Tuesday, May 24, 2011

Amway And The World Series Of Poker?

Every year at about this time of year, Binion's Horseshoe Casino in Las Vegas organizes the "World Series of Poker". Thousands of people fly to Las Vegas, pony up $10,000 and play in the main event. Most people expect to lose their money but they think of it as an experience. Some people hope to win, but ultimately, there can be only one champion. There will be a small group of people who actually take home more than their $10,000 entry fee, but the vast majority will lose money. Most people are aware of the tremendous odds against them winning at the final table, but they press on anyway.

The Amway opportunity, as promoted by the Amway Motivational Organizations (AMOs), operate in a similar manner. The main difference is that most prospective IBOs go into the venture expecting to win, and there is no assurance of there being a champion (new diamond). In the Amway opportunity, there is the real possibility of all the IBOs losing money. Sadly, as I said earlier, most participants go in expecting to win. Most participants do not realize the tremendous and overwhelming odds against them making a net profit, let alone achieving the legendary "diamond" status.

In both scenarios, the vast majority of participants lose money in order for a few to win. The difference is that poker players generally understand that they are likely to lose, whereas Amway participants are often mislead into thinking they are likely to succeed. Most Amway participants figure this out and quit. The difference here is that poker players generally do not quit playing poker. Most Amway participants want nothing to do with Amway or its products when they quit.

This can be confirmed by the fact that former IBOs generally do not continue to purchase Amway goods once they are out of the business. If they did, then Amway sales would continually increase even if their IBO force were to shrink. But that isn't the case. I recently read some Amway supporters bragging about an increase in IBO retention, but even if true, it doesn't appear to be translating into better sales or an increase in the number of new diamonds emerging from the systems.

If I'm not mistaken, I believe there were far more World Series of Poker Champions in the last ten years than new diamonds and emeralds in North America. (The World Series also has smaller events, thus there are many many more champions than new diamonds and emeralds)

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