Income Claim Coaching Cards – Use of Income/Earnings Claims – One of the greatest challenges for direct selling companies is ensuring that the earnings claims communicated by their salesforce members comply with legal and self-regulatory standards. The guidance below, as to earnings claims, is based on statutes, regulations, and guidance documents issued by regulatory agencies, judicial precedent, and decisions from self -regulatory organizations.
Question: How can LifeVantage distributors compliantly talk about the income they generate as independent business owners?
Answer: As included in the US Income Coaching Cards, income claims can be divided into four (4) categories: How much income; Status the income creates; Type of income; and, Effort needed to earn the income.
Each category presents words and phrases that should be avoided and recommendations for what can be represented or said; the Do’s and Don’ts:
- How much income: Don’t say – “Six  figure income;” “Full time income;” “Replacement;” “Career level;” “Guaranteed;” “Life changing;” Top 5%;” and, “Significant earning potential.” Do – state in terms of supplemental, or extra income. Examples: “Certainly helps with the end of month stress;” “Best money from a part time job ever.”
- Status created: Don’t say – “Rich;” “Retirement;” “Freedom;” “Financial Freedom;” “Stay-at-home.” Do – State in terms of average/regular/typical. Examples: “I am in charge of this aspect of my life;” “I breathe easier at the end of month.”
- Type of income: Don’t say – “Passive,” or “Residual.” Do – State in terms of leveraged income or income derived through the purchase, consumption, and selling efforts of others. Examples: “When members of my team are successful, I am successful;” “Together we are building a success story.”
- Effort needed: Don’t say – “Fire your boss,” “Quit,” “Duplication,” “Momentum,” “Ground floor.” Do – State in terms of working hard and being teachable. Examples: “There is nothing that we can’t co with the right attitude and working hard;” “Set your schedule, work wherever you want, and determine your level of effort and work hard.”
Additionally, although the use of a disclaimer; a statement or declaration that provides the substantiation for a claim, cannot “fix” a bad claim, the appropriate use of a disclaimer should be considered any time you talk about the success you are experiencing, especially when talking dollars and cents. As included in the US Income Coaching Cards, the following claims require an appropriate disclaimer:
- When atypical earnings, those representing the 2% rather than the 98%, are mentioned through words, photos, or images: Use the Success Disclaimer (Space permitting):
- “Everyone’s results will vary as we are all unique and different. The Distributor sales earnings disclosed are potential gross earnings and not net of other business expensed and not necessarily representative of the actual income, if any, that a Distributor can or will earn through the LifeVantage Sales Compensation Plan. A Distributor’s earnings will depend on individual diligence, work effort and market conditions. Lifevantage does not guarantee any income or rank success. See the Average Annual Earnings Disclosure for detailed earnings information per rank.”
- (When space does not allow for the Success Disclaimer, e.g., social media), use the correlating generally expected result disclaimer:
- (specific dollar amount) “The average annual earnings of a LifeVantage distributor for [year] was [$ amount] Average Annual Earnings Disclosure.
- (incentive trip) “Of the 50,000 distributors worldwide, about [no. or %] hardworking distributors achieved this incentive trip.
- Special situations:
- Photos/images: Don’t use – Descriptions/images/photos of opulent mansions, private helicopters, private jets, yachts, exotic automobiles, or any substantially similar descriptions or images. Do use – Images of average, regular and typical homes, boats, cars, trips, etc.
- MyLifeVenture: Use – “To participate in the MyLifeVenture program a distributor must achieve the rank of Elite Pro 7 (100,000 OV) and maintain that rank for six (6) consecutive months.”
Finally, when working with disclaimers, it is important to remember the four (4) “Ps”! All disclaimers must be clear and conspicuous; Prominent (big enough), Placement (not buried), Proximate (close to), and their Presentation easy to understand.