Swiss Newspaper Crushes Lyoness

by Ted Nuyten on February 17, 2012

Business Problem

 

Below is a translation of an article in the French Swiss Newspaper L'Hebdo

Lyoness or easy money

[DISCLAIMER: TRANSLATION BELOW. MAY CONTAIN MINOR INACCURACIES]

By Clement Bürge – Posted on 15.02.2012 at 11:35

Lyoness, a community of buyers in 23 countries, is developing in western Switzerland. Crooks or benefactors? The company stirs controversy.

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24 comments… read them below or add one

Nikola February 18, 2012 at 9:19 am
I will comment with few questions: 1. Are you going to shop at least once a week  bread, milk, gasoline........? 2. Do you want cashback on your bank account every wednesday from your everyday shopping ? 3. Are you going to refuse free cashback card,no annual fees instead of points you receive money ? 4.How come "resources exhausted ". Can people stop buying their food, gas, clothes.... ? 4. How come we have almost 600 stores in Switserland and the numbers are increasing every week ? 5. If mention stores are " small " what do you think about "MULLER"?   Regards, Nikola

Kevin February 23, 2012 at 6:21 pm
Lyoness is not an investment nor does it 'tout' for investors. Strange how 'blue chip' companies all over the world are signing up to join the program, isn't it ? I wonder do they have legal departments or lawyers employed ? hmmmm. Pyramids don't have products. As far as I know there's any amount of products you can buy through Walmart or Carrefour who are some of the 'blue chips' on board. Pick a fight with easier pickings !

Donnacha October 1, 2012 at 3:13 pm
They are not. Lyoness is pretending to sign up big customers, but never going past the buying of shopping vouchers, e.g. look here (http://www.boards.ie/vbulletin/showthread.php?t=2056528522) where a number of members have contacted companies like Tesco, Argos &c. and got pretty much the same response from all of them, viz. "we have no dealings with Lyoness, nor have any plans ever to deal with them. In order to find out what Lyoness actually offers, you'll have to contact them".

peter cingel March 7, 2012 at 11:45 am
I agree with Nikola, thats the question have to ask everybody who would like to using Lyoness cashback program.I believe autor of this text get confused and there will be still people to find something wrong about this. Even when you are just shopper still get more than you invested.Its cost you nothing anyway

Pamila Paynes March 26, 2012 at 7:06 am
sure I will take a discount and friendship bonus! and yes I sop for gas and food weekly. remember franchises were almost outlawed years ago. MOST people are not open to innovative ideas and business concepts.

Alex May 23, 2012 at 4:40 am
I have attended a few Lyoness meetings now, my opinion is that it is not an ethical business and will eventuate in many people losing a lot of money. Firstly, yes people will continue to shop and can receive a minimal cash back to their shopping and that of those they introduce. Granted. However people are not making any serious money off this minimal cash back benefit. it is wrong to say that these big companies are 'on board' with Lyoness, with 99% of these companies all that has happened is that Lyoness has engaged a third party that has negotiated small discounts from large brands if they purchase 'gift cards' directly from them. So yes you can order a $100 gift voucher from Lyoness, go to your local shopping centre that is involved and spend that voucher. You then have $3 (using 3% as an example of negotiated discount) which is going to be divided in numerous ways. You will get a very small percentage as cash back. So so far it just seems like a very inconvenient loyalty card. You will also get 0.5% of the money spent by people you introduce and 0.5% of people they introduce. So there is a small amount of money to be made at the surface level. The problem becomes apparent when you then introduce the Pyramid element to the business. Another percentage of your spendings are funnelled off until they accumulate a certain amount (different values for different currencies but around $75 USD) lets call these $75 amounts 'blocks' your block is then placed in a pyramid, once a certain number of blocks from others have filled in behind your block you get a payout, of around $800. This sounds Great!! - But where has this money come from? Well it has been taken from the people underneath you, where will their payout come from? The people underneath them, and so on. The simple truth is you can't pull out more money than is put in, the whole scheme is reliant on more and more people joining. eventually and INEVITABLY this pyramid system will grind to a halt because there are not enough people to support it. In its infancy any company like this looks great, as it continues to grow and expand into new countries, more and more members join and the people on the top are getting rich. I am only 23, I'm not a genius but my brain looks at this situation and i can see it is stupid, here is an example. The companies goal is to have 300 million members. Lets say all these members spent enough to create a 'block' they all fit into each others pyramids and lets say 20% get paid, 80% are still waiting. Yes the 20% might spend enough to have another block each, but each of those people that form that 80% need 8 people behind them, so we need 640% to fill in behind them. Now the payouts slow right down, (because we are waiting for around 1.8 billion blocks to be formed) maybe very slowly these blocks are paid out, but now we have about 1.8 billion blocks each needing 8 blocks to be paid out. We need 14.4 billion blocks to be formed, for everyone to be paid out. thats almost twice the population of the earth. and what about the next payout? 115.2 billion.... The truth is if you join Lyoness you might be successful, but you should know its only because you are taking money off someone else down the track and that eventually the pyramid aspect of the business will either fall apart or come to a halt. The issue only escalates when you look into the higher levels of the pyramid marketing with Lyoness. If you pledge to spend a large amount with Lyoness registered businesses ($30,000 AUD for me in Australia) you can become something like a gold member. You can do this by spending $30,000 AUD straight up or by putting a down payment of $3000. Please note, you cannot take this money back out, it is a 10% downpayment on products or services, so you can either walk away and loose that money or you can spend $30,000 USD. Those are your options with that $3000, walk away or spend $30,000. please understand that. I was mislead to believe i could just spend that $3000, which i cannot it is a down payment on $30,000 worth of products. I have already paid 10% i will then ned to spend an additional 90% just like with any downpayment. This is great for Lyoness and the registered businesses, they have thousands of people pledging to spend tens of thousands of dollars. This downpayment then allows a member to join another pyramid, with simply higher values to each block, so a higher payout, however, please lets use some common sense; The exact same scenario with the pyramid above will take place. Eventually this will become unsustainable. There will be hundreds of thousands of people that invest $3000 with a pledge to invest a further $27,000 that will never see a return on their block. If you involve yourself in Lyoness i think you have to be either stupid or ruthless. Because yes there is a loyalty card with tiny instant rewards but in essence this is a pyramid scheme that right now seems to be doing great because the guys at the top are making insane money, but it has to be at the expense of a lot of people on the bottom. Some times i think maybe i am just crazy, but surely anyone that looks at this seriously can see what the end scenario will be. Alex Spong alex.spong@gmail.com

tscott June 9, 2012 at 6:33 am
Alex, i am thinking about joining this company..coming in at 228.00.. was this an option when you joined?

Joe June 12, 2012 at 12:44 am
We are attempting to help those interested in Lyoness

Lisa June 20, 2012 at 2:35 am
I think the lowest level and free levels are the best level for people who aren't professional networkers. You can always "upgrade" later. This might make some Lyoness members squirm, sorry. I'm an advocate of the 80%ers (who won't see success working an opportunity) 80% of people should be using and sharing the PRODUCT instead of the OPPORTUNITY. I wrote a blog called Why I Quit MLM that discusses the 80%ers, and another one Why You Shouldn't Have to Learn to Sell (a great end product anyway). There is a difference between direct sales (promoting product) and selling opportunity (usually mlm) I think people are confused about the Lyoness product and the Lyoness opportunity when I read these posts. I think the Lyoness product (membership) can benefit 90% of the population. I think the opportunity will benefit about 5% of the people who buy in for many reasons, and NOT because they are "at the top." In MLM business models you can influence your payouts by building your direct network no matter when you join, whose team you sign up with and their duplication models, coupled with how dedicated you are at finding the RIGHT people who are going to WORK with you and HOW LONG you are willing to work at it. Choosing a good product at the right time is of course important in any business model. I, for one, am not interested in the opportunity end of it. I like the product :) And I like to refer it. Know which one you are really about. If its the opportunity, make sure you plug in to the people who know how to build based on opportunity and plan on working it like a business (not a hobby) for at least three years. If you are about the product, then its pretty simple - use it and share it. Just know where you fit and what you intend to do with the opportunity.

Shopping Buying September 7, 2012 at 10:38 am
Alex, I understand why you are skeptic. A friend told me two years ago about Lyoness and wanted to made me a Premium Member (for 3000$). I did not agree, but I can tell you, how it works, because I understand it. You call it 'blocks'. If (first time) 70 blocks from you and following people are full, you will get 675 $, from the second one 35. So, where the money comes from? Every time a card holder is shopping, the shop spend a discount. One part is cash back, one part to the 'block'. 70 blocks are >5000$ in for 675$ out, later (for 35 blocks) >2500$ in for 675$ out. There is no Ponzi or similar scheme. The problem is not where the money comes from (from shopping discount). It is an ethical question: A lot of money in, a smaller amount out – most of the money is just waiting – for ever? If someone has just the free shopping card, he will get this bonus once a blue moon. As premium member (for 3000$), you have to do shopping until you have nearly 30 000 $ discount in the blocks to get the money back. That is right. But if you find some others who take the (free) card, it becomes possible. best is to find shop owners. When the give (free) shopping cards away, it works really. If you are a premium member at the bottom, you are lost. That is right, but if there are some shops at the end and at the very end customers, it works well.

David October 17, 2012 at 12:19 am
Sorry , your wrong the block pay out is not from the people below you, it comes from the merchant and placed into a pool that builds these blocks and then shared with everyone . Example : I go to the store the merchant pays me a cash back amount of either 1-2% then the merchant places another 4-10 % into that pool. So you see that money was not mine to begin with. I did not place that money there. So we are not losing the merchant is NOT losing because when that block matures it is given back to be spent in the system. Meaning the money goes back into the pocket of the merchant again. Its like a water fountain , the pool in the bottom is where the merchant places the extra money to build up. The pump is the shopping and takes the money back to all the shoppers to be shared with . Everything in this company comes from the merchant PERIOD!!!!!!!!! When you understand that the rest makes sense

geoff June 15, 2012 at 6:32 am
You guys are quite funny! I have been doing this for 6 months and made many thousands of dollars - Not to mention not having to pay full price at the till any more. I have helped my mum get cheaper groceries and petrol, and my sister make a great income helping her friends get cashback I am totally baffled at the people who whinge at this business! Right now you are paying FULL PRICE.. with lyoness you dont have to any more!!! whats to whinge about If you dont want to 'downpay for units' then DONT!!!! Jeezzz you would think some one had a gun to your head. I have put my wife and kids in - Why would i want them to pay full price for groceries when they dont have to..... You whingers really need to get your facts right or just DONT JOIN... but dont ruin it for the rest of us who are LOVING this amazing system

Lisa June 20, 2012 at 2:05 am
Agreed Geoff. If one is not looking to open a business, then they should NOT do the gift card down payments (deposits) and just join at the free level. Fact: Most traditional businesses fail. So do most people who are not prepared to invest the time energy and into learning to build a professional network. A statistically small % of people are able to enjoy business success no matter the industry or product. This is not a secret. Fact: If you join at the free level, you have nothing to lose and nothing to fail at. Why not try before you buy? You earn cash back on your own purchases and your free referrals. You also have the opportunity to earn your way into the shopping matrix by...... wait for it....... shopping. No other payments or pay ins required. I mainly promote the free level of membership because I want to see people benefit on using the system whether or not they want to share it with others. I don't do any formal presentations, conference calls or hotel room meetings. Is that really necessary to know that cash back is a good thing? Fact: Most worthwhile endeavors take time and effort. Lyoness should be entered into as a 3 year plan for BUSINESS builders. If you can't stick it out working the plan for 3 years, you probably belong at the free level, collecting cash back and earning your compounded benefits slowly and based on use. What if in 5 years the Cashback Card hits mainstream? Timing is everything - free membership or business builder. I think its nuts that people won't question their prejudices, shut out the noise and look for the leverage (free is the leverage guys) to make it beneficial for themselves. Happy cashbacking!

David October 17, 2012 at 12:07 am
So 6 months , a few thousand so say 2k. So how has that extra 333.00 dollars helped you out? Wow I bet there are a lot of folks that could use a extra 333.00 right now. So why is this not working?

Adam August 27, 2012 at 7:16 am
From what I understand, this erroneous system is far more damaging then beneficial (erroneous does not refer to the system's structure, but the unethical behavior necessary to keep it intact). If you look at most, if not all, MLMs like Lyoness, you will see they tend to partner with companies who are have higher prices then their competitors. Don't be fooled that partnering with large organizations with a long history give the system any validation. Answer this question, why would the company want to partner with Lyoness? Because it helps impoverished areas? No, there are hundreds of other organizations/charities they can donate to if that was their true purpose. They do it because MLMs are an effective mechanisms to funnel shoppers/clients to their services and beat the competition and still maintain their profits margins. Have you ever compared the prices of Lyoness's merchants to their competitors? Aren't their prices higher? Even when you factor in the discount, what you pay is still higher than other leading competitors. With the discount, is the merchant you are forced to buy from through Lyoness the lowest price? probably not. Then, to top it off, they convince their "downline" (or whatever new word they chose to escape the negative connotation of the previous used term; e.g. MLM became "affiliate marketing") they can earn money by helping their family and friends save money, but in reality they earn very little and help their family and friends spend more than they have to if they had options. You would only save money if that was the only merchant available and you received the discount. That is not reality; try buying wholesale, it's cheaper. Now, I'm sure a couple "members" will find a product or two, maybe even one industry (such as in electronics) where this isn't true, but please look at the big picture. These MLMs often find small/rare examples to valid their pitch and convince you to join. Look at the whole package, all merchants, products and industries beforehand.

Frank September 6, 2012 at 8:01 am
I looked very closely at the Lyoness program. I also had my accounts & Legal team look over it. They could not find any illegalities with the program - But you need to work at it if you want to make a business out of Lyoness – It’s not a get rick quick deal – But I am doing well. However, if there is any one that would like to try it, I will give you a 30 day free trial. Just email me at : goldlink@onthenet.com.au FRANK.

Drew September 28, 2012 at 1:31 am
My guess is that anyone that is out to talk smack about Lyoness hasn't tried it, has done zero research into what it really is and you likely take any new idea or venture that comes your way and instantly try to figure out how it WONT work. Fact is that is DOES work. I'm making money and having a great time with it these days. It's simply a global shopping community that is only going to get bigger & bigger. if you'd like to take off your critic's hat and open your mind, you'd see how simple it really is. But some folks are more into squashing new ideas and opportunities than embracing them. Sign up is free and I can set you up with more info about the program so you can see for yourself. Research is key before you kill an opportunity. Then if you're still not interested in a program with NO sign-up fee, NO product to sell, NO auto-ship, NO renewal fees or website to maintain, that's cool. Next......Have a great day.

Roman Ozyjiwsky October 1, 2012 at 4:04 am
Dear Alex It is obvious that you have not done your due diligence on Lyoness. The down payment is a very clever way of attracting the right people to build the business. The question of where does the money come from should be obvious if you take the trouble to think it through. I can assure you that it does not come out of the shoppers or premium members. Please check it out more thoroughly before making such uninformed statements. Roman roanoz@adam.com.au

David October 16, 2012 at 10:47 pm
I dont go around signing people up to join. I hand the card out and I get paid .5% every time someone uses it. Simple. If someone asks me about the business side I tell them about it and let them decide what is best for them. Who pays for it? the merchants do, they get free word of mouth advertising. They get a place in our merchant finder on the website. They get loyal customers like me and my friends and family. I dont shop anywhere else now. If your not a lyoness merchant then I dont want any part of you. Sorry. It's not about the small cash back I get it's about the loyal merchant account unit that gets created over time by me shopping or my family or friends. So who pays for this unit the merchant!!!!!!!!!! Not Lyoness not members signing up. And yes I do great in the business. Look its simple you shop for eggs, gas, toilet paper, cards, shoes you name it everyday. Why not share this with friends and get a small amount back. IT COST NOTHING!!!!!!!!!!!!!!!! If your a business minded person that wants to build a business then yes IT can cost but DOES NOT have too. So try it for 90 days invite a few friends to join you. But if you invite a friend to try it it does cost you $1.50. Small price for a GREAT reward!!!!!!!! Questions email me : Davidcashback@gmail.com

BJ October 20, 2012 at 4:35 am
It is interesting how many business opportunities are available to smart and very savvy people who have the ability to use their personal social network and dynamic personalities to promote any product whether it is Lyoness Australia Lyoness’ cash back Loyalty Card or other product. I was introduced to Lyoness over 12 months ago by a friend who has been with Lyoness since its UK and now he is going very strong with Lyoness Australia. My friend makes it sound all so good. During this same time he has stated to me that Woolworths, Harvey Norman were among 200 retail outlets already onboard with Lyoness! My friend promotes Lyoness Sales as per their policies and training seminars only. I was unable to have either Woolworths or Harvey Norman confirm they would be using Lyoness’ cash back Loyalty Card! Therefore since not being able to verify with supposed Lyoness’ Corporate partners they would be using Lyoness’ cash back Loyalty Card! I come here regularly without making comment until today to read and find out what persons have had to say over past 12 months and here today. Naturally one has to review all comments when trying to make a decision as to whether they should get their feet wet and enter into any proposed business venture with Lyoness and spend $3,500.00. We all understand new companies have teething problems and Lyoness is no different and relies on people to promote them in a good light, unfortunately people are the biggest risk variable in any business platform and if they get the model wrong they can adversely promote the company in a poor light. In the past I have read comments in blogs and on facebook where other persons who have joined Lyoness were complaining about not getting enough after sales backup support, or the Common question is when can I get the cash back... and one from a forensic accounting aspect there seems to be issues Status of Lyoness accounting programs. Also Lyoness’ cash back Loyalty Cards were not accepted at Woolworths and Harvey Norman at that time . Even though they were told by admin people they could use them at those places. This does raise other issues that maybe not all information being sated that is truthful or maybe over stated to impress new comers to spend $3,500.00. My advice to anyone is to do your own home work / research on Lyoness and contact the various Australian government agencies such as Fair Work, Trading and ask them questions about Lyoness. Also contact Woolworths Head Office at Norwest, contact Harvey Norman head office and anyone else and if you hear adverse comments investigate them as well and don’t shrug them usually with there is smoke there is an actual fire. Therefore be sure that your 100% convinced and not listening to sales hype before making a decision to part with $3,500.00. I have reviewed the following comments from another blog, these comments are from pro Lyoness persons... Peter & Mary Lindley who says: There are very few ground floor opportunities to build a business quickly and successfully. This will be our retirement income and my friend believes exactly that himself. My comment was my friend with Lyoness says the same thing... yet I am to see him achieve his goal my friend is also having a hard financial times and in desperate times we will do anything to make a $... Also Julie DeBondt-Barker comment; “In answer to the question that everybody wanted to know (David March 31st posting)….tonight the announcement has been made in Darling Harbour and Woolworths is in. This obviously then includes Dan Murphy’s and Big W. Also Harvey Normans……… It smells like a genuine opportunity and a real no brainer”. My comment to Julie was there is another Loyalty Card group who has Woolworths and Dan Murphy’s signed up... I will come back and give you the details later... My favourite comment read today was made by Harry: "I can find no mention of Lyoness on Woolworths or Apples websites. The only time these companies are mentioned is on a Lyoness related site"! My comment back to Harry was I have been there and I am an Investigator, so excuse me if I don’t pause now and wait to see if you can confirm whether Woolworths, Harvey Norman or Apple can confirm that Lyoness’ cash back Loyalty Cards are accepted by them. This random comment made by a non Lyoness persons that; “A couple of weeks ago I had an interesting conversation with a guy who was the CEO of Lyoness USA. The operative word there is ‘was’ – he no longer holds that position. He said he had a falling out with the founder. Go figure. My comment was it would interesting to find out why there was a falling out between the former CEO and Founder if Lyoness is so successful? When a CEO jumps a ship, they usually see warning indicators, maybe he saw a Ice Berg and thought he was on the Titanic which was about to go down lol But in saying this, I am not convinced that Lyoness will achieve its gold here in Australia. There is not doubt that Lyoness has been somewhat successful in Europe and if all reports are true so it has failed to really take off in the US, again maybe Lyoness should try fast foods side it would be quicker. There is fair comment about hyper growth companies like ViSalus being a multilevel marketing company from LA , California are blitzing companies like Lyoness we will have to wait and find out if that is so! Time will tell... whether Lyoness is here to stay.

Ana October 21, 2012 at 3:30 pm
Ignorance can be very costly. I joined Lyoness in July, but because I did not fully understand it, I did not see the great potential for financial independence. I have spent the time to become educated and have been working Lyoness for about six weeks with great success. 50 + people on my team and great income. Some people tend to accept mediocrity because it is comfortable, they will make any excuse to stay in their miserable situation. The people who join Lyoness are visionaries, millionaires, and billionaires, and everyday people who are open minded and not afraid to learn something new. Most do not have enough information to make a decision about Lyoness.. For those who are willing to get out of their own way and learn something new I will gladly give you the information you need to make an informed decision about your future. email me at majzha@aol.com

Bella November 5, 2012 at 2:23 pm
Hi, Lyoness have a lot to answer for they are a company to stay clear of, I myself and others are owed money by this company, they lied to us informing us there would be a major advertising campaign and we would each be given a equal share of the customer base after the adverting was done. They lied no such media campaign was ever in the works yet they took thousands and thousands in down payments ….When getting a refund and people you can get a refund if promised the same thing as we were, The thing about the refund is they pay you back what they feel like most people pay 1875GPB as that was what it was before it came to Australia, well they are paying 1859GBP or 1862GBP it is a toss of the coin on what they feel like doing. They misled us on saying Woolworths and Harvey Norman were Loyalty Merchants, they were never Loyalty Partners as Lyoness claimed they simply bought gift cards and vouchers from them pure and simple…..Woolworths were aware that Lyoness were using their Logo at the launch and eventually stopped supplying them…. We even placed units next to the Woolworths name …… Oh there is more believe me …. Stay clear people do not get involved with them research them they have been sued over seas , they have been taken to court..

John January 27, 2013 at 6:37 pm
I am a Lyoness loyalty merchant and Premium Partner and all I can say is that Lyoness is the best marketing idea I've ever seen in twenty years. The problem is as usual the people... no surprise about that uh?! Lyoness loyalty merchant are of two main categories: - Small biz - Large biz The first works with the cashback card or mobile voucher you generate in your phone's app. The second, being nine out of ten a store chain, works with original shopping vouchers you can buy in the Lyoness web site as a member, or in Lyoness branches. My biz grew constantly through Lyoness in the past months and I am very happy. As a PP all I can tell you is, that if you have a a bit of vision and will to share the opportunity, it's a blast. I am making a really good income in just a few months without selling anything... and I let me tell you I wasn't doing bad before Lyoness either. NO secrets, no scams, no pyramid... God I can't believe what some can say just for the sake of it. Stop the bullshit and try yourself. It's no risk and extremely exciting. John

Jessie April 2, 2013 at 2:36 am
Hey Phillip Go to a lioness small business merchant and get them to sign you up.