10LuLaRoe paid $4.75 million to settle a pyramid scheme lawsuit in Washington state in 2021
- 11Small business owners are 390 times more likely to profit than MLM participants
- 125% of MLM participants report their relationship with their spouse was damaged due to MLM involvement
- 13Vemma Nutrition Company was temporarily shut down by the FTC in 2015 for operating as a pyramid scheme
- 1443% of participants said their MLM required them to pay for training materials and events, increasing financial risk
- 15The UK Office of Fair Trading found that the average money earned by 20,000 Amway agents was less than the price of the entry kit
- 1660% of MLM participants said they did not receive a copy of the company's income disclosure statement before joining
- 17MLM contracts often contain arbitration clauses that prevent participants from suing the company in court
- 18BurnLounge was ruled a pyramid scheme because participants paid for the right to recruit others for rewards
- 19Fortune Hi-Tech Marketing was shut down for deceptive claims that people could earn significant income, affecting 100,000 consumers
- 2011% of those who lost money in an MLM lost more than $5,000
Interpretation
Joining an MLM is like betting your family home on a rigged slot machine: the data show companies routinely mislead recruits, push costly inventory and training purchases, hide or omit income disclosures and block lawsuits with arbitration clauses, leaving many saddled with credit card debt, bankruptcies and broken relationships while regulators extract multimillion‑dollar settlements and small business owners remain about 390 times more likely to actually profit.
