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A likely target

Network marketers do so well in Utah, some say, because the local culture is closely knit, and a product is easily promoted through Utah's network of church, family and neighborhood connections.

According to Jon Taylor, who has written a new book, "The Network Marketing Game," (Salt Lake City: King Alfred Press), 1997, 246 pp., $9.95, with 52 witty cartoons by Calvin Grondahl, "there are more network marketing companies based in Utah than in New York, Illinois and Texas combined."Taylor, an entrepreneur who is best known for creating and building businesses - over 40 of them so far - got caught himself in network marketing.

A loquacious man who makes friends easily, Taylor has an MBA degree from BYU and a Ph.D. in applied psychology from the University of Utah.

When some of Taylor's persuasive friends approached him to get involved in network marketing, he was at first irritated by the pressure, but then he allowed himself to be talked into it.

He dropped his other professional activities and gave the new enterprise his full effort for one year. Including the loss of salary from his own enterprises, he estimates he lost a year of his life plus $50,000.

"The more deeply I got into it, the more uneasy I became," he says. "The appeal is the money. But the fact is that for everyone who makes it, a vast number come away empty."

The most notable reason for that is the generally low commissions people get for selling a product, meaning that many people who "downline" must sell prolifically, netting a small commission for the person who recruited them.

In the meantime, that person is recruiting more heavily to accelerate his income.

The promises of Taylor's mentors, that he would be making three quarters of a million dollars within two years, were unrealized, but he mastered the system anyway.

He believes he would have prospered financially had he stayed with it longer.

The year of aggressive selling made Taylor's wife very nervous. She was seeing changes in his personality that she didn't like.

"She saw me taking advantage of people, you know, trying to get them recruited into this program. She saw me doing things I wouldn't normally do that really bothered her," Taylor says.

Without realizing it, he was modifying his values. "Then I started getting uncomfortable about it."

At his wife's suggestion, the two of them began making a serious study of the principles of wealth. The result is a set of ethical principles that Taylor regards as timeless, ideas that should govern anyone who flirts with wealth. In the book, he lays these out, principles that include the following - work is a divine gift, deal honestly with others, sacrifice material things, and practice charity.

He talked to 100 people in Utah who had been exposed to network marketing, and found that only 27 percent saw it as an ethical way to do business. He also found that Latter-day Saints were three times as likely to embrace network marketing as the rest of the population.

Taylor's theory about why that should be true is simple, and it goes beyond the stereotype that Mormons are too trusting.

"It's in our very culture in the Mormon Church. Downline, upline. The ultimate upline is our ancestry. The ultimate downline is our family kingdom. The ultimate network is the Church itself."

Taylor thinks that Mormons' religious belief that the "riches of eternity" are immeasurable, that God's promises are never-ending and that spiritual blessings are greater than anyone can comprehend, help explain the Mormon tendency to trust network marketing promises.

"The difference," he insists, "is the element of money."

Taylor also believes that Church leaders who align themselves with such programs lend credence to them. Many Mormons will invest in such a program if they believe a trusted church leader has done so.

These are the reasons he subtitled his book "Gospel Perspectives on Multi-level Marketing" and includes scriptural quotes as well as statements from LDS Church leaders.

In Taylor's opinion, those who read his book will most likely benefit if they think of it as a study in values. "Anyone going after wealth for its own sake," he says, "is vulnerable to the disappointments of network marketing."

When people buy products they can't afford, he says, and then fill up their garages with them, they know they've been stung. Taylor quotes a favorite statement: "A garage is a place where you used to park your car until you got involved in network marketing."

Finally, Taylor says, the saddest thing is that many people are drawn to network marketing because they don't know the alternatives. "They're approached by someone who makes them promises, but they don't know there are a thousand other ways to skin a cat."

Taylor maintains that people can make money in legitimate ways "without having to take advantage of anybody." Although his intent in writing the book was to weigh evenly the pros and cons of network marketing, by the end, he decided "to call a spade a spade."

He became convinced that network marketing makes very good sense mathematically,"but only for a few persons at the expense of many - and only for a limited period of time. It would not be possible for a high percentage of network marketing distributors to succeed at a high level indefinitely, and those who do must do so on the backs of a large number of strivers and losers. One must ask how he or she feels about a system that fosters such extreme inequality."