Why Multi-Level Marketing is Not Taught in Business Schools

Multi-Level Marketing (MLM) is often not part of the curriculum in business schools due to its controversial nature, lack of empirical support, and alignment with traditional business models. Here, we explore the reasons behind this exclusion and discuss whether there is a case for including MLM in business education.

Controversial Legitimacy

MLM operates in a legal gray area. While some MLMs are legitimate, many have faced criticism for resembling pyramid schemes, which are illegal in many jurisdictions. Business schools tend to focus on established and widely accepted business practices. Instructors and curriculum developers are more likely to emphasize well-documented and legally sound business models, making MLM a less appealing topic for formal education.

Sustainability Concerns

The business model of MLM relies heavily on recruitment rather than product sales, which can lead to unsustainable practices and high turnover rates among participants. From a business perspective, this model is not ideal. Traditional business models that encourage sustainable growth, ethical practices, and long-term viability are often prioritized in business schools. MLM’s emphasis on continuous recruitment often conflicts with these principles, leading to its exclusion from the curriculum.

Lack of Empirical Support

There is limited academic research supporting the effectiveness or ethicality of MLM as a business strategy. Business schools typically prioritize theories and models that have strong empirical backing. Without substantial evidence, MLM remains on the fringes of formal business education. Instructors and researchers are more likely to focus on strategies and models that have been extensively studied and proven effective in the business world.

Focus on Traditional Business Models

Business education often emphasizes traditional business models that encourage sustainable growth, ethical practices, and long-term viability. MLM’s reliance on continuous recruitment can conflict with these principles. Many business schools avoid teaching MLM because it does not align with the ethical standards and long-term growth strategies they promote. Traditional models like franchising, retail, and manufacturing are more commonly taught as they offer a clearer pathway to success and sustainability.

Risk of Exploitation

Many MLMs have been criticized for exploiting vulnerable populations, often targeting individuals seeking flexible income opportunities. This ethical concern may cause business schools to avoid including MLM in their curricula. Instructors have a responsibility to prepare students to identify and avoid ethical pitfalls, and teaching MLM may not align with this goal. Instead, business schools focus on teaching ethical practices and responsible business behaviors.

Consumer Protection Issues

Many MLMs have faced legal scrutiny for misleading marketing practices. Business schools may prefer to teach models that are more aligned with consumer protection laws and ethical marketing standards. Traditional models have a established framework for transparency and ethical marketing, making them more suitable for educational programs.

Conclusion: While MLM may be a topic of interest, its complexities and the potential for unethical practices make it less suitable for inclusion in formal business education. However, as discussed in this article, it is still taught at some lesser known colleges and private learner centers where ethics are not as much a concern. For those who want to explore MLM, it remains an important topic for personal development and business evaluation.