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After LuLaRoe, do we need another ‘empowering’ leggings MLM? Savvi thinks so

December 15, 2021, 3:30 PM UTC
do we need another ‘empowering’ leggings MLM?
Savvi, an athleisure MLM firm, is the latest multilevel marketing company to target female sellers.
Illustration by Asia Pietrzyk

Jennifer Ashby stands center stage, brandishing a pair of pastel, animal-print leggings. She glides her hand across the glossy nylon as she describes the elastic-free waistband (“so it doesn’t cut in—do you guys know what I’m talking about?”), slick finish (“a little bit of shine!”), and “custom, Savvi-exclusive print.”

The crowd—nearly 1,300 strong and almost entirely female—applauds as if the $99 leggings were Harry Styles striding on stage. Many of the women gathered on the floor of the Moody Theater in Austin on this sunny September afternoon spent hundreds of dollars to travel across the country to be here, celebrating Savvi’s official launch. Ashby, who is chief brand officer at the athleisure seller, grins and asks: “Anybody want a pair of leggings?” Cheers fill the air.

A moment of context here: Savvi leggings aren’t just leggings, women who attended the event say. Savvi symbolizes something more: Strength. Perseverance. Community. Financial freedom. The crowd hoots as Ashby tosses her prize into the fray.

“I left the launch absolutely feeling more loved and supported and accepted than I ever have in my entire life, and I am 43 years old,” says Jessica Humphries, a Savvi seller in Atlanta. “For me, that’s what I am selling.”

Savvi is an MLM or multilevel marketing company. If the initialism sounds familiar, it might be because of the recent fallout surrounding LuLaRoe, another women-centric leggings MLM firm, which reportedly earned billions in revenue before becoming the subject of dozens of lawsuits and Amazon’s buzzy LuLaRich docuseries. In fact, Savvi has more in common with LuLaRoe than just leggings: Savvi was initially launched in 2013 as Honey & Lace, a clothing MLM firm founded by Dianne Ingram, the twin sister of LuLaRoe founder DeAnne Stidham. (Savvi marks the company’s second rebrand—it was previously known as Piphany.) The two companies have also tangled legally; in 2019, LuRaRoe sued then-Piphany, alleging that it was recruiting LuLaRoe sellers. LuLaRoe says the dispute was resolved via mediation.

In general, MLM companies rely on a business model in which a large network of distributors sell products through personal relationships with friends and family, offering incentives for both product sales and downline recruitment of other sellers. Often, as is the case with Savvi, those distributors are overwhelmingly female (industrywide, women account for 75% of direct sellers). MLM companies say they provide women with an opportunity to become entrepreneurs and make money on their own schedule. Critics have a less charitable interpretation, pointing to findings like a 2011 report by the Consumer Awareness Institute that alleges 99% of direct sellers lose money.

Savvi, which, despite the fall “launch party” began selling its sports bras and leggings in 2020, ticks many of the standard MLM boxes: Its distributors buy, wear, promote, and sell the company’s products. Participants earn a commission by selling clothing and by signing up teams of other women to do the same. Yet the company also takes pains to distance itself from LuLaRoe and its reputation for playing into the worst of the industry’s sins, like saddling sellers with the cost of buying inventory.

“Savvi is worlds apart from LuLaRoe in its business and compensation model,” Savvi told Fortune in an emailed statement. The company declined requests for an interview.

Unlike LuLaRoe, which required each of its estimated 150,000 sellers to spend thousands of dollars buying the company’s merchandise before reselling it, Savvi sellers do not hold inventory: Clothes are sold through affiliate links and drop-shipped directly to buyers.

“We don’t have to have a million pairs of leggings or sports bras or tops sitting in our house,” says Tania Carlson, a Savvi seller in Plano, Texas. “The only inventory we hold is the clothing that we personally purchase to wear and share with the community.” 

Ingram, the twin of the LuLaRoe founder, is no longer involved, says the company. (“In early 2020, Savvi completely brought out Ingram’s ownership interest in Piphany,” reads the statement sent to Fortune.) Savvi is helmed by chief brand officer Ashby, a former wellness coach, and CEO Ken Porter. Porter has described himself as a former stockbroker who’s now spent decades involved in various MLM businesses, including, he says, Nu Skin, Unicity, and MonaVie.

Savvi also aims to distinguish itself from less controversial, but perhaps more dated women-centric MLM firms like Avon, Mary Kay, or Tupperware—names still associated with suburban wine-and-cheese parties. To do so, it is embracing the digital economy, casting itself as a modern e-commerce company. Savvi releases new weekly product “drops” on its Facebook Live and Instagram accounts, and, as is true of most internet-era MLM firms, lives and dies by the power of its online community of sellers.

In its 53,000-member Facebook group, Savvi touts its clothing as a path to self-improvement, and promises “a place where everyone is welcome, supported, appreciated, and LOVED!” The page is full of women sharing their Savvi outfits for date nights, weekly errands, or trips to the gym—and showering one another with praise. 

“It’s so positive,” notes Kati Schwaller Patterson, a Savvi brand partner in Missoula, Mont., of the online community. She says she was feeling down about herself before joining, but started exercising, embracing well-fitting clothes, and connecting with other women as she joined the Savvi community online. “It was a huge gift in my life.”

Joining the Facebook group is free, but becoming a Savvi seller is not. The company requires an annual fee of $49, plus a monthly service fee of $9.95 per month for “brand partners” (a designation that qualifies sellers to earn a commission from the sales of those they have recruited to the company). Personal purchases are also highly encouraged: Savvi sellers have been prompted to spend from $249 to $999 on packages of Savvi clothing at sign-up.

Such purchases are not required, but it’s easy to spend that in that range, Carlson says: “I get something new at least once or twice a month because I love [Savvi] so much. Now, that’s practically all I wear.”

For sellers, the excitement of joining an MLM company may cloud their understanding of how much money and time is being sunk into the venture, says Stacie Bosley, an economist at Hamline University and multilevel marketing expert: “It’s incredibly difficult in the early days to have a sense of the cumulative profit one is likely to earn and how that is going to relate to the investment.”

Like many brands, Savvi is selling a narrative as much as its products. At the Austin event, signs plastered the Moody Theater announcing, “I suffer from chronic ambition” and “Our courage is contagious.” Online, sellers post inspirational content on TikTok and Instagram, showing off their Savvi clothes with workout videos or upbeat dance choreography. Public posts are never explicitly about recruitment, though: “No links, company name or salesy talk (like opportunity or ground floor),” commands a Savvi team’s social media guide. “Do not mention links, apps or share codes in any way.”

Instead, posts revolve around empowerment. The copy for one suggested social media post reads, “Messaging all my powerhouse ladies and boss babes!!!! Empowered women EMPOWER women right?” 

The Savvi sellers interviewed for this article had only positive things to say about their experience as members of the Savvi community. But the message that joining the company means becoming part of a close-knit, supportive family may be obfuscating the financial reality of joining a multilevel marketing business.

“Once we start to use language of empowerment, language of social connection and identity, that changes the way we think about the profit and loss experience we’re having,” says Bosley. “[It may prompt] us to ignore expenses, to not think about it in business terms, but in terms of social connections and identity. Then we may miss some of the business consequences that are happening right under our feet.” 

At this point, it’s unclear whether the majority of Savvi’s sellers will earn more than they spend. “During the twelve months ended September 30, 2021, 52% of the [sellers] who purchased from Savvi did not earn a commission,” according to Savvi’s income disclosure statement. Of those sellers who did earn money selling the company’s products, 80% earned an average of $44 per month. The statement neglects to estimate any costs to sellers. 

“That in and of itself is enough for me to say, ‘Stay away from this company,’” says Bonnie Patten, an attorney and the executive director of the nonprofit organization Truth in Advertising. “It’s deceptive.”

In an emailed statement, Savvi said its income disclosure statement is available to its brand partners and noted that its website informs would-be sellers that the commission figures it touts “do not reflect any fees, product purchases or other investments” sellers choose to make in their business.  

Despite critics’ warnings, Savvi’s ranks continue to grow, with 54,000 followers on Instagram and 74,000 uses of #Savvi. Its growth mirrors the broader MLM industry, which gathered steam during the COVID-19 pandemic. The number of MLM sellers grew by 13% to 7.7 million people in 2020, according to the Direct Selling Association, which says the appeal of flexible, remote work and supplemental income has been a boon for MLM recruiting. The Federal Trade Commission is taking note, and may crack down on the way MLM firms can legally market themselves. 

For women in particular, there’s a clear through line between the current spike and the forces that have boosted MLM companies for decades. Writing for Texas Monthly back in 1995, Skip Hollandsworth described the appeal of selling Mary Kay products as enabling women to be “a milk-and-cookie mom and have a career too, able to set her own work hours so she can take her children to school, be there when they get home, and be there for her husband.” Some of those circumstances—and “traditional” gender roles—have changed, certainly, but the MLM promise of financial freedom remains particularly alluring for those left behind by so much of the corporate economy: stay-at-home moms, single parents, or other caregivers. And at a moment when the pandemic has made it even more difficult for many women to work outside the home, the appeal of making easy money via your Facebook page or Instagram account is more tempting than ever. 

The rise of social media and the “influencer economy” has offered would-be MLM tycoons new tools, but sellers are, at heart, still trading on their social capital and personal relationships. One difference, perhaps, is how savvy today’s digital natives are about that power and its potential value.  

“We’re marketing something every single day of our lives. Every time we use ketchup, or plug our favorite restaurant or our favorite hairstylist. But nobody really pays you back for that,” says Ingrid Fioroni, a Savvi seller in Dallas. “[Savvi] did.” 

The problem, says Patten, is that “the reality doesn’t match up with the dream.” The likelihood of becoming an influencer, of finding fulfillment in a pair of leggings or a sports bra, of turning the warm fuzzies of a Facebook community into cold hard cash is simply slim to none. That can be easy to forget when the MLM marketing machine kicks into gear, touting the wealth of its highest earners and whipping up a frenzy of excitement at events and online.

“Ultimately, anyone who wants to join an MLM should go into it knowing that they probably will make little to no money, or lose money,” Patten says. “If they’re okay with that because they want the camaraderie, because they love the product or service, then that’s absolutely fine. We pay for gym memberships. People pay for clubs. If they can approach an MLM like that, it’s fine.”

For some Savvi sellers, the joy of being part of a group of supportive women is enough to keep going. “The community they’ve created is like this tidal wave,” says Savvi seller Schwaller Patterson. “When you get inside of it, it’s just addictive. But an addictive thing that’s healthy and good for you and positive is not a bad addiction, right?” 

Editor’s note: An earlier version of this story misspelled the name of Savvi seller Ingrid Fioroni.

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