Leaf International Review: Advertising ROIs
There is no information on the Leaf International website indicating who owns or runs the business.
The company’s (prelaunch?) domain (“preleaf.com”) was registered on the 7th September 2012 and names a “Magnar Kongestol” with an address provided in Norway.
On Leaf International’s “Get Satisfaction” support page, Kongestol is listed as an employee of the company,
however his exact position within Leaf International is not provided.
MLM history wise, the only information I was able to find on Kongestol was that he was “Chairman of the Board” for the company “Goodle Adz”:
Goodle Adz launched in mid 2010 and under the guise of affiliate’s purchasing advertising, paid out ROIs from the money invested by other affiliates. The company also paid recruitment commissions upon the acquisition of new affiliates who invested.
When they launched in 2010, Goodle Adz claimed to be
only one concept, (although being the core one) in a big puzzle counting a total of approx 10 media and advertising concepts, which in the next 12 – 18 months will form a complete picture, unlike anything else you have seen online or offline!
Once the new investments dried up a few months after launch however, Goodle Adz collapsed.
Read on for a full review of the Leaf International MLM business opportunity.
The Leaf International Product Line
Leaf International claim to have two primary products, advertising and a “website builder”.
Leaf International’s advertising is sold through the “Leaf Advertising Network” and consists of text and banner ads and featuring a website in their “Website Optimizer” and “Leaf Search”.
The Website Optimizer ‘rotates the websites from Associates, Affiliates and Customers through a viewing platform called a website Rotator‘, with Leaf International associates being ‘required to view 20 sites a day in this system in order to qualify for the Daily Rebate payout‘.
Leaf Search is
an internal search engine that offers an additional traffic source for websites in Leaf.
No further information was provided on Leaf’s “website builder” but going by the name it appears to be some sort of website design tool.
The Leaf International compensation plan prices the website builder at between $68 (premium) to $138 (e-commerce) a month. Advertising is charged at a minimum of $50, capped at $10,000 a day.
The Leaf International Compensation Plan
The Leaf International compensation plan revolves around the sale of advertising and a website builder, along with monthly fees to participate in an affiliate funded matrix commission pool.
Leaf International Membership Ranks
There are four membership ranks within the Leaf International compensation plan and, along with their qualification requirements, they are as follows:
- Starter – pay Leaf International $48
- Manager – a minimum of five personally recruited affiliates whom each have recruited 2 new affiliates themselves, a total of at least 15 affiliates in your downline, $20,000 sales volume from each recruitment leg and a total $100,000 in sales generated by your downline
- Executive - a minimum of ten personally recruited affiliates whom each have recruited 2 new affiliates themselves, a total of at least 30 affiliates in your downline, $50,000 sales volume from each recruitment leg and a total $500,000 in sales generated by your downline
- Senior Executive - a minimum of fifteen personally recruited affiliates whom each have recruited 2 new affiliates themselves, a total of at least 45 affiliates in your downline, $100,000 sales volume from each recruitment leg and a total $1,500,000 in sales generated by your downline
Note that for each new affiliate recruited, a “recruitment leg” is created under the recruiting affiliate. Also note that Leaf International do not specify whether or not the sales volume qualifications are monthly or annual requirements.
Retail commissions in Leaf International involve the selling of either the website builder or advertising to retail customers.
Commissions are paid out at a rate of 25% for sales of the website builder and 10% on advertising.
Referral commissions are also offered on retail sales made by an affiliate’s downline, paid out on two levels of recruitment (affiliates you recruit (level 2) and those they recruit (level 3)).
Referral retail commissions are paid out as follows:
- Level 2 – website builder sales 10%, advertising 5%
- Level 3 – website builder sales 5%, advertising commissions paid out as follows (Starter – no commission, Manager – 2%, Executive – 3.5%, Senior Executive – 5%)
A commission incentive is offered to affiliates who make an effort to sell the website builder to retail customers, raising the base commission offered to up to 150%:
- if 5% of an affiliate’s total generated website builder sales are to retail customers, the commission payout is increased to 17% on level 1, 7% on level 2 and 3% on level 3
- if 10% of an affiliate’s total generated website builder sales are to retail customers, the commission payout is increased to 25% on level 1, 10% on level 2 and 5% on level 3
Daily Rebate Commissions
As per the Leaf International compensation plan,
For each dollar of Advertising purchased an Associate is rewarded one Ad Credit. Associates are paid daily based on their total amount of Active Ad Credits.
The Daily Rebate percentage is calculated from the total amount of Advertising sales by Leaf for each particular day. The Rebate can be anywhere from 0% to 4%.
Aside from having advertising credits, affiliate’s must qualify to earn via the Daily Rebate by
- surfing at least 20 sites a day through the “website optimizer”
- rating all sites visited (at least three must be given “advanced feedback”)
- spamming the internet with at least one recruitment ad a day, placed ‘via an approved Leaf source‘
If the above conditions are met, Leaf International affiliates earn a daily percentage of the Daily Rebate, subject to the amount of advertising credits they have (one advertising credit = $1) and their membership rank:
- Starter – 1.5%
- Manager – 2.2%
- Executive – 3%
- Senior Executive – 4%
Advertising credits pay out a daily ROI for 90 days, with Leaf International recommending to its affiliates
that at least 20% of commissions be used to repurchase more Advertising in order to most effectively maximize the Daily Rebate payment and continue to grow the total Active Ad Credit volume.
Note that the Daily Rebate is paid out virtually. If affiliates wish to actually cash out their earnings they must make a request to do so, and are only able to qualify if they have personally recruited at least one affiliate.
For each affiliate recruited into Leaf International, they are placed in the recruiting affiliate’s 3×9 matrix.
A 3×9 matrix places an affiliate at the top of the matrix with three legs directly under them (level 1). In turn, these three legs branch out into another three legs and so on and so forth down 9 levels:
Each of these legs is a recruited affiliate position (total positions = 29,526) with positions able to be filled either via direct recruitment, or the recruiting efforts of an affiliate’s up and downlines.
In order to qualify for matrix commissions, a Leaf International affiliate must ‘have three associates of any level directly recruited by them‘ (recruit 3 new members) and pay a monthly fee between $38 to $148
There are four price points between this range, each offering an increase in paid traffic, the amount of websites able to be placed into the “website optimizer” and provided capture pages.
Commissions are paid out as a percentage of each affiliate’s monthly fee, with how much of a percentage of the fees paid dependant on what level an affiliate is placed in the matrix:
- Levels 1 and 2 – 4%
- Level 3 – 5%
- Levels 4 and 5 – 6%
- Level 6 – 4%
- Levels 7 and 8 – 5%
- Level 9 – 6%
Joining Leaf International
Membership to Leaf International is $48 annually.
If an affiliate wishes to earn matrix commissions, they must pay an additional $38 – $148 a month.
Building on the traditional Ponzi scheme “buy advertising and earn a ROI” model, Leaf International introduces a retail offering to the recipe, throws in some online marketing tools and pairs it with a 3×9 pyramid scheme.
First we’ll take a look at the advertising. Displayed on the Leaf Advertising Network, which appears to be superimposed on top of their rotator, the “website optimizer”.
As far as advertising revenue goes, nobody is viewing these ads other than Leaf International members, who in turn are only doing so to qualify for their Daily Rebate. With little organic or targeted exposure, the notion of attracting retail advertisers seems slim to none.
Leaf claims to offer advertising positions on its “Leaf Search” search engine, but who is going to be using that given it only indexes sites uploaded into their rotator?
Retail Product sales (the website builder) also appear to be nothing more than a token offering, with the company rewarding affiliates who achieve just 5 or 10% retail sales (meaning a whopping 90-95% of their business comes from Leaf International affiliates). This is a good an indication as any as to the level of retail activity Leaf International are expecting.
Despite this however, the company still attempts to place an emphasis on retail sales:
The importance of retail sales cannot be overstated. The focus of Leaf is not just a work from home opportunity, but to provide powerful tools that can help any business improve their marketing and sales.
In order to maintain proper growth for the company it is very important to market Leaf products directly to customers and not just to those looking to start a work from home business.”
Paying homage to the “wink wink, nudge nudge” compliance that has plagued the MLM industry these last few years in particular, I fail to see how an expected 5 to 10% retail sales within a business could be construed as “important”.
With the advertising side of Leaf International offering less value than the website builder (which itself is a stretch priced at $68-$138 a month (who exactly is this “product” targeting?), I’d say the 90-95% affiliate money figures will be even less in the advertising side of things.
With each dollar spent on Leaf International advertising equating to an advertising credit, members are paid a virtual money ROI based on the total amount of advertising sales generated that day.
Considering the complete lack of value offered to retail advertisers, this ROI is obviously going to be largely paid out of affiliate money.
In offering a daily payout as such, the Daily Rebate can be boiled down to affiliates earning a daily ROI, based on how much they themselves have invested in advertising credits and convinced others to invest.
The true value and incentive for affiliates to purchase advertising lies with the 90 day ROI paid out (with the expectation it will pay out more money than they’ve themselves invested), not the advertising itself. This value and incentive of course doesn’t exist for retail customers, thus we’re looking at an affiliate-funded Ponzi scheme.
Note that this perfectly explains the $10,000 daily investment cap in advertising, which makes no sense otherwise (as a retail revenue source, why would you limit advertising purchases at all?).
In an attempt to balance their Ponzi scheme payouts, Leaf International cap their affiliates from investing (and re-investing $10,000 daily). They also restrict affiliate’s cashouts by restricting them from withdrawing ‘more money than the revenue they have created‘.
Leaf International define “revenue” as
purchases made by their customers, Affiliates or Associates they have directly sold to, but does not include an Associates own purchases.
So whilst affiliates are given advertising credits for their own investments, ultimately they are restricted from actually cashing out beyond the investment money they have brough into the business, via recruitment (as per the complete lack of advertising value, let’s not pretend there’s going to be a retail side to this).
This recruitment of investors is only further emphasised by the daily spam requirement affiliates must adhere to if they wish to earn their daily virtual ROI. This requirement exists solely to attract new investors into the scheme.
Such balances might balance the withdrawals out (offering virtual ROIs to everyone except those who succeed in encouraging others to invest), but effectively it’s still a Ponzi scheme and suffers from the fundamental problem that unless new investments are coming in, there’s nothing to pay out.
The matrix commissions only add to the red flags, with the entire commissions structure being a “pay to play” pyramid scheme. Paying out 100% affiliate money, affiliates pay a monthly fee and in turn earn a percentage of their downline’s paid monthly fees.
Whatever is attached to the fees is of course irrelevant, because it is only the paying of the fees that generates commission revenue. No recruited affiliates paying fees = no monthly matrix commissions.
Looking at “Goodle Adz”, it’s clear to see where the inspiration for Leaf International comes from and despite attempting to present a more legitimate offer this time around, Kongestol still ultimately winds up offering a business that primarily pays out a daily ROI from newly invested affiliate money.
Whack on a pyramid scheme to boot in the form of a monthly fee-based matrix, some mumbo-jumbo about charities, and that’s pretty much all there is to the Leaf International business opportunity.