Trump selling nutrition

MIAMI

It’s like “The Apprentice” meets Amway. Donald Trump is synonymous with luxury high-rises, his TV show and his distinctive hairstyle. Now he’s putting his name on a vitamin and health products business whose salespeople make money by recruiting more salespeople.

The ubiquitous Mr. Trump is partnering with Ideal Health, a 12-year-old Massachusetts-based nutritional-products company, and renaming it “The Trump Network,” though the partners won’t specify what their financial relationship is.

The products will be sold via multilevel marketing - a method of selling products through a network of distributors. Marketers receive commissions for the products they sell, along with a cut from products sold by other salespeople they’ve recruited.

Critics of such programs say that most of the products are bought by the distributors themselves, and that few of the salespeople actually come out ahead in the end.

Mr. Trump, characteristically, is blustery in his bullishness. In an e-mail to the Associated Press, he called it a “rescue and recovery program” for people suffering through the recession, offering a shot at extra income. The company hopes the Trump name and image will help sell the products.

Mr. Trump swooped into Miami for the company’s glitzy launch last weekend, complete with gymnasts and jugglers, at a hotel in downtown Miami. Five thousand salespeople packed into the hotel to hear from the Donald himself.

That star power might mask how hard such businesses can be, said Daniel Howard, a professor of marketing at Southern Methodist University’s Cox School of Business.

“People are more easily persuaded when they want to believe in something,” said Mr. Howard, who has studied multilevel marketing. “Someone comes along with a big name like Donald Trump and pitches riches, it captures peoples’ attention and interest. If he made so much money, they think, ‘I’m glad I’m on board.’ ”

The reality?

“Multilevel marketing is a tough business, and most people don’t make much money,” said Mr. Howard.

The Trump Network will compete with well-established networks such as Amway and scores of retail brands such as Centrum. It’s not clear how many such companies are out there because most are privately held, but Trump Network co-founder Todd Stanwood says that there are about 200. Amway alone says it had $8.2 billion in revenue in 2008.

Joining the Trump Network costs $48. That buys a marketing kit and three months access to a personalized Web site to promote the products. However, new participants are often sold a $497 package that includes the marketing kit, products, CDs, sales tips and coupons.

The products include everything from custom nutrition tests to vitamins to blueberry pomegranate bars. A 30-day supply of a customized vitamin formula costs about $57. Marketers can sell back any unsold inventory.

The Web site does caution: “If any product purchase creates a financial hardship, do not make the purchase. Your financial health is as important to us as your personal health.”

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