Published on July 26th, 2021 | by Laura Smith0
Does Mary Kay Think It’s Above the Law?
In a video titled “Working at Mary Kay | Who We Are | May Kay” published on Mary Kay’s YouTube channel, the company tells consumers that Mary Kay “empower[s] people to live the life they choose, giving them the tools and confidence to start their own businesses, support their families, achieve financial and personal independence, and discover their true potential.”
And in several social media posts, Mary Kay distributors show off the iconic pink Cadillac, which isn’t as easy to get as one might think.
Meanwhile, according to Mary Kay’s Canadian income disclosure statement (the company does not publish a U.S. income disclosure statement), a typical Mary Kay distributor in Canada “does not earn any commissions or bonuses.”
If you’ve been following TINA.org investigations into MLM companies’ use of deceptive income claims, like Primerica, Beautycounter, Market America, Team National, and several others, you may not be surprised by the existence of these deceptive income claims in Mary Kay marketing materials. After all, a TINA.org investigation found that 97 percent of multilevel marketing companies who were members of the Direct Selling Association (DSA) had been making unsubstantiated income claims about the company’s business opportunity.
But here’s why Mary Kay’s deceptive claims stand out: The company cannot claim it is ignorant of the law (or that it is violating it). Here’s a look at some recent (and not so recent) events:
- December 18, 2017: As part of its industry-wide investigation into all DSA-member companies, TINA.org sent a letter to Mary Kay’s general counsel notifying the company that it was engaged in deceptive marketing by, among other things, claiming distributors could “quit their jobs and pursue their Mary Kay business full time.” At the time, TINA.org collected a sampling of more than 20 deceptive income claims promoting the Mary Kay business opportunity. Mary Kay never responded.
- March 5, 2021: After TINA.org amassed an additional 200 examples of unsubstantiated income claims made by Mary Kay and its distributors, TINA.org sent another letter to the company’s general counsel notifying Mary Kay that it was still deceptively advertising its business opportunity as providing distributors financial freedom and the ability to earn a replacement income, buy their dream home, quit their jobs, make six figure incomes, retire their spouses and earn the iconic Mary Kay pink Cadillac, among other things, none of which are typical or generally achievable outcomes for distributors.
- March 8, 2021: Mary Kay responded to TINA.org, stating the company “believe[s] the net impression of the videos and other materials identified in [TINA.org’s] correspondence do not misrepresent the potential of the Mary Kay opportunity.”
- Between March and July 2021: After TINA.org filed a complaint with the Direct Selling Self-Regulatory Council (DSSRC) against Mary Kay on March 9, the DSSRC opened an investigation into the company and informed it that the claims identified by TINA.org are indeed deceptive and must be removed from publication. The DSSRC closed its investigation on July 16.
- June 30, 2021: TINA.org sent a letter to the Federal Trade Commission urging it to implement a penalty offense program targeting the direct selling industry by providing direct selling companies with actual notice of the law so that civil penalties may be imposed against lawbreakers. TINA.org sent a copy of this letter, along with a copy of the FTC’s Koscot cease and desist order (which prohibits representations, directly or by implication, that any participant “can attain financial success”), to Mary Kay.
And today, on July 26, Mary Kay is still telling consumers its business opportunity is a path to riches and pink Cadillacs. So the question remains: Does Mary Kay think it’s above the law?