Dot Dot Smile cans MLM opportunity, moves to “wholesaling”
Dot Dot Smile has informed distributors its MLM opportunity “no longer makes sense for us to maintain as a sustainable business.”
The announcement was made last Friday, giving notice Dot Dot Smile will cease MLM operations on June 30th.
Acknowledging ‘there have been a lot of concerns and questions around the current state of DotDotSmile’, the company went on to state;
in the past couple of years, we have seen an evolution from a focus on building teams, and instead, the community is diving into wholesaling.
Unless I’m missing something, this is Dot Dot Smile acknowledging the majority of its sales revenue is derived via affiliate purchases.
But instead of just saying that (and admitting it’s operating as a pyramid scheme), Dot Dot Smile frames internal consumption as “wholesaling”.
This is important within the context of Dot Dot Smile being tied to LuLaRoe – and LuLaRoe’s regulatory past.
In February 2021 LuLaRoe paid $4.7 million, to settle a pyramid scheme case brought by the Washington AG.
The Washington AG charged that LuLaRoe’s
compensation (was) entirely based on the recruitment of other persons as participants in the LuLaRoe MLM.
In BehindMLM’s mid 2019 Dot Dot Smile review, I noted similarities between it and LuLaRoe’s business model – specifically the lottery distribution model, which wholly encouraged affiliate inventory loading (“wholesaling”).
If Dot Dot Smile are under regulatory investigation, they haven’t disclosed it.
Getting back to Dot Dot Smile closing down its MLM opp, the company advises distributors will still be able to purchase product. If they want to sell to customers, this will be possible “on a different platform with different requirements”.
There will be more details to come on the opportunities above, but rest assured that if you would like to continue selling DotDotSmile or referring customers to purchase, we would love to have you continue to do so.
Reading between the lines, sounds to me like Dot Dot Smile wants distributors to continue purchasing products – but without the MLM regulatory baggage.
What this means for distributors is no more profiting on product purchases by your downline – something they haven’t taken well.
To their credit, Dot Dot Smile isn’t censoring distributor feedback on their social media pages.
Pending any further updates, which seem unlikely, Dot Dot Smile will cease operating as an MLM company on June 30th.
Update 7th September 2022 – Dot Dot Smile has filed for Chapter 11 bankruptcy.
Link to the webinar that preceded the email that went out:
youtube.com/watch?v=ODJJbLsiyJs
It seems there was a leader trip to Costa Rica planned but no communication about it.
Then last week hackers ransomewared the Costa Rica government, which CEO Jeff Thompson frames as a “terrorist attack”.
nationalinterest.org/blog/techland-when-great-power-competition-meets-digital-world/ransomware-hackers-declare-total-war
It’s also a convenient excuse to pull the plug on the trip which, in light of the closure announcement it was bundled with, I imagine would have been quite the awkward spectacle.
A comment in Oz’s original DDS review contains the entire text of the email rug-pull announcement. This line caught my eye:
They’re trying to say this “transition” from the MLM model to direct sales has been organic: that this was the direction everyone in the sales force was heading anyway.
Based on the backlash Oz documented above, I call bullshit. Commission checks are bouncing; the company can no longer afford MLM commissions. So they’re unilaterally and arbitrarily absolving themselves of that burden.
I doubt DotDotSmile has much longer to survive.
It’s a lot bigger than paying commissions on downlines.
They also started a preferred customer program just a few months ago where merchandisers could sign up customers to their DotDotSmile replicated websites and they would get a discount each time they ordered from there.
With this program discontinuing now DotDotSmile gets all of those customers information.
Commissions haven’t been paid still and the trip to Costa Rica was an earned incentive trip for hundreds of merchandisers, not just leaders.
Thanks Katy, I wasn’t aware commissions were owing.
If that’s the case then any Dot Dot Smile future plans are DOA. MLM consultants don’t work for free (IDS jokes aside).
They removed all comments on every Instagram post and are sending nasty messages to people who are commenting on their Facebook page.
Any examples? MLM companies bullying distributors is never a good look.
DDS sent out cease and desist letters to people speaking out about them.
They deleted tons of posts and then deleted the merchandiser group. They handled everything very poorly.
They tried to make it seem organic, like someone above said, but it wasn’t. They pushed team building hard.
Any chance of a screenshot of one of these C&D notices? Sounds like something we’d report on.
I got a cease and desist letter from dot dot smile years ago it made me giggle I deleted it and said f off lol.
They still haven’t paid anyone from May. They owe some merchandisers thousands of dollars, but are on vacation again this week.
They purchased a cookie co franchise but owe so many people money.
The fact that there is a trip that so many merchandisers pushed so hard to earn and there has been no compensation.
Some people earned $2500 in cash for travel reimbursement. No money has been paid at all. On top of our commissions not being paid for the month of May and it is over 2 weeks late. So gross!
No one has been paid since may. Some people are owed thousands of dollars. They laid off all of their staff.
They are disgusting human beings, parading around flaunting money they earned because of the hard work of people they screwed over.
No amount of cease and desist letters will stop the truth from coming out.
We know so many things- it will all come out.