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On Tapes and CDs

July 15, 2008

There have been a number of recent blog posts on the topic of tools, so today I figured I would contribute my own story.

Standing Order Tape for 10/07/1997

Standing Order Tape Receipt for 10/07/1997

When I was an IBO, I plugged into a weekly Standing Order Tape program (SOT) through my Amway Motivation Organization (AMO), INA. I received three packages a month containing a total of five tapes. Two were Nuts and Bolts training tapes, which taught prospecting skills, tips for showing the plan, or objection handling techniques. Two were Lifestyle or Dream tapes; these contained inspirational stories from Emeralds and Diamonds about how the business changed their lives. Many of these tapes were recorded during Major Functions or Monthly Opens. Finally, the last tape was often from a speaker who was not part of the System.

The Economics of Tapes and CDs

Prices ranged from $6 to $12 depending on the tape’s duration. With tax, shipping and handling charges, IBOs on SOT figured to pay over $55 a month, or $660 a year. The System also offered additional prospecting tapes and various tape collections for purchase at functions. An IBO who was serious about building the business was highly encouraged to purchase these additional tapes, which could easily raise annual tape expenditures to well over $1,000. Today, CDs have replaced tapes and are even more expensive at $8 a CD.

BWW CD Duplication Facility Screenshot

BWW CD Duplication Facility Screenshot

To get a sense of how much money is flowing through a Diamond organization, let’s perform some back of the envelope calculations. A 6-4-2 Platinum leg contains about 80 people. With six legs to form a Diamondship, we have 480 people. If we assume that 75% are on SOT, we are seeing $20,000/month or $240,000/year in tape sales through one Diamond. Of course, we have to consider the cost to produce these tapes and CDs. Check out the video on the Britt World Wide homepage and watch the large-scale CD and tape duplication system they have on display. With the means to produce tools for pennies on the dollar, there’s a lot of money left over after tape production expenses.

Who are the primary financial beneficiaries from these tools? It’s certainly not the plugged-in IBO at the bottom of an organization; he or she is paying full price! No, it’s plainly clear that your upline Emeralds, Diamonds, and to a lesser degree your Direct, are getting the lion’s share. When purchasing additional tools at Major Functions, we always had to write down our upline Direct and Diamond’s name. What I didn’t realize at the time, it was to facilitate the flow of money to the right pockets.

The Value of Tapes and CDs

My music library contains thousands of songs which I can access at the push of a button. While I continue to enjoy music I might have purchased years ago, I can’t say the same about the System tapes. In fact, when I made the decision to quit, I sent boxes full of tapes — worth thousands of dollars to my Diamonds — right into the dumpster. Sadly my story is not an isolated case; read other’s experiences on Scott Larsen’s AmQuix.info website. What’s left? Nearly every SOT receipt, dutifully saved for tax purposes (a topic for another day) and vague memories gleaned from the titles of each tape.

Tool Depot

It’s clear, outside of the business, there is very little value in System tapes and CDs. One needs to look no further for confirmation than on eBay, where there are dozens of auctions for used tools with no bids. Buy and open a CD for $8, and its resale value immediately becomes zero.

Within the business, it’s debatable whether tapes have any value. Even if you agree that these tools are helping you build a profitable Amquix business, don’t you feel you’re paying a little bit too much for them? With today’s distribution technologies, there’s really no reason — other than profit motive — for these tools to be made available at drastically reduced costs or even freely. If the tools serve to build bigger Amquix businesses, wouldn’t it make sense to lower their costs to help an IBO’s bottom line? It’s common sense and good business, unless of course, the business is selling tools!

Today, you can download podcasts of courses from top universities such as Berkeley, MIT, Yale, and Stanford, free of charge from iTunes U. It may not be the same as actually attending these universities for four years, but I would argue that it’s better than four (or more) years of listening to the same tapes over and over again.

Looking to the Future

If you are a current IBO and have reached this point in this post, I encourage you to understand how money is made within both the Amway/Quixtar business and your Amway Motivational Organization. When you listen to your next tape, ask yourself if the speaker is in the business of selling products or selling motivation and hope?

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12 Comments leave one →
  1. July 16, 2008 10:32 am

    And the tapes/CD’s are just SOME of the profit. Consider the books, websites, voicemail systems, Opens, Seminar/Rallies, and Major Functions.

  2. July 16, 2008 11:07 am

    Welcome Tex. In my future posts, I will cover these other profit centers.

  3. Joecool permalink
    July 16, 2008 1:27 pm

    The problem with tools is that they are never ending and they don’t produce results.

    Since IBOs often compare tools to a carpenter buying a saw and hammer. A carpenter will usually build something with those tools.

    With fabulous lifestyles, early retirement, and passive reisudal income willable to future generations as the reward, I’m certain a lot of people give this business and system reasonable effort, yet so few ever reach significant levels, and of those who do, there is evidence that it’s not what is promoted.

  4. July 17, 2008 8:35 pm

    Amtraxed…..

    Tools are indeed the unexplainable business non-expense I have every seen. A man in a real business can’t absorb those types of cost and expect to remain in business. These tool kingpin crooks simply make these folk the Simple Simon of plum sucking tool idiots. What should IBOs do about these tool kingpins hovering over them like the turkey buzzard he really is.

    I actually think I run into one of these kingpins on Sequence Inc. Fraud Files. He tried to defend his tool empire but you could tell he was just defending his greed. I think he said he was Bob Smith. Anyone know a kingpin by that name?

    joecool…

    You can’t beat around the bush with these con men and women who go out every night and try to sink the Amway fangs into another of the village inhabitants. The “Business Cult” actually operate like Elvira. She wants to sink her dead fangs in the villagers now. Maybe we ought to dig her up, and put a wooden stake in her heart to keep her that way, semi-dead.

    I get to think that this Bridgechit must be bend over boy’s beach? She’s still alive, so it wouldn’t be a nice thing to do, you know, to put a wooden stake in her cold hearted con woman that she admits she is.

    I got to ask you guys if anyone really thinks I said anything bad enough to get kicked off of I Bend Over For Boys critter? This boy is sick in the membrane. It wasn’t like I was dropping FOAD bombs. I wasn’t that vulgar. Birdchit pie is merely a parody or satire. When someone jumps to conclusions about another’s intent, they make themselves look bad.

    Hey, you cut the birdchit pie up and shove it down the pie hole that all those lies they be a asking folk to believe. These folks have birdchit pie on their face! hehehehe. Lick her up good yonder birdchit pie eating critters.

  5. Carlos permalink
    July 18, 2008 11:31 am

    I was an amway distributor in Amway back between 1994-1997, also in INA. My diamond was Jim Floor. I NEVER felt comfortable just meeting people for the sake of showing them the business. It seemed fake to me.

  6. July 18, 2008 8:28 pm

    Thanks for the note, Carlos. I have not read or heard from many former-INA IBOs. I’m hoping that this blog will help more of them come out of the woodwork and share their personal stories.

  7. July 23, 2008 1:13 pm

    joecool,

    The point isn’t the results or lack thereof, the point is the tool scam.

    If the tools “worked” (many more IBO’s getting involved), you would be scamming more people than if the tools didn’t “work” (much fewer IBO’s getting involved).

    In fact, the more the tools “work”, the bigger the tool scam.

  8. Joecool permalink
    July 24, 2008 10:21 am

    Tex, that’s where you and I disagree. I think the tools scam is a bad thing. But the tools are bad for more than one reason.

    They are the real busienss for the kingpin diamonds and they tools do not produce success in the quixtar business. There is little evidence that the tools actually help people to advance in the quixtar business.

  9. July 24, 2008 10:34 am

    joecool,

    If you weren’t making much money via the tools, there would be an economic incentive for the upline to either use less tools (and spend more time sponsoring and/or retailing) and/or change the content to make them more effective at increasing PV.

    There is no economic incentive to do this with in the current scenario.

    You have to allow free enterprise to operate, it is a very efficient economic model. We don’t currently have free enterprise when the LCK’s lie about the source of their success to their self-proclaimed downline “teammates” and “business partners.”

Trackbacks

  1. Genie INA Bottle « Amthrax
  2. Debate on Systems Tools over on Amway Talk « Amthrax
  3. Tape Recording Income Claims « Amthrax

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