Melaleuca strongly dislikes MLM and has publicly expressed its negative views of the business model. The company operates a consumer direct marketing (CDM) structure, which is designed to be more beneficial to customers and executives. However, the format is remarkably similar to MLM: you earn commission by building a downline and earn commission on both your own and your downline’s referrals. What’s different about Melaleuca’s MDL model?
Well not much. But just like there are subtle differences between Burger King and McDonalds, CDM and MLM are not the same thing. A key difference is in the compensation structure. With MLM companies, you earn a declining commission on your downline sales. For example, you earn 7% on your first level, 4% on your second, 2% on your third… Low commission rates often mean that the quickest and most efficient way to earn a good level of income is Grow your downline at a rapid rate. With CDM, you earn a consistent level of commission on each generation of your downline; 7% on your first level, 7% on your second, 7% on your third… This takes the pressure off of recruiting, meaning you can earn a decent commission with just 2 or 3 in your downline.
This also shifts the emphasis away from introducing products to customers, rather than trying to push starter kits. Compensation is only paid based on your referred customer’s invoice total; You do not receive commissions or bonuses based on customer acquisition/registration. Melaleuca restricts downlines to seven levels, which limits the size of your team. Because you can only grow your team to a certain point, the way you can earn big income is slightly different. If you introduce your downline to more products and try to get them to increase their monthly order with Melaleuca, then you will receive a higher compensation payment. The focus on products instead of recruiting is a major difference between CDM and MLM.
So is Melaleuca’s CDM framework an MLM in disguise? pretty much Melaleuca just put their own spin on the MLM model. To learn more about Melaleuca’s CDM framework, visit ExplosiveMLM.com