Digital Marketer Gets Scammed By An MLM Direct Sales Company - The DM Ep.2 w Vince Reed

Sometimes life is about luck because you can't really choose your mentor. I mean, I'm bringing in more people than the whole company. Like then everybody else in there and they can't figure out how the heck I'm doing it. But any did this company, like steal from and come to find out? Hi, my name is Vince Reed.

Hey, what's going on? Vint Reed here. And welcome back to the dm. In the last episode, you got a chance to learn a little bit about me. See how I grew up, how I started playing sports at a young age, how I fell into the real estate space, and how I found digital marketing. So make sure you go back and check it out. Also, be sure to check out the recap shows. A lot of times I'm like, man, I forgot to share this really important story within this whole process. And I go into a lot of depth and insight on those. So when you're leaving comments after you subscribe to the actual channel, you know, you never know, I might be answering your question or speaking about something that you post in the comments. And with that being said, let's get into the episode.

So in the last episode, I shared with you how I found my very first mentor. And I realized I never shared with you his name. His name was actually. And the reason I joined him was because I saw his ads everywhere and, you know, I was clicking on them and didn't matter what direct sales company I looked up on Google. He was there getting these big awards, making a lot of money, and he promised me if I got started with him that he would teach me Google Ads. And he did. He taught me the basics, the very, very minimal basics. And that was find keywords that people are searching for. Basically, you know, put some money into a Google AdWords account, and when people click on your ad, they'll go to your page and you'll make money. Come to find out, it wasn't that easy. I went to bed thinking I was going to wake up rich and said I woke up $1,000 poorer. So having to go share that story to my girlfriend, now my wife, you know, wasn't fun. I had to tell her that I not only had invested $2,000 with this complete stranger, where I had to send him the money, now I was down another thousand dollars that I didn't have. So I called him back and I asked him for help. I said, hey, you know, this didn't work. Ran these ads, the money's gone. What should I do? And that's where he then proceeded to share with me a story about an individual who'd made well over, at the time, over $20 million. I think by the time it was all said and done, he had made well over 50 to $100 million in digital marketing. So his system would allow you to build these landing pages. And a landing page is a one page website. Sometimes it has a video on it, sometimes there's just copy. And essentially it's designed to filter out people who aren't interested. So the end user puts their name and email in and you're able to build your list. And at the time when I had spent the $2,000 with joining this direct sales company, the way typically people would teach you to grow these companies was to talk to friends and family. And going back to my days at my very first apartment, I didn't like those people trying to get me to these hotel meetings. So the idea of learning how to run ads and build my own list and generate leads, it was important to me. Now, this new mentor that had this system, not only did the system allow you to build these pages, it had training inside of the system that was worth literally hundreds of thousands of dollars. And the cost of this entire system, it wasn't $2,000, it wasn't $1,000, it was literally $49 a month. And for me, I was like, man, what credit card can I get right now to sign up? I was so excited because I was broke at the time and there was no way he would have said this thing was 2,000 or 5,000. I would have been able to afford it. I got into this system and there were many nights that I would fall asleep at my computer just going through training. I mean, he had all types of marketing training. And this is before social media. So, you know, it was Google Ads, it was Yahoo ads, it was YouTube ads. And then back then, what was popular was these article sites where you could write articles and people would curate these articles on these, these sites. There was form marketing and forums are like when you go into little marketing forums and people asking questions, they would. He would teach you how to go into these forms and leave your link. And it was just all of these old strategies. There was a little bit of SEO type training on there. But the thing that I learned the most in that system was how wrong everybody else was when it came to advertising. What was cool was I was able to immediately see why the campaign where I lost $1,000 only lost me a thousand dollars, because had I had any other money in there, I would have lost that too. I was doomed and set up to fail from the very beginning. And, and this is an example of you really don't know what you don't know. So he taught me this concept that I still teach people today when it comes to marketing. And it's understanding the difference between shopping keywords and buying keywords. All right, so I want to explain this to you because if you're out there and you're trying to run ads online and you aren't seeing your funnel work and you're losing money and you feel like I did back then, it's likely because of what I'm going to share with you right now. What I'm going to share with you right now, it's priceless. When I joined and I joined that direct sales company, we were selling these $2,000 essentially like self help personal development CDs. Right. Way overpriced. That's typically how these direct sales companies are. And people would pay 2,000, I would get a $1,000 commission. What you typically think about when you start marketing is how can I set up some ads and drive traffic to people looking for ways to make or Internet marketing or build a business from home. And these are what I call shopping keywords. It's what a person is searching for when they immediately start thinking about ways to make money. Now if you really just think about it, it makes sense, right? Like it's like I have this thing that can help other people make money. Why not just put an ad in front of those people? Well, when you do that, you're getting other people that have no idea about the market, they're curious. Everything to them is probably a scam and they probably aren't as crazy me to send $2,000 to a stranger. So you lose. And that's exactly what I did. So I went in there, I went into Google and the company that give you this website. And here's another lesson in this. I drove traffic to the company website, which was just a generic website. When was the last time you just went to a generic website that you didn't know and just bought from it? Right. Typically doesn't happen unless someone told you about a product or service. So I was doing everything wrong. And you know, I always think to myself sometimes life about luck because you can't really choose your mentor. I fell into this mentor, I got lucky, I went online, found one person, he led me to the next guy. And it just so happened that this guy knew what he was doing. What if I would have found a mentor that would have taught Me how to spam everyone or how to use illegal, you know, bots on the Internet and do some kind of scammy thing. That would have been what I knew, that would have been what I taught. So sometimes it's not about, you know, what you're doing, it's how you do it. So I was driving traffic to this company page, which was not optimized to convert anything into a buyer, and targeting people that were literally shopping, just trying to figure out ways to make money on the Internet. So he said, what you want to do is you want to go after buying keywords. And buying keywords are basically the things people start to search when they're actually in the act of buying. So, for example, if I take the same exact niche market, instead of going and targeting people that are searching for make money online or work from home, people that go down the rabbit hole, like I did when I went from searching for make money on Google, that led me to direct sales. And then I was like, well, what is direct sales? So I started searching for that, and that led me to different direct sales companies. And come to find out there's like literally thousands and thousands of these MLM direct sales companies. And this is where I hit the gold mine. You see, I realized that keywords like make money online or, you know, work from home, they get a lot of impressions, a lot of traffic, meaning a lot of people are searching for those things because they're shopping. And because of that, it's a competitive keyword. The cost of those clicks are a lot higher. But when you go down the rabbit hole and you start to find essentially buying keywords, you might have less traffic, but they're a lot less expensive. So let me give you this analogy. Let's say the keyword work from home or make money online gets a million. Let's make it even easier. Let's say it gets 10,000 people to search it every single month. Now, I could go find 10 direct sales companies with whatever the company's name is, and I could basically target them. Let's say each one of those 10 get 1,000 impressions every single month. All right, but for a fraction of the cost. So let's say work from home, make money online, or whatnot. 10,000 impressions, and it cost me a dollar a click. But let's say that the direct sales companies, they get a thousand each, and I bid on those, but those only cost me 5 cents a click. I'm still getting 10,000 impressions, but I'm actually getting 10,000 better impressions because these are People that went down the rabbit hole. And by the time you actually get to actually searching for the company keyword, you've made a decision. You understand direct sales. You probably were that person that went to a hotel meeting or your mom brought you to some meeting and you're sitting in there like, this is a scam. But I'm going to wait until I get home and go do a little bit of some searching on it online and see if it's legit. And you go online, then you run into my ad where I say, hey, how about I show you how to not go chase friends and family? How about I show you how to generate your own leads so you can dominate this company? And you're like, man, now I'm going to join and my cousin's not going to know that I know the secret of how to actually get my own leads. And that's what happened. And I was just hungrier than everyone else and I said, okay, now I have this direct sales thing. Now I know how to actually create the right type of ads. And that's where I quote, unquote, became this kind of marketing guru and was able to really specialize in what I like to say, helping you get the highest caliber lead at the lowest cost. So once this happened, I realized that I didn't want to be known for selling personal development, overpriced DVDs. I wanted to do something else. So while I was trying to figure out what type of company I wanted to be part of to use this newfound Internet marketing skillset, I started to stumble into affiliate marketing. And when I was utilizing these systems that allowed me to build these capture pages to build a list, I started to understand the power of list building and the money. And the power is in your list, but the fortune is in the follow up, and your list is the emails that you generate. And as you build that list, that's distribution power. And that's why today, for example, people with big followings on social media, they're excited because they have this list that's controlled by the platform that they don't own. When you build a list with a capture page and you get a name and email, you own that data, you own that list, and with the push of a button, you have mass distribution power. So the way that it was taught back when I got started, and it's pretty close to being the exact same today, is that every email that you generate has a lifetime value of $1 per month. All right? So if you have a list of a thousand people, you should be at worst generating $1,000. Have a list of 100,000 people, you should be generating $100,000 a month. That was the thought process. And again, this is before social media. So I started building a list and throughout my time online I've been able to generate well over a half million leads online. I started messing around with affiliate marketing and I was running ads and I was basically trying to sell these affiliate products. So for example, with this capture page system, you would capture leads with an autoresponder tool. And an autoresponder tool today are companies like Mailchimp or ActiveCampaign or ConvertKit or you know, GetResponse and AWeber. These were all the ones that we would use. And I was trying to sell these because I had this new concept of list building and I feel, I felt like there are other people that are going to learn this skill. Let me go try to sell these tools. And this is while I was trying to figure out what else I was going to sell with this newfound digital marketing skillset. So I started trying to sell AWeber, which is an automation tool and software and I can't make any sales. So I'm doing the same thing that I was doing before with selling the DVDs but now I'm selling this affiliate tool. So I was losing money. People were landing on a website and I was basically like here's how I, you know, here's this tool I'm using. It's awesome. You can create automated messages that go out after you get leads. Right? I was getting a lot of traffic. I was now building my list but people weren't buying the actual tool. And then something just happened and I stepped back for a second. I said hold on a second. Like again, it's not what you do, it's how you do it. And I decided to essentially do a case study to show how I'm actually setting up my follow up campaigns and how I'm improving my open rates and my click through rates on my emails. And the difference between this was I went from basically just saying hey, go buy this cool tool, it'll help you create automations to doing what I call today playing show and tell. It's kind of like when you're a kid in school and you know you get to bring a toy to school that day. You're like the most popular kid in school that day because everybody got to see you show and talk about this toy. I started doing that with this tool and immediately I sent this video out and it showed how I was using automation tools to like improve my sales and my lead flow, follow up and open rates and things like that. And all of a sudden I started not only getting sales, I started getting people reaching out to me to help them set up their automations. And I'll never forget the day I remember. I was just sitting there on the couch. I was a little frustrated and mind you, at this point I'm just racking up debt. I'm in well over $16,000 worth of debt. You know, my home is still in pre foreclosure. I'm not making any money at this time, but I'm getting it. And I could see the writing on the wall. Even throughout this entire time, as frustrated as I was, there was no doubt that I was going to make a lot of money with digital marketing. I just knew it was just a matter of time. So I'm sitting there and I get this like ping. I checked my inbox and I saw an email. An email said commission. It was like a cha ching email. And I go and I open it up. If I didn't have high ceilings, I would have hit my head on the ceilings. I jumped up like I won the lottery. And I had just made my first commission online and that was $6 and I think like 37 cents. Someone had essentially joined and purchased an account with AWeber. And I made my very first online sale. Sitting there at home doing nothing. And at that point I said, okay, this is it. I was onto something and my entire strategy started to change. I started to continue to do what I just shared with you in terms of playing show and tell on multiple products and services in the affiliate marketing space. And then I said, okay, I know I can drive this traffic. I know I can get in front of anyone at the right time. And all I gotta do now is figure out how I'm gonna scale this thing up and start really, really making some serious money.

So I started making some money and things are starting to roll. I go down the rabbit hole. Like a lot of people when they get started, they believe it's the thing that they're in that is the thing that's making them money or not. Meaning I was joining all these different MLM companies and direct sales companies and trying to find the one that was easy, right? Truth is, there is no easy. They're all hard. It all comes down to human error. Kind of like when people ask me, Vince, what's the best marketing strategy? Or you know, what platform should I be running ads on? Which one works the best? And I always tell them, I say, you're not really asking me, you know, the right question. Okay. Because what you're really asking me right now is which ad platform is going to make you the most money? Because the truth of the matter is all of the ad platforms work. When you set up an ad, what you're doing is you're paying for that ad platform to show your ad to a human being. If that happens, it worked. If someone doesn't opt in, if someone doesn't buy, that's human error. So I start to do, well, I'm making money now. I'm supporting myself. And I remember social media starting to pick up. So Facebook's around now and Twitter's there. And I immediately, as I'm running ads and I'm doing this, I start to see the first gurus pop out, like specialists that do Facebook ads. If you want to learn Facebook ads, do this. If you want to learn YouTube ads, do this. And I remember thinking to myself, I don't want to be the specific platform guys. So if you go back to when I was first making videos on YouTube, although I was teaching all of these strategies, I'd never, ever say I'm the Facebook guy or the YouTube guy, the Google guy. I simply talk about lead generation and marketing. And the reason I did that was what happened to me in the real estate industry when banks stopped lending. I realized that things can happen in a second where if I start being the Facebook guy, like today, and Facebook doesn't convert or doesn't work the way that it did work, then there goes my business. Now I'm going to something else, and I don't have the credibility, you know, if I start talking about just Google Ads, same exact thing. Because there's a point which I'll get to, where Google pretty much did what was called the infamous Google slap. And a lot of people got their Google Ads account suspended and lost their entire business. I started having some success, and I was like, okay, I'm figure out a company that I want to get started with. And the funny thing is, again, you don't need a company. But that's what I thought at the time. So I saw this ad and there was this guy talking about a social network that pays you. And they were explaining, you know, how Facebook makes all this money from ads, you know, that people put on the site, and that this new social network that was coming out paid a percentage of their ad revenue to the users. So the reason Facebook is so valuable or any other social network is so valuable Today is because of the users. If they didn't have users on the platform, then those companies wouldn't be worth billions of dollars. I mean, have you ever stepped back and thought about it? You got these CEOs of these social networks that are worth billions. And it's free. How is that? It's free because a lot of people are on the. On the platform. They have the eyeballs, and people put ads on those platforms, and that's how they make money. So this ad pops up and it says, you know, new social network that pays you. And I'm like, man, this is going to be huge. And I get started in this company and the company's called, and ultimately it's a social network that is going to pay a percentage of the ad revenue to all of the users. Sounded like a great idea. Especially, you know, during this time. You know, social networks are starting to crank, right? So I get in there and I'm like, okay, none of these people know digital marketing. And everyone is talking to friends and family. It's a classic mlm. They have the kind of an MLM type tiered system. And, you know, I get in there and I'm like, okay, what's a unique angle that I could use with this platform? So I start running these ads on social network sites, and my ad says, are you advertising your business on yet the social network that pays you? And to me, this was like a genius ad because everyone else that was promoting the company was basically promoting it like an MLM to make money. And I went after businesses who I knew were already on social networks. And I said, if I could go after a business owner that's promoting their business on a different social network, it only makes sense to let them know that there's another one that they could be on that actually pays them. And it absolutely exploded.

I was putting out videos each and every week showing how fast my downline was growing. And I was picking up hundreds and hundreds of new users each and every day. And very quickly, within like, the first week, became the number one person in that company, which quickly got me the attention of the CEOs at the company. They're calling me, going crazy. I mean, I'm bringing in more people than the whole company, like, than everybody else in there. And they can't figure out how the heck I'm doing it. So I start telling them, using digital marketing. And they, of course, say, well, can you teach our users how to do digital marketing? And they started inviting me to do these, like, webinars to the entire Community. So now here I am, barely understanding digital marketing when you really think about it, but a lot of more than the average person. I'm doing webinars for, like 200 or 300 people almost every single day, teaching them strategies. So what was crazy about doing the webinars for? I want you to think about this for a second. So imagine if, you know, Facebook, Mark Zuckerberg calls you up and he goes, hey, I want you to do a webinar for everybody on Facebook. That's what I was doing. So not only was I doing the webinar for this company to teach them how to generate leads and teach them digital marketing, they also had me basically showing them how to use the actual social network in itself. So all of the features. So everybody in the entire company basically would watch me each and every week. We even created this website, and it was called. And people would come, we would blog each and every week, and we would watch the traffic. And we were getting more traffic to our site than the company. And a lot of the distributors and people didn't like it. People would complain. There was one guy that created this other thing and was saying how he wanted to remove me from the company because I was taking all of his people because other people and other companies were leaving and wanting to join under me because I was doing private webinars and training for everybody that was in my organization, teaching them how to do the exact same thing for duplication. So it was crazy, this entire process and to go from literally not having nothing to now having this massive audience in a matter of months.

So I had a different idea to build this other company, and I went to this, like, developer website, developer place in my area, and I meet this guy, and he becomes, like, the first guy that really, you know, can code. And we're still friends to this day, and we start to build systems. I saw my buddy who was building a system that I learned from my first real mentor that had the system. I learned all the training from, like, well, he had this system that was building pages and things like that and had training. Well, I said, well, what if we built specific landing pages for the people and. And sold it to them? Because the people in that company only could use the company site, which was terrible, to drive traffic to, and nobody would convert. So we started doing that. So I'm having these webinars to 2, 300 people, and then we're slinging these, like, pages, and we're manually building them. It's so crazy to these, to these users for like, 50 bucks a pop. They're buying it. We're giving them these pages and now we're making like 20 times the amount we're making from the company from selling these pages. Then one day I'm like sitting there and I'm like, okay, this is working. I'm starting to see it now. I'm making some money. I'm, you know, starting to get some, some toys and things are rolling and I don't know how, but I stumble onto a website and it looks just like the social platform in terms of this company, but it's not the company, it's something else. So I start going down the rabbit hole and I start to get this weird feeling. I'm like, is this really like the company did this company like steal from and come to find out was basically a template based website. It was a white labeled platform. And you know, I felt weird about it because the company was giving out these like stock options to some of their people who were bringing other people in. So they'd say, hey, if you get to X number of users, you're going to get stock options and we're going to go public and you're going to make all this money. And I'm like, man, I don't believe this platform is built on the technology that they're saying. And I start to find the company that they're using and, and realized that I could go create this same exact thing and start to realize that the founders of this company, they're 100% lying to other distributors. So I pull out, I call the guy, I'm like, hey, I can't do these webinars anymore, I'm done. And he's like, why? What's going on? And thinking back, I'm like, man, should I have told all those users that this was a template based website? Not that it's bad to have a template based website. The issue was I just knew that the platform itself did not have the functionality to do the things that they were saying that they were going to do. So what they were doing was launching other products through the field, like launching energy drinks and other stuff. And they were paying out percentage of those sales to people and saying this new ad technology is going to come, that's going to pay out people. And I realized that that was never going to be the case and I didn't want to be a part of that. Now I'm sitting there with somewhere between 50 to 100,000 stock options in this company. And you know, that was kind of how they would hold People there knowing that it was just worth the paper that it was on. You know, I basically back out. I'm like, I'm done. I don't accept any of that. And it was perfect timing because, you know, the guy who I was working with, the developer who was helping me build these pages, he calls me one day, he goes, look, the founders of this company, they've done pump and dumps before. Look, here's a company they started, they actually took it public in the penny stock and all the field was excited. The field started buying stock and then they dropped it. The company was done in a year. So it looks like they're trying to do the exact same thing. So timing is everything. Again, you can't pick when you get information, and you can't pick the decisions you make in some situations in terms of being in the right place at the right time. But I'm just glad that I came across that information to find out that that company wasn't the real deal and, you know, to find out that they were literally trying to set up the next pump and dump. And what was crazy is when I pulled out, I went from bringing in hundreds of people every single day to zero. I mean, it was a matter of months where they went out of business. And I don't think they ever actually took the company public. And, you know, I avoided, you know, the big scam that a lot of people fear when it comes to these MLM companies.

I hope you enjoyed that episode. As you can see, it's getting good and it's only going to get better. So be sure to subscribe so you don't miss a thing. I'll see you on the next one.