There are many Internet business opportunities that exploit the novelty of the Web as a lure. If you nibble, they'll further bait you with promises of freedom, esteem, high income and the good life. For a fee, they'll set you up with a company-sponsored, duplicate Website, along with products or services to sell. But many will also offer you incentives to recruit others to pay the fee, which is really what these so-called opportunities are all about. They are among what the U.S. Federal Trade Commission cleverly calls Dot Cons.
The real business of these types of dot-cons is not wholesaling products or services. It's selling the concept of the scheme itself, and duping you into reselling it for them. But by law in most U.S. states, one can't profit from recruiting, with nothing changing hands but fees and commissions for the scheme itself. That's illegal pyramiding. To get around it, these dot-cons sell tangible, "distributorship" Websites on which to seemingly resell their products or services. But a closer look reveals that, what's really for resale, is the distributorship itself over and over again.
It's all just a guise for a relatively new twist on an old scheme called multilevel marketing (MLM) or network marketing. One of the latest twists is exact method marketing (EMM). It's touted as a revolutionary idea that eliminates the flaws in MLM. But it's little more than refurbished hype for the same ol' scheme. They all use some form of pyramiding to resell the scheme itself, some by exploiting loopholes in the law to recruit through a backdoor, others by breaking the law until they're busted. Regardless, they are often formulas for failure, except for the people who created them. They're at the very top of the pyramid, the only place to be―if you're going to run a scheme, that is.
Even if products and services are more than just a hook to resell the scheme, often the dot-cons are not really wholesalers as they might claim. They are extra middlemen between wholesale distributors and you, and you can bet they're taking an extra cut too. Another dot-con trick of the trade, is to "borrow" the reputations of well-known merchants, financial institutions and such, by offering referral (affiliate) deals with them. But affiliate deals are all over the Web, and just about anybody with a Web site can sign up for free. Again, the dot-cons are often unnecessary middlemen taking an extra cut. As a result of these tricks, you'll likely have to gouge absurd retail prices from your customers to earn any margin at all, share your meager referral commissions with unnecessary middlemen, or both.
