Okay, by popular demand, or I should say, because Tex wants me to take on this subject, here is part one in a series on the famous “tool business.” Are there abuses and controversy? Obviously so, as online debate shows. But I am going to take this one step at a time. You cannot understand where it is now and how it can be useful or corrupted if you don’t know how it began and why it began.

What is a networking system?

When you are in networking or an MLM and you hear someone talking about “the system” or “system building” or how to make money off of “the system,” what are they talking about? The word “system” is short for “a systematic way to build a network from the standpoint of the field.” This is what has become known as “the system.”

Okay, I will try to explain. Every networking company is launched with a product and a systematic way to sell it and build a network of others to sell it as well. This “system” seldom works. It is developed by well intentioned corporate people who have very idealistic concepts about building networks and even when it is developed by experienced networkers, people who have actually built networks of their own, well, as they say in war, “no plan of battle survives contact with the enemy.” Or in this case, no plan of recruitment and selling works the same way in reality as it does in theory.

To recruit people and sell products, the networkers in the field have to be nimble and quick on their feet and willing to adapt to the reality of the marketplace. And so the methods, or system for building a network, quickly morph into something different from the corporate template. Sometimes, the corporation has to jump through hoops to keep up. They have to make sure that what the field is saying and doing is legal, ethical and not counterproductive.

To speed up the process of networking, the leaders who have success, use books, cd’s and functions to promote what works and to promote each other so they gain the credibility or stature to teach others.

“The system” is a living organism that is changing with the culture and marketplace around it and so the things that work sometimes change in subtle ways. Methods used a year ago may not be perfect for today.

On the surface there is nothing sophisticated about the materials in “the system.” Indeed, they may tend to be mediocre because the art of networking is to find the common denominator and that may just be fifth grade. If your system will only work for exceptional people it will soon cease working even for them. To be successful it has to work for the “average” person.

If there is a father to “the system” it is Dexter Yager, a beer salesman from Rome, New York who was sponsored into Amway in the 1960’s. Dexter discovered positive books, like The Magic of Thinking Big and the books changed his life. He told his upline, Charlie Marsh, about what he was reading and as Dexter told me, Charlie said, “Oh sure, I’ve read all those books.”

Well, Dexter hadn’t read any of them and he wasn’t about to assume that his emerging network of distributors had either. So he started pushing the books along with the Amway products. At first he loaned out the positive books but he couldn’t easily keep track, so he just gave them away.

When I met Dexter Yager in the 1970’s he told me solemnly that there was no money in books. He and his fellow “diamonds” had just financed a book about the city of Charlotte, North Carolina, a large, coffee table book with poetry and color pictures and boxes of these books had sat in their basements for years left to rot, unsold.

I tried to talk him into publishing a book with a little of his own ideas. After all, he had thousands of people in his network. But Dexter was afraid that it wouldn’t work. I had to ghostwrite it and pay for the printing and shipping myself. Dexter didn’t pay a dime upfront. It was published by Bethany in Minneapolis and we called it Don’t Let Anyone Steal Your Dream. I believe that I had 30,000 copies printed and sent to the Charlotte coliseum. We sold them all retail within minutes.

In any case, in the 1960’s, Dexter would start an out of town group only to return a few weeks later to find it dead. Leaving behind a few books to read sometimes started a spark. Sometimes there was more excitement when he returned. There was no money in the distribution of these books. Thousands of them were purchased in bookstores at the full retail price. When I met Dexter he was surprised to know that he could get an 80% discount for full print runs and buy such books direct from the publisher.

Likewise the emergence of tapes was not a moneymaker. In the summer of 1966, Dexter stopped by a motel in Utica, New York to visit with Fred Hanson, one of the more successful distributors in Amway. Hanson had a reel to reel tape recorder and was listening to a motivational tape. “This is what you need Dexter,” Fred said. But the big, bulky machine cost $58.00. The price was too steep for Dexter.

Sometime in the fall of 1966, Dexter Yager recruited (or as they say “sponsored”) a flamboyant, down on his luck, piano player in Schenectady, New York, by the name of Tony Renard. Tony was a chubby, vivacious character with an outsized personality and suits so old that they were practically back in style. Dexter was totally charmed. Tony was a big dreamer and his wife Sue was hopeful. She would sit nervously looking back and forth at Tony and Dex as they talked about all the great things they were going to do, hoping, just hoping that maybe, maybe, a little bit of it would come true.

Dexter finally bought himself a tape recorder and he would haul the big heavy machine up to Schenectady and play motivational tapes for Tony Renard. For a while, anyway, Tony and Sue could believe.

The problem was that they were absolutely broke. The more Dexter tried to help them, the more it didn’t work. Tony thought that if Dexter could stay in town permanently it might take off. And if he couldn’t do that, maybe he could help them buy a tape recorder and they could listen to positive tapes?

Dexter promised Tony that if he hit $1,500 a month, he, Dexter, would buy him a tape recorder. And then he could listen to motivational speakers like Earl Nightingale all he wanted. Well, Tony made it and Dexter bought it. That five inch reel to reel Craig tape recorder may have been the best investment of the 1960’s. Tony built his business and the lesson was learned. If you want to build a successful network, listen to positive tapes.

(Author’s note: In the summer of 2011 I was contacted by Tony Renard’s daughter, Aurel.  She was born that year and heard her mother and father tell this story many times.  And she corrected the details.  It turns out that Tony set the goal for $1,500.  And it was Tony, and only Tony, who paid for the tape recorder.  He bought it second hand for $46.75 from Dexter!  Interesting.  Tony’s wife, Sue is living in Stuart, Florida and active in network marketing.)

Now, this account about “tools”  isn’t over. It will take many posts for me to help the reader get to where we are today. But it is important to know the history behind this. You can’t really understand where we are today if you don’t know how we got here.

For several years I was the only speaker who was invited into all of the different streams of networking groups and from my standpoint the lesson was clear. The hottest groups, the fastest growing groups, were the ones who moved the most tapes. This was not a gimmick, it was a reality.

I remember one year speaking for Rex and Betty Jo Renfro at the Washington Hilton. They were in the Bill Britt group and they were hot. Everybody wanted to know their secret. Well, I knew the importance of tapes and so I made sure I mentioned it in my speech, referring several times to the “tape of the week.”

I was pretty proud of myself until Betty Jo caught me just offstage and said,” Don’t you ever talk about tape of the week to our group. We move more than one tape a week. We have the tape of the day or the tape of the hour.” And they had the group that was growing fastest at the time and it would produce many money makers and leaders in networking. I have seen the same thing all over the world.

But the fact is, when the promotion of tapes and books began they were not big money makers. Not at first. Indeed, they were often a bit of a nuisance. When I first started giving speeches at Dexter Yager’s annual convention in Charlotte, he was making tapes off of a cheap Wollensak duplicator with one slave attached. It was placed on a board on top of a pool table in his basement. His daughter, April, was in charge. And distributors complained about not getting their tapes on time. And Dexter couldn’t wait to break a new diamond because then they would have to make their own tapes and he wouldn’t have to mess with it anymore.

So keep this in mind as we talk about the emergence of “the tools.” Tapes and later cd’s became part of “the system,” because they helped people build their networks. They were not produced to make money, at least not initially. They were begun to build networks and eventually they did indeed make lots of people lots of money, but precisely because they worked. They were not a scam. They were the key to successful networking growth. And while greedy and unethical people may have corrupted the process, that fact is true even today.

(To start at the begining of this series go to Doug Wead Amway Adventure.)

(To go to the next thread.)

Amway in the UK

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Posted in Business Tagged: Amway, Dexter Yager, Doug Wead Amway, Mlm, networkers, Networking, Sue Renard, tapes, the system, Tony Renard, tool scam, tools

Doug Wead

Doug Wead is our presidential historian and frequent guest blogger here on CLC. You can see more of his work here: Doug Wead's Blog