Conscripted Consumption at Club 100

“Who would like for their own kids to have the exact same life that they’ve had so far? That should be enough motivation for you to take seriously what I’m telling you. Do something different – am I right or not?”

… semi-shouts a Colombian trainer for Herbalife’s Club 100 to her audience of impoverished recruits.

“If you earn 2,000 or 3,000 dollars, and you teach your people to do the same on their club, free check – free everything. Then you will be a great person because you will give your people the financial freedom you promised them.”

You can hear Señorita Stalinita’s full presentation below :: if you speak Español … and you don’t mind being depressed.

… in the beginnings

Herbalife sells the lie that you can make money selling the lie that is Herbalife … the circle of lies. Of course you’re not exactly allowed to sell lies {though its trending} :: so they {barely} pretend to sell products instead … and that’s somehow been enough cover to afford them four decades of almost complete silence from empty-headed/hearted journalists and absentee regulators.

Once upon a time Herbalife’s cover product could actually help a person lose weight {short-term} :: because it contained the addictive stimulant Ephedra … which had the unfortunate side-effect of making people completely dead {the ultimate diet}. But the FDA banned Ephedra in 2004 … the same year that Herbalife went public for the second time.

Herbalife’s guruistic leader was recently dead of a drug/alcohol overdose :: and the drug that they’d been pimping for decades was banned … yet Wall Street still saw something lovable in Herbalife’s business model. NewHerbalife billed itself as a nutrition/wellness company :: its thinnest ever cover given its top-selling product sports an ingredient list that begins like this …

• Soy Protein Isolate
• Fructose
• Sunflower Oil
• Corn Syrup Solids
• Sodium Caseinate
• Mono- & Diglycerides

… some of the not-nutritionalist ingredients ever concocted by foolish men.

… a new herbalife

But Herbalife had a new secret ingredient that Wall Street loved to love in secret :: a business method called “blind lead generation” … that allowed distributors to push an illusory biz op to the masses without mentioning the company or its fructose rich product until deep into a pressure sales pitch rooted in half century old manipulation techniques. Fad diets come and go :: consumer tastes continually churn and change … but the demand for “make money now” never declines.

The company built huge lines of distributors using blind lead generation :: and those lines shoveled hundreds of millions of dollars into the mass media advertising campaigns that fueled Herbalife’s full throttle growth engines. The rewards were high :: but so were the risks … as attention attracts attention.

The Direct Selling Association had lobbied hard for years to exempt the filthy exploitative world of MLM from the FTC’s new Business Opportunity Rule :: they won … like pretty much always. Circa 2011ish :: assholes all across Scamworld had started to panic about the possibility that the new rules might presage some actual effort at enforcement. MLMs like Herbalife had been carved out of the rule … but the blind lead gen systems they relied upon {likely} had not.

Bill Ackman likes to take credit for the fall of lead generation at Herbalife {and for the Earth’s revolution around the sun} :: but Herbalifers have repeatedly told me … lead generation based systems were already bleeding out by the time the Ack started his attack.

… a new new herbalife

Fortunately for Herbalife and its investors :: and unfortunately for the rest of humanity … a replacement business method had been germinating south of the Alamo. Blind lead generation :: dependent as it was on $3000 supervisor orders and five-figure credit card debt … was never going to work in Mexico or Ecuador or Venezuela … but neither was retailing overpriced shake powders by wearing buttons and chatting up family members.

Everywhere you look in Herbalife :: or in MLM more generally … you’ll see that successful downlines are built by adding layers of deception to an obviously unworkable core platform … systems within systems … pyramids within pyramids. The MLM company talks about products :: and polishes its plausible deniability turds … while the subsystems do whatever the fuck.

Club 100 :: a subsystem which combines Nutrition Clubs with a rigorous conscripted consumption based “training” program … dominates Herbalife’s operations in Central and South America. It was so effective :: and so brilliant at fucking over poor people … that it was basically internalized by Herbalife corporate and spread worldwide.

Club 100’s ubiquitous branding represents a two-sided progression :: one side is about training and building daily consumptions … the other about club duplications. The oft promised reward for following the dual path to its completion :: the $300,000+ per year of the President’s Team … is an unattainable lie.

… el consumo de herbalife

Club 100 generates the illusion of Herbalife product consumption by allowing would-be participants to attempt to buy their way into the pyramid one mouthful of corn syrup solid at a time.

The first step :: signified by the green bar on the left … is a protracted training process {compared to university training} which most will never complete. It subjects victims to servitude :: indignity … and intensive indoctrination. The training is rigorously documented :: requiring test taking :: and dozens of signatures from one’s pyramidal superiors. It ends with a graduation ceremony … and the right to get screwed over even harder.

Phase one of the {minimum} four-week course has trainees touring other Club 100 certified clubs in the area :: paying for their shakes and tea … and sitting around pretending to be silent but happy customers. Fake customers help attract new fake customers by giving the fake business a veneer of legitimacy. Trainees often attend multiple clubs each day … drinking unhealthy shake after unhealthy shake.

Phase two has trainees learning to operate a blender by bringing friends and family into various Club 100 certified clubs to pay for shakes which the trainee will prepare. They also prepare the shakes for other fake customers coming into the club {and maybe even some real customers} :: and take care of the clean up … because someone’s got to do it. This phase can last a long time … depending on how big of an asshole is the sponsor.

Phase three involves giving the Club 100 / Herbalife sales pitch to potential new recruits coming through the club alone … or as part of the large-scale “presentation tours” that occur regularly in areas dense with Club 100 clubs.

Here’s what these large presentation tours look like in Venezuela {set by not-me to the melodic sound of “Kidz Bop” covering the Black Eyed Peas} …

Phase four has new recruits out on the streets making personal invitations to the sponsor’s club :: the only form of club advertising allowed for by Herbalife’s onerous nutrition club rules. It’s like a telemarketing job :: only worse … and you might get stabbed … but at least you’re the opposite of getting paid. This final phase does not end until ten new members are “retained” for the sponsor’s club by the trainee.

OMG :: you effing did it! … you graduated from the University of Exploitation. Here’s your certificate :: and red ID badge … entitling you to open your very own Club 100 Nutrition Club.

Each graduating recruit has created hundreds of “consumos” for the already established clubs. They’re consuming throughout the training process {and getting their friends and family to do the same} :: not because they are desirous of the products … but because they are paying to play at the Club 100 system of selling Herbalife.

The only way to get paychecks from Herbalife is to qualify as a Supervisor :: by spending approximately $3000 on the company’s products each year. All the hard work and humiliation of these recruits :: all the shake purchases and street recruiting :: all the tapping out of friends and family :: all the time and money spent on classes and events :: aka all the tasks one normally associates with working an MLM … but these graduates have taken not one step in the direction of a Supervisor qualification. All their efforts have gone exclusively towards helping those above them to qualify and advance.

It’s seriously fucked.

But wait :: because it gets worse …

As the certificate holding graduates open their own clubs :: you’d think they’d now start accruing the benefits of their Club 100 memberships … people touring their clubs to fake consume … large presentation tours … free labor … etc. But not yet :: in order to qualify for such benefits … clubs need a minimum monthly average of 25 consumos per day.

How you get to 25 consumptions per day is on you :: maybe try prayer {or totally fake it as many owners do} … but there’s a bizarre accounting procedure which Club 100 members are required to follow. Names :: products consumed … and price paid are recorded with each membership transaction. People aren’t buying shakes remember :: because that’s against the rules … people are consuming memberships shaped like shakes.

The accounting system :: called “the binding” for reasons lost on me … is as much apart of the fraud as are the fake consumers. The binding is to be displayed openly in the club :: and is made part of the never-ending succession of success testimoanials that are included in ALL the classes :: trainings … and Club 100 events. Like other MLM disclosure procedures :: the binding does not account for the costs of doing business … and so is total useless bollux.

There have been several versions of the binding over the years {and in the various countries and languages} :: but they’re all iterations on the same theme … here’s a pdf of one version in case you’re interested in keeping your own whack accountings. And here it is out in the wild :: convincing peeps that an almost always unsuccessful “business” is almost always successful …

“What is the big secret?” asks Señorita Stalinita in the training presentation embedded above.

“This has to be very clear for you … is that you write down on your sheet and you keep it there, those who want failure don’t listen to me, those who want success listen to me.”

The trainings constantly reiterate this sentiment. If you don’t follow the dictates of the Club 100 leadership … your club is doomed to fail.

… no mio dinero

Most Herbalife Nutrition Clubs fail immediately :: states this Club 100 training slide … because they don’t have consumers. And they don’t have consumers … because they don’t strictly adhere to the rules of Club 100. Those rules :: in direct contradiction to the rules of law … require a sort of blind inventory loading.

All the monies collected from Club 100 consumos are recorded in the binding … and then split between red and green envelopes. The green envelope is the club owners take/salary … but it’s also the envelope from which all costs of doing business are to be deducted. Everything in the red envelope belongs to Herbalife and is to be used to buy more products :: dinero no mio …

But half of all the money is not good enough for the blood sucking red envelope :: because Club 100 requires that 10% of the money from the green envelope then be transferred to the red envelope … regardless of the conditions in the owner’s club {or life}. The more devoted you are to changing your children’s future … the more you feed the red envelope.

It’s pitched in the thrice weekly indoctrination sessions as a kind of guaranteed business growth strategy :: but in reality it’s just a guaranteed spending strategy … one that will lead to failure and financial ruin. Stop conforming to this or the other rules … and you’ll lose your access to the whole Club 100 subsystem.

These systems aren’t mandatory :: Herbalife would respond if Herablife would respond to me … which they obviously won’t. And it’s true … you can have a totally empty club instead. A totally empty club … in a neighborhood already packed with covered windowed clubs selling memberships shaped like chemical shakes.

There are three more pin/certificate/ID consumo levels to attain :: 50 :: 75 … and 100. Increased levels increase the likelihood that the club will be used as one of the conscripted consumption hubs. Everyone wants to pitch their new prospects inside one of the hub clubs … because the presence of other people makes pitching so much easier. MLM is ultimately a group dynamics scam … and this is a highly effective application of group scamming’s core principles and standards.

Clubs maintaining a 100 consumos per day average :: which amount to an incredibly thin slice of clubs natch … are the clubs primarily responsible for duplicating all the new clubs which have been popping up in their thousands these last ten years. As with Herbalife proper :: it’s easy{ish} to succeed when you’re already at the top of Club 100 … and all but impossible to succeed when you’re starting from the bottom {unless you’ve been selected for semi-success by someone at the top}.

… e tu herbalife?

“This is actually a wonderful thing,” said Herbalife’s President Des Walsh when Bloomberg asked him about Club 100 last week. Wonderful for Herbalife … but fucking horrible for the world’s poor. I guess these disgusting creeps in fancy suits think they can keep getting away with it {while collecting their multi-million dollar salaries} :: because it’s not happening in English … and nobody in shallow America gives a shit about foreigners or immigrants.

Anywayz :: they can’t just slowly back away from Club 100 like they did from blind lead generation :: because it’s their last functioning method of operation … and it’s too big to fail without causing Herbalife to fail. For several years now :: Herbalife has been integrating Club 100’s techniques and branding directly into their core programs. This is the welcome pack from Herbalife Extravaganza 2012 …

… along with the double-sided progression poster :: it included a new Herbalife-official version of the binding. After that Extravaganza :: the binding was available for purchase directly through Herbalife at the low low cost $15.50.

When Herbalife created a video response to Pershing Square’s initial criticisms of their Nutrition Club model :: the majority of the club owners represented were Club 100 …

Herbalife is Club 100.

Back to Señorita Stalinita …

I mentioned earlier; those who want success do things right – and that’s not negotiable. I did not come here to negotiate with you if you want to do things or not. If you came to waste your time, that’s your problem. I did not come here to waste my time. I’m here to work with the people who want to progress and to do well in life. This afternoon I told you, you need make the list of all that you and your family need in order to not suffer…

This is Herbalife’s pitch :: worldwide … from sea to shining sea. The richest country in the world exporting to some of the poorest. Not selling sugary shakes or unregulated vitamins :: but the alleviation of the suffering and fear that accompany poverty and struggle … all wrapped up in the American flag and served on a platter of hope.

But it’s a goddamn lie :: it’s a fraud … it’s a scam … and it makes no fucking difference if it satisfies the squishy U.S. legal definition of a pyramid scheme. All of life is an unfair pyramid :: and Herbalife exploits that fact … heaping suffering on those already suffering at the bottom.

If this is America’s dream … I wanna wake up.

>> bleep bloop