Paparazzi Accessories has done their best to keep their information to themselves. Based on the area code from their contact fax number, we are assuming that they are based in Utah. We’re not sure why they don’t want to tell us where they are or how long they’ve been in business. It could be an oversight, or it could be that Paparazzi is trying to be secretive.

They decided to produce a range of Paparazzi Accessories, which all seem to be priced at $5 each. Now as someone who doesn’t wear much jewelry, I can’t comment on this. As someone who has purchased a few pieces as gifts, I would have to say that the $5 price tag would make me more likely to buy it for a 6 year old.

Rather than using traditional sales, Paparazzi has decided to sell their accessories through a network of consultants. Here at The Finance Guy, we believe you can’t make money with MLM, but we’ll go ahead with this full review of Paparazzi, we’ll see if this is a real income opportunity, or just another MLM money trap.

What Is The Paparazzi Opportunity

According to the official Paparazzi opportunity page, getting started just takes 3 simple steps; 1. find a consultant. 2. buy a starter pack. 3. start the party. Sounds too easy!

They proudly remind us that all items are just $5 and every sale you make from your Paparazzi party can earn you between 35% and 45% in commission. Just to clarify, that’s between $1.75 and $2.25 per item. With those margins, you’d want to be making a lot of sales.

Depending on which starter kit you select, you can spend between $99 and $499 to purchase your initial inventory to get yourself ready to sell at your very own Paparazzi party.

How Do You Make Money With Paparazzi

Keeping with their theme of providing minimal information, the Paparazzi Compensation Plan has been reduced to… an image shown below:

Again we’re not certain why they’ve chosen to provide such a condensed form of their compensation plan. It could be they are trying to keep things simple or it could be that Paparazzi is being evasive with the details.

Even though Paparazzi has not given us a lot of information, it is enough to give us an idea of how their compensation plan works, so we’ll go ahead and explain as much of it as we can.

The amount of commission you can earn from Paparazzi will depend on your rank with them. You can climb the ranks by accumulating a combination of Personal Volume (PV), and Organizational Volume (OV).

Every item you buy from Paparazzi will have a point value. If you buy it yourself, it will count toward your PV. If you recruit others to become Paparazzi consultants, anything they buy will go into your OV. It doesn’t end there, you will also get OV from the people below your recruits. This is what MLMs call a ‘downline’.

Retail Commission
Again they remind us that you can earn between 35% and 45% commission selling Paparazzi accessories at parties.

They don’t explain how you increase your commission. However we can see that if you buy 1000 PV worth of product in a single order, you will get a 10% show rebate. We are assuming that’s how you get the extra 10% commission.

They explain that each $5 Paparazzi accessory is worth 2 PV. If you are paying wholesale they should charge Paparazzi consultants is $3.25 per item. So to get the extra 10% commission, you have to personally spend at least $1,625 on Paparazzi inventory in a single order.

Business Building Bonus
If you recruit others to become consultants, you will earn 15% commission from their starter pack purchase.

If you sign up as a Paparazzi consultant, the person who recruited you will probably tell you all about why the $499 starter pack is the best one. While you may get some value from buying in bulk, they could have a motive of their own. Your sponsor will earn more commission if you spend more on your Paparazzi starter pack.

Unilevel Bonus
This is commission you can earn on up to 3 levels in your down line. The people you sponsor yourself are your 1st level. The people they sponsor become your 2nd level, and so on.

Depending on your rank, you can earn between 5% and 10% commission on any Paparzzi purchased by your 1st line. To earn 5% from your 2nd and 3rd lines, you will need to be qualified.

Being qualified for unilevel commission you need to reach the required rank, as well as generate enough PV and OV.

Generation Bonus
This is very similar to the Unilevel bonus. It pays commission on levels 4-6 in your downline. If you meet all the qualification requirements, you can earn between 1% and 3% on any spending by consultants on these levels in your downline

Legacy Bonus
Following on with the theme, this is commission you can earn from levels 7-9 in your downline. To qualify for this you need to reach minimum rank of ‘A-Lister’, with Paparazzi. You will earn between 1% and 2% on these levels.

Infinity Bonus
This is another 0.5% - 1% which is paid on levels 10 and 11 in your downline. To qualify for this you need to reach the rank of ‘Luxe Jetsetter’, or better in the ancient Egyptian business structure.

Cash Bonus
Again this one is reserved for those in the top 3 ranks. If you happen to reach one of these ranks, and maintain your qualification for 2 months, then you can earn a cash bonus.

While it’s nice to know that you can earn all these bonuses if you climb to the top of the MLM triangle, you should remember that all these bonuses are included in the price paid by consultants. If you are a new consultant, then 39% of what you pay for Paparazzi will go to your upline as commission.

How Much Are Paparazzi Consultants Earning

We know it’s possible to earn all these bonuses, but that’s only if you make it near the top. To find out how much consultants are earning, we looked at the 2018 Paparazzi Income Disclosure Statement. This is the most recent version available at the time or researching.

The commissions paid out to Paparazzi consultants, at each rank, in 2018 is shown in the table below:

If we look at the last column, we see the average monthly bonuses paid. It’s interesting to us that at the ‘Producer’ rank, consultants averaged $1,820 per month. That’s annual bonuses of just under $22,000.

To get to the ‘Producer’, rank, you’d need to achieve 5 rank promotions with Paparazzi. Only 0.85% of consultants made it beyond this rank.

Doing some math we see that 99.15% of Paparazzi consultants earned less than a full time income from the opportunity.

Something else we found interesting, is the 2nd column. It shows the ‘Percent of Consultants Earning Commissions Monthly’. This wording tells us that Paparazzi is not showing us all the consultants who earn nothing in bonuses. Again it could be an oversight or it could be that Paparazzi is trying to make the opportunity seem better than it really is.

This could explain why only 6.42% are on the bottom level. If we were to include all the consultants who earned nothing, then we’d expect to see more than half the Paparazzi Consultants earned absolutely nothing.

Naturally supporters of the scheme will tell you that consultants can still earn retail profit, which is not included in the bonuses. In reality we think that there are very few retail sales going on.

Why Is It Difficult To Make Money With Paparazzi

We believe that the problem is not unique to Paparazzi. The problem is with the business model. In his book, Multi-level Marketing Unmasked, Jon Taylor found that 99.7% of people who join any MLM end up losing money. Despite what you hear in the sales pitches, it is highly unlikely that you will make money from any of these ‘business opportunities’.

The reason is because MLM is a system designed to sell products to customers. When you sign up as a Consultant, you are in fact a customer buying from Paparazzi. They have no intention of making you a business partner. The goal is to make profit when you buy accessories from them

Is Paparazzi An Illegal Pyramid Scheme

Even though MLMs closely resemble pyramids, they are not illegal. The technicalities date back to a 1979 Amway ruling. To the best of our understanding, Amway managed to word their documentation in a way that bypassed the pyramid scheme laws. This opened the doors for other MLMs to do the same.

While the paperwork may make them legal, that doesn’t mean that Paparazzi and other MLMs are ethical. If you join any MLM, you have to realize that the only way to make money is if people below you are losing money

We looked at the 2018 FTC Business Guidance for MLMs. This explains when MLM participants are acting in a way that is misleading or unlawful. Examples of breaches include pressuring downlines to purchase products, and making unsubstantiated claims about earnings potential.

As always, we’d love to hear what you think in the comments section below, especially if you an share your experiences with Paparazzi

Are you wondering if you can make money in an MLM? Check our our list of mlm reviews before you join. If you find one that’s not on the list, let us know and we’ll do our best to write a review