Chances are you’re here because you’ve been approached by a Beachbody Coach who has invited you to her ‘challenge group’ or suggested that you join her ‘team.’
It sounds great – who wouldn’t want to make some extra cash by recommending products you love to your friends while getting fit at the same time?
However, you’re a bit hesitant.
Maybe you think that everything sounds too good to be true, or you’ve heard people saying things like ‘Beachbody is a pyramid scheme!’ and ‘Beachbody is a scam!’ and you want to do your research before diving in headfirst.
However, when you type ‘Is Beachbody a pyramid scheme?’ into Google, the majority of results on the first page are articles written by Beachbody Coaches.
This is concerning for several reasons.
First, Beachbody Coaches are automatically biassed in favour of Beachbody.
They don’t want people thinking negatively about what they do, and as pyramid schemes are illegal, they don’t want to implicate themselves.
Secondly, and more importantly, Beachbody Coaches make money off every single person that joins the company through them.
If they can write a blog post that convinces you to join Beachbody, they will make money.
This article is here to help.
We are going to dive into the Beachbody opportunity and find out what being a Beachbody Coach is really like, whether Beachbody is a scam, and finally, whether Beachbody is just another pyramid scheme in disguise.
Is Beachbody a Pyramid Scheme?
What is MLM and is Beachbody an MLM?
In case you were wondering, YES, Beachbody is an MLM company.
MLM stands for multi-level marketing, and MLM companies are also referred to as network marketing companies or social selling companies.
MLMs have been around for years, and popular MLMs include Arbonne, Monat, Norwex and even Avon!
You don’t receive a salary in a multi-level marketing company.
Instead, you earn money from selling products to people you know and recruiting others into the business.
When you recruit a new person and that person begins earning money, you will earn commission from the sales and recruits generated by THAT person.
This continues down in multiple levels (hence multi-level).
Imagine a triangle.
If the person at the very top of the triangle recruits 10 people, and every one of those 10 people recruit another 10 people, and each one of those people recruit another 10 people, you’ll be making commissions from EVERYBODY within the triangle because they’re all in your direct downline (the people underneath you in an MLM are referred to as your ‘downline’ and you’re their ‘upline’).
All you had to do was recruit 10 people and you make money from 1100.
While MLM companies like Beachbody also give you the chance to make money from selling their products, most of the people in MLM companies prefer to recruit others because they stand to make a lifelong passive income from that person, whereas if they sell a product they’re just going to receive a one-off commission.
The ultimate aim of somebody in an MLM then, is to have as many people in their ‘downline’ as possible, enabling them to form large amounts of passive income for little work.
What is Beachbody?
Beachbody was founded in 1998 by Carl Daikeler and Jon Congdon in Santa Monica, California.
It is a fitness and nutrition company that offers a huge variety of workout regimes, meal plans and nutritional supplements in the form of powders, proteins, shakes etc.
The Beachbody flagship product is called Shakeology.
Shakeology is a group of ‘superfood rich’ shakes that are supposed to stop you from indulging between meals and they come in flavours including peppermint mocha and tropical strawberry.
When Beachbody’s first launched, it wasn’t an MLM company, instead using lots of late night infomercials and other traditional forms of advertising to spread awareness of its products.
However, about 8 years into its journey, Beachbody launched Team Beachbody, the MLM leg of its company and today there are more than 400,000 Beachbody coaches selling shakes and workout regimes to their social network.
Another Beachbody product is a subscription service called Beachbody On Demand.
Beachbody On Demand allows you to access all kinds of training videos on any device, with the help and support of a Beachbody ‘Coach’ who will hold you accountable and give you tips and motivation throughout your fitness journey.
Beachbody Coaches will also advise people on the best nutritional supplements for them, what workout is best to achieve their fitness goals and any other questions that clients may have.
Unfortunately, like many other things about Beachbody, Beachbody On Demand isn’t quite as great as it seems.
The Problem With Beachbody Coaches
The word ‘coach’ means ‘an instructor or trainer in sport,’ ‘a private tutor who gives extra teaching’ or someone who ‘gives somebody professional advice on how to attain their goals.’
It seems pretty safe to assume that Beachbody Coaches have some qualifications in the areas of fitness and nutrition, right?
A Beachbody Coach actually just refers to the distributors of the products, and not to people who have any qualifications, expertise or knowledge in the fields of fitness and nutrition.
All you need to become a Beachbody Coach is a social security number, proof that you’re over the age of 18 and proof that you’ve bought the Beachbody ‘Coach Business Kit.’
You do not need to have any training or qualifications related to health, fitness, nutrition etc.
Inside the Beachbody MLM Opportunity
How do Beachbody Coaches make money?
Want to learn how to make money as a Beachbody coach?
Well let’s get into it.
There are several ways of making money with Beachbody.
First, Beachbody Coaches receive commissions for selling various things.
For example, if you persuade somebody to join a ‘challenge group’ and they buy a challenge pack, you will receive a 36% commission.
If you convince somebody to sign up to Beachbody On Demand, you will make a 40% commission, and so on.
Like all MLMs, Beachbody Coaches can also recruit others into the company and earn money from the sales generated by those people.
The most people they recruit, the higher they rank in the company and the bigger their commissions get.
Kellie Gimenez, a successful Beachbody Coach states on her website that the real money to be made in Beachbody is by recruiting others into the business.
‘A majority of your income isn’t going to be coming from the products. The majority of your income, as you grow a team, is going to come from your Coaches and the volume they sell. Because you can only sell so many workouts a month…If they aren’t drinking Shakeology every month, I mean, they can buy one workout and never buy anything else from you. When I first started as a coach and didn’t have a team underneath me, I was making about $500 selling products. That’s not bad. It paid for our groceries. It paid for gas. It was a good income, but it’s definitely not something that could be a successful side hustle.’
In other words, recruiting is the best way to earn money with Beachbody.
However, in order to even qualify for the kind of commissions that Kellie receives, you have to meet certain criteria.
Here’s how it works, according to the Beachbody compensation plan:
Beachbody a ‘binary compensation model,’ which means that if you want to make money, you must have at least two ‘legs’ in your business.
One right leg, and one left leg.
Each of these ‘legs’ is a person that is underneath you.
When you recruit another person, you can choose to put them in either your left ‘leg’ or your right ‘leg.’
When those people recruit people, those recruits will also be a part of your downline and you will make a commission off their sales.
However, the catch is that in order for you to receive any commission from your downline, both legs need to be selling.
If one leg is performing well but the other one isn’t, you won’t receive a cent.
Your ‘weak leg’ needs to be making at least a third of the total sales in order for you to get paid.
Essentially, this just makes it even more difficult for Coaches to make money with Beachbody.
Below is what the binary compensation plan looks like.
One major red flag of a product-based pyramid scheme is a focus on growing a ‘team’ rather than selling products to the general public, and as we can see with Beachbody, the only real money to be earned is by growing a team.
How much do you make in the Beachbody MLM?
In order to see whether Beachbody Coaches are making good money, I took a look at their 2019-2020 Income Disclosure Statement.
An Income Disclosure Statement is a document that allows us to see exactly how many people are earning money with Beachbody, and how much of it they’re making.
The small print states that this table only takes into account coaches who worked for the entire year.
In other words, if somebody joined the business, decided that it wasn’t for them and quit after a few months, their earnings are not represented here.
This means that the results are already skewed because most people who are not doing well in something will quit before the 12 month mark.
The small print also states that only 43.8% of all coaches received any compensation from Beachbody, meaning that 56% of Beachbody coaches made no money in 2019.
The numbers we’re about to see only apply to that 43.8% of coaches who earned anything with Beachbody.
The Beachbody Income Disclosure Statement tells us that:
- 76.1% made an average of $439 for the whole year ($36.50 per month)
- 19.1% made an average of $3142 that year, or $261 a month
- 0.8% made an average of $1015 a month
These numbers show us that 96% of ‘successful’ Beachbody Coaches did not make enough money to replace a full-time job, and that isn’t all.
They do not take into account the expenses associated with being a Beachbody coach, which can run into the thousands.
How much does it cost to be a Beachbody Coach?
To be able to call yourself a Beachbody Coach, there are some things that you will need to pay for.
To sign up to Beachbody, you must pay a one-time fee of $39.95.
After 30 days, you will be charged $15.95 a month to remain in the company.
This adds up to $215.40.
If you don’t want to pay the sign-up fee, you can have it waived by purchasing a ‘challenge pack,’ which can cost anywhere between $140 and $275.
While not mandatory, there are other Beachbody expenses that are highly encouraged.
For example, you can pay $2.99 a week ($155.48 a year) to be a ‘Club Member,’ which will then give you the option to qualify for the ‘customer lead programme.’
This means that if somebody signs up to be a coach through the official Beachbody website, you will be placed into the pool of coaches who they *could* get placed with.
In other words, you’re paying $155 for a small chance at making some extra commission later down the line.
There is also the Beachbody Coach Summit, a conference that costs almost $300 not including airfare, accommodation, food etc.
There is a huge pressure on coaches to attend this summit, and if they decide not to, they will be told that they just ‘aren’t working hard enough.’
You are also expected to buy and use Beachbody products in order to show your followers how great they are.
It doesn’t end there.
In order to qualify for any commission at all, you have to maintain a minimum of 50 PV every month.
This is essentially a sales target, and if you don’t have enough customers to hit it, you can buy products yourself to ensure that you do.
It all adds up, and when you remember that most coaches not making money with Beachbody, every penny you spend on the business is a loss.
Is Beachbody a pyramid scheme?
In order to see whether or not the Beachbody is a pyramid scheme in disguise, we must first outline what a pyramid scheme actually is.
What is a pyramid scheme?
Pyramid schemes are very similar to MLMs, but the main difference is that MLM distributors are supposed to make more of their money from product sales rather than recruitment.
A traditional pyramid scheme takes an initial investment from each member and promises to pay them for enrolling others into the scheme, meaning that people are buying into an ‘opportunity’ to get rich.
However, as members increase, recruiting quickly becomes impossible and so most members are unable to profit or even make their initial investment back.
The Wikipedia diagram below illustrates just how unsustainable this business model is – after just a few levels of recruitment, the scheme would have recruited everybody in the world and there would be no-one left to recruit!
Because it’s impossible for most people to make any money in a pyramid scheme, pyramid schemes are illegal.
However, most pyramid schemes have got wise to the fact that they have to offer a product in order to appear legit, but even though a business may have products, the focus will always be on recruitment rather than product sales.
Because there are so many of these ‘pyramid schemes with products,’ around, the FTC hasn’t quite caught up yet, and so many people believe that just because a company hasn’t been shut down yet, it can’t possibly be a pyramid scheme, which simply isn’t true.
In order to see whether the Beachbody MLM is a pyramid scheme in disguise, we must attempt to answer 3 questions.
1. Are most people unable to profit?
In their Income Disclosure Statement, Beachbody reveal that only 43.8% of Beachbody Coaches make any money in Beachbody, meaning that 56.2% are earning $0.
Of those that do make money, the vast majority of them are likely losing money due to the amount that they’re spending on Beachbody just to ‘run their business.’
Of the Beachbody Coaches that did make money, 96% of them did not earn enough money to replace a full-time wage.
2. Do you have to ‘pay to play?’
The absolute minimum that you can spend to become a Beachbody Coach is $215.40, and that does not take into account a whole lot of other expenses that you will certainly rack up as a Beachbody Coach.
Most people in MLM companies end up spending a lot more money than they make in the company, and Beachbody is no different.
3. Is there a heavy focus on recruitment?
As we have seen, recruitment is the only way to make real money with Beachbody.
The higher you rise in the company, the more bonuses are awarded, commissions increase and you begin receiving passive income from other people’s sales.
Yes, Beachbody is an MLM, or multi-level marketing company.
The Beachbody income disclosure statement shows that unfortunately, most Beachbody coaches do not many money with Beachbody.
Shakeology is part of Beachbody, so yes, Shakeology can be considered an MLM.
As most Beachbody coaches make little to no money and Beachbody strongly resembles an illegal pyramid scheme, becoming a Beachbody coach is not worth it.
Is Beachbody a Pyramid Scheme? Final Thoughts
Most MLMs closely resemble pyramid schemes and Beachbody is no different.
With a huge emphasis on recruitment, fees to join and pressure to buy products in order to hit targets, Beachbody appears to be functioning like a pyramid scheme.
Most Beachbody Coaches are not making a profit, and so the idea that this is a legitimate business opportunity is just not true.
If it wasn’t already clear, Not Your Boss Babe does not recommend joining Beachbody, or any other MLM!
That’s about it for now, but if you have any questions or comments, don’t forget to leave them in the comments section below.
An alternative to joining Beachbody…
So then, how the hell do you make passive income online?!
Well, a much more viable alternative to network marketing is affiliate marketing.
Affiliate marketing is very similar to network marketing, but unlike multi-level marketing, you actually stand a chance at making a substantial amount of money from the comfort of your own home!
Just like multi-level marketing, affiliate marketing involves promoting products you love and making a commission every time you make a sale.
However, unlike MLM, there are no monthly quotas, no sign-up fees, no recruitment involved, and most importantly, the money that YOU earn will be going straight into your pocket, NOT trickling up the pyramid.
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