A South Korean cosmetics company is making a major push into Britain, and claims that those who sign up to be a sales representatives can earn thousands in commission each week, and bonuses of up to £720,000.
Founded in 2009, Atomy has become one of the world’s biggest “multilevel marketing” (MLM) companies – where individuals make money by selling items and getting people to sign up – and claims to have 15 million members globally.
After launching in the US, Canada, Australia and other territories, it has set its sights on the UK and Europe, and says tens of thousands of people have already signed up.
It is the latest in a line of direct-sales beauty companies likely to particularly attract women who may be struggling financially and looking for new ways of earning cash – a trend that has been accelerated by the pandemic.
The company’s launch videos and promotional material emphasise the large sums it says can potentially be earned as a “distributor” – including, for those who reach the top of the programme, six-figure cash bonuses and perks, such as a personal assistant and personal driver.
MLM schemes are typically made up of large numbers of people selling items such as beauty and cleaning products, candles and books, from home. They are controversial, and in the UK there are scores of individuals and groups campaigning against them on social media.
Campaigning group Hey Hun… #BanTheScam claims MLM is a “predatory business model” that should be banned, and is planning a protest in central London on 28 August.
Meanwhile, another critic of this type of scheme told the Observer that, in his opinion, Atomy was an “economic cult”. However, there is no evidence that any UK authorities are investigating MLMs.
Critics have labelled them “pyramid schemes”, but Atomy denies this. It describes itself as “a consumer-oriented network marketing company”, adding that people can join for free, with no obligation to sell products, and that the vast majority of its customers are “consumer-only” – that is, not earning commission from sales. It held its official launch event at the New Theatre Royal in Portsmouth on 28 July.
The UK company is called Atomy Distribution. It has an office in Guildford and plans to hold seminars where people can find out more about this “business opportunity”.
It specialises in beauty and skincare products and health supplements, and says it is offering people the chance to become their own boss and earn additional income by becoming a distributor.
In its video message to potential recruits, it claims that through its compensation plan, “you will be able to fulfil all the dreams in your life scenario”.
In simple terms, members earn points from their personal purchases and from purchases made by their “legs” – that is, the team of customers they have recruited as members.
Points then translate into commission and other payments.
Before you can start earning commission, you need a minimum number of personal points, plus those for each of your legs.
However unlike some similar companies, members buy from an online “shopping mall”, not from another distributor. This means that distributors do not have to hold, and pay for, stock that they may never manage to sell.
Atomy has five levels of sales rep, called “dealerships,” and seven “masterships”, each with its own rules.
There is a complex system of commission payments, bonuses and other incentives.
In one video, Ruby McGrath, the UK and Europe managing director, says that in terms of general commission, distributors get a “score” for reaching each dealership, and each score is “roughly about” five US dollars. “The maximum score you can earn per day is 300,” she adds. This suggests a maximum of $1,500 (£1,080) commission a day.
Then there are the mastership bonuses, described as “once-in-a-lifetime” awards for reaching each level. Those reaching the lowest rung receive some company products, while Atomy claims those reaching the top rung, known as “imperial master” status, would receive £720,000 cash, plus other benefits including “office rental, personal assistant and driver hire”.
To join, an individual must provide the membership number of the person who is referring them.
Atomy’s website says it offers more than 400 products, although last week the shopping mall on the UK site appeared to list a smaller range, from £5 for four tubes of toothpaste to £180 for the “Absolute Skincare Set”.
The UK launch film on YouTube includes a sequence where the company bosses take afternoon tea with “a very special guest” – who turns out to be a lookalike of the Queen. The lookalike flicks through an Atomy brochure while drinking tea and eating sandwiches on the terrace of a stately home, and is then delighted to be presented with a basket of the company’s products.
The UK trade body for the direct sales sector, the Direct Selling Association (DSA) – whose members include cosmetics company Avon and the health and beauty firm Amway – estimates there are 631,000 direct sellers in the UK, 96% of whom are female. The DSA is an association controlled by its members, and operates a code of conduct with which they have to comply.
The Observer asked the DSA if it was aware of Atomy UK and whether it had applied for membership. It replied that “this company is not known to us”.
The DSA has said, in the past, that while multilevel marketing structures “may seem similar to pyramid schemes,” – which are illegal in the UK – “in reality they are substantially different and are more similar to a conventional corporate business model”.
The US-based Direct Selling News website recently published a “Global 100” list of direct sales companies which featured Amway in first place and Atomy at 12. The site said that in 2020, Atomy’s annual revenue was $1.48bn (£1.06bn).
David Brear, who describes himself as an author who has studied cults, told the Observer that, in his opinion, Atomy was an “economic cult” that was peddling a “cruel illusion”.
However, McGrath says that “you don’t have to be a distributor member to enjoy Atomy’s products,” and that “97% of our customers are consumer-only (ie, non-commission earning)”.
She adds: “Our members love our products and recommend them to people to try … there is no pushing people to buy, no joining fee, no stock holding, no minimum requirement to purchase any products.
“Additionally, unlike other network marketing companies, our consumers purchase via the online shopping mall, not via a person.”
McGrath says that of the $1,500 maximum commission a day that “reaching this level takes a lot of hard work and dedication. Typically, for someone to make Atomy their full-time job, we would say it takes over three years of dedication and hard work”.
She added that Atomy was “looking into” applying to join the DSA.