Network Marketing Compensation Plans
The Forced Matrix

The matrix compensation plan, or forced matrix as it is commonly known these days, is essentially a unilevel plan with its emphasis being limited width. The distinguishing feature of the plan is therefore its limited width.

The rules of this plan also make provision for limited depth, but this is not necessarily a key feature of the plan.

Compensation plans denoted by 3x9, 5x7 are all examples of a matrix compensation plan. The first number refers to the width of the plan while the second number refers to the depth of the plan.

3x9 for example means that you can have up to three distributors on your first level and your organisation can go down nine levels deep. Another way to look at it is that you can have a maximum of three distributors on your first level, nine on your second level, twenty seven on your third and so forth up to the ninth level.

Notice that, given the structure of the matrix plan, there is a limit as to how many distributors can be in any level. Once the level fills all available positions, any new recruit will spillover to the next available position on the next level. If the next level is also full, the new recruit will be placed on a level further down.

Theoretically, it is possible to saturate your organisation. The potential saturation of the matrix plan should not be cause for concern. It rarely happens in the real world that any one person can fill a matrix structure.

If you are interested in working out the potential size of any matrix organisation, simply multiply the number of possible distributors on the previous level by the width of the matrix and add the resultant answers together to get the total.

Let's use the 3x9 as an example.

On the first level you have three, on the second level you will have 3 by 3 which is 9. On the third level you will have 9 by 3 which is 27. Keep multiplying until the level nine. Finally, add all your answers. The answer you get is the potential size of a 3x9 matrix plan.

Still confused?

Here is a 3x9 matrix worked out for you.

3 x 3 = 9
9 x 3 = 27
27 x 3 = 81
81 x 3 = 243
243 x 3 = 729
729 X 3 = 2187
2187 x 3 = 6561
6561 x 3 = 19683

Adding up all the answers, we find that the potential size of this matrix is 29523.

Does the potential size of a matrix plan really mean anything to you as a distributor?

Not much. The key lies in understanding how it works and whether you will be able to run a sustainable network marketing business with a company that uses this plan.

Success with any network marketing compensation plan mainly depends on two factors:

  • Your personality or character, and
  • The nature of the products you are selling.

What type of distributor are you? Are you just a product user? Are you a sales person type of distributor or are you a sales leader or recruiter type of person?

If you are product user for example, the forced matrix may suit you if the products you sell require a monthly subscription, preferably by debit order. Your aim was not to build a business in the first place but merely to use the product or the service. As a result any business, small as it will be, will be mainly from any spillover from upline.

This may not apply to a recruiter whose main aim is to build a business. As a business builder, the forced matrix may offer a much greater challenge to you, because...

You need to work out
how you are going to
build your structure

And...

Since width is limited you may end up channelling all your new members to distributors who are themselves not as keen as you are in building a business.

So balance is required. What I find is that the forced matrix will work better for subscription based products or services. With this kind of products you do not have to worry about whether your downline will make any purchases from the company in this pay period or not.

To overcome this problem, some network marketing companies have what is known as auto ship or automatic shipping. This means that you, the distributor, authorises the mlm company to ship an agreed quantity of products to you and bill you accordingly. The company does not have to wait for your order.

There are two advantages of the forced matrix compensation plan, namely:

  • The potential for spillover; and
  • The possibility of having more than one sponsor.
The potential for spillover

Spillover is a term used to describe a situation where, after signing up the maximum number of distributors on your first level, any person you sign after this maximum 'spills over' to the next level. And if the next level is also filled, to the one following it.

The potential for spillover is the most hyped of the two advantages. When recruiting, distributors often promise their prospects massive amounts of spillover. Statements such as 'I will build your downline' are common in opportunities using the matrix plan.

These kind of promises often create what is probably the major disadvantage of the forced matrix plan, namely, that people will sign up having the false believe that all they need to do is sign up and their downlines will be build.

If you promise your prospects that you or someone else will build their downline, you might be setting up yourself for major problems down the line.

The myth behind spillover is that you will benefit from upline activity, and that your downline will also benefit from upline activity.

Many distributors use this idea as a recruiting tool. The problem is that if someone joins your organisation because you or your upline is there to do the recruiting, you may end up with an inactive downline.

The potential to have more than one sponsor

Your sponsor is the person who introduced you to the network marketing opportunity or the person in whose downline you fall directly.

Because of spill over, you will not necessarily be in the direct downline of the person who introduced you. You may be placed in a direct downline of another distributor.

The benefit of having two sponsors is that, if both sponsors are active and excellent trainers, you may gain a lot from their experience.

There are two misconceptions about the matrix plan

  1. Downlines grow faster
  2. The reason behind this is that since you are forced to have only a limited number of distributors on your first level, those distributors you recruit beyond the given number will be placed in your second level until it is also filled. In addition you will receive new distributors from upline. This way your downline grows quicker.

    This misconception breeds the second, which is...

  3. Distributors will remain motivated
  4. People are not necessarily motivated by freebies, i.e. spill over distributors in the case of forced matrix plans. The opposite may actually happen. Some people will join your organisation expecting to have their downlines built by others.

Promises such as "Join my team and I will build your downline" are common in practice. Promises like that can be a recipe for disaster.

Whether the forced matrix is for you or not is for you to determine. Do note that like other networking marketing compensation plans, the forced matrix will not necessarily work well in all situations.

Follow this link for a discussion related to the forced matrix plan.


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