The LiveSmart 360 ‘Smartline’ – How does it work?
Update 30th May, 2010: Since writing this article LiveSmart 360 have updated their compensation plan. /end update
I’ve since taken another look at the Smartline System and attempted to dissect how much money LiveSmart members can expect to earn from the Smartline System.
From now until May 15th, you can join an exclusive, limited opportunity to profit from every person that joins our company after you, whether you referred them OR NOT!
That’s right. Earn money from product purchases of everyone who joins after you… FOREVER!
-LiveSmart 360 Pre-launch promotional video, 2010.
Without a doubt one of the most hyped aspects of LiveSmart 360 during pre-launch was the Smartline. Marketed as a truly passive income stream the idea is that you generate income based on the work of everyone who joins after you (hence the term ‘smartline‘).
Now obviously this was never intended to be a major income earner for LiveSmart 360 members. I mean if everyone just sat around waiting to generate the bulk of their income of the work of others, then nobody would be actually generating any income to share around.
With the prominence with which the Smartline system was marketed though, you’d be forgiven for thinking so. Today I’m going to take a look at the Smartline system and hopefully clear up how it actually works and exactly what kind of money you can expect to make from it.
The premise behind the Smartline system is simple, when someone joins LiveSmart 360 they are assigned a tracking position within the Smartline. People who join after you are assigned a tracking position below you and it is these people you eligible to receive a Smartline system monthly commission off of.
Business Volume (BV)
The Smartline system consists of 2% of the total monthly company business volume (BV). BV is a value put on the products when working out commissions and bonuses directly related to sales volume. It is used instead of the wholesale or retail price of LiveSmart 360’s products.
For example let’s say product A retails at $10 and has a BV of $1. You’re entitled to make 10% commission whenever one of your downlines sells product A. If one of your downlines then sells product A, you make 10c commission which is 10% of the BV value of $1, not the $10 retail sale.
I’m not entirely sure what the BV value in the dollar is for LiveSmart 360 at this stage as I haven’t been able to find a fixed number. Parts of the LiveSmart 360 compensation plan seem to assume it’s $1 for every 1 BV. Take for example the following;
On all volume after the first 100 BV (Personal/Retail/Customer) during a calendar month, we will pay a 50% Bonus on volume generated by each (Personal/Retail/Customer) order with 50% of the BV rolling into Dual-Team Commissions. This is inclusive of the retail profit.
For example, if you enroll a Preferred Customer with a product order containing 100 BV, you would earn a $50 Retail Bonus.
The above is taken from the Retail customer bonus section of the compensation plan and on a 100 BV order seems to place a $50 value on the retail customer bonus. This indicates that 50% of 100 BV has a dollar value of $50, or $1 = 1 BV.
Elsewhere in the compensation plan however it is mentioned;
The credits can be used on any product that carries a 70% BV ratio or higher.
This indicates that not all products have a BV of $1:1. I’m not entirely sure what the values are as the compensation plan is not clear in this regard. For the sake of this article I’ve gone with the first quote above from the compensation plan and will assume that $1 of product has a BV of 1.
The Smartline System Pools
The 2% of BV that goes directly into the Smartline System is broken up into three pools. The first pool is made up of 1% of the 2% BV and the second and third 0.5% respectively (1% Pool 1 + 0.5% Pool 2 + 0.5% Pool 3 = 2%).
Pool 1 (1% of company BV)
The Smartline System Pool 1 is made up of 1% of the 2% total company BV set aside and is open to both customers and LiveSmart 360 members who personally generate a minimum of 25 BV in one month.
Admittedly I’m not exactly sure how customers become part of this pool, the compensation plan does not make this clear at all. Presumably customers are not given tracking points as they don’t join the company (at least that’s how I read it).
Requiring members to join the company before purchasing would be illegal as it’s definitely pyramid scheme territory. Again, the compensation plan isn’t clear on this so unless someone else can clear it up below (please leave a comment) I’m just going to ignore customers and focus on LiveSmart members who join after you.
To date the number of people in the LiveSmart 360 Smartline System is about 160,000. Note that LiveSmart 360 have set a deadline of May 22nd, 2010 for people to either lock their spot in the Smartline or lose it so the 160,000 Smartline number will change this Saturday. For the sake of this article though I’m going to assume LiveSmart 360 convince everyone to lock their spot in the company.
Let’s be generous and say that LiveSmart 360 generates 50 million dollars in sales in its first month, this will equate to 50 million total BV. Out of this total BV, Pool 1 accumulates 1% or $500,000.
This $500,000 is then split via ratio. For example if you were the first person to join LiveSmart 360 you’d be entitled to the largest share of this $500,000 pool. Split evenly between 160,000 members this would be $3.12 each. Due to the ratio effect of only being paid proportionately to how many people joined after you in the Smartline though, this means the early joiners will get more then $3.12 and those that joined later progressively less.
I’ve sat here for the last 30 minutes trying to work out exactly how much the proportions are, say for the first member to join LiveSmart 360, the person at 50% and then 25% but the math is doing my head in. I keep getting stuck at calculating exactly how much of a percentage of the $500,000 each person gets from being eligible for commission on 159,999 LiveSmart members (first person t0o join) to being eligible on just one member (the last person to join).
Maths isn’t my super strong point but there must be a formula for this as it’s ratio based. Unfortunately though I’m not seeing it. If anyone works it out feel free to let me know and I’ll update the article.
Pool 2 and 3 (0.5% of company BV)
According to the LiveSmart 360 compensation plan, pools 2 and 3 are identical payout and qualification wise. Both pools are only open to LiveSmart 360 members and require a monthly contribution of 50BV for a member to be eligible for a payout.
At 50 million dollars in monthly company revenue, pools one and two come in at $250,000 each.
Again, trying to calculate the percentage paid out to each Smartline member retrospective to their position in the line is doing my head in maths wise, any help will be appreciated.
Meanwhile I’m not entirely sure what the point is for having 3 pools when 2 of them appear to be the same and have identical qualification rules.
As you can see the money side of the Smartline System is a lot more complicated then the premise of simply receiving a monthly share in revenue from those who join after you in the Smartline.
Either way even with the final maths missing and a generous estimate of monthly total company revenue of 50 million (I’ll add some more figures once the math is figured out), it’s easy to see that with large LiveSmart 360 member numbers the payout isn’t going to be that great for a lot of members.
Although nice as a novelty, the LiveSmart 360 Smartline System isn’t really going to compare to the income generated directly by your own sales and that of your personal team.
I guess it’s back to the drawing board for anyone who thought they were getting an easy ride on LiveSmart’s Smartline idea…
If anyone wants to see something funny, go to the livesmart360.com site and click on the “Products” link (in the top-ish nav).
“Let’s be generous and say that LiveSmart 360 generates 50 million dollars in sales in its first month”
I’ll note that they claim that May 15th was just the “soft launch”, while the “hard launch” happens in…
Wonder why they need 7 months of soft launch. Actually wtf is the difference between a soft launch and a hard launch?
Was there something broken with the products section? I clicked it and didn’t notice anything strange.
Had anyone tried to buy their products? I ordered 2 pieces of 360 mists knowing I could generate earnings or some BV. Now,checking out my commission and earnings on the system, the amount is 0.
I think the compensation plan is complex & complicated.
Yeah I’ll say. Trying to work out a formula for caluclating the Smartline commission has been bugging me all morning. One of those things that’ll continue to bug me till I work it out.
Originally I was calculating the payout based on a percentage share of the pool revenue paid out multiple times. I quickly realised this didn’t work as the payout would be in the billions (the first few thousand payouts of members high in the Smartline would bankrupt the company.
I know the mathematical theory is that member one gets the largest possible ratio and then the percentage of revenue is calculated down as you go down the Smartline. The amount of members then directly influences how many parts the revenue pool is broken up into.
LiveSmart 360 themselves have really done a shocking job in explaining the Smartline System concept. I’m no mathematical prodigy but I’ve been trying to work this out on and off for the better part of a day now. God help the LiveSmart committed members and any potential members trying to work it out.
A “soft launch” is kind of like a test run. It’s viewable by the public, usually, but it’s not officially ready. Kinda like the StarCraft 2 beta. There might be bugs, but nothing embarrassing.
A “hard launch” is the official release. Everything is ready to go and working.
While I obviously don’t know for sure, my guess is that you won’t be able to enter orders until the hard launch, but you can certainly pay $30 to “lock your spot” or any of the other membership payment plans to “start your business”.
As for the products section, are you sure that you did it on the livesmart360 site, and not the lockyourspot site?
If you do the former, you’re brought to the text “Product Category:” with the text “No items found.” below it.
My point is, their cart system, and the way you’re brought to it… well, it’s just not usual, y’know what I mean? 😉
Wikipedia had a better description:
So what happens if there’s no interest in the market place? Do they just do a runner come launch date?
From what I understand LiveSmart have locked down the downliens etc. until after Saturday which is the deadline to ‘lock your spot’. After Saturday it should work.
The promotional stuff said you’d be able to start earning straight after launch last Saturday. I thought they’d be shipping products as normal hence I wondered what was going to happen for the hard launch.
Ah I see it now. Didn’t really pay attention to it as the products are categorised.
Just wanted to say sometime in the last 24 hrs LiveSmart 360 have uploaded a new compensation plan document so I’m going over that. Seems to explain things a bit better.
There’s a Smartline System formula included so I’ll update this article soon with the missing pieces.
Hopefully changing the compensation plan isn’t something LiveSmart plan on doing frequently.
Nup I’m still not making sense of it. The new LiveSmart compensation plan contains the following formula:
If I’m reading that right, your share is directly proportionate to how many personal enrolments you have in the Smartline as well as your own personal sales volvume.
The other factor ‘Smartline points’ isn’t mentioned anywhere else in the compensation plan so I’ve got no idea what that is. It could be your tracking position but I fail to see how that’s relevant as a multiplier in calculating your revenue share.
Unless people are given dynamic tracking position numbers that change as the Smartline increases or decreases? I’d assume if the tracking position is a multiplier then those at the top of the Smartline will need to have bigger numbers then those at the bottom. Obviously these numbers can’t be fixed if the Smartline is changing it’s length all the time.
Still clear as spaghetti…
I’m aware that the article isn’t quite accurate as it stands but I’m not going to update it until LiveSmart 360 come out and properly explain this mess. I can see a few more compensation plan revisions on the way and updating each time will be a pain.
Additionally using terms nobody knows the meaning of and not properly explaining one of their most hyped commission structures is woeful.
Apparently they have a compensation plan call later this week, hopefully someone can explain to people how this system works and what the actual components are in calculating your Smartline commission.
Oz, I think they’re betting on people not knowing the difference between a “soft launch” and a “hard launch”, and they’re using it to get money now while not supplying anything until next January (although maybe they’ll come through with the cruise and restaurant coupons now, oh boy!).
I think you’re being incredibly fair and nice about them. I have a different opinion, as is pretty obvious. 😉
LiveSmart 360 is shipping real products to Members and customers the first week of June.
If I’m not mistaken, the 1st shipment will be on June/July 2010. Where did u guys get the idea the shipment is only after hard-launch started (Jan 2010)?
I believe, for this soft-launch until hard-launch in Jan 2011, we are in the process of developing the company. So we need to work together to put this thing through.
Im wondering what the plan is on starting the pay-outs on this smartline, is it not going to start until hard launch 2011? if this is the case many people are not going to be as motivated to do business as they are right now at this may soft launch, they should get some pay-outs going sometime this may or june.
3 Days and counting to get the full details of LiveSmart 360.
elvz… how do you know were getting full details in 3 days, the 26th?
see it now in your account, it was updated.
Ugh updated again.
Maybe instead of hyping with youtube videos LiveSmart 360 could have worked on making it’s comp plan info understandable first time round.
they couldn’t nail the patent before launch?
So is it June or July those are big gaps.
@@just curious now!
I don’t know the specifics but perhaps you need FDA approval before patenting a drug/medicine invention? LiveSmart 360 have announced they’re going to be carrying out some research on this Zorbmax mist stuff so maybe there are requirements that need to be met before they can file for a proper patent on it.
yeah, until now can’t fully understand their comp plan.
Hopefully they don’t change the comp plan again any time soon. I’ll have another look at it soon and do a revised writeup.
smartline points X PV X Personal Active enrolments in the Smartline
No. of smartline in system X personal buy(each 25BV count 1) X smartline that active(50BV/month) below you
more higher position, more personal buy in that month, more downline active = more share for smartline pool
It doesn’t based of equal share, it base on position and effective of downline and your account.
As PT Barnum famously said, “There is a sucker born every minute”, and it seems that the pyramid marketers are taking full advantage of every one of them.
LiveSmart360 is a con! They make people think that just by joining and purchasing products, you will earn. This is clearly a SCAM!
They start by giving false hopes, they wouldn’t last!
to John Smith,
pyramid scheme’s are people making money off people joining, there is a product involved here with 360, it really can’t be considered a “pyramid scheme”
Try to google “promotional pyramid” instead of just “pyramid”, as you will see that most countries in the world have laws that affect them. They have roughly the same rules in the United States as in Europe, Australia and Asia.
They may be allowed in certain tax havens as long as they do not take place domestically, but they are illegal in all Western countries I have checked.
to M_Norway: then how is there so many of them out there who offer products that have been running for years with no problems legally, I agree the ones who offer just advise and non-sence to get people to pay a monthly fee are pyramids.
I have often wondered the same thing. The rules exist, but many pyramids can hold on for a long time without interference from authorities. They often choose only to publish warnings.
Governments responds always in retrospect, they react after something illegal has happened. That they have not stopped anything does not mean it is legal. Priority is big and important issues in front of the smaller cases. Most of the pyramid issues will not be investigated before they are large enough, just before or after the pyramid collapses.
The easiest way to determine if anything could be a pyramid:
– Do you mainly recruit new distributors?
– Or do you mainly sell products or services to consumers?
The definition of “recruit new distributors” includes if you recruit them to higher levels over time. In most pyramids, one can buy their way to higher positions if they are willing to pay. Up to 50 percent recruitment may be normal and legal. Recruitment is often the only way to make money in a pyramid, or at least a necessary way to make money. If you do not recruit anyone, you earn no money. The need to recruit is a clear sign of a pyramid.
Pyramids are doomed to collapse because of the constant need to recruit new participants, and because of the lack of regular market (regular sales to consumers). Participants’ income comes from other participants, it is simply a redistribution of money among the participants – money distributed continuously upward in the system.
(Auto-translated, and I deleted a few lines)
with 360 there seems to be a “regular market” and not just constant recruitment, people order new product volume as they run out of there current purchased product and you are paid on volume, this way of marketing with bulk volume may subside the pyramid theory.
I have only checked this superficially. You probably have to enlist AT LEAST one person to be eligible for payments? And this person must enlist at least one person, the next must enlist at least one person …
Products and services are often used as camouflage in promotional pyramids, so people will not discover that it is a pyramid until they have been “sucked into it”. One must simply consider what is the main purpose of the concept – focus on recruitment or focusing on regular sale?
A complicated compensation plan can make it difficult to evaluate a concept, since one is concerned with trying to understand the details instead of the main features. One is simply confused by the “BV, PV, Fund 1, Fund 2” and other details. Try instead to focus on the main – if they focus MOSTLY on recruitment or ordinary sales.
I have not checked this company very carefully. When I check these things, I usually like to look at ads, websites and descriptions from the distributors – with a focus on the main. The question “Are they trying to recruit more participants, or do they attempt to sell products (in an ordinary market)?” answer pretty much. Then I check the details if there is a need for this, but I usually check the main features first.
Livesmart360 is tipicly a scam. They talk about smartline for the masses but it´s a pure scam.
Livesmart360 is a pure mlm company who 99% fail. They talk about goob c.plan ,but them plan comissions is so complicate tipicly of mlm companies only want your money and only the top earn comissions.
The LiveSmart 360 compensation plan is design for the leader and heavy hitter who will make a lot of money on their compensation plan. And those who can only bring in little number of recruits or personal referred members only gets penny.
It is very hard to reach the top level of Diamond position. There are lot of requirements and the cost of monthly BV to maintain is too much high.
Most of the MLM companies get high sales on their first 1 year only maybe because of their hyper active networkers. But soon those who are at the bottom will realize it doesn’t work for them thus will make them to quit.
The residual income here comes from their members who continually in autoship with their monthly products. If you are a networker marketer and can bring lot of members then this is for you. But if you are just a newbie and knows nothing in recruiting. Then this will be a ripped off to you.
And if you love the products and found it effective then this is good to you. But first try to look for other products that is as effective as their products but didn’t cost too much.
Any one has idea how to cancel your membership with Livesmart?
OMG I made one payment to benefit from the smartline, as I was confirmed by Mike Potillo himself that I would benefit from it if I get the package I got…
I got paid $0…
Just noticed that even though I never approved it, my money was withdrawn from my account for two consecutive months without my consent! I never even got a receipt or something…just found out from my bank account that they took payments!
Tried removing myself from the Livesmart 360 but couldnt find where to!
Please if anyone knows how to do this…help!
I sent a support ticket and a message directly to Mike Potillo about this but got no reply!
Hell I’m well known out there and have 1000’s of visitors daily on my website…what would an article submission about this do, you think??
Sorry to hear about your losses. Regarding cancellation, I’d be phoning LiveSmart 360 directly and requesting one. From what I understand they have fulltime support staff that process calls from members.