cash-texts-logoOne of the newer niches to emerge in the MLM industry this year has been the combining of SMS advertisements with MLM compensation plans.

Definitely still a fledgling niche, to date two major players have emerged in the niche: Text Cash Network and Cash Texts.

I’ve already reviewed Text Cash Network back in early November and found it to be a risky venture in that they were paying out monthly commissions for recruitment ($1.50 a member), based on the presumption they’d be able to cover costs by attracting advertisers.

With no other income streams, Text Cash Network are employing a pretty risky business model to say the least.

Today we’re going to take a look at and review the other major player in the SMS MLM niche, Cash Texts. Read on for a full review of the Cash Texts MLM opportunity.

The Company

Cash Texts launched on November 25th 2011 and is headed up by CEO John Benham.

Cash Texts claims Benham has ‘over 26 years of experience in the marketing, direct sales, and networking industries‘, including stints at Primerica, World Marketing Alliance, World Financial Group, World Leadership Group ‘and many others‘.

Whilst Benham is CEO of Cash Texts however, he doesn’t appear to actually own the company;

Who owns and operates CashTexts.com?

A small group of marketing experts collaborated on this project. For the time being they wish to remain anonymous to members.

However, advertisers will have direct access to them.

No reason is given as to why the owners of Cash Text wish to remain anonymous other than ‘because they want to’.

Why Cash Texts’ owners are making themselves known to advertisers but not members remains a mystery, but by doing so the owners only invite suspicion on themselves and the Cash Texts opportunity at large.

As far as I’m concerned, in the world of MLM this is just not good enough. As always, be extremely cautious of signing up to any MLM company that does not clearly reveal who owns the business (even free to join ones).

Update 23rd December, 2011 – Troy Dooly over at MLM HelpDesk has advised that the primary owner of Cash Texts is Atticus Killough.

Killough is listed on the ‘about us’ page of Cash Texts as CTO (Chief Technology Officer?) of Cash Texts, but the company refrains from clarifying that he is the primary owner of the business.

Why Cash Texts have choosen to do this remains unclear. /end update

The Product

Cash Text Network don’t have any tangible products to retail themselves, but being an advertising network members are able to sell access to the Cash Texts advertising network to potential advertisers.

Note that this advertising network is currently only open to US based advertisers.

Cash Text Network also do not reveal the cost of advertising on their network, or what options are available to potential advertisers.

The Cash Texts Compensation Plan

Cash Texts pays out a commission each time a member receives an advertising SMS from the company, what is effectively a recruitment commission as well as commission based on advertiser spend.

SMS Commissions

For each advertising SMS a Cash Text member receives from the company, Cash Text will pay out a 5 cents commission to the receiving member.

Recruitment Commissions

Whereas a standard recruitment commission is usually paid out monthly at a flat rate, Cash Texts’ recruitment commission is tied into how many SMSs those in your downline receive.

Cash Texts use a unilevel structure which means that every person you bring into the company is placed directly under you (forming your first level). If people you’ve recruited recruit new members, they form your second level and so on and so forth.

Everytime one of these members receives a text via the Cash Texts SMS advertising network, you receive a commission. Cash Texts pay out their recruitment commission down 5 levels, with payments being as follows;

  • Level 1 – 5 cents
  • Level 2 – 4 cents
  • Level 3 – 3 cents
  • Level 4 – 2 cents
  • Level 5 – 1 cent

Although the mechanics are slightly different in that the commission is tied to SMSs received, I believe this is still a recruitment commission as without the recruitment of others – you don’t get paid.

I’ll go over this particular commission more in the conclusion as even though this is a recruitment commission, due to the mechanics of the greater Cash Text business model it’s not necessarily a legal negative.

Advertising Network Commissions

If Cash Text members attract advertisers to the network, Cash Text promise to ‘give (members) a percentage of what they spend with us for LIFE’.

Cash Texts do not disclose what this percentage is or detail any further conditions that may or may not apply.

Joining Cash Texts

Cash Texts is free to join.

Conclusion

How do I know this is not a scam?

You are not paying anything…scams want your money.

The above is the rather simplistic answer Cash Texts provide their members with to address their concerns that Cash Texts might be a scam.

Whilst I agree that it doesn’t appear to be an outright scam – there are some serious problems with their business model that need addressing.

I think the best way to discuss this is to split the business opportunity currently available to US based members and international members.

Cash Texts as a US based business model

US based members of Cash Text can join the company for free, market the advertising network and earn commissions off advertisers who join, SMSs they receive themselves and from members they sign up (when they receive an advertising SMS).

Due to the mechanics of their recruitment commission and the fact that membership is free, I’m curious as to how this plays out legally.

The traditional problem with recruitment commissions traditionally is that they are funded by membership fees, which in the case of Cash Texts, don’t exist.

That said without recruiting, you have no members in your downline (unilevels don’t have spillover so you have to recruit yourself) to receive texts and thus cannot earn any commissions.

I suppose technically given that you can join and receive 5 cent commissions yourself and attract advertisers to the network without recruiting, the recruitment commissions of Cash Texts might be justifiable (again, only because there’s no membership fee).

That said, as far as advertisers go, currently Cash Texts are (at the time of publication) not offering a personalised advertising profile to potential advertisers which puts them miles behind the competition (other advertising networks).

Currently Cash Texts are advertising member profiles as ‘coming soon’. Why Cash Texts launched without this is beyond me, as it seems to be a fundamental feature needed to attract advertisers to the network.

Advertising networks these days are highly targeted, and sending mass SMSs to Cash Texts members nationwide just isn’t going to be competitive (no matter the cost), when compared to other advertising options available to advertisers.

Cash Texts as an international business model

International members are able to join Cash Texts but they do not receive texts and cannot earn commissions themselves for receiving texts.

Realistically, not being based in the US they aren’t going to attract any advertisers to the Cash Texts advertising network either – despite this option being available to them.

That leaves the recruitment commissions, which essentially strips down the international business model of Cash Texts into a ‘recruit US based members and make money’ scam.

Even without a membership fee, with this being the only option currently available to international members – as a business model the commission payouts for international members solely boil down to how many US based members one can recruit.

Unless there is a means for international members to earn a commission other than by the recruitment of others (directly or indirectly) – Cash Texts membership should not be open internationally.

Given that the owners seem quite happy for this to be, this casts a negative light on the rest of the business and perhaps the true motivations and legal ethics of the anonymous owners of the business.

Why they’d invite that on themselves I’m at a loss to say.

 

Admittedly the SMS niche within the MLM industry is still new but to date the two companies I’ve reviewed in this niche both have glaring problems with their business models.

Problems that not only severely cast doubt  on the long-term sustainability of the businesses themselves, but also over the fundamental legality of the compensation plans in question.

As an international member I see no point to joining Cash Texts and as a US based member, the lack of personal profiles will make it difficult to attract advertisers which ultimately means a reliance on recruitment commissions (I don’t care what anyone says, relying on getting paid 5 cents a text you receive yourself is not a viable MLM business by itself).

Combine all of this with the fact that the owners of Cash Text refuse to identify themselves, in my mind you’re left with a pretty big question mark over the Cash Text MLM opportunity.