WakeUpNow fail to address retail elephant in the room
Retail sales are the lifeblood of any MLM company. Without a steady flow of revenue from people outside of the opportunity purchasing your products, you’re only putting off an inevitable collapse.
A complete lack of retail sales saw WakeUpNow rack up $3.3 million dollars in losses for 2012. This trend continued and in 2013 the company recorded another loss of $4.5 million.
No doubt seeing the writing on the wall, WakeUpNow management introduced mandatory retail quotas in late 2013. Forced onto an affiliate-base that had previously been solely focused on affiliate recruitment, these changes were met with mixed reactions.
Affiliates who had focused on signing up, paying the minimum volume-spend themselves and then recruiting others to do the same were rather unhappy.
The loss figures above are quoted from WakeUpNow’s own 2013 Disclosure statement, which was the focus of a recent BehindMLM article. Titled “WakeUpNow blows through almost $8 million in two years“, the article looked at the current situation, what WakeUpNow focused on in the statement and what that likely meant for the business going forward.
In summary, WakeUpNow looked to be pushing more of the same – which I suggested would in turn result in more of the same. That being the ongoing loss of millions of dollars from year to year.
That evidently didn’t go over too well with WakeUpNow corporate, who were quick to deploy their PR agency.
The first response came in less than 24 hours by way of a spammy press-release. Written for no other reason than to be linked back to by over-zealous WakeUpNow affiliates, who for some reason can’t quite seem to grasp WakeUpNow themselves author (or at the very least solicit) such works, declares “WakeUpNow passes 100,000 customer milestone”.
Sounds impressive, until you consider there’s no mention of how many of those customers are retail.
Furthermore, the maths doesn’t add up either. How does a company with 100,000 customers still manage to lose $8 million over two years? Even the smallest of spends ($10), translates into millions of dollars in revenue.
Some things need to be considered here. In addition to no mention of retail ratios, WakeUpNow also don’t clarify whether these 100,000 customers are currently active (having made any recent orders), or whether it’s a cumulative number.
Anyway, it is what it is – a bunch of spam that’s both misleading and ultimately irrelevant.
WakeUpNow followed up this response with an email sent to me via BehindMLM’s contact form. Well, not from them per say but from Mike Scerbo of Rose Moser Allyn Public Relations, who appear to be working for them.
Scerbo’s email was anything but personal, containing seemingly recently written spammy press-release that asked me to “consider” the following “key points”:
A Bright Future For A Different Type Of Direct Sales Company
WakeUpNow welcomes all constructive criticism. That’s the best way to improve our product and our people. We even welcome criticism from direct marketing critics. However we must take issue with a piece recently published by Inside MLM on May 8th.
To set the record straight WUN has always made retail sales a priority BECAUSE trends show we are excelling in that area. There has always been a focus on retail as our many affiliates would attest.
As for not showing massive profits in the early stages, we’re in some pretty good company. Amazon, Facebook, Tesla and others technology companies did not show profits in their early years. WakeUpNow is developing a long term, legacy company and to fulfill this strategy we would rather reinvest in our growing company than make a quick short term profit.
As for commission generation, the numbers reflect that we are blessed with a very large customer and independent business owner base and only a percentage of them choose to make the commitment of time and energy needed to earn commission.
However, many of those who do make the commitment have become financial success stories. Regardless of their intent to earn commissions WakeUpNow customers derive real value from the products. There is no cost to become an independent distributor.
Much of Inside MLM’s article focused on selected items on our 2013 Annual report. That report was honest and comprehensive because we believe in full disclosure. It shows we are honest and optimistic.
Our sales continue to grow. In the last many quarters, WakeUpNow’s gross sales volume has increased at a substantial rate relative to prior quarters. WakeUpNow attributes this growth largely to improvement in the scope and quality of its product offerings.
Recently our Energy drink Thunder sold out of the initial order months ahead of expectations.
WakeUpNow is in business for the long-term, unlike many in the direct marketing firms that make big promises, leave town with a fast buck, and leave affiliates holding the bag.
We are investing in our company, improving our customers experiences and in a future that will provide long term success.
We appreciate your consideration of these key points.
Inside MLM, really…?
As you can see, yet again the retail elephant in the room is side-stepped in favor of a bunch of irrelevant waffle. Scerbo does mention retail, but in the vague sense that “trends show (they) are excelling in that area”.
Oh really? Let’s see some numbers then. Enough with this marketing spin bullshit.
Here was my response:
“To set the record straight WUN has always made retail sales a priority BECAUSE trends show we are excelling in that area. There has always been a focus on retail as our many affiliates would attest.”
With all due respect, what an absolute load of horseshit.
Mandatory retail quotas were brought in in (sic) late 2013 for the sole reason that retail just wasn’t happening. Then a good cross-section of your affiliate-base revolted, because prior to that they’d all been making money solely on recruiting.
I’m not interested in the PR spin bullshit. You’re welcome to provide 2012 and 2013 retail figures at your convenience (and month on month 2014 if you so wish). Note that the only figures I will accept are revenue from subscriptions sold to non-affiliates (this does not include ex-affiliates, affiliates who have not recruited or affiliates who stopped paying fees).
If you’re willing to provide this information, please contrast it with the revenue sourced from affiliate subscriptions (internal consumption).
“As for commission generation, the numbers reflect that we are blessed with a very large customer and independent business owner base”
The “numbers” show you’re in the hole almost $8 million dollars.
If that’s WakeUpNow with a “very large customer” base, you’re doing it wrong.
I applaud the transparency your company has shown in providing the figures, but in and of itself does not excuse them – or change what they reveal.
Care to make an official loss/profit prediction for 2014 based on your first quarter 2014 revenue figures? Better still, provide those figures to me and I’ll do my own analysis.
Please do not reply back with anything but correspondence on the points above. If I see a tincan response or excuses, it’s going straight into the spam bin.
I sent that yesterday, and was going to do the polite thing and give them a week to reply (and provide the requested retail information) before writing a followup.
As of yet I haven’t received a reply, but that doesn’t mean WakeUpNow’s PR agency have taken the weekend off.
Published today, WakeUpNow’s latest press-release again fails to provide any clarity on the issue of retail activity within the company. Instead, they do their best to divert attention away from the topic primarily by
- implying BehindMLM is ‘working for or with competitors‘ and
- drawing irrelevant comparisons to Facebook, Amazon, eBay, NuSkin, Herbalife and Usana (WakeUpNow claim they are “on a similar track” to these companies)
One sentence did catch my eye: ‘WakeUpNow’s revenues have increased in recent quarters’. WakeUpNow attribute some of their losses to re-investing said revenue back into the business. This is of course fair enough, but again …”revenue”, how much of that is retail revenue?
Three separate responses to the same article highlighting a near $8 million loss over two years, yet none of them provide any hard retail revenue figures or ratios.
Instead we get a bunch of rosy fluff statements, irrelevant comparisons and marketing bullshit that fails to address the core issue behind WakeUpNow’s demonstrated failure:
Is WakeUpNow the MLM business opportunity viable on a retail level?
The only way to ascertain that would be a year on year retail revenue comparison, which only WakeUpNow can provide its investors, affiliates and to a lesser extent myself. That and only that will show that the company indeed is not heading for another straight year of millions of dollars in losses.
WakeUpNow publishes disclosure documents to provide information to investors. Our company embraces this practice. We believe that transparency and honesty help foster a culture of accountability and integrity.
The ball is in your court guys. Provide those figures and put the concerns to rest, or continue to publish irrelevant waffle, have your affiliates create childish YouTube campaigns and go on failing to address the core-issue.
You didn’t lose nearly $8 million dollars over two years because of BehindMLM, your competitors, other MLM companies, transparency, corporate integrity or whatever other nonsense you want to come up with. You lost it because your affiliates weren’t selling your third-party merchant offerings to retail customers.
Either show tangible proof that changes have been made in this area for the first quarter of 2014 (compared to 2013), or come clean and admit that WakeUpNow is on track to record another year of millions in losses going forward.
You don’t me anything, but that much you at the very least owe to your investors, shareholders and affiliates.
Footnote to WakeUpNow affiliates: If you cannot conduct yourselves in a professional manner, your offtopic comments will not be published. This is not the place for what passes for WakeUpNow marketing on Facebook, YouTube et al.