Beachbody Multi-Level Marketing

[boloboffin]

I discovered a multi-level marketing plan surrounding the various fitness videos produced by Team Beachbody. You may be familiar with some of them - the biggest is P90X, which is always on the infomercials, but they have at least six other programs. They also sell supplements - vitamins, meal replacements, whey protein, etc.

And they have a sales program very reminiscent of Amway.

I was looking into this because one of their "coaches" put an ad into Craigslist for part-time work, which is what I was looking for. I need $50 extra a week, basically, and that's almost not worth getting a real job for. How many part-time places would let me work one shift and take that one shift off on a week I want to drive to Austin or the like?

Beachbody avoids the pyramid scheme legality by offering the products that they do. I do like the look of the P90X plan, although I would start myself on a different plan right now. And the vitamins and supplements are likely quality products as well. I'd have to do some research on that.

But I saw a huge red flag in one of the videos where the compensation plan was being "fully" explained. Well, it wasn't, so that's two, isn't it? One person asked what the average salary of the diamond coach was (Amway has the same language, right? Active, Emerald, Ruby, and Diamond). The people on the conference call were like, "Everybody's different." Well, yeah, everybody's different. That's why you add their salaries all together, divide by the number of people, and find out the average salary. The people conducting the call didn't even give out the average salary of the Diamond coach, someone three levels above the floor!

And when I did a search for critiques of the plan, I kept getting Beachbody coaches talking the plan up! I was going down several pages and not finding any criticism of Beachbody whatsoever, which is spooky!

But, like I say, I don't need that much money, I like the product, and the way compensation is structured (I'd say I understand about 90% of how it works right now), it really is designed around you making money when you're helping other people get into better shape or make money themselves. Everybody wants to get fit. And there is immense advertising support by the company - they are on TV all the time!

So I'm asking for people here to turn their critical eye to this setup. It most definitely is couched in the same sort of grandiose financial claims as any other multi-level plan out there. Is there anyone here that's actually had experience with this particular company? If you've had any experience at all with multi-level, is this plan just more of the same or is it better or worse than your experience?

Here's the link to some of the videos I watched:

www.myfitnesspays.com

The Compensation Plan - How I Get Paid video is the one I'm talking about. It's rather longish, and you have to work your way through at least 15-20 minutes of intro before you get into the actual 45 minute explanation. Anyone willing to trudge through it has my appreciation! After the video concludes, some more videos about various parts of the plan should become available.

ETA: And, yes, I'm reading through the Amway thread right now, and marveling how much Amway defenders sound like 9/11 Truth advocates.

 

[boloboffin]

I'm going to go ahead and post this link here, which I found on page 5, I believe, of the Amway thread.

http://www.vandruff.com/mlm.html

Team Beachbody fits right in there. I will say that they've done the best at trying to move their product legitimately, but the MLM portion of their business still fits every one of the basic criticisms on that page. It's more evolved and probably does a better job attempting to address some of the concerns than most. But the fatal flaws remain. I'll do some more looking into it to write up how it works. The "team cycles" especially is a genius way of ramping up expectations while distracting from the unlikelihood of ever making money like this -- until you get the pyramid below you, that is.

 

[Brainster]

Bolo, you are an intelligent guy, so if somebody can't explain it to you so you understand it, I'm going to assume that either a) they don't understand it themselves or b) they're being deceptive. Either of those options strike me as a red flag.

If you are comfortable that you can make the $50 a week with them at the "Active" level without a ridiculous expenditure of time, then I wouldn't worry too much about the calculations of what you'd make at the diamond level.

Oh, and with income it is definitely better to look at "median" levels rather than "average", which can be skewed by a few high-income individuals.

 

[boloboffin]

Thanks, Brainster. I think I'm going to hold off on Team Beachbody, though. I finished the highly entertaining Amway thread and it's plain that TB has tried to correct some of the excesses of the MLM model, but only to sustain it for the benefit of the upline.

Take the team cycle thing I mentioned. This is how it works. You are restricted in TB to only two legs of downline coaches. Your downline accumulates points by selling product, etc. So far, the same as Amway (except in the restriction to two legs).

But every day at a set time, the computer checks the accumulated points of your downline. If one leg has 240 points, it checks the other. If the other has 120 points, the computer deducts them from the legs and you get the first cycle payment for your weekly check. Depending on your personal points, you get $15 to $21 per cycle. The sales pitch exults over the fact that you can cycle 40 times a day at this point! Is that at all likely to happen? Of course not. Points are awarded in different ways, but even if it's a dollar a point, is it likely you're going to sell enough to cycle 40 times a day? No. I'd be surprised if people are cycling twice a week!

The propaganda says that there are eight ways to make money in TB, and there are. But if I had a nickel for each of those eight ways every day for a year, I'd probably make more money than almost anyone in the TB plan. It's a pyramid scheme, all right. It's just got an interesting twist on the razzle-dazzle.

Plus, the product looks really good as well. Unlike Amway, which seems to sell comparable products at drastically higher prices, TB has effective fitness plans in a variety of niches. I've even seen evidence of a diabetes management program that's been endorsed by several leading diabetes organizations. So the company isn't completely soulless. I don't know how to run the numbers (or have the right numbers to run) to know if it all works out in the end to a decent sales job. And to get $50 a week, I could stay "active" and sell $200 worth of TB product a week. That's one of the ways to make money, 25% commission on what you sell. Whoohoo!

But I do know that both presentations about compensation got a little fuzzy at times. And reading about the tool scam and knowing that I'd be downline for a number of people, I'm betting that the pressure to buy stuff myself would be relentless. One more disclaimer: I've seen no evidence of a tool scam yet with TB, unless it's the DVDs of the fitness programs themselves working as the tools in this arrangement. There is a "showcase package" that has all of the programs TB offers so you have a "lending library" to help sell. It's more than 50% off the price of all the programs combined!!!

And that exactly sounds like psyching coaches into buying a lot of inventory to stack up around their house, etc.

And I've done some cost comparison now on supplements and vitamins and found only one that seemed to be a better deal, the loss leader for TB. Everything else is cheaper at Costco or supplement stores.

In the end, what's fascinated me is that it seems to be such an ingenious twist on the MLM scheme. I wondered if it was enough different to cross the line into respectability. I don't think so now, because it's got all the flaws mentioned in that paper I linked to from the Amway thread.

I guess I'll just have to suck it up. I went to the IRS site and figured out I could have less withdrawn and still get a little rebate back. And I've got a minuscule raise coming up, so maybe that will be enough. If not, well, I guess I'll get a job waiting tables for my birthday!

 

[Brainster]

Not sure it's common where you live, but here in Phoenix there are a number of poker companies where they go into a bar and charge the bar a fee for setting up Texas Hold 'Em tournaments. Those companies are frequently looking for Tournament Directors (the people who actually run the bar tourneys) and compensation is typically around $50 for 3-4 hours work in an evening.