Optavia Review: Medifast weight loss programs with grey retail
Optavia provides no information on their website about who owns or runs the business.
The company does have an “about us” section on their website, but instead of providing corporate information it’s used as a marketing pitch.
I noticed the SSL certificate used by Optavia belongs to Medifast. That lead me to this article, which revealed up until July 2017 Optavia was known as Take Shape For Life.
Take Shape for Life was launched as an MLM subsidiary of Medifast back in 2002.
Medifast was founded by William Vitale in 1980 as Vitamin Specialties Corp.
Today the weight loss focused company is based out of Maryland in the US.
As of October 2016 Daniel Chard (right) is CEO of both Medifast and Optavia.
As per another article from the Baltimore Sun;
Chard has more than 25 years of direct selling and consumer products experience.
Before his time at PartyLite, Chard held various jobs over 17 years at Nu Skin Enterprises Inc., including executive vice president of distributor success and president of global sales & operations.
Previously, he had marketing roles at PUR Recovery Engineering and The Pillsbury Co.
Why this basic information isn’t provided on Optavia’s website is unclear.
Read on for a full review of Optavia’s MLM opportunity.
Optavia market a range of “programs” targeting optimal weight and health.
Optimal Weight 5&1 is a program that revolves around “eating six small meals per day”.
On the Optimal Weight 5&1 Plan, your body enters a gentle but efficient fat burning state while maintaining retaining lean muscle mass.
Choose from more than 60 convenient, nutritionally interchangeable, scientifically-designed Fuelings.
Optimal Weight 5&1 programs range in price from $414.60 to $448.60.
Each Optimal Weight 5&1 program appears to be a roughly twenty-three supply.
This is based on the 119 servings per program divided by five supplied meals a day.
Under the Optimal Weight 5&1 program, a customer has to prepare one meal a day.
Optimal Weight 4&2&1 is marketed as a ‘flexible meal plan to help you achieve a healthy weight‘.
Four of your meals are OPTAVIA Fuelings.
Choose from more than 60 delicious, nutritionally interchangeable and scientifically designed Fuelings.
The Optimal Weight 4&2&1 retails at $408 and appears to be a thirty-five day supply.
This is based on the 140 servings per program divided by four supplied meals a day.
Under the Optimal Weight 4&2&1 program, a customer has to prepare two meals and one snack a day.
Optavia claims the Optimal Health 3&3 program
is easy to follow and consists of three balanced Lean and Green meals and three Optimal Health Fuelings each day.
The Optimal Health 3&3 program retails at $333 and appears to be a forty-three day supply.
This is based on the 130 servings per program divided by three supplied meals a day.
Under the Optimal Health 3&3 program, a customer has to prepare three meals a day.
In addition to program kits, Optavia’s “fuelings” can also be purchased separately.
Complimenting Optavia’s weight loss programs is Purposeful Hydration, a vitamin infused range of beverages.
Purposeful Hydration is available in orange, lemon lime, mixed berry and raspberry lemonade for $39.95 a box.
A “Purposeful Hydration Kit” for $159.80 is also available.
Optavia also market “Optavia Premier” membership, which appears to be their retail customer autoship offering.
Optavia Premier provides access to
- five free boxes of Optavia fuelings with a customer’s first order
- free shipping on qualifying orders
- customer rewards and offers
Whether there’s any additional costs associated with Optavia Premier membership is unclear.
If you click on the “shop all Optavia Premier Kits” button on their website, you’re redirected to a shopping page detailing the three regulator Optavia program kits above.
Optavia’s Compensation Plan
Optavia combines retail and recruitment commissions, both in terms of qualification and payout.
Residual commissions are generation based, with several performance-based bonuses also on offer.
Optavia Affiliate Ranks
There are fifteen ranks within Optavia’s compensation plan.
Along with their respective qualification criteria, they are as follows:
- Coach – generate less than 1500 GV a month from at least five retail customers and/or recruited affiliates
- Senior Coach – generate at least 1500 GV a month from at least
- Manager – maintain Senior Coach qualification with 2 Qualifying Points
- Associate Director – maintain Senior Coach qualification with 3 Qualifying Points
- Director – maintain Senior Coach qualification with 4 Qualifying Points
- Executive Director – maintain Senior Coach qualification with 5 Qualifying Points
- Integrated Executive Director – maintain Executive Director qualification, plus generate 6000 PV and 15,000 GV a month, generate and maintain five Senior Coaches or higher teams and be certified
- Regional Director – maintain Executive Director qualification and generate and maintain at least one Executive Director team
- Integrated Regional Director – maintain Integrated Executive Director qualification and generate and maintain at least one Executive Director team
- National Director – maintain Executive Director qualification and generate and maintain at least three Executive Director teams
- Integrated National Director – maintain Integrated Executive Director qualification and generate and maintain at least three Executive Director teams
- Global Director – maintain Executive Director qualification and generate and maintain at least five Executive Director teams
- Integrated Global Director – maintain Executive Director qualification and generate and maintain at least five Integrated Executive Director teams
- Presidential Director – maintain Executive Director qualification and generate and maintain at least ten Executive Director teams
- Integrated Presidential Director – maintain Integrated Global Director qualification and generate and maintain at least five Executive Director teams
PV stands for “Personal Volume” and in Optavia is sales volume generated by sales to retail customers and personally recruited affiliate orders.
GV stands for “Group Volume” and is PV generated by an Optavia affiliate’s downline (unilevel team).
Qualifying Points required for Manager through Director qualification are generated as follows:
- recruit and maintain a Senior Coach ranked affiliate = 1 Qualifying Point
- each 1200 PV generated = 1 Qualifying Point
Ranked team (required from Integrated Executive Director) are unilevel legs with a required ranked affiliate in them.
This ranked affiliate can be directly or indirectly recruited into that unilevel team leg.
Finally note that for all Integrated ranks and from National Director, rank qualification must be maintained for three months prior to promotion.
Retail and Recruitment Commissions
Optavia affiliates earn a base 15% commission on sales to retail customers and personally recruited affiliates.
Retail and recruitment commissions scale up based on an Optavia affiliate’s monthly sales volume:
- generate 1200 PV in a month and receive a 20% commission rate
- generate 2400 PV in a month and receive a 22% commission rate
- generate 3600 PV in a month and receive a 24% commission rate
- generate 4800 PV in a month and receive a 26% commission rate
- generate 6000 PV in a month and receive a 28% commission rate
An additional 3% bonus is paid on retail and personally recruited affiliate orders if an Optavia affiliate is certified.
Certification requires an Optavia affiliate to pay $200 for an exam.
Retail and Recruitment Bonuses
Optavia rewards affiliates for consistent PV generation over three consecutive months.
- generate 2000 PV a month for three consecutive months and receive a $250 Consistency Bonus
- generate 4000 PV a month for three consecutive months and receive a $500 Consistency Bonus
- generate 6000 PV a month for three consecutive months and receive a $1000 Consistency Bonus
New Optavia affiliates can also qualify for a $100 Client Acquisition Bonus.
Client Acquisition Bonus qualification requires an Optavia affiliate to generate $1000 in retail and/or personally recruited affiliate orders (min five customers/affiliates), within thirty days of signing up.
If a personally recruited affiliate qualifies for the Client Acquisition Bonus, the affiliate who recruited them also receives a $100 Assist Bonus.
Team Growth Bonus
The Team Growth Bonus is a single-generation coded bonus paid on downline volume.
The Team Growth Bonus is tracked via unilevel team downlines.
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.
The Team Growth Bonus is determined by rank, and paid from a Senior Coach down to another Senior Coach or higher ranked affiliate in each unilevel leg.
- Senior Coach’s receive a flat 4% Team Growth Bonus
- Managers receive a 6% Team Growth Bonus on Coach downlines and 2% on Senior Coach downlines
- Associate Directors receive an 8% Team Growth Bonus on Coach downlines, 4% on Senior Coach downlines and 2% on Manager downlines
- Directors receive a 10% Team Growth Bonus on Coach downlines, 6% on Senior Coach downlines, 4% on Manager downlines and 2% on Associate Director downlines
- Executive Directors receive a 12% Team Growth Bonus on Coach downlines, 8% on Senior Coach downlines, 6% on Manager downlines, 4% on Associate Director downlines and 2% on Director downlines
The coded nature of the bonus kicks in when lesser ranked affiliates are paid the Team Growth Bonus.
A maximum 12% on level 2 and deeper downline volume is paid out via the Team Growth Bonus.
Lower ranked affiliates are paid less than the 12% Executive Director rate, meaning any percentage differences paid to lesser ranked affiliates roll up to higher ranked affiliates.
E.g. If as an Executive Director you had a level 2 Senior Coach in one leg earning a 4% Team Growth Bonus, as an Executive Director you’d pocket the 8% difference (12% – 4%).
If in the above example you were an Associate Director, you’d be paid 4% (8% – 4%), leaving 4% to be paid upline to higher ranked affiliates.
Note that the Team Growth Bonus begins on level 2 of each unilevel team leg.
And again as previously stated, the Team Growth Bonus is calculated individually for each unilevel team leg.
Executive Director Generation Bonus
Regional Director and higher ranked Optavia affiliates qualify for the Executive Director Generation Bonus.
A generation within the Executive Director Generation Bonus is defined when an Executive Director or higher ranked affiliate is found in a unilevel leg.
This Executive Director or higher ranked affiliate caps off the first Executive Director Generation Bonus generation for that leg.
The second generation begins immediately after them, and either extends the full depth of the leg or is capped off by another Executive Director or higher ranked affiliate deeper in the leg.
Using this generational structure, Optavia affiliates can earn the Executive Director Generation Bonus on up to six generations per unilevel leg.
- Regional Directors earn a 2.5% Executive Director Generation Bonus on up to one generation per unilevel leg
- Integrated Regional Directors and National Directors earn a 2.5% Executive Director Generation Bonus on up to two generations per unilevel leg
- Integrated National Directors earn a 2.5% Executive Director Generation Bonus on the first two generations per unilevel leg and 2% on the third
- Global Directors earn a 2.5% Executive Director Generation Bonus on the first two generations per unilevel leg and 2% on the third and fourth
- Integrated Global Directors and Presidential Directors earn a 2.5% Executive Director Generation Bonus on the first two generations per unilevel leg, 2% on the third and fourth and 1.5% on the fifth
- Integrated Presidential Directors earn a 2.5%Executive Director Generation Bonus on the first two generations per unilevel leg, 2% on the third and fourth and 1.5% on the fifth and sixth
Fully Integrated Business Coach Consistency Bonus
Certified Executive Directors qualify for the Fully Integrated Business Coach Consistency Bonus when they meet and hold the following criteria;
- generate 6000 PV
- generate 15000 GV and
- generate and maintain five personally recruited Senior Coaches
If the above criteria is maintained for three consecutive months, a $1000 Fully Integrated Business Coach Consistency Bonus is paid out.
Note that up to four Fully Integrated Business Coach Consistency Bonus can be earned each calendar year.
Elite Leadership Bonuses
National Director and higher ranked affiliates qualify for a bonus percentage on downline National Director and higher ranked affiliate sales volume.
- National Directors qualify for a 0.5% Elite Leadership Bonus
- Global Directors qualify for a 1% Elite Leadership Bonus
- Presidential Directors qualify for a 1.5% Elite Leadership Bonus
An Elite Leadership Bonus is paid out on downline volume in each unilevel leg, up until a second same-ranked affiliate is found.
- the National Director tier pays out until a second National Director is found in a unilevel leg
- the Global Director tier pays out until a second Global Director is found in a unilevel leg
- the Presidential Director tier pays out until a second Presidential Director is found in a unilevel leg
Note that the three Elite Leadership Bonus tiers stack, meaning a Global Director retains their National Director tiers in each applicable unilevel leg.
Optavia affiliate membership is $95 and then $99 annually.
Medifast have been around for a while and seem to offer a convenient yet comprehensive approach to weight loss.
Although the components that make up their program kits can be purchased separately, my impression is that Optavia’s programs are best committed to over a period of at least a few months.
This fits in well with a sales focused MLM opportunity.
What lets Optavia’s business model down somewhat is the lack of distinction between retail customers and recruited affiliates (coaches).
At OPTAVIA, our Coaches are the lifeblood of our program.
OPTAVIA Coaches help others realize Lifelong Transformation, One Healthy Habit at a Time.
In fact, Optavia categorically clarify that they equate personally recruited affiliates to retail customers (clients).
Coaches do not receive Compensation for their personal orders.
This is because personally sponsored Coaches are considered the personal Clients of their Sponsors.
This creates a problematic scenario in which potentially the majority of Optavia’s sales revenue is generated from recruited affiliates.
Not helping is a lack of retail volume qualifiers, likely again owing to Optavia failing to make a distinction between retail and recruitment volume.
This would be an easy distinction to make, and would be a great starting point as far as improving Optavia’s compensation plan goes.
Not only from a purely regulatory perspective, but also to ensure Optavia affiliates aren’t creating endless recruitment chains at the expense of retail.
The good news is you can still evaluate what you might be getting into as a prospective Optavia affiliate.
To qualify as an Optavia Coach five customers are required. These customers can be retail customers or recruited affiliates.
What you find out is how many of the five required customers your potential upline has are retail customers.
At a minimum you’re shooting for three. Any less and you’re potentially getting into pyramid scheme territory.
Especially if this is a common ratio among Optavia’s wider affiliate-base.
Another aspect of the compensation plan I wasn’t too crash hot on was the whole certification thing.
The Certification Exam provides Coaches with a valuable credential, awarded in partnership with the MacDonald Center for Obesity Prevention & Education (COPE).
Take your business to the next level by becoming a Certified Coach!
I get Optavia are trying to educate their affiliate-base but tying certification into compensation, especially confusing “integrated” ranks, is perhaps not the best approach.
Without consideration of the potential logistics or costs, perhaps a better approach would be to directly reward affiliates who opt to certify.
This way Optavia could do away with the integrated ranks and still reward affiliates who opt for certification.
If the 3% retail/recruitment bonus was limited to retail, there’s no reason that couldn’t remain either.
As already mentioned, Medifast have been around for decades. There’s obviously something to their products and programs, but be aware of any specific weight loss marketing claims.
In 2012 the FTC went after Medifast’s Jason Pharmaceuticals subsidiary for unsupported weight loss program claims.
In light of a previous 1992 FTC settlement order, again for unsupported weight-loss program claims, Medifast coughed up $3.7 million.
Under the new settlement order announced today, Jason Pharmaceuticals is prohibited from misrepresenting that consumers who use any low-calorie meal replacement program, including the Medifast “5 and 1” plan, can expect to achieve the same results that an endorser does, or can lose a particular amount of weight or maintain the weight loss.
Such representations must be non-misleading and backed by competent and reliable scientific evidence that consists of at least one adequate and well-controlled human clinical study of the low-calorie meal replacement program, or a study that follows a protocol detailed in the settlement order.
Note that this settlement didn’t pertain to Optavia, nor did I myself come across any Optavia related specific weight loss marketing claims.
I did see a bunch of personal experience marketing efforts though, so just be wary of anyone promoting specific weight loss amounts based on their this experience.
One last thing I’ll touch on is the corporatey feel Optavia gave me.
A visit to Optavia’s website very much feels like its a side-project for another company, which I suppose it is.
This isn’t necessarily a bad thing, but in MLM a “headless” company so to speak isn’t a good look.
At the very least you want to know who’s in charge and why, and Optavia doesn’t inspire confidence by not providing this information.
Instead it feels very corporatey – with the passion in the website marketing copy coming off as hollow.
And what’s up with William Vitale?
Other than his boasting about making more money than athletes back in the 80s, I struggled to find any information on Vitale – not even a photo.
Despite Medifast and Optavia having both been around for a while, there’s definitely room for improvement in both presentation and compensation.
Approach with caution.