Matrix Marketing: The Bottom Line

Posted by Neville on March 21, 2011 under Money | Comments are off for this article

Here’s the bottom line: If you are last into a matrix Opportunity you WILL lose your money. If you get in first you will make money. BUT does it feel right to you to make money knowing that those below you will definitely lose their money?

Matrix MarketingWhy is the bottom line here at the top? Well to put  it simply, you might not get the end of this longish article. Unfortunately the rest of the article maybe not quite so simple.

What is a matrix?

You will see them advertised all over the internet. You will get sales pitches to join them in your email.

A matrix is a sales structure into which you are recruited, and then you go out and recruit others. These become your downline, and for recruiting them you will be rewarded. Historically they were presented to you on a restaurant napkin in the form of a chart showing how your team will expode in size with just a few levels. And that explosion will send big dollars your way.

Let’s do a bit of Maths (or for our American friends: Math).

Let’s presume a very simple matrix: 1 Person recruits just 2 other people. And each recruit does the same.

Assuming each recruit is successful in doing their recruiting in one day, and does no other recruiting:

After 1 day the opportunity will have 3 members. After 2 days there will be 7 members, after 3 days there will be 15 members.

Wow this opportunity is growing well? And those who have joined should be receiving payments. All looks good so far.

Let’s jump ahead to the end of the first week. 256 new recruits on that day, and 511 members in total.

At the end of two weeks: 65,535 members. Looks like a healthy program.

After three weeks: Approximately 8.39 million members!

After four weeks: On that last all day all of the members of Facebook are added! That’s 5.36 million new members and 1.07 billion members altogether.

I think you will agree that this is getting out hand, and completely unrealistic. Unfortunately a lot of the advertising for opportunities like this do not tell you that, and imply that the market for recruits is endless.

Most matrices end at 10 or 15 levels, at which point you can start to build another if you haven’t already started to do that. The payment structure for one of these matrices varies, but is interesting to note from one of them that:

When level 1 is filled (2 recruits) you get your money back.
Levels 2 to 4: you slowly build to double your payment. (16 recruits downline). At these levels a small proportion of recruit payments goes to the person on top of the matrix.
Level 5 to 8: the proportion of recruit payments to the top person decreases again, and payments to that person rises to more than 10 times that person’s monthly payment.
Level 9: Recruit payments proportion increases and the payment to the top person jumps to 42 times their monthly outlay.
Level 10: Recruit payment jumps to 4 times the previous level. Payout to the top person reaches nearly 250 times their outlay.

And guess what! That is the figure that is promoted heavily in their advertising.

Yes, the first few levels will get people their money back, and they will be able to truthfully say that the opportunity pays, and produce copies of their payments advices. All good advertising to get more recruits.

But with things like this it is going to stop  somewhere and those that have joined last, will not get one cent of their investment back.

How many of those 1024 members in the bottom level of the first matrix are going to get to the top of their own matrix? That’s a total of more than 1 million members at the bottom level. If the program gets that far and no further, that’s 1 million people not getting anything back, 500,000 getting their money back. 250,000 getting a 20% return and so on. Just 1000 people in the matrices will be getting the promised payment, the one advertised. That’s 1000 members out of more than 2 million members!

I knew this would be heavy going, but if you’ve got this far, here’s the bottom line again.

If you are last into,or on the last level of a matrix Opportunity you WILL lose your money. If you get in first you will make money. BUT does it feel right to you to make money knowing that those below you will definitely lose their money? The last level will have about half of the participants, and they all lose!

This post was originally posted at one of the Social Networks where I have scaled back my participation due to the large number of people promoting matrix payment schemes and a couple of other issues.

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