Direct Cellars MLM Review: Is This Wine Company a Scam and Pyramid Scheme?

Direct Cellars Review

The overview and rankings

What to look for in a MLM:

What is Direct Cellars?

Let's then learn...

Is Direct Cellars a pyramid scheme?

Although there is no solid proof that Direct Cellars is a pyramid scheme, it’s very obvious that they are.

First off is that they ceased their operations because of mismanagement and the lack of funds.

They didn’t clearly state this, but it’s already a given knowing that recruitment is their main focus.

Yes, they do sell legit wine products, but the way they are sold is still via recruitment.

What is a pyramid scheme?

A pyramid scheme can take the form of a company or organization that pays members whenever they manage to recruit people.

This is the form of incentive given to members instead of earning from their solid products and services.

Businesses like this are already banned in many countries around the globe as it is impossible for members to earn from merely recruitment.

This diagram from Wikipedia explains this clearly...

Members who make some money manage to do so because they aggressively recruit people to join this business opportunity even though it’s very far from being one.

The diagram also shows that members stand no chance of making money in the long term when they are with Direct Cellars because they are just going to be running out of members to recruit.

Here is a 5-minute video that helps you spot pyramid schemes in disguise...

And why is it that...

Success is rare with Direct Cellars

This happens because many MLMs, including Direct Cellars, have a sales quota which members need to follow.

This means that they can only receive commissions if they can reach the quota of products that needed to be sold monthly.

They then have to buy the products if they can’t reach the quota. This is why members spend loads of cash from their own pockets before getting their first recruit.

How does Direct Cellars Work?

Direct Cellars work by selling a variety of wine products that come in bundles.

They also have an affiliate membership program where anyone can join, sell their products, and earn commissions out of their sales. If you were to look at it from a theoretical standpoint, you’ll see that it’s a win win.

But what really happens is that Direct Cellars is saving huge money on supposed marketing campaigns because they can skip all of it and just let their members do all the promoting and marketing.

Direct Cellars products

Direct Cellars sells wine. But the thing is… they don’t sell wine by piece.

Customers can’t even choose the wine they’re going to buy as they are sold in bundles which the guys from Direct Cellars factories choose.

However, they’ve got a style to this, and that they claim they have an expert team of wine tasters who make sure that the wine you are getting is ideally suited to your characteristics, preferences, and attitude.

For me, this just doesn’t make sense...

You also need to subscribe to their products if you’d want to buy. You have two subscription options:

• Customers - 2 bottles of wine are sold at $70 monthly. Meanwhile, 4 bottles of wine are sold at $100. This subscription package automatically renews every month.
• Affiliate members - You get price discounts if you’re a member. 2 bottles of wine are sold at $50 monthly.Meanwhile, 4 bottles of wine are sold at $80. This subscription package also still automatically renews every month.

Take note that there is nothing special about their offerings no matter how many times they claim that they are special.

A way to prove this are the many other wine MLMs out there such as:

• Scout and Cellar
• Traveling Vineyard
• OneHope Wine

They all claim special and selling an exclusive offering even though they just sell it in different ways...

Here is a 1-minute video about their wine products:

It's then vital to know if...

Can you make money with Direct Cellars?

You can make money from them before. But even when they were still operational, you are still going to have a hard time making money, just like with any other MLM.

There might be a few who do, but they work for more than 8 hours a day, only to earn an income similar to minimum wage.

They don’t even have any income disclosure...

How to make money with Direct Cellars

Selling their wine bundles and recruiting members are the only ways you can make money from this MLM.

Also note that you only earn bonuses from the sales of your recruited members and not from merely recruiting them.

It’s a smart way for MLMs such as Direct Cellars from being called a pyramid scheme.

But if I were to deeply analyze it, it seems like they still failed at this, which eventually led to their closure.

How much does it cost to join Direct Cellars?

You have 2 bundle starter pack choices if you want to join Direct Cellars.

These are:

• Premium Wine Lover Elite ($500) - Includes 12 assorted wine bottles
• Premium Wine Lover ($250) -  Includes 4 wine bottles

Direct Cellars monthly cost

Being a member means you must maintain 80 PV monthly to receive commissions.

PV means personal volume or the amount of products you must sell each month.

The costs you’re going to incur on the 1st year are…

• $250 to $500
• $80 x 12

Minimum costs for year 1 = $1,210 to $1,460

Also don’t forget to still include the costs on training, gasoline, travel, food, and many more miscellaneous stuff...

Direct Cellars compensation plan

Direct Cellars have a compensation plan, but it’s still confusing just like any other MLM. No need to worry, though, because I’ll simplify it up for you…

Direct Cellars offers members 4 main ways for them to make some money:

• Retail Commissions - Earn 10% to 20% commission for every wine bundle you sell. The value depends on your rank or level.
• Recruitment Commissions - Earn $125 to $250 every time you recruit a member. The value depends on the subscription pack they availed.
• Residual Commissions - Earn 8% to 20% commission from the total sales volume of your downline.

I know, it’s confusing. There are loads of complex terms and fancy names mentioned.

But that is no surprise at all because MLM always do that so members will think that they have a lot of chances of making money.

When in reality, they just need to do these 2 things…

• Sell wine
• Recruit members to the wine company

But then again, Direct Cellars is no longer operational. So no need to worry about that...

You can learn more about their compensation plan by watching tis 4-minute video...

Is Direct Cellars a scam?

There is a very big chance that Direct Cellars is indeed a scam. Although this isn’t proven, the very nature of their business tells us.

They might sell legit wine products and pay their members as planned.

However, they immediately announced their ceasing operations and saying that the reason for this is due to the lack of funding. There’s something really wrong with the company from the start.

The rest of this MLM review is going to dive deeper into this by showing the pros and cons so you’ll know what to expect in case Direct Cellars comes back in the future...

Just to be fully transparent with you, I am not a distributor myself and I do not endorse it in any way.

I have researched the website, testimonials and information on the Internet to get to the bottom of what this program genuinely does. This is because I have been burnt from programs just like this in the past and I want to prevent others from making the same mistakes. If you’d like to learn how to “Spot an Online Marketing Scam” then click the highlighted text.

What I like about Direct Cellars

Key Terms:

• Pyramid Scheme – recruits members via a promise for payment from recruiting others into the company rather than providing a product
• Affiliate Marketing- Connecting a customer to a product they are looking for and receiving a commission for doing so
• Red Flag - A warning sign

#1 Clear compensation plan

Direct Cellars spent a lot of time crafting an interesting compensation plan.

It might still be a bit confusing as with any other MLM, but at least, they had the effort to pull it off in a nice and engaging way.

It’s got lots of seemingly detailed words, and also has graphics and diagrams.

What I don't like about Direct Cellars

#1 Ceased operations

Direct Cellars is no longer operational.

They said that the reason for this is the lack of funding. Aside from that, they didn’t anymore mention anything.

Based on my own analysis of this, it’s likely that they’ve been tracked down by the authorities due to their pyramid scheme business model.

#2 Expensive products

They sell expensive wine products. Just take a look at the other brands out there…

You can see the huge price difference of other wine brands, and they still have pretty nice ratings.

The fact that they sell overpriced products is another sign that there was something off about the company from the start.

#3 No income disclosure

Direct Cellars doesn’t have an income disclosure.

Either their members aren’t earning well, or they just aren’t that serious in talking about the financial status of their members or company.

#4 Hidden monthly expenses

You need to sell 80 PV or $80 worth of products every month for you to be eligible to earn commissions and bonuses.

If you can’t do that, then you have no choice but to just buy the wine bundles yourself just for the sake of staying active.

A fact that MLMs don’t want members to know is that their biggest customer base are their members because they always buy their products hoping they can make a profit out of it sooner or later...

#5 Is Direct Cellars a pyramid scheme in disguise?

Yes, no doubt it is. You need to spend $80 to stay active.

Here is a diagram that shows how their business model works...

And you can avoid that by recruiting members. So you have to do your best to recruit as many people as you can just so that you can avoid the costs...

#6 Downward trend

Here is what Google Trends has to say…

The diagram shows the downward trend of the number of people who are searching for Direct Cellars on the internet.

This is shown by the blue line. Meanwhile, the red line is for Farmasi, another MLM, which is having a good time with the number of searches.

You can clearly see the difference between a successful MLM and a failing, or in this case, failed MLM, here.

My opinion - Direct Cellars

Direct Cellars is already closed and shut down due to financial issues.

No doubt that it is not a good company from the start because even if they sell legit wine products, the fact that they sell these by the bundle and in autoship subscriptions, means that there’s something off with the company.

Here’s what I can say about the business opportunity...

Recruitment is the focus, and you do this even though you already know that they are going to end up losing money.

In no way does this sound ethical to me. But don’t worry because there are still a lot of better and legit business opportunities out there waiting for you to discover...

How I make passive income online

MLMs are not scams or illegal. However, I'm not a fan of them because of the restrictions to the expensive products you have to promote.

Once I learnt about affiliate marketing, I realised it's a far superior business model because:

• You can promote anything you want and truly own the business
• You never need to sell to friends and family
• It's completely free to start

In 2018 I had no idea what affiliate marketing was.