MLMs and Travel: A Bad Mix

And Now, Back To Our Regularly Scheduled Program

2009-12-10T04:33:00.000-05:00

Details Of the Big News Coming Soon

2009-12-08T04:02:00.000-05:00

We obtained a sneak preview of the things to come in YTB. In the new year, YTB and the Coach's Corner are convening in Las Vegas to make some "blockbuster" announcements. This is a memo from Duane Vancil the "Chief of Special Operations"

This will be like no other meeting that you've attended at YTB. It is a leadership summit - a meeting for the leader's leader. It is time for us to be proactive and retake our position as a dominant force in the Network Marketing Industry. We've been working diligently on our future; fixing issues that have plagued us for far too long. Some things are already visible while others will be unveiled in Las Vegas.

You will see, firsthand, new searchable reports and hear from CEO Bob Van Patten as he explains recently enacted corporate processes that will improve our accuracy and exceed your expectations.

You don't want to miss being the first to hear about the Pre-Launch of a new concept and be part of a live broadcast where Coach will announce this program to the rest of YTB.

We will show you how the travel franchise will tie into the launch of new initiatives.

You will hear updates on shopYTB and hear about new featured stores and products.

This meeting will be remembered as the turning point; the time we stopped reacting to our circumstances and crystallized our vision for the future! Make plans now to attend.

Duane

Duane Vancil, Chief of Special Operations

Please note that YTB is no longer referring to themselves as a "travel company" or in the "travel industry", but in the "Network Marketing Industry." And rather than being a focus of their business, YTB has now decided that travel will "tie in" to the other initiatives.

Who still doubts the direction and intention?

Where's Waldo Doug & Candy?

2009-12-07T04:56:00.003-05:00

This update just in from the ranks. Here are the leaders in the latest Coach's Corner contest.

So you've heard there is Coach's Corner Contest, right? If you haven't, the TOP 3 Coach's Corner Members in number of Qualifying Sales during the Contest Period will receive a 7 day, 6 night no-hassle trip for two to the location of winner's choice! The Coach's Corner Members who are in the 4th through 25th positions in sales will receive $1,000 in cash! So who are the leaders so far?

James Prewitt is currently in first place with Deborah Bradley just 12 sales behind. In the number 3 position is Donald Bradley who is 14 sales behind the leader. Shedrick White, Tonya Mizelle and Trey Harris are all within 20 sales of the lead and Tinkey Miles and Fabulos Darley are tied for 7th place. Rounding out the top 10 in a tie for 9th place are Rita and Damon Walker, Keith Jones, Garland and Marsha Webb and Roland and Michelle Athouris.

Maybe the "TravelPros" ought to stick with their day jobs.

Recruiting Not So Good

2009-12-04T04:50:00.000-05:00

Contrary to Scott's assertion that YYTB is here to stay, it seems that recruiting is STILL way off. There is dissension among the troops again and YTB has once again cut the threshold to get a bonus in half!

It seems that many people are unable to recruit 6 people. What happened to this being a "no brainer?": It seems that mass defections are having an impact.

This next announcement is a huge deal for you, our builders. Some of our top leaders need more than 6 sales to earn a $1,000 Leadership Bonus because of fall off. Now the $1,000 Leadership Bonus is no more than 6 sales away! How? Reps that need more than 6 sales for their next bonus are being reset. What that means is that no one will need more than 6 sales to receive your next $1,000 Leadership Bonus! Anyone that is less than 6 sales away from your next $1,000 Leadership Bonus will remain the same. Your most recent sales will count toward your next bonus.

If you think that is great, hold on! Whenever you earn a Leadership Bonus, the sales associated with that Bonus will be locked away. No longer will you have to replace the sales that fall off from any previous Bonus! This will work exactly the same way as it currently does at 30 sales BUT NOW it happens at 6 sales! And as extra incentive for you, the builder, all sales made after October 31st will count toward your next Bonus. If a Site Owner makes a $99 payment and it is one of their first four payments, it will count as .25 toward the current bonus. All sales made prior to November 1st will not count toward any Bonus unless they are one of the 6 that count for your current Bonus. Those sales will count toward the $10,000 Bonus. This program is good through, at least, the first quarter of 2010.

The Check Is NOT In The Mail

2009-12-03T07:49:00.000-05:00

Aisle 19 has been around for a long time. And Shop YTB has been as well. We wondered why most of these transactions were never reflected on the balance sheets submitted to the SEC. Perhaps this update may shed some light onto the situation.

It appears that in Shop YTB, there are only two stores that are indeed paying commissions--Body Slimwear (hence the emphasis on the girdle sales) and YTB Insurance. It also seems that the the "cash back when you shop" is having issues as well. So to all the YTBers who claim you received tons of cash back, I guess you were mistaken.

I wonder how the consumers who signed up feel. They were told that they wouldvget cash back and now it seems that too is delayed. Hmm. All is not well in Shop YTB.

We are pleased to announce that on December 25th we will be paying shopYTB commissions to Site Owners on products for which we have received both sales data and money. Featured Stores that will be included in that payment are Body SlimWear Collection by Ghiada and YTB Insurance quotes.

We have not received everything we need from the Aisle19 Featured Stores, which include Digital Discounts, Xymetri and Makaila Morgan. Until we receive everything we need from Aisle 19, their Featured Stores and products cannot be included in commission or override payouts. We are working diligently with Aisle 19 to facilitate this process.

Cash back checks will be sent this month to customers as long as they have earned a minimum of $2.00 cash back. Subsequent cash back checks will be sent to them when their account reaches a balance of $10.00.

We are working vigorously to pay your override commissions for shopYTB by December 11, 2009. In the event that we do not meet that goal they will be paid on January 11, 2010.

What A Year It Was

2009-11-30T04:52:00.001-05:00

Obviously 2008 was a very difficult year for the travel industry. 2009 was not too much better; but there is some light at the end of the tunnel. When you compare the stock prices of a cross section of the industry all segments are up except for the airlines (who are dealing with fuel prices and ancillary revenue) and YTB. In fact, the average increase from 2009 to 2009 is 154%! Some notables are Expedia and Priceline--both up over 260%. Apparently they have discovered a business plan that consumers trust and support. Perhaps it is due to the fact that they hire travel professionals. Even the staid brick and mortar American Express is showing a 122% increase. Do the executives at YTB have a solid explanation for this? Certainly if the performance was close to the competition, but when your competition is showing triple digit increases and you are showing almost triple digit decreases, something is wrong!

Travel? What's That?

2009-11-27T04:08:00.001-05:00

YTB is clearly moving onto different (not greener) pastures. Travel has really become a secondary (or tertiary) focus for the vast majority. In this video, Kim Sorensen proclaimed that YTB was "good friends" with the President of Costa Cruise lines and then proceeded to forget his name and relied on his daughter (Shelly Sorensen Coppersmith) to remind him--yes, nepotism is alive and well and earning big salaried bucks in Wood River.

If you needed further proof that travel has fallen by the wayside, watch what Shelly has to say about the YTB Seminar At Sea on the Atlantica. She had just returned from it and out of the 50,000 RTAS, there were "about" 60 on board.For the math challenged that is about 1/10 of 1 % of the RTAs that were interested enough in a travel product to attend a seminar at sea.

Happy Thanksgiving

2009-11-26T00:24:00.001-05:00

More Deception

2009-11-25T12:08:00.000-05:00

I watched this video (caution: 18 minutes long and very time-shareish) the other day and I seem to recall not too long ago that the very same Melissa Boston was speaking about how revolutionary YTB was because they sold travel. I have said for months now that they are re-focusing their efforts on other stuff and apparently the "other stuff" is now girdles.

As I was watching this, I just kept thinking that YTB is promoting this as something new; like they invented it or something. Just like when they went into travel; they proclaimed they were the ones that put travel and the Internet together. Invariably some will believe this.

The other thing that struck me on this video was that it was all about deception. Melissa talks about being sexy, looking sexy, and acting sexy. Doesn't it make sense that after all that looking, being and acting that you might actually become involved in sex?

What is the reaction of a guy or girl (yes, YTB sells man girdles too) who courts this "sexy" woman or man and finally gets down to business and "unwraps the package" to find out that they have been deceived all along. What they thought was a svelte and trim partner, is indeed really a human cousin to an Orca.

Then I realized, that deception is a way of life for YTB. Look at the false promises made over the years by the directors and recruiters. The deception cost them a million dollars in California and who knows how much in Illinois?

A New Look

2009-11-21T17:02:00.001-05:00

I was bored with the old look. Check back as I tweak this some more!

The Coach, Scott and Kim Show

2009-11-17T17:14:00.001-05:00

This bit of news from the Louisville area. Hmm, now who was the heavy recruiter in that area? Oh yeah, wasn't it Candy May?

Unmotivating Indeed

2009-11-16T12:40:00.002-05:00

Good Solid Professional Advice

2009-11-11T04:17:00.000-05:00

With so many people going AWOL in the middle of a cruise, one might think that advice such as this might not be the most appropriate coming from a "travel professional"

A grown Man can act a 'sho nuff Fool aboard a Carnival Cruise Ship....Cruise ship rules, y'all...remember!

But it's ok.

Now this is what I like to see! It's FUN FOR ALL~

It's Only A Small Hole In The Hull

2009-11-09T04:07:00.003-05:00

When YTB ran into the iceberg several years ago, many (including myself) thought she would go down like the Titanic. There is good news and bad news. The good news is that the damage is done and apparently is unable to be repaired. The bad news, is that it is a smaller hole than originally thought and it will be a slow and painful finish to the pyramid scheme.

A month ago, I predicted the number of RTAs at the end of the 3rd Quarter to be 52,000. I was close. The actual number is 50,421. Many thought I was way off base. The most recent 10-Q was released on Friday (PDF, 159 Pages) and as expected the numbers are not impressive. Just some highlights:

Current RTAs number 50,421 ( a 9 month loss of 41,962)
3 months income comparing this year to last is down by 45%
The 9 month net loss is $3.1 million (versus $3.4 million for 2008) despite having 64,000 fewer RTAs
They have blown through 400K and are down to $800K cash available
Their credit card processor upped their escrow to $3 million
On November 5, 2009. two more Board members quit and required a very complete indemnity contract
Nearly 70% of their business is still from recruiting. 22% from travel (3 months)
78% of of their business is from recruiting and 17.4% from travel (9 months)
Travel Commissions earned this quarter are $3,642,000 (extrapolated that means that they sold $36M in travel. With a weighted RTA count of 53,688, the average RTA sold $670 in travel this quarter)
Commissions paid to RTAs this quarter were $2,069,000. An average of $38.54 per RTA.
Commissions paid to RTAs for the first 9 months of the year were $5,694,000. An average of $86.70 per RTA.
RTAs appear to still be on target to earn just over $100 a year. This number has not significantly changed in several years.
Travel commissions received this quarter have decreased 50.5%
Travel commissions paid this quarter decreased 54.9%
YTB has stated that due to poor sales performance, they do not expect to earn an override
There is still no mention of revenue generated by YTB Cars, YTB Camping, YTB Romance, ShopYTB, etc.
The Illinois suit is still hanging in the balance.
The Class Action suit is still active and awaiting a judge's order for the plaintiffs to resubmit
They have terrible terms on a loan on the headquarters which is rumored to be for sale in order to raise cash
They were stiffed on the property they sold and need to foreclose on the property
The result of the case involving the former Directors is still ongoing

The attrition of the RTAs is particularly interesting over the past year. It shows a decided lack of confidence in the program as well as a lack of results from their vaunted Directors--the ones that remain. While overall, the rate of loss has decreased--they are losing 144 RTAs per day this quarter as opposed to 193, and 289 per day in the prior two quarters. They are not recruiting nearly enough people to remain viable. This quarter, they were recruiting only 33 people per day compared to 45 and 83 in prior quarters.

The numbers suggest that YTB is consistently losing 16% to 18% of their paying RTAs per quarter. If this trend continues, the numbers will be under 20,000 this time next year, and under 10,000 by December 2011. The big question remains how long YTB can keep up the charade and continue to convince people to send in $600 per year for a measly $100 in return. Of course if YTB settles with Illinois for any substantial sum, it will also put another whammy on the picture.

There are a lot of ifs, ands & buts surrounding YTB. But for now, they are still around, and still selling travel (albeit at half the rate they were) and still recruiting people into the scheme.

The Dissatisfaction Continues To Fester

2009-11-05T10:29:00.000-05:00

There is a discussion on the Coach Tomer Facebook Page that pretty much illustrates what I have been saying for many years. You can't make money in YTB selling travel. But this time, it is not me speaking, but those actually in YTB.

I actually do not blame anyone for this not working out for me. I loved what I was doing truelly I did, I would do it full time for my main source of a job if I could, however I just could not make any money at it, and what is worse, being a travel site owner and promoting travel, I really thought some benefit would come to me. I have traveled quiet a bit since becoming a RTA and when I tried to use my credentials, they basically would laugh at me, so I finally got to the point in saying if it does not benefit me, why go on?

Thank you though

Long But Interesting Reading

2009-11-03T04:06:00.000-05:00

If anyone is interested in a long (146 Pages PDF) document, you can read about all the inner workings of YTB as they were transcribed from a hearing in the case against the departed directors--Bill Hoffmann and Kent McLaughlin.

You can see where they did indeed change the compensation plan, the forced acceptance of new terms and more.

You can download it here! Certainly will give some insight!

Settling Down

2009-10-29T04:40:00.001-04:00

After rocketing to 9 cents a share on the news that Coach was fired from the Board, YTBLA has now settled back down to where it was before. It certainly seems like the markets don;t have too much confidence.

Just Some Thoughts

2009-10-26T11:47:00.000-04:00

I had a conversation with a YTB Director this weekend and he was insistent that YTB was travel focused. He chided me about the post about Shop YTB and them proceeded to tell me about all the juices and slimming clothes that were sold out as a result of Shop YTB. Not too much mention about travel.

As he was explaining the Shop YTB mall to me it dawned on me that indeed YTB seems to have just shuffled the deck chairs once again. His comment which was my "aha moment" was "with the money you can save in your own personal shopping, it more than pays for your monthly YTB fee."

There you go! A few years back, YTB was using travel as the hook to get people to sign up into the recruiting/pyramid/endless chain scheme. They portrayed jetting across the globe at pennies on the dollar and travel suppliers fawning over them. Well, we all know how well that worked out as is evidenced by the lawsuit in California, IATAN, RCCL, NCL, Illinois lawsuit, million dollar fines, etc.

So what does YTB do? They get involved with one of the multitude of online "shopping malls". Initially it was Aisle 19 and now they are partnered with someone else but privately branded. This is no different than Market America, Aisle 19, and many others.

So what is the hook? How does YTB convince people to pay them $49 a month for something that they can get for free almost anywhere else? They promote the personal savings and the "incredible commissions" when people buy from your mall. And I am sure that very little non-selfsold merchandise is purchased through the portals.

But to get these wonderful discounts/cash back and commissions because your friends and family will want to buy from you (that worked really well in travel didn't it?), you MUST have a YTB travel site at $49 a month. The pitch is that it will pay for itself with cash back. The hook is that you will have a travel business.

Once again, YTB has found a way to make a whore out of the travel industry!

What Happened To Aisle 19?

2009-10-23T10:50:00.000-04:00

Did Aisle 19 fire YTB? It sure seems so according to their CEO who set the record straight on this forum on October 8, 2009. So, Aisle 19 is no longer the power behind YTB? Can someone explain?

Hello All, maybe I can set the record strait. I am the CEO of Aisle19, Inc. Aisle19 is not a MLM or network marketing company. However, Escape, a company that markets for Aisle19, is a network marketing company...a darn good one. Escape and Aisle19 are owned by the same parent company, thus the confusion sometimes.

However, Aisle19, is not an MLM company it is simply an online savings portal. Of the 600,000 plus members of Aisle19, only 50,000 of them are involved in the partner company- Escape International, Inc.

Aisle19 provide its FREE members with a FREE saving's portal where they can shop at their favorite stores. When they do, they get exclusive sales (about 15% of time) and Cash Back on their purchases (avg. 5% cash back).

They pay the same price as they would by going to Target, etc. direct-but they get cash back and sometimes better prices than target direct.

If someone is simply a customer, they never join Escape. If someone wants to earn money by giving Aisle19 away. Then they can join the Escape income opportunity. When they do, they become Escape IBO (independent bus. owners) as well as Aisle19 members.

If part of Escape, an IBO also gets paid a percentage when one of their customer shops online via Aisle19.

Pretty simple! A customer uses Aisle19 and saves and gets cash back. An Escape IBO also earns for giving that Aisle19 membership away.

Scam? No.

So, to answer the original questions. Aisle19 is not a scam, and Escape is the finest Income opportunity in the home based business world.

Also, as an answer to another question: Aisle19 is no longer providing YTB with access to the Aisle19 online mall.

If you have a question and want facts by someone who is liable for what they write. Write my offices directly at david@aisle19.com. I'd be happy to have someone (or myself) answer your questions directly.

Thank You,

David Rutz
CEO
Aisle19, Inc.
Escape International, Inc.

Plagiarism 101

2009-10-20T04:43:00.000-04:00

Even if you don't write for The Examiner, you too can plagiarize right on Coach Tomer's Facebook Page. Go ahead, they won;t care!

On Saturday, ~~disciple~~ Independent Marketing Representative Andre Hackley came up with this gem:

No other city comes close. It may no longer be caput mundi (capital of the world), but Rome is an epic, bubbling-over metropolis harboring lost empires. One visit and you’ll be hooked. Rome has a glorious monumentality that it wears without reverence. Its architectural heirlooms are buzzed around by car and Vespa as if they were no more than traffic islands.

Funny but that seems very close to this gem published here:

No other city comes close. It may no longer be caput mundi (capital of the world), but Rome is an epic, bubbling-over metropolis harboring lost empires. One visit and you’ll be hooked. Rome has a glorious monumentality that it wears without reverence. Its architectural heirlooms are buzzed around by car and Vespa as if they were no more than traffic islands.

A Cult? You Tell Me.

2009-10-15T10:56:00.000-04:00

Too Funny!

2009-10-12T04:25:00.000-04:00

Tony Ytb

Coach Is In Italy Eating Great Italian Food, But Still Thinks About Us & Want's Us To Eat Good Food Too!! Monge!! Monge!! Everyone!!

The RTA Attrition Continues

2009-10-09T20:29:00.001-04:00

If you will recall, for the last quarter, YTB was losing a net of 149 RTAs per day which showed some improvement over their full year attrition of 178 RTAs per day.

It seems that the 3rd quarter is continuing the trend of losing less RTAs per day than the previous quarter, but the attrition is still very alarming.

At the end of the 3rd quarter, YTB has only 52,000 RTAs. This represents a net loss of 95 RTAs per day. Moreover, any decline has a direct impact on the income since most of the income is derived from the RTAs paying their monthly fees.

To illustrate, at their peak of 138,000, at $49.95 per month, this scheme was generating $6.8 million dollars per month. Now at 52,000 that income has been reduced to $2.5 million dollars per month.

Of course the latest push has been to Shop YTB and not travel. YTB is making a decided push to other retail outlets to make up the money that they are not earning selling the travel websites.

It is only a matter of time until travel will leave the portfolio entirely. This will get the travel professionals off their backs, it will get the attorneys general off their backs, and quite possibly may give YTB as a corporation a chance at survival.

I have said many times that MLM and travel do not mix and one of the main reasons is the narrow margins in travel. You can only split a penny so many ways.

More info on the upcoming 10Q as it becomes available.

No More Sweetheart Deals

2009-10-09T11:32:00.000-04:00

It is interesting that only now that Coach Tomer has been ousted that Travel Pro admits that under the Tomer's guidance, the Board was stacked with cronyism and neoptism.

All in all, it’s a great move for YTB, especially with the way this all this developed. This isn’t some band aid or hasty move that didn’t have input or thought put from everyone involved. Not with the Board of Directors YTB now has. Gone are the “good ol’ boys” and “buddy system” and in with some very promising and talented executives.

Wow, it was not too long ago that he was cheering on the same Board filled with "good ol' boys" and "buddys". What has changed? Is this an admission of a complete failure of corporate governance?

But be clear, the deal Van Patten got was not the same deal that Tomer got. The base salary was slashed by nearly 15%. Tomer still is the Top Director in the company and earns off of every recruit. Tomer still retains the overrides on sales from the IBCs (Internet Business Centers). But look at the two base compensation programs:

Van Patten:

The Company and Mr. Van Patten have executed an employment agreement with a term of twelve months, beginning October 6, 2009 and expiring October 4, 2010. The Company has agreed to pay Mr. Van Patten an annual base salary of $300,000. Mr. Van Patten will be eligible to receive an annual performance bonus equal to 2% of the Company’s annual earnings before taxes if the earnings are greater than $500,000 but less than $1.5 million, 2.25% if the earnings before taxes are greater than $1.5 million but less than $3.0 million, or 2.5% if the earnings before taxes are greater than $3.0 million. The Company has also agreed to provide Mr. Van Patten with a monthly car allowance of $1,000, and he will be eligible to receive management-level employee benefits. Either party can terminate the agreement at any time without recourse.

And Tomer:

Under their employment agreements with the Company, each of Messrs. J. Scott Tomer, J. Kim Sorensen, J. Lloyd Tomer and Michael Y. Brent will serve in their positions for five-year terms, earning starting annual base salaries (in fiscal 2008) of $325,000,which shall increase in increments of $25,000 for each successive year under the agreements. Each employment agreement automatically renews for additional one year terms at the then-current base salary upon the expiration of the initial term or any successor term if either party does not provide notice of non-renewal at least 90 days prior to such expiration. Each of Messrs. J. Scott Tomer, J. Kim Sorensen, J. Lloyd Tomer and Michael J. Brent will be eligible for a cash bonus equal to a percentage of the Company’s net pre-tax income for each year in which such income surpasses certain thresholds, in the following percentages:(i) 2.0%, if net pre-tax income is at least $500,000, but less than $1,500,000; (ii) 2.25%, if net pre-tax income is at least $1,500,000 but less than $3,000,000; and (iii) 2.5%, if net pre-tax income is at least $3,000,000.

And one other item the press release did not address was that Andy Cauthen was also forced from his President and COO position within the company (YTB International) and will remain as Secretary of the Corporation as well as COO and President of the subsidiary YTB Marketing reporting to Scott Tomer.

Coach Fired From His Own Pyramid Scheme

2009-10-09T10:07:00.000-04:00

COACH IS FIRED!

According to a press release issued this morning, it appears that our sources yesterday were indeed correct.

Coach Tomer no longer has a position in the Corporation and is now the the top Rep in the Pyramid and has been replaced by "Consultant" Bob Van Patten.

It will be interesting to see how this impacts the issues facing YTB including their cash flow situation, their declining enrollment and more importantly the civil lawsuit filed by Illinois Attorney General Lisa Madigan.

I suspect that with Coach out of the corporate picture, YTB may be in a better position to negotiate a settlement with Illinois. But, then again, the suit charges Tomer individually and corporately. And one wonders how and if the insurance will cover him.

Watch the stock carefully!