MonaVie, Xango and others recently received some very bad press recently. Tom Harvey of the Salt Lake City Tribune in an article titled “Utah Juice Companies Offer Few Prospects.” poured some sour juice on MonaVie. You can also acquaint yourself with an article of Lou Abbot’s take on the article.
It is not our intentions to sour your belief about MLM or network marketing, but we do want to offer up some lessons that can be learned from the bad press of some MLM companies like MonaVie, Xango and the list goes on.
MonaVie and Xango are not the only companies doing exactly the same thing to pitch you and get you into the “Deal”. You see there are plenty more companies doing the very same thing but are not or have not yet been taken to task for their actions. But please do take precautions when looking for and or once you have joined a company and find that you are not making any money.
Please see below some income promises gone sour…note who is making the money in these companies. It is the top distributors only. It is not the new guy who has been working for months and months and can not make his or her first commission check.
At XanGo in 2009, the latest available income statement, the top 1.2 percent of distributors received an average of $37,019 a month, while the rest – 98.8 percent – averaged $163 in monthly commissions, according to the company’s own analysis. “As would be expected in any sales organization and even retail, those who spend the most time building their business and who treat it as a full-time job ultimately make the most income,” spokesman Jeff Chandler said in a statement.
For Tahitian Noni in 2007, 83.6 percent of distributors who earned commissions received only an average of $55 a month. Andre Peterson, a spokesman for Tahitian Noni, said having the number of distributors in each level of earnings would provide a more accurate picture of average earnings but then he declined to provide those numbers, saying it was proprietary information.
But behind the new slogan, which suggests a kind of intimate, we’re-all-in-this-together, friends-and-family business model, still lies a stark statistical reality. An analysis of the average earnings data provided by MonaVie in 2009, when it last supplied distributors with comprehensive numbers, reveals that 98.5 percent of distributors who earned commissions averaged just $129 a month despite the pitches to the contrary.
According to MonaVie’s distributor income disclosure statements, the vast majority – at least 86 percent of all those who sign agreements – don’t earn any bonuses. MonaVie says the 86 percent includes those who signed up only to buy the product at wholesale prices, but it won’t provide a breakdown of how many of those simply failed to recruit any other distributors and earned no money as a result.
Counting only distributors who earned commission checks in its 2010 statement, the very top 1 percent of MonaVie distributors took home an average of $52,992 per month, compared with the 99 percent who averaged $841 a month. Only .05 percent – 34 people out of 92,000 or so active distributors – earned a million dollars or more in 2009. For earnings that could be considered a car payment, only 5 percent of commission-earning distributors received an average of about $300 monthly. And about 90 percent made even less than that. To put it another way, those 95 percent all together averaged only $200 a month.
You know we all join network marketing companies with a goal and a dream to make a little extra money. Hopefully there is no one who is reading this with the notion to quit your 9 – 5 before you are making enough income from your MLM company to warrant firing your boss.
Dreams and goals aside there is a much bigger picture here. First of all we are not looking to criticise or belittle Tahitian Noni, Monavie or Xango for their lack of disclosing to their prospective distributors and distributors real income potential. Even a small business venture in the real world could result in similar facts and figures and have the same failure and attrition rate. There are plenty of people who start at McDonald’s and leave to go elsewhere…failure and attrition. there are many who start a traditional business only to have it fail before it’s second anniversary.
It is our belief that there are many more companies that are failing to report the real facts.
As mentioned above there is a bigger picture…that bigger picture is not the amount that can or can not be earned by the minority or the majority…it is in the fact that MonaVie failed to disclose this information.
At company events you will see a handful of millionaires dressed in their Rolex watches and expensive Armani suites, arrive in their red Lamborghinis, go prancing across the stage to receive their HUGE cardboard check for thousands, while the little guy who received a commission check of $55 that month look on and believe the will get there too. But with facts like those mentioned above, there seems to be little to no room for any more than the 1% already at the top of MonaVie distributors. Of course you could always hold out for one of those top distributors to be terminated. YUP that happens too. Another story though.
Inflating earnings is an epidemic in this industry and the norm it seems.
We allow ourselves to be pitched and hyped by MLM companies…because of our fears and dreams. We know that we will never make the kind of income that is being promised in our regular jobs, huge homes and fancy cars are just stuff dreams are made of. But MLM is making promises much like a politician at election time. The promises sound good but never really come true in the end.
MLM companies neglect to fully disclose just what is required of us to make the kind of income promised, instead they help us promote our families on Facebook fan pages, help us build vision boards and goals lists and keep dangling the carrot on a long stick.
All company policies and procedures prevent us from making income promises, yet companies do it astutely from the stage all the time breaking their own contracts they designed and drew up to keep you on a leash; to have some clause to be able to terminate YOU at their WILL.
Is it really any wonder that people tag MLM as a scam or pyramid scheme? With behaviour such as this by companies and the management teams the result can only be concluded that there will be far more disappointed and disillusioned network marketers.
Who will become frustrated quickly, quit too soon, and eventually blame themselves and the industry.
We believe that if companies presented their opportunities honestly, there would be many more recruits, there are people looking for opportunity… Most people do not join their MLM to buy a mansion overlooking the bay and a private leer jet. Most join to be able to pay the credit card debt off or send the kids to college or to be able to help out their church.
How refreshingly honest would it be to have someone present their opportunity to you like this …
If you want to make an extra $1000 a month, here’s what you have to do. Spend about $150 on our products, and among all the people you meet in your lifetime, and all the people they meet, you find about 50 people to do the same thing, and you’ll be earning about $1000 a month.
That simple invitation is a skill taught by Tom ‘Big Al’ Schreiter as part of his 25 Essential Skills For Network Marketers. You can download the complete list and read more detail at www.BigAlSkills.com.
If you’d like to learn how you can avoid the cutthroats or would like to remove the mind boggle and meadow muffins from MLM, contact us and we would be happy to share what we have learned.
First published Dec 10 2011 06:13PM
Updated Dec 13, 2011 09:53AM
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