Industry Multi-level marketing Number of employees 3,500 Founder Jorge Vergara Headquarters Guadalajara | Key people Jorge Vergara (CEO) Website www.omnilife.com Founded 1991 | |
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Products Nutritional supplements, skin care, soft drinks CEO José Luis Higuera (8 Apr 2015–) Profiles | ||
Omnilife Group is a Mexico-based multi-level marketing company that distributes dietary supplements. The corporation is owned by Jorge Vergara, who also owns the football club Club Deportivo Guadalajara.
Contents
History
Vergara teamed up with two American colleagues and founded Omnitrion USA in 1989. On September 11, 1991, Omnitrion Mexico was officially founded. Vergara's associates later sold him the rights for Omnitrion Mexico, whose name was changed in 2000 to Omnilife. It began operations with three employers, six distributors and a total investment of $10,000. Its objective was to recruit many independent sales consultants to sell nutritional and dietary products to a broad public.
The company currently operates in Latin America, the United States, and Spain, and sells more than 70 different nutritional and dietary supplements.
Marketing strategy
Vergara refers to the company's multilevel marketing as "Multidesarrollo", a model which he says is based on marketing methods he used as a distributor with Herbalife. As with other multi-level marketing companies, Omnilife contracts with independent sellers who, in turn, are encouraged to recruit more independent sales representatives under them to create a larger sales and distribution network. Describing the way in which Omnilife functions in Guatemala, anthropologist Diane Nelson describes it as a "direct-sales pyramid scheme (like Herbalife and Amway) in which one accumulates points by selling the product and recruiting more sellers." Sales are made through a company catalog, but products can also be found in stores.
In her discussion of Omnilife in Guatemala, Nelson says that it "is a capital formation complexly linked to prosperity gospel forms, but also to Mayan heritage and post revolutionary dreams of improvement." Nelson is ambivalent about the role of the company in highland communities, but remarks that "it seems to offer both economic promise and ongoing, interethnic, communal therapeutics."
Philosophy
"People that take care of people" ("Gente que cuida a la gente") means, according to Vergara, bringing better health and vitality to many people through an energetic and dedicated marketing force. The company promotes empathy with clients, showing respect toward them and having patience with them. They also encourage clients to care for the environment, support education, and participate in sports activities. Observing the "Omnilife Basic Course" in Guatemala City, Diane Nelson notes that "the dynamic is Oprah Winfrey-esque, with a tough love feel and strong engagement from the audience." At a later "Lack and Abundance" workshop, Nelson reports that participants were encouraged to share their stories of suffering and trauma, and were then asked to construct a "dream map" of their material and emotional aspirations.
Scandal in Chile
In August 2014, the TV program En su propia trampa demonstrated that the food products are sold as therapeutical products and miracle cures, and recorded with a hidden camera the presentations. Despite what vendors say, their products do not have any healing power and the permit that has the company only specifies that they are dietary supplements, without therapeutic effects. Another aspect was that, according to the testimonies of sellers, Omnilife charges a high business incorporation fee to the workers, promising big profits, which in practice are never materialized.