The “Welcome from YaGooft Owner” page on the Yagooft website displays little else than a cheesy 45 second marketing video featuring what appears to be a company theme song:
The rest of the Yagooft website contains no information indicating who runs or owns the business.
The Yagooft domain (‘yagooft.com’) was registered on the 18th February 2012, however the domain registration is set to private.
I did note that the YouTube videos that feature on the Yagooft website were uploaded to the account “wagoti wagoti”, but I was unable to find any further information on this name, or whether the name was connected to whoever is behind Yagooft.
As always, if a MLM company is not openly upfront about who is running or owns it, think long and hard about joining and/or handing over any money.
The Yagooft Product Line
Yagooft refer to their service as a “Global Advertising System”. Without the marketing spiel, essentially it’s an affiliate driven coupon network. This in itself is nothing new but through their inhouse (but not as yet released) translation software “Turbo Talk”, Yagooft claim that members all over the world will be able to communicate with eachother in realtime.
On the merchant side of things, the Yagooft Global Advertising System runs like any other voucher network, in that merchants sign up for free and are then able to market vouchers to the Yagooft memberbase.
Revenue wise Yagooft don’t charge merchants but rather charge customers (their members) when coupons are actually used to purchase a product or service from a merchant.
Despite stating that ‘merchants are never charged a penny by Yagooft’ in their compensation plan material, the company does charge merchants to advertise, stating advertising costs of 25% (of the value of the voucher), capped at $10 per “priced voucher”.
This revenue comes out of the money Yagooft affiliates pay Yagooft when purchasing a voucher, which would otherwise go to the merchant.
Turbo Talk also serves as a secondary product for Yagooft, and is bundled with affiliate membership to the company ($199).
Turbo Talk is essentially a translation software package that has been integrated into the Yagooft opportunity.
The Yagooft Compensation Plan
Yagooft reward affiliates for introducing new advertising merchants to their Global Advertising System and recruiting new affiliates into the company.
Yagooft affiliates who refer merchant partners to the Yagooft coupon network are paid a 40% commission on the “upfront voucher fee” paid by Yagooft members to Yagooft when they purchase a voucher.
Using a unilevel commissions structure, Yagooft pay out residual commissions on merchant commissions down 20 levels.
A unilevel commissions structure places an affiliate at the top with every personally recruited affiliates placed directly under them (level 1). If any level 1 affiliates recruit new members, they are then placed on the original affiliates level 2, and so on and so forth.
Using this commission structure, Yagooft pay out 1% of the earnings on each level of an affiliates unilevel organisation. Note that this is 1% of the merchant commissions earnt by affiliates in the unilevel structure, not recruitment fees.
Yagooft pays affiliates for expanding their business ‘by building a team of advertising affiliates, who will (then) do the exact same thing you did‘.
To pay out their recruitment commissions, Yagooft use a binary compensation structure. A binary structure places an affiliate at the top of the structure, with two legs directly underneath them. These two legs form an affiliate’s left and right teams.
In turn, these two legs have two legs underneath and so on and so forth down theoretically infinite levels.
In order to qualify for recruitment commissions, a Yagooft member must recruit at least two new paid affiliates, both of which are placed directly under them and form the start of the affiliate’s left and right teams.
Once qualified, an affiliate is then paid a commission each time new members are recruited, using a ratio of 1:2. A 1:2 ratio means that 2 sales from one team are counted against 1 sale from the other team, with each new sale only being able to be counted once for commissions purposes.
Eg. On day 1 your left team makes 3 sales and your right team 1. This qualifies you for one commission, with 1 sale remaining on your left team. If the next day your right team made 2 sales and your left team none, you’d again qualify for another commission and be left with 0 sales outstanding on either side.
Each time a 2:1 ratio of sales is counted for commissions purposes, Yagooft pay out affiliates $25.
For every seven of these 2:1 ratio groups counted (21 new members recruited in total), Yagooft also pay out affiliates a $50 bonus. Recruitment commissions in Yagooft are globally capped at $25,000 a week per affiliate.
Finally, affiliates who earn $10,000 in any one week are also given the chance to “recruit themselves” and place a new membership position within their existing binary structure (at the top of their left or right teams).
This in effect means that going forward, they “double dip” on overlap between the two binary structures.
Membership to Yagooft, however those wishing to participate in the compensation plan and business opportunity must pay $199 a year plus a $25 admin fee.
The concept of a voucher network and MLM is nothing new and entering an already saturated niche (non-MLM and MLM companies in daily deals compete for the same merchants), most MLM daily deal opportunities struggle to gain any real traction.
Thus far I’ve yet to see one take off with most either failing in their first year or doing little else other than scrape through.
Looking to differentiate themselves, Yagooft are adding the Turbo Talk translation software into the mix. From a daily deal voucher perspective, I’m not really sure what the aim is here.
Practically I can see that it would allow affiliates and merchants who speak different languages to connect, but I can’t help but ask why they’d be connecting (for the purposes of marketing Yagooft) in the first place.
Part of Turbo Talk sounds like a social network, allowing existing merchants and affiliates of Yagooft to interact in their own native language with one another but that is self-contained. Useful maybe but not really what I’d call a marketing addition to the daily deal site itself, which is where the revenue is being generated.
In any case, rather than deal with someone through translation software, I’m sure it makes far more sense for merchants to deal with a local affiliate. Local affiliates are in a much better position to communicate with (no matter how good Turbo Talk is) and would ideally possess a much greater awareness of the local market and target demographic (remember, it is after all advertising that affiliates are selling).
That said, as far as the daily deals go I don’t see a problem with Yagooft’s voucher network business model. They’re using a standard reverse coupon model meaning they charge customers rather than merchants per voucher purchased by affiliates.
When combined with the recruitment commissions offered however, several red flags emerge.
First and foremost, the cash commissions offered through the binary coupled with the $224 affiliate membership fee pretty much reduce Yagooft to a pyramid scheme.
You join the company, sign up people and then earn commissions on your own recruitment effort and those of your downline.
No doubt some would argue that affiliates are paying for a license for Turbo Talk (indeed Yagooft themselves push this), however nothing separates affiliates from voucher network customers other than handing over $224.
Either members are paying for affiliate membership with which access to Turbo Talk is thrown in, or they’re being forced to purchase a product I imagine most wouldn’t purchase just to participate in the Yagooft income opportunity.
Both of these options are red flags in themselves.
And on the topic of “Turbo Talk enterprise licenses”, for an additional $199 I’m not even sure what affiliates are paying for over the standard integration of Turbo Talk into Yagooft’s voucher network and social media components.
The company states merchants will be able to market their vouchers in other languages so I’m not really sure what affiliates are paying an extra $224 for (other than paid affiliate membership to participate in the income opportunity).
As an affiliate, either I can blindly contact merchants that don’t speak my language using Google Translate, or I can pay Yagooft $224 to do the same only with Turbo Talk.
In that sense Turbo Talk as a marketing incentive for a coupon deal network doesn’t really seem to make sense to me.
Getting back to the legitimacy of Turbo Talk as an actual product within the Yagooft compensation plan however, I suppose primarily it depends on whether or not Yagooft offer TurboTalk at a retail level to non-affiliates.
I couldn’t see anything indicating this was to be the case (commissions on the retail sale of Turbo Talk to customers was absense from the Yagooft compensation plan material). If this is the case then truly the argument that members are buying a Turbo Talk license is a hard one to make.
If the licenses aren’t available at a retail level then affiliates are infact buying into the income opportunity which with attached comes the Turbo Talk software license. Otherwise nothing would separate affiliates from merchant customers.
This in turn means if we ignore the optional merchant side of things Yagooft are indeed operating as a bog standard pyramid scheme.
If the argument that Turbo Talk is infact a product purchase, the fact that it isn’t offered at a retail level becomes a red flag and so too does the requirement to purchase it in order to participate in the Yagooft income opportunity.
Either way you cut it, there are several pressing issues that need to be addressed within the Yagooft opportunity membership wise before the viability of the coupon deal network even comes into play.
A bit of a shame really seeing as the coupon network should be what makes or breaks a coupon directory MLM company, rather than how they choose to structure the affiliate membership side of things.