Vemma a scheme? Woah, not so fast

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It’s no secret by now- the FTC has succeeded in shutting down operations for Vemma Nutrition Company even before courts rule on anything.  The lawsuit FTC vs. Vemma was filed August 17 but was just made public this week.  

And some Vemma bloggers are flat-out outraged.

Already the news outlets are having a ball playing up the story and making big headlines while they’re at it.

CNBC has picked up the story, and the New York Daily News ran an article under its Crime section…talk about guilty until proven innocent!  What started out as a small but shocking blip on the radar screens of direct marketers became overnight a sensationalized mass-media story.

Why the dramatic hype of a seemingly innocuous lawsuit which doesn’t affect many people on the grand scale of things?  Vemma may be a successful company with $2 million in revenue last year, but on the whole it’s not a brand that merits national attention…usually.

Are journalists generating hype for alternative reasons?  Perhaps there’s a greater story here?  Let’s take a look at a few of the headlines and compare them to the facts and see where that gets us.

Here’s what the headlines are telling us about the Vemma case

  1. “Vemma Shut Down for Running Pyramid Scheme”.  OK here you’ve got a classic case of guilty until proven innocent.  Shouldn’t this say “allegedly” running pyramid scheme?  That’s from CNBC, who should know better.
  2. “Federal Trace Commission calls Vemma energy drink ‘illegal pyramid scheme’ that targets young adults”.  True, the FTC does talk about targeting young adults in its lawsuit.  However, the five charges have nothing to do with targeting young adults because THAT’S NOT ILLEGAL.  So, here we have  clear case of hype: readers will morally object to Vemma right away because “oh no” they’re targeting our youth!  Horrors!  Well guess what, if that’s something you object to then Coca Cola, the National Park Service, Apple, Starbucks, and Verizon Wireless are guilty of the same thing: offering jobs to students or marketing their products to students.  That’s from the NY Daily News, cited above.
  3. “FTC shuts Vemma ‘pyramid’ scheme that used college kids”.  Now Vemma’s USING kids!  And notice that the pyramid scheme question is now a bygone conclusion.  That’s from the New York Post.

And that’s not all…once you start reading the bylines and opening paragraphs of these reports you begin to get the sense that something bigger than Vemma is at stake here.  Consumer Affairs ran a story that began with this sentence: “…by Vemma Nutrition, a multilevel marketing scheme…”.

What’s the difference between this and other nutrition MLMs, like Rain International?

The wording is carefully crafted to make ALL multi level marketing businesses sound like schemes.  “Scheme” is negative and implies the hidden motive of ripping people off.  That’s not what multilevel marketing is…it’s a valid means of distributing good products via social and individual, personable channels.  Some say it MLM hearkens back to the days of the corner store where the shopkeeper knew all his customers personally.  

He could deliver better service and could more aptly fill his shelves with the good customers really wanted, not just the products he wanted to sell.  Journalists are either acting irresponsibly by not investigating the true nature of MLM, or they’ve got a secret agenda.

Either way, it’s not what journalists are supposed to do.

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