The Inventor
Earl Silas Tupper was born on a farm in New Hampshire in 1907. At the beginning of his career he worked as a farmer and a gardener. At the age of 30 he joint DuPont where he learned a lot about plastics. Only a year later he set up shop. In the 1940ies flexible plastics was a very new product.
Already in the 1930s Tupper experimented with different kinds of plastics and found a method to fabricate an unbreakable, flexible and hygienic material whereas hitherto plastic was brittle and therefore difficult to form.
By studying covers of tin cans Tupper also found a solution for the plastic lids.
The Product
The combination of the light and flexible plastic boxes that could take different colours and shapes plus the airtight plastic lids that were easy to open made Tupperware such a success and a household name if it comes to food storage.
The Marketing Strategy
The best product will not sell if nobody knows about it. We are in the 1940s, a long time before the internet came to life. Tupper tried to sell his invention through retailers but it did not sell well.
Tupper began to market his product on private parties that are still known (at least around here) as Tupper parties. A recommendation from one experienced housewife to another one made the success. This is called referral marketing.
Multilevel Marketing Today
I don’t know about Tupper’s compensation scheme but today, referral marketing is a multilevel marketing and each seller in the system is an independent reseller.
Think of it as a pyramid, the higher up a person is the more they earn. The top person (dark red in the picture below) can sell products directly and also search other resellers (lighter red, level 2) that sell products and sell other resellers and so on. The point is that only the top level players really earn money because number 1 participates at the sales of all layers below, number 2 as from layer 3 and so on. You see that if you are at level 12 you might work a lot with little reward.
3 reasons to reject
I was offered such an opportunity not so long time ago. Although my level was not too bad I refused for the following reasons:
- I would not call this independent but rather see it as a modern form of slavery
- Everybody can participate in this system and in the age of digitalization I did not want my name to be mentioned with people about whose business acumen I don’t know anything
- Although personal contact is irreplaceable to humans and multilevel marketing might have been ok in Tupper’s time I believe that a sales strategy should be a win-win-situation for all parties involved which means it has to be specifically designed for every business. Cookie-cutter methods don’t work.
Did you ever participate in a referral marketing system? What is your experience?
