LifeVantage Review 2.0: Pseudo-compliance masks lack of retail focus
About a month ago a reader informed me that our LifeVantage review was out of date.
BehindMLM reviewed LifeVantage in late 2015. Primary concerns raised in the review were a lack of retail focus and mandatory affiliate autoship.
Upon reading our review, the reader claimed I needed “to update your information as there have been several changes since Darren Jensen became CEO.”
Today we revisit LifeVantage for an updated review.
LifeVantage is still based out of Utah and headed up by Darren Jensen (right).
Since publishing our initial review, Jeunesse sued Jensen for raiding.
The lawsuit was filed in January 2016 and confidentially settled in September the same year.
In January 2018 LifeVantage was sued for allegedly being a pyramid scheme. The lawsuit also alleges LifeVantage sells snake oil products.
As at the time of publication, the lawsuit is still playing out.
Since 2015 LifeVantage has expanded its range of products, which now include nutritional supplements, personal care, fitness and pets.
LifeVantage’s flagship product, Protandim, has been split in NRF1 and NRF2 varieties.
To stay active and energetic, your body needs power. By helping your body maintain mitochondrial function as you age, Protandim NRF1 Synergizer is the spark plug your daily health deserves—in a scientifically-engineered formula designed to deliver.
With Protandim Nrf2 Synergizer, you can take on aging with the only supplement that helps your cells produce their own antioxidants. Feel younger. Live healthier. That’s the power of Protandim Nrf2 Synergizer.
Protandim NFR1 retails at $59.99 for a bottle of 60 capsules. Protandim NFR2 retails at $50.99 for a bottle of 30 caplets.
Alternatively the NFR1 and NFR2 formulas can be purchased together for $85.99 (one month supply).
Other nutritional supplements LifeVantage markets include:
- Omega+ – “supports brain health, cardiovascular health, skin health, and the immune system”, retails at $48.99 for a bottle of 90 capsules
- ProBio – “support(s) optimal digestion and immune system function”, retails at $50.99 for a bottle of 90 caplets
- AXIO Regular – a beverage powder that contains “Nrf2 ingredients … designed to deliver more mental clarity, focus, and concentration without the jitters or caffeine crash”, retails at $60.99 for a box of thirty single-serve sachets
- AXIO Decaf – same as AXIO regular but without added caffeine, retails at $60.99 for a box of thirty single-sever sachets
A full catalog of LifeVantage’s personal care, fitness and pet supplements is available on their website.
The Lifevantage Compensation Plan
LifeVantage’s compensation plan combines retail, recruitment and residual commissions.
Several performance and rank based bonuses are also available.
LifeVantage Affiliate Ranks
There are twelve affiliate ranks within the LifeVantage compensation plan.
Along with their respective qualification criteria they are as follows:
- PRO1 – generate at least 100 PV and 1000 GV a month and recruit and maintain at least one commission qualified affiliate
- PRO2 – maintain at least 100 PV a month, generate at least 2500 GV a month and recruit and maintain at least two commission qualified affiliates
- PRO3 – maintain at least 100 PV a month, generate at least 5000 GV a month and maintain at least two personally recruited commission qualified affiliates
- PRO4 – generate and maintain at least 200 PV and 10,000 GV a month and maintain at least two personally recruited commission qualified affiliates
- PRO5 – maintain at least 200 PV a month, generate at least 20,000 GV a month and recruit and maintain at least three commission qualified affiliates
- PRO6 – maintain at least 200 PV a month, generate at least 50,000 GV a month and maintain at least three personally recruited commission qualified affiliates
- PRO7 – maintain at least 200 PV a month, generate at least 100,000 GV a month and maintain at least three personally recruited commission qualified affiliates
- PRO8 – maintain at least 200 PV a month, generate at least 200,000 GV a month and maintain at least three personally recruited commission qualified affiliates
- PRO9 – maintain at least 200 PV a month, generate at least 500,000 GV a month and maintain at least three personally recruited commission qualified affiliates
- PRO10 – maintain at least 200 PV a month, generate at least 1,000,000 GV a month and maintain at least three personally recruited commission qualified affiliates
- Executive Master – maintain at least 200 PV a month, generate at least 2,000,000 GV a month and recruit and maintain at least four commission qualified affiliates
- Presidential Master – maintain at least 200 PV a month, generate at least 5,000,000 GV a month and recruit and maintain at least five commission qualified affiliates
PV stands for “Personal Volume” and is sales volume generated by retail customer orders and an affiliate’s own purchase of products.
At least 40 PV of any required amount must be purchased by an affiliate.
GV stands for “Group Volume” and is PV generated by an affiliate and their downline.
Note that the following additional GV qualification criteria applies:
- PRO2 to PRO4 – up to 80% of required GV can be sourced from any one unilevel team leg
- PRO5 to PRO9 – up to 60% of required GV can be sourced from the largest leg, 30% from the second largest and 10% from the third
- PRO10 – up to 40% of required GV can be sourced from two legs and up to 20% from a third largest
- Executive Master – up to 40% of required GV can be sourced from two legs and 10% from a third and fourth
- Presidential Master – up to 40% of required GV can be sourced from the largest leg, up to 35% from the second largest, up to 10% from the third and fourth largest and up to 5% from the fifth largest
Finally note that Pro10 and higher ranks must be held for three consecutive months before qualification is achieved.
To qualify for MLM commissions, each LifeVantage affiliate must generate at least 100 PV a month.
40 PV must be an affiliate’s own product order(s).
LifeVantage affiliates are paid a commission when they sell products to retail customers.
Retail commissions paid out are the difference between the wholesale and retail cost of products ordered.
LifeVantage pays residual commissions via a unilevel compensation structure.
A unilevel compensation structure places an affiliate at the top of a unilevel team, with every personally recruited affiliate placed directly under them (level 1):
If any level 1 affiliates recruit new affiliates, they are placed on level 2 of the original affiliate’s unilevel team.
If any level 2 affiliates recruit new affiliates, they are placed on level 3 and so on and so forth down a theoretical infinite number of levels.
LifeVantage caps payable unilevel team levels at nine.
How many levels a LifeVantage affiliate earns residual commissions on is determined by rank:
- PRO1 affiliates earn 2% on level 1 and 5% on level 2
- PRO2 affiliates earn 2% on level 1, 5% on level 2, 9% on level 3 and 5% on level 4
- PRO3 affiliates earn 2% on level 1, 5% on level 2, 9% on level 3 and 5% on levels 4 and 5
- PRO4 affiliates earn 2% on level 1, 5% on level 2, 9% on level 3 and 5% on levels 4 to 6
- PRO5 affiliates earn 2% on level 1, 5% on level 2, 9% on level 3 and 5% on levels 4 to 7
- PRO6 affiliates earn 2% on level 1, 5% on level 2, 9% on level 3 and 5% on levels 4 to 8
- PRO7 and higher affiliates earn 2% on level 1, 5% on level 2, 9% on level 3 and 5% on levels 4 to 9
PRO5 affiliates are able to apply for an additional unilevel position within their existing unilevel team.
PRO7 affiliates can apply for a third position and PRO10 affiliates for a fourth.
Additional unilevel team positions effectively allow an affiliate to earn multiple times on sales volume generated under additional positions.
Additional unilevel positions have their own rank, which must be qualified for in order to earn residual commissions.
Generational Matching Bonus
PRO3 and higher ranked LifeVantage affiliates earn a Generational Matching Bonus on residual commissions earned by their downline.
The Generational Matching Bonus is tracked via the unilevel team and pays out as follows:
- level 1 (personally recruited affiliates) – 10% matching bonus on earned residual commissions
- levels 2 to 5 – 5% matching bonus on earned residual commissions
Note that to qualify for the Generational Matching Bonus, a PRO3 or higher ranked LifeVantage affiliate must be generating at least 200 PV a month.
If an affiliate is generating 100 to 199 PV a month (100 of which is new volume for that month), they will receive 50% of the Generational Matching Bonus.
For PRO3 to PRO6 ranked affiliates, 100 PV of the required amount each month must be volume from new retail customers and/or recruited affiliates.
PRO7 and higher ranked affiliates are exempt from having to generate new volume each month.
Smart Start Bonus (recruitment)
The Smart Start Bonus recruitment commission is paid on the recruitment of new affiliates who sign up with a product pack.
- Silver Pack – $300
- Gold Pack – $600
- Platinum Pack – $1200
LifeVantage affiliates who generate 200 PV a month earn a 40% Smart Start Bonus, paid on the above product packs.
Affiliates who generate 100 to 199 PV a month earn a 30% Smart Start Bonus.
Smart Start Bonus (preferred customers)
The Smart Start Bonus preferred customer commission is paid on a preferred customer’s first monthly order.
A preferred customer is a retail customer who has agreed to place a monthly autoship order, in exchange for a discount.
Smart Start Bonuses for preferred customer orders are the same as recruitment:
- 40% if an affiliate is generating 200 PV or more a month; or
- 30% if an affiliate is generating 100 to 199 PV a month.
The Launch Bonus is a coded bonus paid on product packs purchased by preferred customers and newly recruited affiliates.
The bonus itself is paid based on rank, with each rank getting a certain amount of the bonus.
Silver Packs pay
- $12.50 to PRO3 and PRO4, PRO5 and PRO6 and PRO7 to PRO9
- $6.25 to PRO10
- $3.75 to Executive Master and
- $2.50 to Presidential Master
Gold Packs pay
- $25 to PRO3 and PRO4, PRO5 and PRO6 and PRO7 to PRO9
- $12.50 to PRO10
- $7.50 to Executive Master and
- $5 to Presidential Master
Platinum Packs pay
- $50 to PRO3 and PRO4, PRO5 and PRO6 and PRO7 to PRO9
- $25 to PRO10
- $15 to Executive Master and
- $10 to Presidential Master
As I understand it the referring affiliate is paid the Launch Bonus at their rank.
The system then looks upline to pay the remaining rank bonuses out.
E.g. for a Silver Pack $12.50 is paid to the first found PRO3 or PRO4 affiliate. Another $12.50 is paid to the first found PRO5 or PRO6 affiliate and so on and so forth.
Note that in order to qualify for the Launch Bonus, a LifeVantage affiliate must be generating at least 200 PV a month.
Elite Bonus Pool
LifeVantage take 4% of company-wide sales volume and place it into the Elite Bonus Pool.
PRO7 and higher ranked affiliates qualify for a share in the Elite Bonus Pool.
The Elite Bonus Pool is split up into four smaller 1% pools, corresponding with ranks PRO7 to PRO10.
- PRO7 affiliates earn a share in the PRO7 pool
- PRO8 affiliates earn a share in the PRO7 and PRO8 pools
- PRO9 affiliates earn a share in the PRO7, PRO8 and PRO9 pools
- PRO10 and higher ranked affiliates earn a share in all four Elite Bonus Pools
Rank Achievement Bonus
LifeVantage affiliates are rewarded for qualifying at the PRO10 and higher ranks with the following one-time bonuses:
- PRO10 – $100,000 over twelve months
- Executive Master – $250,000 over twenty-four months
- Presidential Master – $500,000 over twenty-four months
Note that rank must be maintained over the entire payout period.
LifeVantage affiliate membership is $50 plus shipping.
An affiliate can also opt to sign up with an additional enrollment pack:
- Silver Pack – $300
- Gold Pack – $600
- Platinum Pack – $1200
The only difference between the packs and the regular affiliate membership option is bundled products.
My primary criticisms of LifeVantage back in 2015 were mandatory affiliate autoship and a lack of retail focus, so let’s focus on those two points first.
Unfortunately LifeVantage still requires affiliates to purchase at least 40 PV of product each month.
This is crafted within a 100 PV requirement, with the remaining PV either from additional purchases by the affiliate or retail orders.
An MLM company forcing affiliates to purchase any amount of product each month is unacceptable.
Not only is it pay to play, but it also encourages self-funded commission qualification. By that I mean a LifeVantage affiliate is far more likely to purchase 100 to 200 PV of product each month, as opposed to that same volume being retail.
What should be happening is LifeVantage requiring either 60 or 140 PV to be retail, leaving the remaining 40 PV either retail or an affiliate’s own spend, their choice. Either that or lock countable PV from an affiliate’s purchases at 40 PV.
With all that in mind, I get the impression that reducing the mandatory 100 PV a month spend to 40 PV is just pseudo-compliance.
From a practical standpoint it’s unlikely LifeVantage affiliate behaviour has changed since 2015.
The good news is you can easily verify this yourself, by asking how much of the 100 or 200 PV your potential upline is retail volume.
Anything less than half (50/100 PV) and you’ve just confirmed that affiliate is running their LifeVantage business as a pyramid scheme.
Forcing affiliates ties into a lack of retail focus, so on that specific point nothing has really changed.
LifeVantage’s compensation as of 2019 itself focuses on retail volume beyond straight retail commissions, by focusing on preferred customers.
There’s nothing inherently wrong with that, except LifeVantage does it in very pseudo-compliancey way.
The LifeVantage compensation plan document refers to affiliate enrollment packs as “product packs”. I’ve kept the verbiage in some parts of the compensation plan but it’s pretty obvious these are meant for affiliates only.
If you need confirmation of this look no further than LifeVantage’s 2019 Distributor Application, which on page 2 refers to them as “enrollment packs”. On the LifeVantage website they’re referred to as “opportunity packs”.
Retail customers, even preferred ones, aren’t enrolling as affiliates – so mentioning preferred customers buying the packs is lip-service.
I’d be willing to be the number of preferred customers that are purchasing a $300 to $1200 a month is negligible. Hell, I’ll even go so far as to say non-existent.
Complete lip-serve on LifeVantage’s part and clearly an attempt to create the illusion of retail sales when there isn’t any.
Another missed opportunity to drive retail volume is the Generational Matching Bonus.
100 PV of new volume a month to qualify? Great! But why does this include newly recruited affiliate purchases (qualifying via recruitment)?
Why not require 100 PV a month in new retail volume? And what’s up with the volume requirement not applying to PRO7 and higher ranked affiliates?
PRO7 and higher ranked affiliates shouldn’t be focused on generating new retail volume each month? Why on Earth not?
On the product side of things it’s great to see LifeVantage has expanded beyond what was offered in 2015.
They’ve kept within the theme of the original offerings and what’s been added compliments what was already there.
What can’t be ignored though is the cosmetic changes to the compensation plan (it’s essentially the same).
With a lack of retail focus it really doesn’t matter what products LifeVantage has.
I’m not saying that retail isn’t taking place, it’s just when comparing LifeVantage as of 2015 and now, they haven’t actually changed the core focus of the business in a meangingful way.
It’s more like “OK there’s a potential problem with regulators here, so how can we make the fact that the majority of our sales revenue is affiliate purchases less obvious?”.
And to that end you have LifeVantage’s current MLM opportunity.
As I concluded in 2015, approach with caution.
I think using the word “forced” to do 40 PV to qualify for commissions assuming you have customers producing 60 PV monthly from their orders to qualify for 30% or customer volume of an additional 160 PV in customer volume to qualify for 40% is a bit misleading.
Most people WANT to use these products so nobody feels “forced!”
My wife and I purchase at least 200 PV ourselves because we benefit from using Protandim TriSynergizer for example. If there were no financial opportunity, we would still purchase these products and isn’t that the real test of a legitimate MLM company?
I’ve been with this company for 7 years 7 months and am only a Pro 4 but I am not going anywhere.
I love the fact that Darren Jensen is the CEO, that the company is publicly traded, that Erin Brockovich is on the board of directors, that the company is the front of jersey sponsors for a major league soccer team, Real Salt Lake, that the stock is doing so well, that Blackrock, the world’s biggest hedge fund holds a large position in the stock which says something about how they view the future prospects for this company.
But, OZ, I don’t believe I have ever read any of your reviews and I’ve read a ton of them, where you do not advise “approach with caution” with a lot of justification in many cases. lol
No it isn’t. Unless the comp plan has changed 40 PV must literally be affiliate-spend. It’s forced and let’s not mince words or justify mandatory affiliate purchases.
There is no need for it.
Considering PRO4 required PV is exactly 200 PV, how much retail PV have you generated over the past three months?
It is indeed, with one very important caveat.
Vemma tried this on with the FTC and it failed. The reason is because when you force affiliates to purchase product (or that’s the defacto way affiliates are qualifying for commissions (pay to play)), you can’t make the argument that everyone is buying outside of commission qualification.
An MLM company can only argue people are buying for the products and not commission qualification if said purchases aren’t tied to commission qualification as per the compensation plan.
Considering you’ve presented yourself as a text-book example of someone running their MLM business as a product-based pyramid scheme, I think I was bang on.