MLM Matrix Compensation Plans --Words of Caution

First off, I assume you understand what a mlm matrix compensation plan is.

My purpose of this article is to give you first hand knowledge and experiences using matrix plans. Although this might sound like I am hammering mlm matrix's to death and also that I don't like mlm matrix's, that is not the case. I use matrix's as a backdoor method to my mlm marketing efforts.

However, mlm matrix's are NOT my primary business.

MLM Matrix Compensation Plans

Words of Caution: #1 Matrix compensation plans have not been around that long and they do not really have that good of track record. Very few companies have made it with a pure mlm matrix plan. Many of them have had to modify their matrix compensation plans in order to survive.

I read somewhere that only 9% of all mlm companies (and believe me there are thousands of companies out there) are using a mlm matrix compensation plan.

On the flip side (to be fair) a couple of mlm companies use a matrix plan and they have been around for 15 years. YES, they have made some major modifications to their compensation plans and that is the major reason they are still around. You simply cannot live on a matrix plan for long term success. Adding a uni-level plan or some other type of compensation on the backend of a matrix greatly increases survival rates.

Words of Caution: #2

Smaller matrix's especially those that have a 2 x or 3x first level will attract lazy mlm distributors.

More In Depth Coverage: if you can earn income from all levels in your matrix without having to sponsor anyone--will attract lazy mlm distributors.

A MLM Matrix compensation plan will attract State Attorney Generals, postal regulators and other regulatory agencies because it will appear to look like a pyramid or even a lottery. To top that off a MLM matrix compensation plan that requires recruiting will create misunderstandings between all parties hence, negative publicity.

Negative publicity will kill a MLM faster than anything.

Words of Caution: #3

Matrix's usually limit the levels you can earn income from. "Hey Bob, all compensation plans limit the levels you can earn income from, so what's new"? Well, many things are different including how many mlm distributors can be on any of your levels. Uni-level plans have unlimited width.

More in Depth Coverage: Talk to successful mlm'ers and ask them were the majority of their income comes from. Levels 1-4 or anything below their 4th level.

MLM matrix compensation plans limit the levels you can earn income from and usually are structured like this 2x3 or 3x4.

Smart companies who use a matrix plan have added incentives to help the professional mlm'ers earn income from the lower levels. Some add a 100% matching bonus (more discussion on this later), others add a uni-level plan after certain levels have been reached, while other companies will allow for an expandable matrix. This simply means once you fill your matrix you are then allowed to start another matrix.

By starting another matrix you can then capture at least SOME of the downline income LOST IN A MATRIX that would have been paid in a uni-level plan.

100% Matching bonus | 50% matching bonus

You will see this a lot in a matrix plan. That is the companies simple solution to helping professional mlm'ers capture income below their advertised pay lines. ie: 2x3 or 5x5

However, if you take a 3x3 matrix and fill it up you will have 3 on your first level, 9 on your second level and 27 on your third level. By offering you a match on anyone you personally sponsor, you can receive income from levels 4, 5 and 6 if that person you sponsor falls on your third level. Sounds good doesn't it?

Remember, there are another 26 members on your 3rd level and you will never receive any type of compensation if you train these people to fill their personal 3x3 matrix. Why?

Because their new members fall outside your matrix and you didn't sponsor them. This is the major drawback of matrix plans. Yes, even uni-level plans limit your income potential below certain levels, but they include options that allow you to earn income from levels deeper than their normal bottom payline. Oftentimes, they will block you after someone in that particular leg reaches a certain level. Some even break off.

One positive to this spin is the fact that someone has to sponsor the new mlm distributor. Because you will receive a matching bonus, you do have a vested interest in their success. Basically, you will take a greater degree of interest in helping this person succeed. Without a matching bonus, this person would more than likely fall through the cracks.

Word of Caution: # 4

Let's get away from negative thinking and look at a positive way to build a matrix.

More In Depth Coverage:

What we teach our matrix members who join our group is this:

1. join only if you can afford the price of the product + monthly marketing costs.

2. join only if you are willing to learn our system within 2 weeks and begin to teach it the minute you sponsor your first new member.

3. join only if you are committed to sponsoring (4 new members if it is a 2x matrix or 6 new members if it is a 3x matrix)

4. join only if you are committed to sponsoring your new members within the next 4 months if it is a 2x matrix and the next 6 months if it is a 3x matrix.

5. don't worry about marketing we provide coops

6. don't worry about what to say, we have trained leaders who will help

7. don't worry about money, we are committed to helping you break even quickly and into profit soon.

8. Be ready to study this industry so you can become a leader ASAP.

Now, that is a long laundry list. And yes, we still have people that beat the system, however what we do have are new mlm distributors who join our team, knowing what is expected of them and what is expected of us.

Normally, our groups grow slow to begin with, once momentum kicks in we grow fast, we grow profitable and we grow stable income checks that keep growing month after month.

Normal compensation checks in matrix's grow the first 4-6 months and then they plateau for another 2 months before they begin to crash in less than 3 months. This is very typical of matrix's unless you have some filters set in place, up front.

MLM Distributors are always happy to join a matrix, however they are not happy to do all the work. With the proper expectations of your group laid out you will build a happy, productive and duplicating downline.

Right?

If you are currently in a mlm company that uses a matrix, please feel free to contact us and tell us your success/failure with matrix plans. There are always exceptions to the rule and we want to hear your voice.

God Bless and have a fabulous week.

Bob Your Source for MLM Leads Reviews

MLM Consultant, Bob has coached thousands of networkers since the early 1980's along with 16 Years of Coaching High School Baseball & Football. Bob has reached the top level in 3 different companies and served as a member of the board for 2 years with a large nutritional company. Today Bob continues to coach network marketers/mlm'ers and he lives on the Yakima River in Prosser, Wa. With his wife Sue, two kids, Robbie & Kirsten, and their dogs named Cougs, Champ, Cammie and CJ.