Stella & Dot – Business Opportunity Or Not?
I was introduced to Stella & Dot as a product back when I owned that beauty salon that I spoke of in my NuSkin review.
My (inept) business partner had a friend who was doing the Stella & Dot thing, and she invited her to set up a pop-up shop one Saturday on our premises.
I didn’t find out about it till the day so nothing was planned, and an area of the salon was hurriedly cleared for this woman to lay her wares out and set up stall.
It wasn’t the best of presentations, because as I say what with having no notice we weren’t prepared, but such was the way of it with my then partner and she was like that in all things: useless.
I didn’t really mind the intrusion, though, I liked different promotions and gimmicks in the salon, and it was a ladies’ salon, so the jewellery thing fit.
In fact it was a great spot for a Stella & Dot rep to set up, and a good idea (whose ever it was).
The Pop-Up Shop – such as it was
I’d no idea what Stella & Dot was I admit, I thought it was the woman’s own handiwork, and I’ve got to admit now, knowing what I do, I wouldn’t have wanted it in the salon if I knew it was a MLM.
Because everything else we sold was brand names in makeup, skin and hair care purchased through the official channels, and products you’d see advertised on TV and in salons big and small, worldwide.
This Stella & Dot stuff, was a bunch of trinkets you’d usually only see for sale on a coffee table in the rep’s house at a trunk party.
The staff all had a good look, and were given a piece or two to wear (or model) for the day and they had fun picking out items, so that was good. It was novel for them and I liked to see the girls happy and having fun at work.
I think the idea was customers would ask about the pieces etc, and from a sales angle, it was a good idea for a promotion.
Except no one bought anything.
I do remember one or two women browsing and taking a closer look at the items, but the rep didn’t engage anyone as I recall – she barely spoke to me, never mind any prospective customers – and she just kind of laid everything out hoping it would sell itself I guess.
Which they didn’t, as I say.
I think the issue with that was that the items were clearly overpriced.
Even as guy, I could see it was way too much of a mark-up. I may not buy this stuff regularly but like every other man I have purchased plenty of jewellery as gifts over the years, and I wouldn’t buy any of it, not at the prices that were being asked.
Hence I thought it was custom made, the sole work of the rep, who was “Stella & Dot” i.e. her business name.
It didn’t dawn on me till much later that this was a MLM, and she was just another “Hun” BossMom hoping to make a living out of this stuff.
I can’t call it “junk”, I thought the items themselves were okay for what they were, but whereas I would’ve happily bought a necklace or bangle at £7.50, I wouldn’t at £75.
That was the asking price, and more, on some of these pieces.
It was just too pricey.
Too pricey to spend that sort of money in beauty salon when you could venture a few doors up and go in a fully-fledged jeweller’s or a department store with glass cases full of costume jewellery, and at a fraction of the price.
It looked like a hiding to nothing and it was. The woman packed up early in the afternoon and went home an hour or two before we closed.
There’d been no enquiries, no brochure or business card handouts, and no sales.
Part of that was the rep, who obviously was no sales woman, and didn’t even strike me as particularly a people-person. She’d made no effort the whole day and just stood around with her clipboard in her hand and a deadpan face.
That clipboard thing wasn’t a good look, either. Stood with it clasped to her chest she looked unapproachable, and wasn’t exactly exuding welcoming and fun vibes.
I’m not saying that I’m the greatest extrovert or salesman myself, but I have dealt with the public, and I have stepped up to play the role required in doing that, and I know it isn’t easy… but you gotta try.
So I wasn’t surprised when the woman got no leads. And as I say, she had the perfect vehicle for it that day, on a Saturday, the salon’s busiest day, with appointments and walk-ins galore.
She never came back again. I don’t know how long she kept at it, but I did see a few pics pop-up in Facebook news feed a week or so later that my business partner was tagged in, and it was a trunk part for Stella & Dot.
It looked a pretty sad affair, too. The woman hosting it had a lovely home, but there were maybe four people at that “party” including the rep, one of which was my business partner, and another being the woman I’d recognised touting the ageLOC system… and I guess she’d accepted the invite as a means to try and pitch her MLM, not buy anything.
I suspect that’s how a lot of these parties go. Everyone on your Facebook or phone list gets an invite, a handful turn up, and as they get sick of it every other week, they whittle away too. I mean, how big a market is your friends list?
Plus you’re trying to recruit that friends list to your “team”, adding direct competition to your main marketing audience…
So good luck with that.
A Company Of Women For Strong Women
“You’d be great at this!” it proclaims on Stella & Dot’s Stylist page.
I said this earlier, that sales is a tough gig and not everyone is cut out for it, but reading the Stella & Dot brochure, it’s not painted that way. It’s all “go-girl” ra-ra cheerleading for the “modern woman” who’ll find this “empowering” and as a super woman already with a job, “You got this!”
It’s contradictory too – this fits into your “busy life” yet one of its main selling points is as a genuine business opportunity for stay at home mothers and other women looking for something to fill their time with… but I guess no one likes having to admit to a life less busy than their neighbour’s.
Maybe, maybe not
But I mean… honestly? Stella & Dot are so over the top in their marketing literature, and layer on the feminist buzzwords so thickly, that it just comes over as patronising: “a company inspired by, created for, and run by strong women.”
Sure, go for it, but we’re all people, all human, and that means facing up to some facts of life applicable to us all – namely that you haven’t necessarily “got this” just by virtue of being born female or being capable of holding down a job and paying your bills on time. That doesn’t make you borderline awe inspiring and qualify you for entrepreneurial greatness.
That stuff – keeping a roof over your head and earning a living – it’s what you’re supposed to do as an adult. I know. I’m a man, and I’ve been doing it all my adult life without expecting a round of applause.
I just don’t recognise this world of “dis-empowerment” these women focused companies push as reason to join them, and the utopia that will supposedly bring: “Behind every successful woman is a tribe of women who have her back” proclaims Stella & Dot…
When the reality is, if you want to experience exploitation, these MLMs – run by women – will introduce you to a world of that that’d make the most ardent, anachronistic misogynist, blush with envy.
But therein seems to be hook, that buying a Stella & Dot starter kit is akin to throwing yourself in front of the King’s horse and making a statement about woman’s suffrage…
Which you can buy into for $199 for the Essential Kit, $499 for the More To Love Kit, and $699 for the Ultimate Kit. Presumably for the Ultimate Woman – do you get a cape with that?
There’s a handy slide bar on the page that shows just what kit you need to buy to meet your desired monthly pay check. It also advises how many hours a week you need to work to achieve that figure…
As I said, if anyone’s exploiting women and treating them as dumb it’s Jessica Herrin and the cohorts of aspiring Stella & Dot “entrepreneurs” looking to recruit a down line.
Who’s Jessica Herrin? The Stanford Business School graduate behind this multi-million dollar company.
Now, she’s a bona fide entrepreneur and millionaire, and she didn’t become a millionaire and get feature pieces in business journals by hawking overpriced costume jewellery in trunk sales in her living room.
No. That’s what you do, to keep her in the manner to which she’s accustomed. And her job is to tell you how “empowering” that is for you – buying her kits and trying to make a few bucks off it after expenses: food, drink, travel etc.
And according to Jessica, and her handy earnings slider, you can make $250 a month on 1-2hrs a week after an investment of $199, and if your goal is $10,000 a month (and wouldn’t that be nice) then work 25-40hrs a week and spend $699.
It’s that easy! How much you earn is up to you!
So let’s take a look at Stella & Dot’s earnings stats and see how ambitious and driven everyone is if it’s really “up to you” and just down to a personal work ethic.
How Much Of A Business Opportunity?
To answer that question we need to take a look at Stella & Dot’s disclosure of average earnings.
That’s paid stylists at that level – not all stylists at that level. Because a bit further down it’s stated “An average of 62% of Independent Stylists in the United States were not paid for any given month in 2017.”
So for that first row of the lowest level stylist, that 73.9% is of the 38% who got paid.
That 38% includes “Independent Stylists who sold at least $1 in a given month during 2017.”
Averages can be highly misleading. If we have 5 stylists and one sells $100 of product, another $25 and the remaining three $1, then the average is $25.60.
Median is a better indicator, and hence why these MLMs don’t use it.
The most jarring thing to bear in mind when looking at that table is that those figures are not monthly earnings, but for the entire year.
So we have to go all the way up to Associate Director if we want to consider an annual salary you could actually live on. That’s 1.5%… of the 38% who made money. Which is 0.57% of all Stylists at large and active.
Which is another way of saying that 99.43% of ALL Stylists earn less than that figure.
Do you really think you’re going to buck that trend and beat those odds? Even with all “training” you’re going to be given.
So what is all the support and training you’re going to get with Stella & Dot?
Pretty much the same as other MLMs. You get a bunch of videos to watch (recorded who knows when) and the support of local and regional get together meetings with your competition (other Stylists), and personal tuition from your sponsor – the person you signed up under and who gets a kick up in commissions on anything you sell… like you’re hoping to do with your down line (if you have one).
Which, to be honest, sounds a lot like the blind leading the blind. I mean, you all watch the same videos and then attempt to apply it, and then mentor each other – regardless of any real experience or success.
Your sponsor’s main focus and pressure will be in getting you to maintain those PQV points you need: “To keep an active Stylist account, you need 500 PQV in the last rolling 6 months. If you do not meet this requirement, your account will be converted to earn referral rewards when you share Stella & Dot.”
PQV is Stella & Dot’s sales measurable relating to personal qualified volume or personal retail sales. The Compensation Plan states “1 QV is generally equivalent to $1 USD, not including tax, shipping and discounts.”
So there is some pressure on you to meet sales targets, or you’re not getting paid.
And you get paid in credit on your Stella & Dot pre-paid Visa card, which as a prepaid credit card incurs fees to activate, transfer, and use. At the moment it’s a one-off fee of £5.25 and £1.25 a month thereafter.
What you get paid on that card is 25%-35% commission on your sales.
Oh, and you get a website, too… to help you make those commissions.
If you’ve never looked into getting yourself a site, and have no knowledge of web design, even with the myriad of DIY tools out there now, you may well be impressed with that: your own website.
But if you know anything of how the web operates you’ll appreciate that it’s a stock template and used by every other Stella & Dot Stylist, with a saturated web presence i.e. don’t expect any SEO juice or organic traffic off it – you’ll be paying to try and promote that site.
Alongside everyone else’s that looks exactly the same.
Is Stella & Dot A Pyramid Scheme?
Not as much as others. Not like Herbalife or Juice Plus for instance.
That said, while the owners haven’t included as much of the obvious out-and-out elements of a pyramid scheme as some MLMs, they’re still pretty pyramid-y… to coin a phrase.
You can return unsold product and you don’t have to purchase ahead of orders. That I like, that they don’t encourage inventory loading.
Stella & Dot also removed themselves from the UK’s Direct Selling Association as they didn’t want tainted with the association of those companies who promote the recruitment of a down line over the sales of the product. And they don’t, Stella & Dot promote the sale of their products first and foremost.
What I don’t like is that you have to purchase all the jewellery and samples, and maybe even some stock to sell, or you’re going to just always be taking orders… which may lose you money if you can’t fulfil that impulse buy on the spot… and folks can go online and order without you.
And if they can do that, what good are you? This isn’t Avon in the 1970s or 1980s, with a rep serving villages in a remote corner of the country. Folks can easily get this without you if they want.
Stella & Dot may like to describe themselves as “an incredibly different business” but they remain a MLM in one very important factor as already discussed: their success rates.
Meaning the vast majority of people who join and buy the kits, lose money.
Can You Make This Work?
I think you have to be honest with yourself about this one, and get over all the hype and how wonderful it’ll be to picture yourself in the next company brochure as a success story and example to strong women everywhere.
Yeah, it’s great to price up the trinkets and calculate that you need only sell half a dozen pieces at each trunk show at £50 a pop, to be making some coin at this hobby business, but the reality is you can’t rely on your immediate friends and family as a market.
You’ll get some initial support, some few people will turn out, but you won’t be exactly showcasing too many times in your front room, and you’ll have paid for all the booze and nibbles too.
What’s going to hammer you more than anything else is the asking price for costume jewellery that doesn’t enjoy widespread brand recognition or any of the social cache or heritage to warrant the higher price.
I mean, if you weren’t peddling it, would you be buying it?
And there’s plenty of the stuff at discount price on eBay if folks really want it and do have a genuine affinity for the brand.
And plenty of other reps, probably not too far from you, pushing this stuff.
But there are some, minuscule, percentage of Stylists that do, so it can be done.
However, do you have all the elements in place? A massive following on Instagram and several thousand ‘friends” on Facebook would help. A thick skin to keep persevering in the face of rejection and disinterest from these people as you push your MLM at them (and maybe even shed friends and acquaintances as they avoid you). Genuine self-confidence and the ability to project your enthusiasm is a must – not pretending you do, just because it makes you feel good to say it.
What I mean is, are you really going to be happy getting on the phone to people, applying sales pressure tactics (no matter how nicely) and following up and chasing sales, dealing with unhappy customers, pursuing new customers all the time… and look yourself in the mirror and still 100% believe in your message as a Stella & Dot evangelical.
Are you going to make it into the 0.57% of Stylists actually earning a living salary from this?
The odds, it would seem, are against you, but it’s your call to make.
If you’d like to try something a little less stressful (and annoying) than trying to foster endless trunk parties onto your long-since wearied friends, then take a look at Wealthy Affiliate (WA).
It’s web based affiliate marketing and a lot less intrusive and expensive to make sales in.
If you want to find out what WA is all about then read my review of them here.
It’s not for everyone. If you like to write, and I obviously do, then it’s an easy process to follow: post content people want to read and monetise it.
It’s a lot easier when folks come searching for you, than you go knocking on their doors.
Check it out. Up to you.
Recommended further reading:
A classic from another millionaire like Jessica Herrin, but minus selling the MLM:
Crack the Code to Wealth and Live Rich for a Lifetime!
by M. J. DeMarco