Modern MLM Software Compensation Plans that SELL for Direct Selling & MLM Companies
MLM Software and Compensation Plan.. BOTH titles are topics which are intertwined and deeply critical to a Direct Selling, Party Plan or MLM Company's success! If you're using a 1980's compensation model, stop asking your leaders why sales have flatlined.
The MLM Compensation Plan Problem
•Too many companies swallowed the concept of "a Compensation Plan must be Complex, no one needs to understand it... that's the Mystery that causes people to join!" ahem... NO.
•Too many companies have been derailed by "self-proclaimed consultants", I refer to as Vultures of Start-Ups.
•Too many companies have been steered by "so-called leaders", that join and request a comp plan be modified to benefit themselves.
Youv'e seen the MLM Compensation Plans... 10-30 levels deep, paying a few % on the first level, and some bump around level 7 or 15, then break away overrides, etc.
And, the companies are paying 30% to 70% of their sales, for what? They've received flat-lined at best, or diminishing sales. Yes, those $20k/mo earners, 50k/mo earners, $100k/mo earners, $250k/mo earners! They get a handsome check, while the downline only feeds the check, few earn $10/mo!
Sure, challenge me. Shoot me your compensation plan and public income claims. Then answer my questions. I will draw out the real numbers. Those income claims are slanted to look good, but facts are facts.
I'd rather see a substantial percentage of a genealogy earn money each month, then for a 1%er to enjoy $500k/mo.
..But that's just me, the guy that see's companies come and go. The guy that see's what makes a company stick, what makes distributors stick and sell.
....I'm just some guy, don't listen to me...
I've had a few words of wisdom, that I have shared repeatedly for about 30 years now...
On Compensation Plans: "You CAN have a Successful compensation plan that is Simple, Potentially Profitable, Incites Sales, Compensates the Masses, Reduces Customer Services, Reduces BBB and AG Complaints, Reduces Social Media Complaints."
On SEO Marketing (my other angst): "The internet is like a Haystack the size of the Moon. It has Billions of needles in it, and you want people to find YOURS! Good luck! If you want to be successful, stop paying those SEO wachamoles and do this. 1.) Simplify your Site, so your Needle is Clean and Shiny... 2.) Get Content on your Site, Relevant to what someone is Searching, so your Needle Stands Out ... 3.) Get as many other needles, as you can, to point to YOUR Needle."
..For now, we are talking about the MLM Software Compensation Plan. Look for our other articles, to learn how MLM Software can Get Your Needle Noticed!
Back to MLM Software Compensation Plans, and specifically, Modernizing to Sell MORE and Pay MORE!
Here's some 3rd grade common sense....
..If the average person will recruit 1.5 persons in their lifetime...
..AND You are a successful go-getter...
...You Bring in 10 People as Independent Reps beneath you... your Level 1, if you will. Congrats! You've beat the odds!
Level 1 - You have 10 people.
Now one of those was your best friend BOB who recruits.... 1.5
You have 10 people on your front-line.
Bob, in his Lifetime has... drumroll... 1 or 2 on his front-line.
..In his lifetime, meaning, will BOB ever earn anything from level 2, 3, 4, 5, 6, 7, etc?
The odds are, if Bob WERE a go-getter and was able to get 10, his 10 people would all suffer the same lifetime average of 1.5.
..So if Bob were successful and recruiting a bunch of his friends..
....Bob's average friends would not build an organization.
.....Bob's friends would be discouraged and put-off at joining his team or business.
Listen Closely... Diamonds have shouted it for years... "it's not about me being successful, it's about how many of YOU I can help become successful!"
..By the way, that Quote is a Serious Truth Bomb and MLM PRO Tip!
If the compensation plan is designed for Diamonds, how will YOU become successful, with the averages for you and everyone you bring in are.. well, not so great!
In 2014, I had a potential client (turned client), contact me with a question. Of all the compensation plans that I had done, for over 2 decades at that point... what would be the perfect compensation plan.
The criteria we sought:
1. We wanted to do modeling to locate a compensation plan, that would result in a Substantial portion of the available Genealogy Earning a commission
2. We wanted to see a compensation plan, with the strongest potential to cause available persons in a Genealogy to repeat and earn again
3. To have a Substantial portion of the Genealogy earning, means our focus must be OFF the "leaders"
4. We wanted to see a compensation plan develop, that was simple to understand
5. We wanted to see a compensation plan develop that would create LESS customer service calls at Commission Calc, due to a clearer understanding of earnings
6. We wanted to see reduced potential of complaints to a BBB or AG due to misrepresentation at joining, in return for clear simple compensation plan that had potential to earn
7. If Possible, if the numbers allowed, we wanted to see "some" availability for further bonuses, for those that "may" build depth in an organization
8. More than anything, the compensation must be around product/service sales, not on application fees, corporate training programs or other faux products
9. Based on this Intel, we wanted to identify any modifications in our MLM Software to achieve the desired MLM Software Compensation Plan
What happened in 2014, was we had a compensation plan develop, that spoke heavily to what we had long preached and taught.
In fact, it dotted all the i's and crossed all the t's of this statement, I had shared for so many years... "You CAN have a Successful compensation plan that is Simple, Potentially Profitable, Incites Sales, Compensates the Masses, Reduces Customer Services, Reduces BBB and AG Complaints, Reduces Social Media Complaints."
The buzzwords of that MLM Software Compensation Plan...
Infinite Customers - Get as many as you like! Substantial Retail Bonus on all Customer Sales $ChaChing
Infinite Personal Direct Distributors - Get as many as you like! Each of which are Free to get as many Customers as they like, and you could earn a % of
..Income is on your own effort... clear
..Some income by Leveraging others... clear
..No further downline, so more $ChaChing on that Level 1... creates REPEAT Workers. If I earned $x this month, Hey, I can do it again!
....I won't go to far, but an Infinite Depth element, to cast to those that build a downline, possibly some check-match and pools to toss icing on the cake
I held out the specifics, but YES you can have a Modern Comp Plan that incetivizes people to work, sell your products, and do it again next month... get this..
..By PAYING THEM!, NOT by hoarding it up to pay 1 guy or gal in the company a crazy $250k/mo
Pay the 90 percentile and have the 90 percentile actively market your produts again and again!
Or, pay the 1 percentile and have over 90 percentile as disgruntal, complainers, with high customer/distributor turnover
..Hmm, it really is that simple... always has been!
Now, MLM Software Compensation Plan speaks specifically of the archetectural model of which orders are tracked and potential commissions calculated within an organizational structure, but let's hit MLM Software.
MLM Software speaks to the global platform, beyond the compensation plan, encluding the public consumer shopping experience to distributor backoffices packed full with genealogies, reports, tools and more.
Inspetta's DB44 MLM Software drives Start-Ups to Enterprise Grade clients.
In our view, MLM Software is the front-end that consumers interact with, shop, etc, administration area to manage inventory, marketing, content, promotions, members and commisisons, as well as distributor back offices to manage sales, earnings, reports, training resources, virtual and in-person parties.
..I wish it were as simple as one-size-fits-all, but if we applied that to Tennis Shoes, TShirts, Automobiles, Houses.. anything, the world would be pretty borring as you and your things would look and function EXACTLY like everyone elses.
..Thus, a company's desire in MLM Software Features, Scalability, Look-Feel, Compensation Plan Complexities, Back-End Infrastrucuture, will all play a role in cost.
About Scott Leonard
More than 28 years of Corporate Consulting in the MLM Industry, assisting existing and start-up companies with Marketing, MLM Software, Compensation Plan Design, Industry Nuances and Insight, Software Sourcing, Software Development, Corporate Structure, Product Acquisition, Warehouse Management, and Pre-Launch Management.
More than 30 years of Corporate Consulting in the areas of Sales, Advertising, and Marketing. Trained in 'Old-School' Advertising and specializing in cutting edge Guerrilla Marketing. (Most of the world has forgotten about Burma-Shave... that's Old-School!)