What Is OPTAVIA?
The name OPTAVIA is a new one in the direct selling industry, although it was technically just a rebrand by Medifast, which was founded in 1980. OPTAVIA has seen record growth since its inception, and it continues to increase revenue and sign up new distributors, or coaches. OPTAVIA sells healthy coaching plans and portioned meals to its customers, and business has been booming. With a low number of existing coaches, OPTAVIA may present a good opportunity to enter the health coaching MLM space.
History Of OPTAVIA
OPTAVIA is somewhat of a new name in the MLM space, having just been created in 2017. However, it was actually a rebranding of an older company’s product line. Medifast, which has been around since 1980, rebranded its subsidiary “Take Shape for Life” into the new OPTAVIA company. At that time, they also launched a new line of products called OPTAVIA Essentials which are sold directly from coaches to clients.
OPTAVIA’s parent company, Medifast, was founded in 1980 by Dr. William Vitale. At the time, the company’s products were only sold to doctors, who then prescribed them patients. Medifast grew quickly and soon became a publicly traded company on the New York Stock Exchange.
Medifast has consistently been a very trustworthy company. It was named to Forbes list of 100 Most Trustworthy Companies in America in 2016 and 2017. Since its launch, OPTAVIA has been no different.
As of December 2017, the OPTAVIA line saw 9 consecutive quarters of growth. At that time, the company has 16,700 active earning coaches. In 2019, the company continued to expand internationally into Hong Kong and Singapore.
While OPTAVIA seems to have a pretty clean record, its parent company has been the target of investigations and penalties in the past. One of Medifast’s subsidiaries, Jason Pharmaceuticals, was ordered to pay $3.7 million in 2012 for false advertising. The advertising associated with one of their weight loss products was found to have no scientific backing.
There are also several websites and reviews online that accuse Medifast of overstating the income levels of its coaches. Some sites dedicated to OPTAVIA state that the products make customers ill, contain unacceptable levels of metal, and lead to bad gut health. The basis of these claims has not been proven, though some of the sites seem to have a large following.
Current Company Structure
Today the OPTAVIA company is still wholly owned by its parent company Medifast. The company is headquartered in Baltimore, Maryland. It is still publicly traded under the ticker symbol MED, and the company’s CEO is Dan Chard.
As of the 2nd Qtr 2019, OPTAVIA reported having around 30,000 active earning coaches within its company. Medifast revenues were just over $500 million in 2018. The company also reported in 2Q19 that OPTAVIA branded products accounted for 75% of consumable units sold. So, OPTAVIA is an extremely important subsidiary to Medifast.
OPTAVIA Product Lines
OPTAVIA products are all about healthy living and weight management. The company offers several different products or plans. Each plan includes a coaching component as well as the actual meals and food that will eat during the plan.
For example, OPTAVIA’s 5&1 plan allows your body to enter a gentle fat burning state while still maintaining lean muscle mass. This plan teaches you to eat 6 small meals each day in order to maintain a healthy weight. Five of the meals are provided for you, and you learn how to cook a healthy dinner.
Their Purposeful Hydration line of products helps you to drink plenty of water throughout the day. This is a line of water flavorings that encourage you to get plenty of hydration. These are designed to go hand in hand with their other product offerings.
Company Marketing Practices
OPTAVIA still strongly markets their products to doctors and health care professionals. They encourage doctors to sell the company’s products to their patients to get their patients healthier and earn an extra source of income. OPTAVIA has even distributed publications that walk through how the doctor can incorporate the company into their practice.
Social media is another way that the company encourages their coaches to connect with clients. By creating support groups or other similar groups on social media, the OPTAVIA coach can connect with clients and help them with problems and issues. The support piece of the OPTAVIA program is a big selling point, not just the physical products.
Making Money With OPTAVIA
Given that the number of active OPTAVIA coaches has doubled within the last couple of years, it would seem people must be making money in the program. The weight loss industry is a huge industry across the world, especially in the United States, and people spend lots of money looking for ways to accomplish their weight loss goals. But what can someone expect to earn as an OPTAVIA coach?
Taking a look at the OPTAVIA 2018 Income Disclosure Statement paints a very bleak picture of potential earnings. During 2018, less than 20% of active coaches earned more than $5,000 for the entire year. Only about 3% of coaches earned more than $30,000. So, that means about 97% of coaches earned less than a full-time income. On the high end, only 0.18% of coaches earned more than $200,000.
How To Enroll
In order to become an OPTAVIA coach, you will first need to talk to your current coach about opportunities. You can then order your OPTAVIA Business Kit to get started. The cost of the kit is $199, although it does include quite a bit in the way of business development.
The business kit includes OPTAVIA’s Coach Success System, numerous guides about the company’s plans, several physical items like planners and pens, and 12 months of your own OPTAVIA website. A coach must pay a yearly renewal fee of $99 in order to remain active. This provides continued access to the coach’s personal Octavia website and the online community.
OPTAVIA’s compensation plan provides several different ways for their coaches to earn income. The first, and most basic, is a commission on all sales that they make directly to clients. A coach earns 15% income of these sales and can earn additional bonuses on those sales if the volume and consistency is high enough.
Next, coaches earn commissions through recruiting and sponsoring other coaches. They earn additional income if they help their downline coaches earn specific bonuses. For example, as a sponsoring coach, you can earn a $100 bonus if you assist a new personally sponsored coach in earning his or her Client Acquisition Bonus.
Lastly, OPTAVIA rewards leadership development by allowing its higher tier coaches to earn income up to 6 levels deep in their downline. They refer to the downline as generations and call this commission generational income. Once a coach reaches Integrated Presidential Director status, they can then be eligible for all of the national bonuses.
Sales And Marketing Techniques
OPTAVIA is another example of a social media driven marketing approach. Coaches are encouraged to create support groups through social media for their clients, and they can also use social media followings to recruit new clients and coaches. Medical professionals are still strongly targeted by the company as coach recruitments, although there are many coaches who are not in the medical profession.
Comparison To Other MLMs
Contrary to many MLMs, OPTAVIA does not just sell physical products. Part of their sales process includes a program that helps people live a healthy life. There are a fairly low number of coaches enrolled with the company. This could be because the enrollment and renewal fees to become a coach are quite high compared to other direct selling opportunities. Comparatively, the income earning potential is lower than most other opportunities as well.
Conclusions For OPTAVIA
OPTAVIA is a health and lifestyle company focused on weight management programs that include information and food. The company has seen growth in recent years and provides about 75% of the revenue for its parent company, Medifast. Enrollment with OPTAVIA as a coach is quite expensive and the earning potential is quite low. Overall, this does not appear to be a good opportunity for making money through a direct selling company.