Vemma Energy Drink Nutrition Supplement or MLM Scheme
Vemma-The Truth about Energy Drinks, Healthy Nutrition Supplement or MLM Scheme
I write. My venue of choice are coffee shops. Small coffee shops, or chain, I don’t really care. I do prefer Starbucks, simply because of the uncomfortable seating atmosphere and the irritation of the coined and repetitive speaking culture by their employees and management. This is in addition to their repetitive music marketing pumped through the speakers while you’re inside and the CD’s readily available for an impulse purchase right at the register. I know Starbucks employees wish they could bring in their own music because I talk to them at Starbucks all over California, Arizona, and, previously, in Oregon-they go bananas from being inside the store listening to the same music over and over.
Every writer must find stimulus, or the lack thereof, to be a catalyst for their writing. This happens to be mine. Unfortunately, or fortunately depending on your perspective, I am approached semi-regularly by individuals wishing to sell their product or service as they, too, are in business for themselves.
My initial reaction is to grit my teeth and hold my breath and smile with a slight “I’m irritated” look, but I’m working on that. I usually end up telling myself to be polite, listen, and take a deep breath. Following these actions, I ask a couple of genuine questions. I make a rapid assessment and I am blunt with the inquiry so as to receive their information promptly. I want to get back to work. I may make a recommendation for them and tell them I’m not interested to achieve the same result-to get back to work with minimal delay.
The most frequent approach, especially once the would be salesman or recruiter identifies the fact that I am affiliated with health & fitness, is that of a “new” miracle nutritional supplement in the form of a drink.
I have done extensive research on these supplements and companies. Several of these supplement “miracles” are always the “latest” and “hottest” trend only recently available, or they claim they have been available for years and they have science to prove they work! It’s ironic that these products all seem to have so many doctors on-board for their brand and celebrities promoting their product, to boot.
Furthermore, these nutritional companies typically can be traced back to having multi-millionaire and billionaire support at their foundation. They also share some other important commonalities such as a heavy emphasis on marketing, advertising, and charitable contributions (or the appearance thereof anyway.) Many times, these companies also have one of a few different deceitful strategies employed-those that have been successful for over 20 years-that of a Ponzi scheme, a pyramid scheme or a slight variation thereof. The perpetuators, usually blinded, ignorant, or simply good intentioned and fooled individuals, attempt to gain additional “owners” or “distributors” or “Brand Partner’s,” or they are given similar titles upon being recruited by their “up-line.” Yes, it is true that many of the sellers of these products make a high salary and sometimes leave their real job to only engage in their newly found business venture. And, in some cases, these people become “regional representatives” (or similar title) for their product, yada yada yada. My fuse has grown shorter and shorter with these companies as they use deceitful tactics to get your dollar, and they try to get mine. I am like a dentist with his magnifying glasses on with a high-powered light and a dental pick and mirror in each hand. I will not allow the deceit to go unnoticed any further.
- The Scheme
Yes, it is a scheme. I’m sorry to say it, but it’s true. I will first identify the pyramid scheme and Ponzi Scheme methodology, because that’s what they are-just add a peppering of a product, oh I don’t know, let’s say in the form of something popular today like a diet supplement! MLM, known as multi-level marketing, is another methodology that is employed by these companies looking to avoid confrontation with the FTC (federal trade commission.)
- Pyramid Scheme Definition:
“In the classic "pyramid" scheme, participants attempt to make money solely by recruiting new participants into the program. The hallmark of these schemes is the promise of sky-high returns in a short period of time for doing nothing other than handing over your money and getting others to do the same.
The fraudsters behind a pyramid scheme may go to great lengths to make the program look like a legitimate multi-level marketing program. But despite their claims to have legitimate products or services to sell, these fraudsters simply use money coming in from new recruits to pay off early stage investors. But eventually the pyramid will collapse.” U.S. Securities and Exchange Commission
- Ponzi Scheme Definition:
“A Ponzi scheme is an investment fraud that involves the payment of purported returns to existing investors from funds contributed by new investors. Ponzi scheme organizers often solicit new investors by promising to invest funds in opportunities claimed to generate high returns with little or no risk. In many Ponzi schemes, the fraudsters focus on attracting new money to make promised payments to earlier-stage investors and to use for personal expenses, instead of engaging in any legitimate investment activity.
With little or no legitimate earnings, the schemes require a consistent flow of money from new investors to continue. Ponzi schemes tend to collapse when it becomes difficult to recruit new investors or when a large number of investors ask to cash out.” U.S. Securities and Exchange Commission
- Another definition of a Ponzi scheme:
“Definition: A Ponzi scheme is a scam in which a gullible public is enticed with the promise of very high returns, which is based upon paying off early "investors" from the cash from (hopefully ever increasing numbers) of new "investors." The whole structure collapses when the cash outflow exceeds cash inflow. The key in running a successful Ponzi scheme is to keep it going as long as you possibly can.” Dr. Steven Knope
Similarities between the pyramid and Ponzi schemes:
“Ponzi and pyramid schemes are closely related because they both involve paying longer-standing members with money from new participants, instead of actual profits from investing or selling products to the public.” U.S. Securities and Exchange Commission.
Also see this link for a side-by-side comparison of the ‘hook’s employed to pull in the participants for these schemes.
First, hey don’t shoot the messenger! Many Amway representatives that I have known in my life are really good hearted people, and some have been my close friends.
Amway has been under scrutiny, and charged, since the 1970’s! Countries have pursued ban of Amway sales in their countries! Um, hello?
There are a number of ‘watchdog’ type of groups that can be found by a little research. One of those groups is the Pyramid Scheme Alert (PSA).
- As the PSA accurately assesses:
- “One of the most problematical of business models is multi-level or network marketing (MLM ). Many MLM programs show all the effects and characteristics of a pyramid scheme, but the MLM industry has nonetheless been allowed to continue and flourish. Though considered benign by many, its insidious and corrupting influence and the financial and social harm suffered by participants is considerable. Unfortunately, victims of these programs seldom complain, blaming themselves for their failures.
- A chaining hierarchy of levels of distributors -- more than is functionally justified -- is recruited without area limits, which leads to extreme leverage and perceived saturation in the marketplace.
- RVE-EHI. Relative vertical equality (RVE) in compensation systems leads to extreme horizontal inequality (EHI) in payout over the entire network of distributors -- huge payouts to a tiny percentage of participants, while the vast majority wind up losing the money and effort they invested over a period of time.
- Significant purchase or recruiting quotas are required (or incentives offered) to qualify for increasing bonus levels or purchasing discounts in an ascending hierarchy of payout levels (the "pay to play" feature).”*
There are too many complaints and allegations against multi-level marketing companies to list them all, so I will only refer to a couple to keep this brief and to the point. Additionally, it’s all about getting your money folks, how many times must I say this? Marketing professionals know this and I’ve listed a spiel, too, for entertainment.
- A complaint to the Federal Trade Commission: Here
- Multi-Level Marketing promoter, to increase profits: Here
Skeptics like myself can take hits like the best of them.
“The most prominent Vemma Business complaint you hear is that it is a pyramid scheme or some sort of scam. These words get tossed around a lot by people who seem to have a vendetta against the whole network marketing industry. They might have joined an MLM company 10 years ago, didn't make any money, so now they want to save the world from 'pyramid schemes'. Is your best friend one of these people?”*
I do have a vendetta against deceit from diet companies-regardless of where it emanates from. My analogy is this, I don’t like crime. Just because the FBI statistics (see Table 49) say that there were 10% more murders and robberies in the Unites States by blacks in 2009, does this mean that I don’t like blacks? No, not at all. Do those statistics represent the black community as a whole? No, not at all. I can just as easily cite the fact that whites raped 20% more frequently than blacks in 2009, so should I now not like whites? It’s the crime that I don’t like-get the picture?
So, yes, I do have a vendetta, but it’s against the deceit and pompous arrogant promotion of products that have not been identified scientifically to truly be healthy and safe for the public. Instead, there are layers of deceit instituted by these adept and highly skilled marketers that takes time to sift through. Time that most people simply do not have in their busy lives. Well, guess what? I take the time, and I offer my evaluations as just and unbiased as possible, in spite of my potential inclinations.
Quite frankly, there is too much emphasis on diet today. “Take this, it will help you with that. Do it this way, it will make this happen for you. All you have to do is this, and your problems will be eliminated, I know it’s worked for me.” Etc.
Here is a great excerpt from a Zen master on diet,
- “You should eat everything; then your mind becomes broad and generous. But at the same time you should control, have a little of each thing and not too much of any.” Taisen Deshimaru, Questions to a Zen Master.
An example of an “objective” promoter of the available product Vemma.
- “Vemma is a good opportunity with some great products, but without the secrets of recruiting like the top producers, I'd be surprised if you lasted 3 months. Take my word for it. You don't have enough family and friends who will want to join your business to create a legitimate income from your Vemma business.” *
Alas, I love it when I run across great motivational speakers and smooth talkers. They are rare, which is one reason they are so successful. It’s ironic that part of this marketers strategy is to up-talk the Vemma product, yet knife them in the back (in addition to the skeptics!) as far as their strategies for success are concerned. Oh, but you can learn the right methods and sales techniques to sell Vemma, “If I hear from you today... you can download my entire system (and the bonuses above) for a mere $39.95.”* Of course I can.
The funny thing is, by my mere referencing both Vemma and this MLM strategist, both of their traffic flows will increase in addition to their revenue and publicity. They win either way. My aim, however, is to not to give free publicity to entities I don’t believe in. My focus is to give you good people, who are interested in being fully informed, both the good and the bad information. You, then, can ultimately decide for yourself what is right. What you find to be right may be completely different than what I find to be right-and that is okay.
Here is a link of another MLM strategist trying to make money on Vemma, though they ‘support’ the product and company, they hammer their techniques to sell it. So why then is it they are not just selling the product and instead are selling you on learning how to sell it? This is what I call the scammers scam, taking all of the benefit of a profitable company and attempting to walk on their coattails.
“Family & Friend Fraud” FBI
Some quotes from FBI officials from the above FBI video, which is outstanding:
- “I think a lot of these scam investments are sold by those that are great salesmen, quite frankly.”
- “I think the maxim buyer beware is appropriate.”
- “Check out what’s being offered through as many independent sources that you can. Just don’t take the statements or materials given to you by the person selling you the security as truth.”
Four of the most recent “nutritional” magic drinks that I’ve been approached repeatedly to sell and become a “distributor” for in the last two years, all of which are popular, are:
I’m going to include 5) Emergen-C in this 5 part write-up series simply because of the indirect promotion of the product that I’ve encountered on a regular basis by several real and “ordinary” people.
Founded in 2004, by BK Boreyko. Founder of New Vision 1995. Former Amway distributor, Former Matol distributor,
Promoted by Yibing Wang, M.D., Ph.D
Endorsed by -I looked and looked. The closest thing I could see to an endorsement was by Mens Journal
Speakers hired to speak at their meetings: Doctor’s Mehmet Oz and Michael Roizen
Vemma-the company states, “Vemma provides a powerful liquid formula that makes it easy to get the vitamins, minerals and antioxidants you need to form a solid nutritional foundation.”*
In English, it’s a juice drink.
“New Vision is a so-called multilevel marketing (MLM) company, like Amway, Mary Kay Cosmetics and Shaklee vitamins. To make money in a typical MLM, new recruits such as the Almeidas must sell the company's products and sign up dozens or hundreds of other salespeople, known in the MLM world as distributors. Potential profits come from commissions (3% to 8% at New Vision) from products sold by distributors themselves, as well as sales generated by the recruits they've signed up. Although many of the nation's 500-odd major MLMs are perfectly legitimate businesses, their pyramid structure and aggressive selling tactics have given the 50-year-old industry a somewhat shady image.
According to New Vision co-founder B.K. Boreyko, the company's 40,000 active distributors earn an average of only $300 a month in gross commissions. And in order to be eligible for even a portion of these commissions, distributors have to buy at least $100 worth of New Vision vitamins and minerals each month, either for their own use or to resell. To get the maximum commissions, they must spend a minimum of $300 each month on New Vision products.”*
Reportedly, the Boreyko’s have earned awards and have given to charity. Good for them! “His total donations exceed $4 million.”* I’m not a Phd in math but a question does surface while evaluating the company. If you’ve accumulated over a billion dollars, “BK has successfully built two health and wellness companies with total revenues exceeding $1.5 billion,”* how much is $4 million?
Hey, I’m all for the American Dream and people having success. It’s just with Vemma, my research says ‘stay away.’ That is unless you intend on becoming fully absorbed by the product and recruit endlessly, or until you reach the same level of recruitment that the Boreyko family has. My guess, though, is that you don’t have a lifetime of participation in MLM types of businesses and experiences like B.K. Boreyko, however. He is a skilled technician at what he does: Salesman. I’ve known many-they are unbelievably good at what they do. It’s hard to not get sucked into their vector force when they are in their element, regardless of what’s for sale. I’m not here to tear up the Boreyko’s or any other individual. I am here to point out the fallacy of the methods and nutrition aspect that have been dictated as truth.
I’m going to skin alive Vemma’s self-reported science, then just leave you to your own judgment and common sense as to the validity or nonsense of their “science.”
- The “science”:
Vemma touts their use of the facility Brunswick Laboratories in Norton, MA as, “one of the industry's most widely recognized experts in Independent Clinical Testing.”
Well, the first thing that stands out is that the company self proclaims, “Brunswick Laboratories is recognized internationally by leading health research institutions and companies in the nutraceutical, pharmaceutical, food and cosmetic industries. We are a pioneer and a world leader in research and diagnostic services related to antioxidants and oxidative stress, and have earned a position of respect and trust based on the contributions we have made in this field.” Ok, I’m left in want. They do not refer to a single source to back-up their claims-not good. I’ll come back to this shortly.
My further research identifies Dr. Xianguo Zhao as the “Chief Scientific Officer and Executive Vice President of Brunswick Laboratories, LLC” as of 2006. Chief Scientific Officer? Ok, he is listed as a doctor right? This is where the professional designation as a Dr. gets to be misleading. When we hear doctor, we tend to presume medical doctor, M.D. Not the case, again here. This is a Phd from China, “He received his Ph.D. in Pharmacognosy from China Pharmaceutical University in 1997.”*
Dr. Boxin Ou serves as Vice President of Brunswick Laboratories, LLC. He is a medical doctor, right? He is listed as a Phd. I’m not stating that these company executives have to be medical doctors to do research, I just want everyone to be clear that they are Phd’s and not medical doctor‘s. Boxin Ou, Phd, patented the ORAC method. From what I can see, the company uses that method on just about everything and the method does warrant further research.
- Click here for a good article to ponder the ORAC. The author makes valid points and states, in part, “Companies that claim a 6000+ ORAC per serving and on the same label proclaim the phytonutrition of 15+ servings of fruits and vegetables are again likely either ignorant of the literature, or succumbed to the temptations of hyperbole.”* Since Vemma uses the Brunswick Laboratory study as a selling point with ORAC as one of the principles of foundation, it deserves thorough study. My understanding, based on this research, is that the values of these substances are constantly fluctuating depending on the state of decomposition, etc. That is an important note in itself.
Lastly, Jim Nichols is Brunswick Labs president. He is also the founder and chairman of Brunswick Laboratories. Boxin Ou, Phd appears to have been a part of the company since its inception in 1997, with the addition of Xianguo Zhao, Phd, in 2006. Jim Nichols issued an interesting apology to consumers regarding the use of his companies testing as promotion for certain products. It’s a worthy read. Note the apology was given the same year Vemma was introduced.
Ultimately, my flash evaluation of Brunswick Laboratories is that they try to make honest effort at producing good science. My beef with their procedures, from what I can see, is that they still do not meet the stringent protocols that regular peer reviewed scientific journals do. As an example, the Vemma testing, as demonstrated by their abstract, used only 59 people during a time-frame of only 30 days. What? I’m sorry, this is not sufficient to make such substantial claims as they do. Give me hundreds of people evaluated over years of monitored study and repeat those studies and have them peer reviewed, then we will be talking real science. Thumbs down, not for the small amount of research done by a seemingly stand-up company, but thumbs down for the claims being made by Vemma.
That one study is simply not something to put a foundation on. It can, however, be built upon by following through with some good long-term peer reviewed research. To date, none has come forth. This study was a Korean study-see the full-text here. The conclusion, even by them, was non-committal, “Future studies should evaluate the effects of the xanthone-rich product more elaborately in more populations and evaluate long-term outcomes.”* In other words, maybe, maybe not.
The second study that Vemma identifies as the crux to their basis is also authored by Boxin Ou, Brunswick Laboratories, but with far less participants than they used previously. “Ten men and 10 women participated in this study. The average age of both study and placebo groups was 22 years old.”*
- They conclude with both, “Further studies need to be done to characterize the antioxidant properties of the xanthone-rich product as a dietary supplement” and, “A detailed study is required to confirm all possible contributors and the mechanism of the antioxidant capacity increase.” No kidding. What elevates my internal temperature is the fact that these inconclusive studies are used as their sounding board. Here’s what Vemma’s hired doctor is quoted by them as saying, “The studies you are about to read give credence to the countless positive testimonials Vemma has received from customers over the years on its ability to help overcome challenges, increase vitality and enhance well-being.*”– Yibing Wang, M.D., Ph.D. Well spun, doctor. Clink on that link and you will see he has been paid by the company since 1998 as its Director of Research and Development and involved “since its inception in 2004.”*
Vemma, sadly, there is not enough evidence to support their claims. Yet. Perhaps there will be at some distant future point with some true research that is peer reviewed by reputable governing bodies. Until then, hyperbole and arbitrary opinion rule the day. I’ve asked this before, “Who’s the guinea pig?” You can be, it’s your choice. Like Zrii, I know what my choice is.
Lastly, I have a few friends (yes plural) that are in the Vemma business. Of two that I spoke with, one is all about the product as it has been somewhat of a miracle worker for their family-their kids are not sick and not missing school like they had "pre" Vemma. They believe in the product and in the sales. One of the other friends I spoke with that has been selling Vemma for about a year, who also is in the health industry, doesn't have anything bad or exceptionally positive to say about the company or the product. Their only issue is that they haven't made any money selling it.
This is the second write-up on nutrition energy drink companies of a 5 part series. See my other write-ups by following these links! Zrii, Vrroom, AdvoCare, and Emergen-C. Thank you for your time, your attention, and your votes!
Dwayne Ivey, keeping nutritional companies honest daily.
© Dwayne Ivey - October 2010