First, a little background to set the stage for what follows.
A contract is something that all parties agree to that governs the rights and duties of those involved. A contract can stipulate anything, however, there is no contract unless there is an agreement between two parties. It is a statement of expectations and “how things will work”. The business platforms we affiliate with have contracts, also known as “Terms of Service”. You agree to these terms in participating in our business.
In the world of Affiliate and Online Marketing, there are many compensation models. Among these are subscription, referral line, power leg, matrix, uni-level… and the list goes on. (Most) all provide incentives for some type of leverage. Leverage is defined in different ways: 1) overall volume, 2) individual transaction margin, and/or; 3) organization size. Obviously, in many cases, these go hand-in-hand.
With eLearning courses, products are based on tiers of content complexity - from beginner content to more technical “how to” content across all facets of information. Each tier of content has a different price point.
With one of the platforms we affiliate with, a referral sale is made to the Recruiter. The industry "nickname" for this is a One-Up, This “one up” is simply a structured leverage component of the contract. (It is how the contract works. It is what is agreed to.) In real terms, it is a one-time, secondary/referral payment to a Recruiter with recurring (but not contractually guaranteed) outcomes.
These potential recurring payments are collected through a Line Structure with successive payments being made by individuals, not on the basis of automatic [time frame] payments like a subscription (this is why it is not guaranteed). It is a leverage component that is built into the structure of the contract, however, it is effort-driven. If you want to ensure subsequent "powerline" payments you need to ensure the success of individuals who are in that line. As in all Social Commerce, you get paid by helping to ensure the success of people in your organization.
One last angle here. In money jargon, a Referral Line is a financial engineering component. Most all compensation models in the Social Commerce space (that are not one-time, straight percentage commissions) have some form or leverage component. What the compensation model being explained here does - is akin to compound interest (paying interest on interest). With a Referral LIne, instead of paying interest on interest, the component is people paying people at their participation level in a "Line". People at their given (investment) level are positioned structurally and contractually. This defines how the overall leverage of this "compensation structure" functions.
This is not a gift as some critics purport. It is a contractually stipulated, legally compliant payment governed by the compensation structure - again, a part of the contract which is agreed to by all parties.
Once this is understood, it is your "job" to drive success down the depth in multiple powerlines that will be available to you - based on your organizational growth (width) in recruiting Client/Partners that are front line (direct) to you. This combines with each second sale being "referred" to you; inherently creating new powerlines - creating leverage. You then work with the people in each line to your financial benefit as everyone in these lines pass up their second sale in the depth of that line. This can (and should) happen for many generations of depth - theoretically to infinity.
A Referral Line is a POWERFUL recurring income generator if worked to its potential. However, to maximize its financial potential, it needs to be combined with people who can competently replicate a process [across and down] a referral line structure.
When this takes place, a Referral Line compensation structure can yield significant results. This is why it was chosen to be in our portfolio of offers.
