FAQ

Is Consumer Direct Marketing the same as MLM?

The distinction is the structural test articulated in Vander Nat & Keep (2002) and operationalized in subsequent Federal Trade Commission enforcement actions: whether the compensation a typical participant receives flows primarily from product sales to end consumers, or from the recruitment of new participants and internal volume requirements.

Consumer Direct Marketing programs sit on the consumer-purchase side of that test by design. Multi-level marketing programs vary; some pass the test, some do not, and the FTC’s enforcement record captures the cases that did not.