Earning Political Currency! MLM vs Ponzi
Brand Building doesn't happen without Word of Mouth Marketing !
Multi Level Marketing (MLM)
In MLM a Product, Concept or Service is sold to few people, who in turn sell it to few more people each. The Commission is earned by sellers all the way to the top. It is also known as Network Marketing, Pyramid Sales or Referral Marketing.
It takes Max 7 levels of Contacts to reach anyone on this Planet ! As shown, the Guy in Red convinces 3 people in Blue to buy a particular product or a service. The Blue Guys in turn convince 3 people each, resulting in 9 Grey people. As per the concept, for every sale done by a Grey guy, the rewards are given to the Blue guy who sold it to him and also to the Red Guy. Meaning the Red guy gets a small commission every time any of the 9 Grey sell & also from sales of any Blue guy.
Deploying MLM in Politics
Most political parties are born through Word of Mouth Marketing using MLM. They may sell different Concepts like Congress sold Independence, BJP - Hindutva / Nationalism / Ram-Mandir, AAP sells concept of Swaraj through Anti-Corruption plank. The methodology remains the same, Broadcasting Promises using Word of Mouth Publicity.
As in MLM, few Volunteers convince more Volunteers to join in spreading their ideology, who in turn add many more Volunteers, till they reach every Voter in that Region.They Get Paid as discussed in my earlier Blog Political Currency.
There may be layers of volunteers, who eventually reach Voters and convince them to elect leaders from their party. The Volunteers may be rewarded as District - Taluk - Panchayat - Village - Community Leaders. Each enjoying appropriate power and respect from the people of their region.
Conditions for MLM to work
As in every Sales Cycle, here too there are Two Components, Sellers & Consumers.
Sellers are the Leaders & Volunteers who Propagate Party Ideology & its Promises till consumers. The Chain of command follows from top leadership till the Volunteer who interacts with Voters. There should be No communication gap between them, either in terms of following commands (top - bottom) or transfer of voter feed-backs (bottom - top).
Consumers are the Voters who benefit from Party Ideology & its Promises. They seek Trust of Leaders & Volunteers before lending their support. Breach of Trust in Ideology or Promises leads to Cascading Negative Effects.
Strength of a Chain is equal to strength of its Weakest Link !
An Extremely important point to note here is that MLM is a Double Edged Sword. As in a Pipe, both good & bad info flows in either direction. Any Blockage or Leakage breaks the MLM cycle.
Advantages of MLM
If executed sincerely, it is an extremely effective tool for propagating a Concept to millions of people in shortest Possible time. Almost All Revolutions have spread using MLM model of Word of Mouth Propagation.
Few Notable Advantages :
- Fastest method of reaching out to maximum people, through Existing Contacts.
- Convincing becomes easy, as it rides on already established relationships.
- Once accepted, Customer Loyalty is unbreakable by competitors.
- Volunteers remain Loyal, as rewards flow without much efforts.
- New Promises get Broadcasted at Lightning Speed, within Established Chain.
As in the Animal Kingdom, there are two types of people in any organization, Predators & Parasites.
Predators are the go-getters who use their own strength (Kinetic Energy) to get things done. They are the Currency Earners for the Party who motivate fellow Volunteers to perform.
Parasites typically live on others achievements. They survive on work done by their Colleagues or Team mates and live on Currency Distributed by the Party. They boast about Past Performance (dubious) & Position (Potential Energy) for their existence. Like Parasites, their Excretion hurts the party more than their Consumption.
Survival of any Party depends on how Quickly it Finds & Flushes Parasites !
Ponzi Schemes
Charles Ponzi ran a MLM scam in 1920 by duping Investors using fraudulent methods. Schemes are called Ponzi, when people are lured to invest in a concept that doesn't have proper profitability mechanism. Such organization run out of currency sooner than later & investors get duped.
Most Multi-Level Marketing turn Ponzi, when Parasites out-number Predators !
When MLM turns Ponzi
When the number of Currency Earners get out numbered by non-performing Leaders, the party gets defunct. Most Non-Performers promote like minded people to hide their wrong doings, adding to the speed of decline.
Symptoms of MLM turning Ponzi
As in the case of Automobiles, Hiccups during normal running is the time to examine the Selling Machine. When Excuses start pouring, time for a thorough checkup !
Sensing Trouble :
- The Earning of Political Currency Declines or Stops growing
- Number of Volunteers or Supporters or both start Shrinking
- Hiccups or Resistance in following Chain of Commands
- Customer (Voter) response declines or feedback stops coming
- In-fighting, Blame-Game, Groupism are signs of unrest among Volunteers
As is normally the case, Parasites stay dormant, typically blending with their surroundings. However, they can be easily spotted by their passiveness. Some times we do find active parasites, but their activity is limited to camouflage their non-performance.
Spotting Parasites :
- Normally Silent in the meetings, or Yes Men
- Asking queries that are beneficial to Individuals than the party, is a sure give away
- Normally Hang around with other Parasites, exchanging latest blood sucking mechanisms
- Giving Excuses or Promises than Reporting Performances
- Defending or Promoting other Parasites, sometimes even Attacking Performers
The most damaging effect of MLM turning Ponzi is Loss of Credibility. When Voters stop respecting Volunteers or Volunteers resist following Commands, the decline of the Party Begins. MLM to Ponzi is like an Aircraft in Tail-spin, extremely difficult to salvage even by experienced Pilots !
Effects of Ponzi :
- Goodwill Harvesting campaigns start Failing due to Poor Response
- Consumers (Voters) start Questing the Motive, instead of Supporting
- Performers get discouraged, Parasites start Panicking
- Volunteer Response reduces Drastically, Excuses get Creative
- Morale of the Organization takes a beating, Innovations & Initiatives Stop
As the news of Predators getting out-numbered spreads, Parasites get panicked. Instead of working to save the organization, they rush to Protect Themselves. They typically Gang-up against Performers to Plunder whatever Currency that remains. They perform like the Looters as explained there.
After Effects of Ponzi :
- The First & Foremost after-effect is Party gets Split into two or more Groups
- Parasites start Operation Cover-up, with High Visibility Activities, mostly Non-Productive
- Performers Stop Working, as they do not see any Rewards coming their way
- Consumers (Voters) get Vary after seeing change in Attitude or Leaders with Dubious Characters
- An MLM Starts Among Voters, Spreading Negative Information about the Party
The After-effects devastate Morale of Volunteers & Leaders in the Party and Destroys Credibility of the Party amongst People. While the Leaders get into the Blame-Game, the Volunteers start playing Pahle-Aap to correct themselves. Turn-around Looks Bleak from all Angles !
Turning Ponzi into MLM again
Every M&A expert looks for Companies / Products gone Ponzi with possibility of a Profitable Turn-Around. It is possible, has been done umpteen times, but the timing has to be perfect. Delay reduces chances of Turn-Aound.
Painful but Possible :
- First thing First, Change of Management. New Team with Fresh Start
- Parasites should be neutralized, at-least stripped of Leadership Positions
- Take Performers in to confidence, Reward them with Challenging Responsibilities & Realistic Targets
- Inform Voters about the change in Management, with Realistic Reasoning and Clear Short-Term Deliverables
- Start a new MLM Cycle, taking Leaders, Volunteers and Voters along for Quick Recovery
It may look too cumbersome to go through the pains, but it is easier to salvage an existing Party than build a new one from scratch, unless Top Leaders have spent too much time Twiddling their Thumbs.
As Hitler Says in "Main Kampf", there are three types of people in every Struggle. The Fighters, the Hedgers and Traitors. In the Struggle to keep the Party Growing, all you need to do is Empower the Fighters, Convince the Hedgers about Victory and Ensure Traitors Cross the Border.
The Situation need not always be about the Whole Party, this can be used to Salvage individual Units across a Region.
Disclaimer : I have been an Active Karyakarta of AAP Bengaluru for past 2 years.
The Views mentioned above are my personal and should be treated so. More about
me at www.nashwall.com/About-Us.html
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