Is This Why Mary Kay Costs So Much?
Mon, Aug 4, 2008
After writing my post about Mary Kay, some of the feedback I have received about the products is that they are too expensive.
I thought, perhaps, that this had something to do with the multi level marketing style distribution model, though it now seems like there may be another answer -
Could it be that some women find Mary Kay to be too expensive simply because they are applying far too much make-up?
Do products distributed via the networking business model cost more?
What do you think?
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Lol at all the funny Indian pictures you post here!
Thanks for letting me use your picture for this Aruna
You are always welcome!
How long do YOU take to put your make-up on in the morning???
Not much…I go to sleep with it
Yuck… it must be horrible waking up with green pillows
LOL! That could be one reason. It’s true a little MK goes a long long way!
I have my own theories on why MK is perceived to be expensive. In one camp you have the drugstore brand users. They are going to think MK is too expensive because they are used to buying the cheap brands at the drugstore. In the other camp you have mall users. They feel MK can’t possibly be comparable to their Estee Lauder or Clinique and therefore, it must be overpriced for something they feel is beneath them. 
Mary Kay, Inc. considers the products to be a “prestige line” meaning MK competes with mall brands like Chanel, MAC, Estee Lauder, Lancome, etc; not with brands like Avon, Cover Girl, Maybelline, Revlon, etc. I’m looking for the official statement I have on email from MKC, but so far haven’t found it. I’m sure it’s buried in my folder somewhere.
I don’t find that MOST people think MK is too expensive. My customers think it is just the right price for a quality product. As a matter of fact, one of the reasons you don’t see many MK commercials on TV is because they use most of their profit on product development (R and D) and consultant prizes rather than paying for advertising. This also allows them to produce a high quality product without the high price.
Contrary to the method of selling creating a high cost, by implicating direct sales, MKC is actually able to keep a low cost by keeping the products out of stores and mall establishments. They avoid extra costs involved with these methods of sale by selling directly to independent distrubutors. Hope that makes sense.
Oooh, not sure avon reps would like you implying that their brand is not ‘prestige’!
If you find the official statement then please post or paraphrase it - that could be interesting reading.
Was it you or mk4me I had this discussion with before - is the price of MK products higher than it could be because of the network marketing model?
Probably MK4Me. But MK is actually priced LOWER than it could be because of network marketing model.
But you would say that.
Wouldn’t you
I can see when I go to the mall that MK costs less than comparable mall brands. I can tell by using the products that the quality is better than what I used from the drug store. Mall brands are costly in part because they are at the mall and there is overhead cost involved with that.
There is no overhead cost involved with home based consultants distributing the products so prices can be lower for the quality of the product. 
If a percentage of the money you make in sales (4%+ as you mentioned) goes to your upline could that not be considered an overhead?
All overhead incurred by the fact that certain brands are sold in certain places is covered by the difference between wholesale and retail prices. So in the case of Mary Kay, that is 50% (of suggested retail), which is pretty typical for cosmetics (not particularly low.) In addition, out of the wholesale price, there is potentially 4% to whomever recruited the consultant (the consultant being the person who buys at wholesale price.) And there is 9% - 13& to the team leader (if there is one) and sales director (there ALWAYS is one.) AND there is an additional 4% - 5% to the senior sales director. And then, there’s an additional 2% NSD commission. Plus there are occasional team building bonuses, and the costs involved with the career cars. All of that is overhead incurred from the wholesale costs (so on average probably a little more than 20% of the wholesale cost, or 10% of the suggested retail.) That, plus the little advertising they actually do, would be equivalent to what a traditional cosmetics company would spend on advertising and the sales force that gets the wholesale accounts. If this chart is any indication, those costs are not particularly low.
Kewl green pic! Interesting reading. Glad I stopped over. My choice of past department store brands was price extraordinaire over my Mary Kay that I now use. I’m relating to retail pricing here before enjoying wholesale cost that gives credence to a lean checkbook these days. I found a far better product (Mary Kay) at retail prices than I ever paid for my break-the- bank dept store priced items. Women need to be well versed on brands. Then the picture grows clearer with one’s first hand knowledge of price per ounce, etc. Imagine my having paid over $100 for a less than one ounce little jar of moisturizer at the department counter. Silly me. It did not deliver the results it indicated on the labeling after a few jars. I couldn’t even get anything in return for my unfortunate experience. Then….MK walked into my life (literally) and the rest is history as they say.
Hi Pink Biz, thanks for popping over
Personally, I think any women who spends $100 on makeup needs their head examining, but maybe that’s just me - I think beauty is on the inside rather than just cosmetic.
I can see that I’m gonna be outgunned quite quickly on this post as I believe you and Shades of Pink are already acquainted arn’t you?
P.S.
What did you think of the other MK post that you just read?
PS : You should link to your site when leaving comments on other blogs
Gotta keep this skin supple! Beauty is in the eye of the woman who is looking in the mirror-hehe! My DH thinks like you do though, nice! Yes, Shades and I are acquainted through our blogs. I feel certain she feels the same about the product quality and money savings as I do (and our customers). Thanks for kindly suggesting the link. Which post are you referring to?
Are you as passionate about MK as Shades so obviously is?
I believe I saw you looking at this post didn’t I ?
Surely you jest, my head DID need examining spending that kind of money. LOL! I was fortunate, really fortunate, that my MK Moisturizer costs $22.00 and delivers visible results. Works for me! I am a woman who will only purchase quality product. Been there, done that with drugstore brands. No more.
Jest? Huh?
I am ever so passionate about MK. My experience has been wonderful as a consultant. About the post (isn’t that a thread/topic?), I am not surprised by it. Not even at the responses. From an observer standpoint (your standpoint that is), you assess what you see, read, hear perhaps. From a responder standpoint, those with a negative experience and a positive experience will post theirs thoughts as such, respectively. I found it typical of each person’s position and thinking.
On a blog it is a post, on a forum it would be a thread or topic (or at least that’s my understanding of the terms).
Would I be right in thinking that you believe those who are pro-MLM/MK or anti-mlm/MK are very two well defined types of people who are set in their ways?
BTW, Avon representatives sell practically everything from bubblegum to cars and everything inbetween. They are so diverse until prestige is not even debatable. Tossing catalogs in driveways and in public places is desirable for business. Frequency of campaigns change with great frequency, 2-3 week intervals. Profit percentages based on sales graduates upward reaching 50% profit on $1500 sales. At least my friend told me this about three years ago when she was involved. Avon has some good products and people do order. It just would never be for me.
Yeah Avon are quite prolific where I live (near London, UK) - the catalogue dropping is commonplace, though much less-so since I got rid of my wife
I’ve seen mention of Mary Kay over here but without seeing a full inventory listing I wouldn’t like to comment on the relative merits of the brand or individual products.
Thanks for clarifying the terminology. I’m new recently to blogging. Sure, there’s always both sides of the fence in business.
That there is and, hopefully, both can be aired here as I love a healthy discussion.
I’m guessing you yourself fit into the category of optimistic home worker?
Eight years of loving my Mary Kay business. I work my business. I don’t talk about making things happen. I don’t daydream about what could be. I’m a successful retailer with a solid customer base who makes 50% profit on each and every item sold. A reorder business created on the basis of initial time spent with the customer. If I may, I’d like to say that I’m a saavy business woman that both moves and controls my inventory so I’m not sitting on 5K or anything near it. What can I say? Some women are not business minded? No, I’d say that some women need to learn how to run a business. Perhaps their MK experience enlightened them on whether they would enjoy this type of work. It is a job, one does have to work. I think it’s a positive thing when a consultant comes to terms that this business is not meant for them. Unfortunately, they couldn’t say no to abusing their credit card or cash money. Being accountable in business, making a profit, feeding the funnel with new clients is all viable for a positive outcome such as I’ve experienced. Yes, I love what I do.
It shows!
Actually, you are the first MK person I’ve come across thus far who would appear to be making good money.
Does the majority of that income come from sales or recruitment?
Sales. Keep in mind, even extra shoe money per month makes some women happy. Can anyone put a price on making good money?
I put a higher price on being happy and spending time with my kids - obviously the ideal would be to have a job that facilitates that whilst paying good money at the same time.
If there was a conflict of interest then money is less important, as long as I have enough to pay my bills.
Found the quote from Yvette Franco (VP of Brand Development at MKC) about “prestige brand” status:
“Mary Kay is a Prestige Brand in the Market place; which means we compete with Department Store brands like Clinique, Estee Lauder, Lancolm and Mac. Brands sold in Drug Stores and Wal Mart such as Maybelline and Cover Girl and even Avon , are considered mass brands and are not whose market share we are competing for.
In Comparison to other Prestige Brands, here is how we fared in unit sales this past year in the market place.”
Now you just know what I’m going to ask next don’t you… how does MK perform in the prestige market, vs it’s competitors?
Well, that is where the whole debate of “Best selling brand” claims come into play.
http://www.shadesofpinkblog.com/2007/09/13/mary-kay-does-it-again/
Data from market research eh?
I think Benjamin Disraeli had something to say about the validity of statistics
LOL!
Yes. I think the MK debate comes from how do other companies measure their sales. MK measures largely by the amount sold to distributors. I was of the impression that other companies use this method as well. It has been discussed at length on the Balanced Mary Kay blog.
I don’t think the means of measurement really matter does it?
What is relevant is whether or not two companies you are comparing are using the SAME means of measurement or not.
If they’re not then any comparisons are going to be fairly meaningless.
Interesting, though, that the figures comes from the amounts sold to distributors - I think we both know that is probably not a reflection of the volume being sold to end-consumers is it?
I agree. I think most corporations base their numbers on how much the distributor is ordering and find it to be reflective of what is being sold to end consumers.
How much inventory do you think a new MK consultant needs to have in order to get started?
I’m certainly not an advocate of huge initial orders. I think if the consultant is financially stable any amount between $600-$1200 is sufficient. This way if she needs more, she can always order more. If she doesn’t sell as quickly as expected, it’s not an overwhelming amount. I started with $1200 wholesale. I increased my sales and wound up a star consultant that first quarter.
I’m happy I started where I did.
If someone is in a financial pickle, I recommend $0-$200 and I tell them to take orders first. By financial pickle I mean if she says she has bill collectors calling her (or something similar) she does NOT need inventory until she starts selling stuff.
So are you saying it’s possible to begin with MK without having to spend/invest a single cent?
Oh it’s definitely possible. There are people on the national level who started with zero inventory.
Is there not a $100 start-up/registration fee?
There’s a $100 start-up cost and you get a starter kit containing $323 worth of full size retail product as well as two totes and enough samples and catalogs to see 30 clients. This $100 expense is the only requirement to call oneself a beauty consultant with Mary Kay. Inventory is a decision to be made after the initial $100 investment.
I was referring to the inventory when I said people start with zero. They can start with no inventory stocked and take orders.
“This $100 expense is the only requirement to call oneself a beauty consultant with Mary Kay.”
Wouldn’t it be better if they had other requirements, such as experience, the ability to talk to others, marketing, the ability to sell, etc?
To get started? I don’t think so. To be considered for director? Perhaps. I’m happy I have Mary Kay right now because the job market in my area stinks. If you don’t have what they want on paper, it doesn’t matter what you can learn.
At least in MK, I can learn and do it at my own pace and I don’t get “fired” or told I can’t be a consultant anymore if I get too busy to work MK.
I think the job market is lousy everywhere at the moment. Like you, I have a job I don’t particularly like but there arn’t many alternatives available right now
Nope, hence I’m happy that MK doesn’t have minimum entry requirements.
The only thing I can find near me that doesn’t have entry requirements is prostitution - do you think i should give it a go?
LOL
That’s an idea for an upcoming post… “Is This Why Prostitution Costs So Much”.. just gotta find a suitable picture to go with it
Oh, and I should add, it wouldn’t bother me if MK was #1 or #101. The products fixed some serious skin issues I was having as a result of one of those prestige mall brands.
That’s enough to sell me on it.
I could have made you a paper bag and cut some eye holes in it.. that would have been even cheaper
hahaha!
MK stuff is more expensive than the stuff you buy at Wal-Mart, but it is better than the Wal-Mart cr*p, too, IMHO.
For me, price is not the only consideration on what I buy.
But that is just me….;)
Hi Shay - where have you been girl?
We’ve missed you!!!
You know how it goes…..life happens. LOL
Between working to finish my degree, homeschooling the kiddos, teaching Engligh as a Second Language, and other stuff, my online time has been greatly diminished.
LMAO - The should be “English” as a Second Language.
Darn typos!
LOL
Judging by the spelling, it’s not only your online time that is greatly diminished is it!!
MK is better than some stuff, not nearly as good as other stuff. It all depends on your individual skin. It looks win-win on paper since they offer the 100% guarantee. Of course, if you have a “scary MK lady” as your consultant, sometimes it’s better to just take a loss. Become a personal use consultant and you cut out the middle man and get it for cheaper and you don’t have to deal with anyone.
Oh, and the #1 best selling brand. What they don’t tell you is that they are comparing themselves to certain brands. They are number # in comparison to certain brands, not all brands. Very misleading statement.
Statistsics can be used to prove any point can’t they
Are you a ’scary MK lady’ Arabella?
Exactly, Scam. I always hated that they called themselves #1.
No, I am not a scary MK lady. I do use the skin care. I am personal use because of a scary MK director that I try to avoid at all costs.
Why is the Director scary - are they someone who hounds consultants?
“Hounds” is tame for what she does. She recruits anyone that moves so that she can keep her car. She dials for dollars at the end of every month to “help the team”. She pushes ordering and does not focus on teaching to sell. She recruits and then pushes for huge inital orders since most MK consultants are not around after a year. The turn over rate is scary. She knows this so she gets the money fast. She is your steriotypical MK lady. Loud, pushy, big hair, lots of makeup, does not take no for an answer and believes that MK is the be all end all of everything in life.
I know that there are bad apples in every bunch, but MK seems to have more than their fair share.
“..does not take no for an answer and believes that MK is the be all end all of everything in life..”
ha ha, I could say that about 99% of the network marketers I’ve ever conversed with!
What does ‘dials for dollars’ mean?
In order to keep your status as a director and keep the car and your unit, you have to order a certain amount, as a whole, director and unit together. So, if a director is short at month’s end, she calls up everyone under her and asks them to help her reach her goal. Basically asking for them to place an order.
Not all director’s do this. If you are familiar with Dave’s site, MK4ME and Speaking so not do this.
I’m very familiar with Dave’s site - he’s a great friend
Obviously you don’t know anyone you come across online at all but mk4me always comes across as being someone with integrity.
I’ve never spoken to Speaking though.
My director doesn’t do it and neither does her director.
There is a director in my geographical location (though not in my Seminar affiliation) who does all of the things you’ve described, Arabella. Some of her former consultants are now my customers and others deliberately became inactive because they LOVE MK, just not her. And now they are in my director’s unit and her senior’s unit.
If I am not mistaken, she is a director, too, and does things alot like MK4ME. Before reading their posts I had no idea there were ethical directors. I have been in 3 units - due to moving - and have an aunt in another unit and a sil in another and 2 friends in 2 other units. We are all spread out across the country and things are done the same way as in mine. I had no reason to believe that there were ethical people in MK until reading MK4ME’s posts and then later, Speaking’s. I remember someone else on Dave’s site - don’t remember who - but she knew people all over in MK and her experience, and their’s, was the same as mine. The craziness DOES seem wide spread.
It’s certainly an unfortunate situation.
I’m personally not involved in network marketing at all but have read a huge amount about it, in addition to having had friends involved as well.
My general perception is that some mlms are better than they are perceived to be but are dragged done somewhat by those who represent them.
If multi level marketing companies were better at getting rid of their own consultants who give them a bad name then I believe they would prosper far more than they do now.
I agree. There should be some sort of application, same as a regular job. In MK, if it has skin, recruit the hell out of it.
you’re probably not wrong!
Do you have a website Arabella? (feel free to link to it if you do).
Actually, in my area we are NOT told this. And Mary Kay Ash never said this either. They tell us to show produ