Organo Gold DEBUNKED Pt 3: An Infinite or Finite Business Model?

Here is a snapshot of the Compensation Plan Overview video. There are numerous videos over-viewing Organo Gold that can be found on personal web pages by distributors, and YouTube. Below is a video still-shot of Holton Buggs explaining the concept of the Dual Team. Here, at 0:29 seconds, Bugg’s is emphasizing the idea that a distributor can make “infinite” commissions by recruiting an “infinite” amount of distributors in their downline.

Take a look at the image below from an article titled, “The Pyramid Structure of Multi-Level Marketing – Why it IS a Scam” from www.consumerfraudreporting.org.

With straightforward mathematics, one can see that there is a matter of time and number of recruits that will lead to an inherent collapse (similar to a stock market bubble). Organo Gold’s dual team concept will make this process slower by using a multiplying factor of 2. Naturally there will be a lot of “snapped branches” on the “placement tree” (pyramid) from the distributors who “quit” during the expansion. Once it reaches the deepest level of market penetration,the only way Organo Gold business is able to survive is by signing up new distributors. Members at the top, tip of the pyramid will get paid, but there will be a high turnover or “churn” rate at the bottom of the pyramid (who are they going to sell products to? The only other option is to keep selling the “dream”).

 “Is Organo Gold a Recession Proof Business Opportunity”?

At the coffee jazz mixer’s and distributor meetings, I noticed a common theme (that everyone is tired of where they are right now, and want to experience financial freedom, and have more time to do the things they love). These people are Organo Gold’s ultimate market.

“The problem with the MLM “income opportunity” model is that the product (the “unlimited” income opportunity) is bogus. It does not exist. And, “unlimited” expansion, the foundational principle of MLM, is impossible. The promise offered to consumers is illusory. The pyramid model in which each person recruits more “below” must always place the vast majority in the lower ranks where a recruitment-based income – by design – can’t be possible. For a very few to be profitable, nearly all others cannot be. As the limits of the falsely advertised “unlimited” expansion are reached, those in the bottom lose their investments. They quit the schemes in large numbers usually within a year and then are replaced with new hopefuls. The “business” continues as long as the schemes can find new recruits (investors). Bad economic times produce many new potential recruits. Bad times for products are good times for sellers of hopes and dreams and purveyors of “independence, be-your-own-boss, can’t-get-fired, 20-hours-a-week-for-financial-security, anyone-can-do-it” income schemes.” – Robert L. FitzPatrick (in his article, “Has MLM Corrupted Avon?” from pyramidschemealert.org )

Organo Gold DEBUNKED Pt 1: “Lets Get Real!”

Websters Dictionary’s definition of “Debunk”: v. to expose false or exaggerated claims.

Google’s definition of Debunk:

1. Expose the falseness or hollowness of (a myth, idea, or belief)
2. Reduce the inflated reputation of (someone), esp. by ridicule

It is in my analytical nature to investigate, speculate, study, research, and use logic as well as common sense to come to grips to a sweet state of reality.

The Opportunity…

Let’s start with the number one tagline “Do You Or Someone You Know Drink Coffee?” For many of us, even if we don’t drink it, our answer would be “of course!” Then the information is given that “Coffee is the second most consumed beverage on the planet after water. It’s the second most traded commodity after oil. People drink coffee all day, every day in almost every country around the world.”

WHAT about coffee? Coffee is a single traded commodity that is sold to the mass public through numerous companies. It is clear that Organo Gold is not the only coffee company. Let me make it more clear that it is NOT the only Coffee Company that sells coffee with Ganoderma. I can stop here since coffee is the tag line, but they also are not the only company that sells hot chocolate or tea with Ganoderma.

Let’s move into economical realism:

We know that there is a fairly decent population of coffee drinkers almost everywhere hahaha! But see for yourself: How many different brands of Coffee are on the Market? How many people would switch from drinking their traditional brand to drinking Organo Gold Coffee? (It’s unreal to assume that everyone would switch, even given the beneficial herb that’s infused in it. Market Penetration will be a competitive challenge for a new coffee company given the popularity of coffee itself. What is the selling potential of Organo Gold Coffee? What is competitive about their product? The cost of the product? The Ganoderma?

In the case of this multilevel marketing company, how many independent distributors are in a given area? How much OG product is being sold, vs. the OG ‘Opportunity’ being sold?

What’s REALLY unique about Organo Gold’s products?

When visiting the website (www.organogold.com) a visitor will see phrases that will make them feel good about the coffee. One of the phrases is “The World’s Only Source of 100% Certified Organic Ganoderma”.

An alternate name for Ganoderma is Reishi. You can Google the herb “Organic Ganoderma” and find that there are other companies that sell Ganoderma and are certified Organic (you have to search hard because most of the ads that you will see are Organo Gold’s top and bottom distributors).

And let me jump to pricing right quick since I’m on the topic of Google Ads. For 1. Google would not let me advertise Organo Gold’s Ganoderma Lucidum using the word “capsule” or “pills” without providing a medical license. 2. The cost of OG’s Ganoderma -90 capsules is $59.00 (see here). I clicked on a fellow ad for AlohaMedicinal’s Ganoderma Capsules-90 count for $14.00 (see here). I also clicked on a fellow ad for Gano Brand’s Coffee- 30 sachet box of black coffee for $10.95 (see here). On Organo Gold’s website it’s 23.00 for 30 sachets (see here).

Because Organo Gold is the talk of the town (it HAS to be in order to survive), it is illusory that it’s the only business offering its particular products.

I’m still a little bit confused about Organo Gold’s Coffee not being FDA approved. I know that the FDA does not regulate herbs or herbal supplements. Therefore Organo Gold beverages and “capsules” are not subject to the FDA, and it is illegal for any health claims to be made. Of course marketers play around this, promoting claims from buyers of the product…

Organo Gold Opportunity DEBUNKED Pt 2: “Pyramid Thingy” Up Next…

Organo Gold DEBUNKED Pt 2: “Pyramid Thingy”

Note: There are seven ways to get paid in Organo Gold, but I am only mentioning the first three, because the next 4 levels are for those who have built large downlines  and accumulated residual commissions.

1.      Retail (self-explanatory)

2.      Fast Start Bonus (A bonus is paid to a distributor each time they sign up a new qualified distributor).

3.      Dual Team Commissions (explanation below, directly from www.organogold.com.

“Team Commissions are another cornerstone of the Organo Gold Compensation Plan. As a new distributor, your focus will be on developing a base of retail and preferred customers. You will also focus on helping your downline generate volume through sales.

The Team Bonus aspect of the plan is calculated through your placement tree, which has two teams, a right and a left. You will be compensated based on successfully building sales volume within your placement tree. Your sponsor (or anyone else in your placement tree) may place new reps in your placement tree […]”

Example of a “placement tree”:

It’s very heavily populated at the bottom so it looks like the people are on top of each other. But it bears a common geometrical figure:

Let’s compare and contrast these two photos. The biggest similarity that I see is the shape. They both contain a triangular shape and/or a geometrical pyramid. What is the difference between the content in these two photos? Well, one consists of people forming the shape, and the other one consists of lines forming the shape. The shape that it is forming is a pyramid, as known as the “placement tree” by Organo Gold. When you sign up as a distributor, you will be at the bottom of your company’s pyramid. You will start with your dual team (right & left), placing two individuals under you, This forms your pyramid (“placement tree”).

“Pyramid Thingy”

“When a lot of people see this opportunity they wonder, ‘is this one of those pyramid thingy’s?’”- A team leader mentioned this while presenting the “opportunity” at one of the CJM’s hosted by my aunt. He was on page 17 (below) of the presentation.

After presenting the question, he answered himself with a rebuttal: “Corporate America is the biggest pyramid out there!” For comparison purposes I merged the black and white pyramid photo and the Dual Team photo from page 17 above:

Now, let’s look at Corporate America’s pyramid:

We established that Organo Gold is a pyramid, and that Corporate America is a pyramid. What makes Organo Gold a better option?

“Organo Gold Opportunity DEBUNKED Pt 3: “An Infinite or Finite Business Model?”…Coming Soon

Organo Gold Scam… Say BYE BYE!

The first individual that introduced me to the opportunity was my Aunt, who is a Coffee Connoisseur (as she assumes. A coffee connoisseur would be an individual who is knowledgeable about coffee in itself, not someone who just drinks 4 and 5 cups a day, but I digress…). She had her first Coffee Jazz Mixer. A distributor is recommended to have at least one Coffee Jazz Mixer a week. A Coffee Jazz Mixer (CJM) is a social gathering where the distributor invites family and friends, etc, to drink coffee and eat refreshments while being presented the Organo Gold Opportunity.

The team leader and other fellow members of my Aunt’s team came and supported. Once the opportunity was presented more in depth, including the health benefit of the coffee & the ‘amazing’ compensation plan, I was confident that I could work this opportunity and I joined. It gets fun after this (haha!)

I signed up as a “Dual Team Qualified” member, meaning that I can create a downline and make commissions off of their sales, as well as make a bonus for signing up more Dual Team Qualified members.

I just couldn’t resist with all of the hype and momentum.

One of the things that I started noticing from the minute I joined was the small bits and pieces of discrepancy that I kept hearing and seeing. Let me jump right into it.

At the CJM, the team leader mentioned that Atlanta had over 6,000 distributors (BTW less than a year before I joined it was 650, AND a month after I joined 1,200 more members signed up.) This wasn’t mentioned during the presentation but afterwards when a distributor asked they gave the number. This was the first warning of “bad idea” that I had gotten: Market Saturation. My aunt and I ran into great opportunities to market the brand and products, but we were right next to other distributors…(no profit there aye?)

Knowing this, I entered into the wonderful field of internet marketing. I started with Pay Per Click Advertising. It was fun, because it was competitive and I got most of my ads to appear at the top of search results for a low price. One thing that ticked me off; there were other producers (top producers and bottom producers) showing up right there with me, and people had to pick and choose which one of us they were going to click on. Hmmm I wonder why team leaders do not recommend distributors to market through internet, but to start instead by drawing up a list of people they know and make phone calls??

  • REALITY: Distributors are in competition with EACH OTHER! For example, my aunt chooses her first two individuals to work under her. Yet BOTH are family members. Well they are already divided as a family, because while they are on her team and she makes off of their commissions, the two members do not make off of each other, and are indeed in competition to make their millions.

One of the things that I found when marketing on Google is that there are other companies, that are not multilevel marketing companies (like Organo Gold is), who are selling the EXACT same products, cheaper than what OG distributors are paying wholesale. I don’t know about any other money making guru, but my life of luxury consists of helping people save money. There are many people who can benefit from the effects of Ganoderma (especially in Coffee) but I would refer those individuals to a coffee that is much lower in cost.

Also, I’ve heard the Organo Gold Compensation Plan dozens of times, and not one leader mentioned that distributors only get paid commissions off of the lesser performing leg. Plus, the auto-ship requirement for commissions is not mentioned in the presentation either. When my mother asked (just like when one lady asked if the product was FDA approved) in the middle of the presentation, the team leader said “I will get there in just a second”. It’s not FDA approved and there is a monthly minimum requirement. I found that to be interesting.

But anyway, as I am being approached by previous OG customers who were interested in buying more OG Coffee, I refer them to where it is more affordable.

*Phew* There is MUCH rebuttal on the topic of Organo Gold. Yet I have a mind of my own.

Interesting Articles on MLM’s & Market Saturation: Check Out, http://themlmfile.com/marketsat.htm, and  http://www.mlm-thetruth.com/files/Ch3to6-Case4andAgainstMLM-3-25-11.pdf