Send your thoughts about House Bill 2843

The bill can be found below. Click here for a summary about the contents.

The legislators in Tennessee are looking for input about the bill. This is an important bill for residents in Tennessee as well as fellow professionals in the network marketing industry. Please send your input in support of the bill to the Commerce Committee’s research assistant, Anna Richardson: [email protected] Also, be sure to CC the Chairman of the Commerce Committee, Jack Johnson at: [email protected] If you have any suggestions or ideas about the language in this bill, feel free to share your thoughts here or with the legislators.

House Bill 2843_Draft

MonaVie and the Push for “Proprietary”

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MonaVie is experiencing a slight erosion in its distributors. It happens. Companies get mature, the original excitement wanes, the once sexy and cutting edge ingredient becomes a commodity and various leaders start looking for the next best thing. It’s certainly not the end of MonaVie…they’re one of the largest companies in the industry. They’re simply facing some struggles that’s not unique to their business or this industry.

Rod Cook, MLM Consultant and editor of the MLM Watchdog site, referenced some of MoanVie’s struggles in a video and cited a few reasons for the decline: expensive monthly autoship requirements, lawsuits against distributors after publicizing their “Open Door Campaign” and changes in their compensation plan.

Experience is the best teacher

There’s a lot to be learned by watching companies work their way through struggles. There’s a saying that says: “The best teacher is experience and the best experience is someone else’s.” In 2007, Amway went through a bad regulatory experience in England and made subsequent changes that literally saved their business. There’s a lot to be learned from their adjustments in England and in the United States.

So how is MonaVie responding? They’re dropping their prices, increasing their PV and rolling out a free shipping program for distributors on AutoShip. In short, the story of the acai berry no longer supports the hefty margins from the early days. They’re also doing something a little more subtle: they’re locking down intellectual property rights to give their product a clear point of difference from other comparable items in the marketplace. I’m calling this a “Push for Proprietary.”

The “Acai berry” is an amazing product with incredible health benefits; however, it’s no longer a strong selling point to say “we have the acai berry” because the berry is EVERYWHERE. It’s in shampoo, countless juices, ice creams, smoothies, coffees and energy drinks. It’s even in vodka, which is just weird!

In the past, I’ve written about the importance for companies to commit to innovation to keep their distributors armed with relevant products. It’s a challenge for companies because the speed of innovation across the world has accelerated. Companies can either innovate fast or lock down the proprietary rights to their products via patents.

Since the Acai berry is not proprietary and MonaVie is not able to lock it down, they’ve recently patented a “brand” of acai (dubbed “AcaVie”), which I’m guessing includes a unique extraction method. The “AcaVie” logo will now appear on the MonaVie bottles in their effort to build up the value of the mark “AcaVie,” which they own. So when a prospect says “Why would I pay $X for a bottle of monavie when I can get the same thing for $Y at Walgreens?”, distributors now have a stronger point of difference by saying “We have the exclusive rights to AcaVie, which offers the most health benefits associated with the acai berry.” It gives distributors another point of difference to justify the price of the product.

Leveraging Proprietary

Understand, this is not MonaVie’s first patent but it’s an example of leveraging “Proprietary” to protect a product from price erosion. “Proprietary” is an important word in the direct sales industry. If a product is proprietary, it serves as an assurance for the distributors that they’re not building up the brand awareness of a product that will eventually devolve into a commodity once it gets duplicated. “Proprietary” insures the sales force that their sales efforts will stick. Right now, brands hanging their hat on the Maqui berry or any other hot ingredient should learn from MonaVie and think of ways to at least patent the process by which the ingredient is extracted or used.

What do you think about this? Is MonaVie making good changes to protect their margins? What can other companies learn?

Len Clements

Len Clements’s influence in the network marketing industry cannot be understated. I can say with 100% certainty that Len is one of the most knowledgeable individuals in the country with respect to the direct sales industry. In addition to his specialty of creating compensation plans for startup companies, Len is incredibly well versed in the law. When it comes to the particular needs faced by startup companies, Len has a lot to offer.

Len is a tireless contributor to the betterment of the direct sales industry. It’s amazing how much work product he produces each week. He does work for clients, he conducts interviews with various industry leaders, he’s an extremely active leader for the Association for Network Marketing Professionals, he’s been a keynote speaker and he’s one of the most sought after expert witnesses for companies in litigation.

In addition to his professional abilities, I also value Len Clements as a friend. Whether I’m filing a class action lawsuit or trying to pass an anti-pyramid scheme bill, Len was always there to spend hours with me providing his perspective and guidance. Instead of reacting emotionally to rumors, Len has always struck me as a guy that “seeks first to understand.” No matter the circumstance, he’s always trying to get all of the information before forming his opinions, which is another reason why I value Len’s friendship.

If you’re in the market for a MLM Consultant or an expert witness, Len Clements is certainly a person to keep in your roladex. His resume is provided below.

Len Clements – Resume