XELR8 Closes
January 21, 2010
This just came across my desk today:
After careful consideration, the Board of Directors of XELR8 has determined to pursue an alternative business model resulting in the discontinuation of our XELR8 Multilevel Marketing Program in its current form, and has asked me to inform all XELR8 Independent Distributors of this decision. As a result, the current XELR8 Compensation Plan will be terminated effective February 28, 2010, and you will be offered the ability to participate in a program to be announced on a national call on February 3, 2010. At that time you will be offered an attractive incentive for you to continue to enjoy XELR8 products as well as compensation for existing and new customers that you introduce to Bazi. (read the rest of the letter here…)
This is precisely why you must choose your company wisely, be absolutely certain to be building your own list so you can recover quickly from such an occurrence, and create a cash flow program that pays up front. Now would be a good time to reach out to any XELR8 reps you may know and bring them into your current MLM!
Arbonne Review
January 21, 2010
Arbonne was founded in 1975 by Petter Morck. In November 2004, Harvest Partners, a private equity firm, acquired Arbonne in partnership with management providing a strong financial backing for future growth. They are currently open in United States, Canada, Australia and the United Kingdom.
What is Arbonne Selling?
Arbonne started out offering high end skin care systems to customers that are pure, safe and beneficial to you (they recently added a weigh loss program as well) The skin care industry is a largely unregulated market that often produces products that are toxic to the end user. Arbonne provides a lineup that is aware that your skin is your largest organ, and whatever you put on your skin gets absorbed…
There is bound to be some price resistance from the products, however, as with the high quality lineup that Arbonne offers, there is a cost. Since the “value” of the product is best demonstrated face to face – people just don’t know how toxic the product the put on their skin really is – network marketing distribution is an ideal fit.
Experience has shown the price push back does not decrease the market size significantly, just the effort to do a proper presentation. Since both main niches are hitting the baby boomers, the market size will be growing for the next ten years, the prospects continue to be strong.
What is the Growth Potential?
The traffic analysis of the Arbonne website is not indicative of their overall business growth, since they have a strict policy of not allowing independent consultants to market their business online. The offer a replicated website that can be used to direct potential customers and business partners to, but it is very limited in scope, and not set up to do the selling or recruiting for you… just a transactional site.
How is Money Made in Arbonne?
Like every legitimate network marketing company, there is a significant retail commission available to independent consultants, on the order of 20% to 35%. Not bad, but that’s not where the leveraged income comes from. The multi level compensation income that comes from building a team of consultants.
The Arbonne compensation plan is at it’s core a unilevel plan that pays on up to six generations of your organization depending on qualifications. Since a generation is based on rank in the plan, it appears to pay much deeper than these six potential levels.
A full 49% payout is presented in the pay plan document, which is a healthy number for MLM companies that have a real product. Watch out if the company you’re looking for has more than about 60% or less than about 20% pay out!
My Arbonne Analysis
The skin care niche is an interesting one in that it does well even in a bad economy, especially in the United States. Seriously, many women would go without eating before going out in public without their makeup on. The product line up is high quality but making sales to consumer in this market is a very high touch, belly to belly process, best done with home parties. Arbonne doesn’t allow any online marketing both to protect their brand and because the high touch product sell, but that doesn’t mean you can’t build an Arbonne business online.
Building an Arbonne organization online will need to be done by using an attraction marketing system, which allows you to build a relationship with an ever growing base of prospects by offering them exceptional training. To get to the point of becoming a full time entrepreneur as quickly as you can, you should have a solid cash flow program as well.
All in all, Arbonne is a legitimate and solid company.
Dubli Network Review
January 19, 2010
BACKGROUND
Dubli is a unique breed of company that was founded by Michael Hansen in 2006, and is currently headquartered out of Cyprus, presumably due to their favorable tax laws. It started in Europe, developed a very strong presence in Germany, and recently has been making in roads into the US market.
The company offers two unique websites. For marketing their product to consumers there is dubli.com and for marketing the business side and building an organization there is dublinetwork.com. Both sites have decent and growing traffic; dubli.com boasts an alexa rank of 20,505 world wide, while dublinetwork.com comes in slightly higher with 47,654.
As you can see from the chart, they are doing well… I assume that the serious dip in the rankings for dublinetwork.com in later January is just an Alexa glitch, as I’ve not found any significant press to justify such a drop, and the fact that dubli.com continues strong.
PRODUCT
Dubli operates a reverse auction site that allows prices for very nice commercial products to go down based on bidding. The way it works is they put up for auction quality in demand items at a starting discount and guarantee that it’s the lowest price you can get online (and pay you back the difference plus 10% if you find otherwise within two weeks).
The unique twist is that the current “bid” price is hidden, and only the starting price is revealed. To see the current bid price, you must spend a “credit”. Once a credit is bid (which cost the customer $0.80), the bid price is reduce by $0.25, and the bid is revealed. If you like the price at that time, you can then buy the item, and it’s taken off the auction and the process starts over again.
In theory, if enough people bid on a product, it’s possible to get a good deal. The challenge is that if only 10 people want to see the price, only a $2.50 discount will be available. In order to really save money, hundreds or thousands need to bid. One down side is that there is only one winner, and everyone else funded the game, and compensation plan.
COMPENSATION
So where does the money come from, and how is it distributed in the dubli opportunity?
It technically doesn’t come from the actual deliverable products at all, but rather from the “credits” discussed earlier. People need to buy credits at $0.80 each to reduce the bid on an item by $0.25. The difference of $0.55 is used to fund the compensation plan and provide the company with operating income and profit.
There are two ways this money is distributed to those building a network marketing organization with Dubli. First, between 5% and 25% commission is available from sales of credits to your retail customers; the exact rate depends on your personal volume of credits in the past 12 months. These are people that are in the game just to save money, and bid on items available at dubli.com. Dubli boasts a customer to distributor ratio of 72:1 which is staggering, and much higher than any other network marketing company I’ve personally reviewed.
The second, and more profitable part of the dubli compensation plan are over rides available from your organization. To qualify as a business associate (or BA) you will need to purchase an e-biz kit for $175, and then accumulate at least $499 annual credit volume. Based on how many other business associates you personally sponsor, and how many customers you bring in, you can earn somewhere between 5% and %35 on your organizations credit purchases.
Like many other comp plans, the organizational volumes are based on leadership levels… what disturbs me here, is that if a spot is vacated that money disappears into the company coffers. I would much rather it just continue to roll up.
ANALYSIS
There are only 15 people who are listed as making over $10,000 per month promoting Dubli on the businessforhome.org site. The top distributors listed being Dean & Angie Mannheimer reporting $90,000 per month income, followed by Bettina Rasmussen & Villads Vest and Walter Richter at $25,000 per month. While these incomes are certainly nothing to sneeze at, the numbers aren’t very strong yet here in the US. The concept of reverse auction websites seems to be a bit foreign in the US, and might explain for the sluggish start here.
Dubli has done very well in Europe, however, and continues to do so.
Will Dubli take off in the states remains to be seen. It is a unique business opportunity, that offers a consumer the potential to save money, which should fare well in a recession… Can they train enough consumers to see the fun of bidding on a reverse auction to attract enough entrepreneurs to decide to become business associates?
It seems to be a simple marketing challenge. It’s unique, but that’s good. What’s needed is some effort to apply a good attraction marketing system and build a compelling presentation highlighting this unique selling proposition. Of course while you’re building up your residual income with Dubli, it might be a good idea to add a high converting cash flow producing component to your business portfolio so you can get to full time quickly.
Just remember… massive action creates massive results!
Make it a great day.
MonaVie Review
January 18, 2010
BACKGROUND
MonaVie burst onto the network marketing scene in January, 2005, and has since expanded operations to include Canada, Australia, New Zealand as well as Brazil, Mexico, Singapore, Japan and Israel.
Founded by a strong group of entrepreneurs, Dallin A. Larsen, Henry Marsh and Randy Larsen many of who have extensive experience in the direct sales arena, and more specifically the functional health beverage network marketing industry. A solid leadership team is one of key attributes to look at to assess the long term viability of a company, and MonaVie does well here.
The companies website (monavie.com) has a decent and steady traffic, with an Alexa ranking of 32,471… certainly not the highest we’ve reviewed, but since a large part of the promotion of MonaVie is done offline, this is a respectable rating. The main online presence for distributors to present the information appears to be the mymonavie.com replicated website system. The system doesn’t get a lot of traffic, however, so it’s not clear how much it really get’s used. For reference, often times a thriving distributor based replicated system will get more traffic than the company website; that is not the case here.
PRODUCT
MonaVie offers a functional health beverage product line that features the remarkable açai berry as the star. Each juice in the lineup offers a blend of the acai berry and other fruits (such as bilberry, cupuaçu, blueberry, camu camu, acerola, aronia, and pomegranate) each combined to offer unique advantages for the consumer. To support their Jewish clients (and since Israel is one of the countries they are open) they even offer a unique kosher alternative. This thoughtfulness is not something often seen.
COMPENSATION
The MonaVie compensation plan provides nine potential income streams, but the main source of revenue for most active distributors looking to generate an income will come from the binary override tree. I’m not a huge fan of binary plans, as I think there are too many games involved in balancing legs. Since it is a binary plan, there is a limit of $10,000 per week you can earn. For most people $40k per month would be life changing, but it really disturbs me that any limit is in place. They do let you open up to 4 business centers, though so can raise that a bit… but why the extra hassle?
As you move up the ranks within the plan, there are other leadership bonus’s that will then pay on the “sponsor tree” which is treated as a unilevel. MonaVie pays out 50% of the sales volume; this is a good and reasonable level for a company with a real product that needs to be shipped.
ANALYSIS
There is no denying the fact that a lot of people are creating some fantastic success with MonaVie. In fact, 460 distributors are listed with incomes over $10,000 at businessforhome.org site. This is in close alignment with the official disclosure by the company, seen below.
As is common with virtually every network marketing company, however, the VAST majority of people make little or no money. This is okay, as long as the entry level distributors are happy and enthusiastic consumers of the juice they are getting. It’s not okay, if their intent was to make money. Usually it’s a balance of both.
Many Amway distributors migrated to MonaVie, and this ended up with a frivolous lawsuit (shame on you Amway) that has since been settled. It’s hard to say bad things about Amway, since this entire industry wouldn’t exist if not for them, but their attempt to lock up the livelihood of distributors is unethical in my opinion.
The downside that I see with MonaVie is that their product line is that like every other functional health beverage out there, in that it has quickly developed competition selling similar products at much lower costs… most of the times these products are very much inferior to the original, but for Joe average consumer, they buy the hype and do not necessarily do enough research to know if they are buying a quality product. That said, if people get good results, which they must be, they are much less likely to change to a cheaper brand.
Since the company is only nine countries, the upside potential for global expansion is large. Also, now being five years old and out of the startup phase, the long term viability seems to be very strong.
All in all, MonaVie is one of the good companies out there, and you could do much worse for your self than choosing to join them.
If you would like to learn how to effectively market MonaVie online, here’s some free training to show you exactly how to do it.
Is it a Scam?
January 12, 2010
Let bring this right out in the open… I love network marketing both the direct sales side and the multi level marketing side. I will not be a guy that labels something a scam unless I honestly believe that it is.
There are way too many negative people in this world stuck in poverty mentality that label anything that offers a profit potential as a scam, or a pyramid (didn’t we get over that label decades ago?). To them if someone refers a friend to a product and makes a profit from them, then that’s a “scam”.
I beg to differ.
I’m a pure-bread home grown capitalist, and entrepreneur, and I run my business to make money. Hopefully you do too. I have both a direct sales company that earns me primarily on my own efforts and a traditional multi level marketing business that I earn on several levels of my team… and I love both.
To me, a real scam, when you boil it down, is when the business does not have a real, legitimate product or service. By definition it’s a fraud or confidence trick. A ponzi scheme is a special sort of scam that builds a house of cards based on the process of recruiting only… this is why they are illegal. They often mask it with what looks like you’re getting something of value, but if you peel it away, this turns out to not be the case. Ponzi schemes are profitable only if you get in early, and why they are illegal.
So if you are looking at an opportunity, here’s a real easy test to determine if it’s a scam, by my simple defintion:
- Are you receiving a product or service for the money you’ve invested?
- Is the value of the product or service at least in the ball park of comparable products? Realize that many times the products distributed through network marketing are of higher quality than comparable, and there is real value in that so don’t undervalue the uniqueness or quality.
- Is the compensation you’re receiving from the movement of the real products or services or is it really a front end game and you’re making money only for bringing people into the business?
So, there you have it, I’ll stick to these guidelines while I investigate the various network marketing companies. If you disagree with my definition, please let me know and we can have a discussion.
TVI Express Review
January 7, 2010
Background
I’ve been hearing a lot of buzz about a company that launched in 2009 called TVI Express, or Travel Ventures International, so being the curious type that I am I decided to do some digging on my own to see what they’re up to and provide some unbiased third party insight into their product line, business plan and viability as a means to make long term income.
I’m not a member of TVI Express.
Company
TVI is a UK based company, but the corporate headquarters are in Cyprus. The founders are an anonymous group of investors from the UK, and try as I might, I can not find any information on who they are or the executive team. This is what I can learn about them from the TVI power point presentation:
“TVI is funded by a prestigious Business group having many successful Businesses worldwide.”
Details of the financial backing and executive teams is information that is often very useful in discerning the long term viability of the company, but without it doesn’t necessarily mean anything bad; but in the home based business arena, most legitimate companies go out of their way to at least let you know who the executives are.
The business was first launched in India and China in February 2009, and grew so fast they decided to expand into other markets, hitting the US in July of 2009. They are indeed generating a lot of traffic to their website. As I write this their global Alexa rating is 5,038 and their US rating is 2,107, with the traffic trends still slightly increasing
This Alexa ranking alone gives you the clue to the buzz that is being generated by this company; to get that kind of rating from Alexa takes a lot of traffic! I’ve found two third party marketing websites that are being used and driving significant traffic to the main TVI Express website, both produced by USHBB: getinandhangon.com and freehealthscare.com. They too have respectable and stable traffic, but neither is growing.
So it’s obvious that TVI Express has created a splash on the scene, has quite a few promoters of the business, but what exactly is their product line, and how does this all work?
Product
As a member of TVI, you pay a one time fee of $250 to $275 (depending on how you pay) to gain access to their discount travel club membership. Theoretically you then can save money on flights, lodging, transportation and accommodations, although in my research I’ve not found anyone willing to share that they get better deals than are already available on sites like travelocity.
Also included in your one time membership fee is a 6 Nights/7 Days Vacation in one of the 3-5 star Hotels/Resorts across the world. Details and any restrictions are not disclosed up front. On the surface this appears to be a solid value for the cost of membership.
Compensation
Let’s take a look at how to make money with TVI and their compensation plan.
TVI takes the $250 start up fees and distributes a portion of it between two “boards” each with 15 spots in it. The first board is called the “travel” board, and the second is called the “Express” board.
You start out in the “Travel” board, and as long as you’ve sponsored two people, once the board fills up, you’ve earned your first commission of $500, and earn a spot on the “Express” board which is where the big money comes from.
The express board works just like the travel board in that there are 15 spots, and as long as you bring two people personally from the travel board to the express board, when those 15 spots fill up you earn $10,000. This enticement for “easy” money is probably the driving force to their phenomenal growth over the course of 2009.
Once you have cycled through the express board, you get to re-enter another express board and start the process over again.
Do this a few times and you can be rewarded with override commissions ranging from 5% to 10% on your team.
Analysis
The money to fund the plan comes from the one time fee. This in and of itself is not a problem, since this is what most top tier direct sales companies do as well; companies like Global Resorts Network and Wealth Masters International charge a one time fee for the their training or membership, and the sponsoring distributor makes a nice commission for making the sale.
The difference with TVI Express, is that the sponsoring distributor doesn’t make money on these sales, but rather has to wait for the board to fill up in order to be compensated. On the surface seems to be an effort to encourage team work, but is there more to it?
In order for the money to keep flowing, and commissions to be made, new people must continually be brought in.
It appears TVI is treading close to ponzi scheme to me. From wikipedia we find the definition of a Ponzi Scheme:
“The perpetuation of the returns that a Ponzi scheme advertises and pays requires an ever-increasing flow of money from investors to keep the scheme going.”
I think TVI is hoping that since new distributors are receiving a nice 6 Night/7 Day vacation for their membership up front, that true value was delivered for their membership fee, and any compensation is just a bonus, and thus avoid getting shut down by the FTC…
I’m not a lawyer so I don’t know how to read this one.
If you choose to pursue TVI Express as a business, I’d do so quickly, and probably avoid having this as the only thing you’re working.
Just my two cents worth.
