MLM – Australian X-Up Plan – MLM Software in South Africa
What's All the Fuss About, 1UP, 2UP, Compensation Plans?
The Australian 1up and 2up compensation plans have been popping up on a consistent basis over the last several years in the home-based-business industry. When you put both of these comp plans on paper mathematically they are very impressive. Even though they are mainly used in direct sale type products, and in the gifting industry.
Essentially when you join a company or opportunity there is the startup cost which for the most part in these programs is $500-$5,000. once you are in your first and second recruit in a 2up, and your 1st recruit in a 1up is given to your sponsor, inviter, as compensation for mentoring and training. Once these qualifications are met you breakaway from your sponsor, inviter, and start your own paylines. Now you become the benefactor of the pass-up sales. Which in theory goes down to infinity because once you get pass-up sales your new recruits start the cycle all over again. So in theory you keep replenishing your organization with new blood.
To take maximum advantage of this type of pay structure you should have a base of at least 10-20 people that you personally invited into the business that are part of your organization. Then you should help those people help you by passing up their qualifying sales. So in essence you max out the comp plan and have 10-20 new recruits to work with. And that cycle just keeps repeating itself.
The problem lies in the MLM mentality of going wide, with no support to the existing people that are already in your payline. If you are doing this you end up just being another super recruiter, and your only as good as your next sign up. Once you stop recruiting your income will stop. Depth is where the real money is.
If you make a conscious effort to work with the existing paylines you already have, you do (3) THINGS. You build a residual income to infinity with no level cutoffs. You leverage your advertising dollars because your people spend their money so they can get qualified. And you always have new people to work with without having to recruit all the time.
So by working with your people, you are working for yourself but with all the perks and benefits. To simplify: All the money from the qualifiers goes directly in your pocket doesn't it? Hello!!!!!! It most certainly does.
Take a tip from the "Direct Mail" industry. Does it cost you the advertiser more to get a new customer or is it more cost effective to work with someone already in your payline, and upgrade an existing customer. I think you know the answer to that.
Bottom line is "it is not the pay plans" that are the problem it is the people working them. That is why the 20/80 rule rears it's ugly head again. Only 20% of the people you enroll will pass you up sales if you don't make the effort to help qualify them. If you do that you have fulfilled your obligation, and it become a win-win isn't that what we are all after?
Australian 2-up MLM Compensation Plan? You May As Well Get a Lobotomy!
The numbers have been proven over the decades. Part-time network marketers, without a system, will sponsor 2.7 people into any business. That's why it's so incredible that there are dozens of MLMs where you give away your first 2 sponsored people.
It's called an Australian 2-up. You give up your first 2 sponsored people to your upline. You don't get any commission from them, ever. It all goes to your upline.
An Australian 2-up is always, always, always associated with a one-time sale. So there are no residuals. The income usually flows entirely from selling the one product to new people. There may be other products, but one single product accounts for 99% of the business volume. The Aussie 2-up compensation plan is usually associated with a $1,000, $2,000, $5,000, $10,000, $25,000 package.
An Australian 2-up Product Package Is Always Information
It's never the type of product you'd expect in a traditional MLM.
Some network marketing companies sell a benefits package, a discount dental program, discount legal program, etc. The big problem with such products is that traditionally, a high percentage of customers never uses the product, and they drop out quickly. So they never see the value. If your customers don't experience the product, you won't have a very high retention rate.
It's the same with an Aussie 2-up. That comp plan is always associated with a one-time sale. And if average people only ever sponsor 2.7 people ... and if the first 2 of those sales (and new reps) go to your sponsor ... then you understand why this compensation plan never works for the average part-time network marketer.
Who Does It Work For?
The Australian 2-up works fine for that "A" type personality, that hard-driving, closing, selling, "bodies laying in the street" sponsor monster ... THAT person is fantastic in an Australian 2-up, because they can build it.
But it's not for YOU. You will never be successful with it. The numbers don't lie.
So why do people get so excited about the Aussie 2-up?
They get sold on the idea that they'll get rich somehow off all the people who will will get passed up to them, AFTER they pass their 2 to their sponsor. They get sold on the hype. The reality is, they never get the first 2 to give them their 2.
Here's The Magic
Every compensation plan drives a certain behavior in the field. An Aussie 2-up is always about the front-end big ticket item. It is never a plan that creates residual income.
There's never a monthly autoship, no back-end product consumption. We talk about companies looking for the "purple cow," the remarkable product. You never find a product like that with an Aussie 2-up compensation plan.
This plan is strictly for the "A" type personality. And they do their darnedest to convince YOU that you can change, that you can become this hard-driving salesperson ... but I have 2 questions for you:
1. Do you really believe that your current personality isn't good enough?
2. Can you really picture yourself spending every day, the rest of your life, as that pushy, aggressive, churn & burn salesperson, willing to say anything, do anything, all to get a sale?
The only way that'll work for you is to first get a lobotomy. Otherwise, you are absolutely not going to do it. You may think you can, but you can't, because it goes 100% against your nature. And after it doesn't work, you'll feel like a loser, because you can't do "whatever it takes" to be successful.
To be successful, don't put yourself in a situation where you are 100% certain to fail ... and that's where you are with an Aussie 2-up compensation plan.
Keep looking. There are good network marketing companies with comp plans that you can work successfully. The Aussie 2-up may not be one of them.
But you are advised to work hard to get more than 2 downliners then you also will be a sponsor, from that stage, you will surely earn.