It Works! (the company) and what you should know before you join

It Works! is a network marketing company widely known for their unique body contouring products, especially the Ultimate Body Applicator™.

They also sell skincare products and have now expanded into nutrition and essential oils (see: Doterra and Young Living).

Calling themselves a “lifestyle brand”, their products are sold purely through direct selling, making It Works! a popular choice for people looking to start a home based business.

So have I been involved?

This video explains:

 

All good? Let’s continue…

Overview

A direct marketing company since 2001, It Works! reached their goal of $100 million in sales in 2012. By the end of 2013, they’d reached $450 million in sales and were on Inc. Magazine‘s list of America’s fastest-growing companies for the second year in a row.

In 2014 It Works! was recognized by the Tampa Business Journal as the top growing business in the Tampa Bay area. That designation is awarded to businesses displaying the highest figures in percentage-based growth and revenue increase by dollar amount.

There are more than 90,000 independent distributors in 18 countries (they’re called “Wrapreneurs”, named after the company’s signature product). Currently, the primary goal of this company is expansion beyond the current 18 countries and present number of Wrapreneurs.

They hired Janne Heimonen as President of International Operations to lead them in this goal. He will be responsible for operations in Europe, Canada, and Australia and will primarily focus on building local teams in Europe to support the expansion goal of It Works!

Success in network marketing often comes with a trio of events: hitting huge sales goals, expanding overseas, and new HQ. It Works! is no different from the rest in this regard: their new headquarters, purchased in 2012 and recently completed, is located in the Tampa Bay area.

Compared to Google’s headquarters, the 50,000 square foot building (actually located in Palmetto, FL) has some very unexpected features:

  • putting green on the roof
  • bumper pool
  • coffee bars on each floor

There’s enough space for 150 employees, yet another testament to the success of It Works!  Want more proof?  They jumped 29 spots on the list of direct selling companies in the world. That list is produced and maintained by Direct Selling News, and is based on revenue growth.

As for the founder, he’s not quite “rags to riches”, but almost. He and wife started It Works! in 2001 (well the kernel of the company started in 1995 when they first tried direct selling and discovered Mark was utterly fantastic at it).

They’d been living on his high school teaching salary (his wife was a stay-at-home mom with 3 kids). Now their company does hundreds of millions in sales each year.

One reason It Works! took of so well was its first product, which is still the flagship product of the company. It’s a toning wrap for the body (more on this below) and Mark brought it to market just when Baby Boomers were craving ways to look better, as part of the huge fitness boom for older people.

A toning wrap for the body that tightens the skin might sound like snake oil, but people love the product, obviously, so it must work on some level. Plus, look at the sales figures- they don’t lie.

Products

So, what is a “toning wrap” anyway?  There are actually two components to the Ultimate Body Applicator system: the Defining Gel and the Applicator. They are to be used on alternate days.

The Ultimate Body Applicator is a polypropylene cloth infused with extracts and other ingredients. You wrap it around any body part you’d like to look smoother and more toned. Common parts include the abdomen and thighs. People have also been known to use it on the chin, upper arms, and legs as well.

The Defining Gel is a body contouring gel that improves skin texture by hydrating it. The main ingredient after water is Witch Hazel, which is a type of alcohol, but after that it’s glycerin, which is a common ingredient in moisturizers. It also contains a long list of natural extracts from plant sources, as well as natural oils. Used on days in between “wrap days”, it get massaged into the skin like lotion and augments the results of the wraps.

There is a separate product to be used on the face. The product label claims users of this product can expect to see positive results within 45 minutes of using it.

Premium Supplements

There are also multivitamins, mineral supplements, and enzyme supplements with known ingredients and natural sources. They are premium quality, and come in stress-reduction, weight-loss, digestive health, and anti-aging formulas.

Compensation Plan

Wrapreneurs spread the word through social media and other online venues, then hold “wrap parties” to demonstrate the “crazy wrap thing”, as it’s called in company videos (wrap parties don’t get near the criticism of parties hosted by Tupperware and Princess Home affiliates).

There are 3 ways to join It Works:

  1. Retail Customers: Allowed to sell products and keep the difference between wholesale and retail pricing.
  2. Loyal Customers: These are the customers you get to enroll for at least 3 months of Auto-Ship. You get wholesale pricing on all the products in their Auto-Ship orders, and you earn commission on those orders, too. Build a team and get more commissions on your team sales.
  3. Distributors: Anyone on your team who finishes the enrollment process. They become part of your downline, on which you earn commissions. The number of levels depends on your ranking.

Qualifying to earn commission means either your bought a Business Builder Kit or you had at least 80 BV on auto shipment or at least 400 Personal Bonus Volume for the month.

There’s a $100 fast start bonus if you enroll 2 qualified active loyal customers or if any of your distributors do the same within the first 30 days.

Earn 10% commission on the first 2 levels, and open up additional levels by increasing your sales. You also get 5% enroller bonus on your Loyal Customer orders and personally enrolled distributor orders.

Compression exists, which means anyone below you who isn’t commission qualified for the month loses their earnings and they get passed up the line.

Recap

The compensation plan is a little complicated and there’s a lot of emphasis on recruiting. Of course that’s typical of an MLM company that’s still in expansion phases. And 10% commission on your downlines doesn’t sound so hot.

Until you learn what these products cost, that is.

At $75 for a tube of Defining Gel and $99 for the Ultimate Body Applicator™, now we’re getting somewhere. Supplements range from $55 to $139 retail, and event the essential oils are priced high at $99 for a pack of 4 and a $75 infuser.

The wrap product is a quick fix for looking good- it’s a seller, in other words. And sales figures prove, people eat this stuff up. The add-on products may or may not work, but focus the unusual and irresistible wrap products and it might work for you too. Might

I’m not a hater of the company. But in the end, it’s still the sad story of selling hype and chasing the hot opportunity.

If you’re not a fan of hitting up your friends and family on Facebook to join your scheme…There is a better way.

Check this out. It will help wreck your money-chasing habits.

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Jeremy Page

Jeremy Page created Multiple Streams for ballers, big thinkers and online business owners. You can follow him on Instagram here.

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