Is Ambit Energy a Scam?
So, the short answer to the question is "No"! Ambit Energy is not a scam.
However, as I've spoken to many Ambit Energy Consultants...
I understood from them that some customers will have good experiences with the company, while others may have bad experiences.
There are a lot of good reviews, and almost equal amounts of bad reviews on this company.
But you have to understand that the experiences differ because of the different practices of each independent Ambit Energy Consultants.
Ambit Energy Review Summary
Name: Ambit Energy
Founders: Jere Thompson Jr. & Chris Chambless
Price: $75 + $24.95/month (Used to be $429 + $24.95/month)
Bare Naked Scam Rating:
Summary: Ambit Energy is a Multi-Level Marketing Company that provides cheap electricity and natural gas to its customers.
If you are unfamiliar with Multi-Level Marketing, it is a business opportunity offered to people who are interested in promoting the Ambit Energy business.
Is the Ambit Energy Business Opportunity Recommended? Neutral (Interesting facts discussed in this review)
What is Ambit Energy?
Ambit Energy is a Multi-Level Marketing Company that is supposed to provide cheap electricity and natural gas to its customers.
It was co-founded by Jere Thompson Jr., whose family started the well known worldwide franchise called 7-Eleven, and Chris Chambless, who was a senior execute of Excel Communications, which was one of the fastest growing companies in the U.S. surpassing Wal-Mart and Microsoft in 1995.
Seeing the opportunity to capitalized on the energy deregulation, the co-founders started this company with the intention of redistributing wealth and at the same helping people save money on their energy bills.
Here's how the deregulation works...
Currently, Ambit Energy provides its services to 17 deregulated states in the U.S., and it has over 1 million active customers.
There have been a lot of complains about the exorbitant prices on the energy bill, but there are good explanations to this which we will discuss later on.
To earn money from Ambit Energy, you need to join as a consultant by paying a one-time fee of $75 and a $24.95 per month for a personalized Ambit website.
The business opportunity used to cost $429 for the set up, and it is supposed to be a good thing that they've reduced the price to $75.
But with the price reduction, a lot of people grew interested in the business opportunity. So much so that the quality of the consultants have decreased over time. I'll talk more about this below as well.
Now, let's discuss about the Ambit business opportunity...
How Does the Ambit Business Opportunity Work?
Basically, as an Ambit Consultant, you'll be promoting the services to your friends, family members, colleagues, neighbors or whoever you've come across.
You'll be able to earn commissions from your customer's monthly energy bill, as well as from the people whom you've recruited as Ambit consultants.
To be truly successful in this business, you have to recruit a team of highly motivated sales driven consultants to promote the services.
You can earn from your own sales, as well as your team's sales. Here's a video that explains the Ambit opportunity in general.
And, here's a video that goes into detail about the compensation plan. Note the outdated price of set up fee in the video.
Is Ambit Energy a Pyramid Scheme?
Honestly, with such a business structure, many people claimed that Ambit Energy is a pyramid scheme.
The more consultants you recruit, the more money you will earn. It is as simple as that.
But here's the catch...
Pyramid schemes do not have a legitimate product or service, but Ambit Energy has.
Which is why this is not considered a pyramid scheme, but a Multi-Level Marketing opportunity.
For your information, Multi-Level Marketing opportunity is legitimate in the U.S.
Although the company is legitimate, there are certain things you have to understand and consider before you join the business opportunity.
Should You Join Ambit Energy as a Consultant?
Well, it really seems to be a great opportunity to earn lots of money month after month.
Who doesn't use energy anyway, right?
However, much like any brick and mortar business, there is a high failure rate of consultants.
Here are the main reasons for failure...
#1 Reason: Lack of Prospects
For any consultants to be wealthy through this company, one needs to have a constant flow of prospects.
This is the biggest problem faced by every consultant.
When you first join the business, you are taught to create a list of people whom you think will benefit from the services of the company. Which is basically every household you know.
Then, you'll reach out to them to share your discovery. It sounds really simple, but in fact it is not.
Out of the 10 people you call, 5 of them will probably meet with you.
And, out of the 5, you will probably get 1 or 2 customers if you are lucky.
As you know, your business will boom if you are able to recruit many Ambit Consultants.
How many prospects do you think you have to meet in order to recruit one consultant?
To be honest, it is much easier to sell the services, then to promote the dream (recruiting).
It would be an uphill battle to sign up new consultants as well as to maintain a group of Consultants under your helm.
Furthermore, after you have expanded your list of prospects to call, where else will you find new leads? Should you go door to door?
That is why I always recommend people to learn how to find prospects online. This way, you'll get an endless stream of prospects.
#2 Problem: Lack of Leadership
A quality service depends largely on the consultants and its team.
If the team leaders teach its consultants to only focus on recruitment, and not on helping others save money on energy...
You'll expect that there will be a lot of customer complaints from that team. Too many complains will eventually drown a business, and you do not want to be a part of it.
A well groomed team is one that focuses on its customers. Providing the best customer service will always trump those which focuses on profits.
So, if you want to join as a consultant, I would suggest that you test out the after-sale service provided by your consultant first.
If you have a good experience with your consultant, then it makes sense to join the business through your consultant.
#3 Problem: Wrong Mindset
This is absolutely not a get rich quick scheme.
Don't expect to have immediate success when you join the company.
Success is through hard work, dedication, perseverance, creativity, and a little bit of luck.
You can definitely be successful with this company, and that means that you have to become a great salesperson.
If you hate to be in the sales environment, this is not a business for you. You can check this out instead.
However, if you aspire to be a great salesperson for Ambit, you need to either find a good coach or mentor, or to learn from other successful people in the industry.
How Ambit Energy Scam People?
Ambit Energy saw the opportunity to advertise cheap energy services to consumers.
While at the back end charging them a variable usage rate that can fluctuate tremendously.
These are all mentioned in the fine print of the service agreement.
To be honest, very few people would get into the details of the service agreement, and all people care about is to save money.
As long as the company can promise to save its consumers money, there will be demand for the service.
But, this is where most people got caught in the Ambit Energy scam.
In almost every service agreement, there will be a fixed rate of service and a variable rate.
Consumers can usually enjoy the fixed rate for up to 1 or 2 years, and if they did not renew their contract on time, they will be charged at the variable rate.
That is why so many people receive an energy bill that cost thousands of dollars. Shocking! But it is real!
The fault lies with both the Ambit Consultant who sold the services, as well as the consumers for not understanding the contract properly before putting the pen on the paper.
The Quality of Service Depends on Your Consultant!
Whenever an Ambit Energy Consultant sells a service, it is important that they highlight the important parts of the service agreement.
I would think that the most important part of the agreement is where the variable energy rate kicks in, but it is missed by so many consultants.
The problem with this is that there is a huge inflow of new consultants because of the newly reduced sign up fee.
And, most new consultants were not properly trained.
All they care about is to sell the most expensive plan to earn the biggest commission, regardless if it is ethical.
The Good and the Bad of Ambit Energy
Other than the rate hikes, there are also several complaints about the unethical practices which you should be aware of.
In a business like this, it is also quite difficult to regulate each and every consultant.
The Class Action Lawsuit
The Class Action Lawsuit were mainly against the false advertisement that lures people into buying "cheap" energy.
As I've mentioned above, Ambit Energy charges consumers a variable energy rate that can hike without limits. Though it is stated in the fine print of the service agreement, and it is signed by the consumers.
Many consumers claimed that they didn't know about such a clause. In 2015, Ambit Energy settled the class action lawsuit for $950,700. The proceeds were returned back to the affected consumers.
To put it simply, Ambit were forced to settle or else they lose the license to operate in the New York.
Thinking of Becoming a Customer? Here's what you need to know!
Before you put the pen on the paper, you must carefully go through the fine print of the service agreement with your consultant.
This is to ensure that the contract you are sold to is the one that you are signing for.
You must also ask if there are any alternative contact details (other than your consultant's contact) for after-sale service.
This is to ensure that you have your questions answered, even if your consultant is unavailable for whatever reasons.
When your bill has arrived, take some time to study it, and make sure that you are paying what you have agreed upon.
When in doubt, always contact your consultant first, and then to the alternate contact person.
My Sincere Advice to You
Whether you are considering to become an Ambit Consultant or you just want to benefit from the services, you have to exercise your due diligence.
Do not sign a contract blindly, and do not join the business opportunity without considering the things I've mentioned above.
Ask your consultant to walk you through the contract, and if that consultant refuses or gives you an excuse, don't sign with them.
You can always find another consultant from the website.
If you enjoy the customer service from your consultant, then it would make sense for you to consider the business opportunity.
A huge part of the due diligence is already done on the fact that you are a happy customer of Ambit Energy.
If you ever find yourself in a situation where you do not have enough prospects or leads, I would highly recommend that you learn more about attraction marketing. This is the strategy used by top earners to find high quality prospects online.
And, if you don't think that Ambit Energy is the right business opportunity for you, and you are still looking for one...
Were you or are you an Ambit Energy customer? I invite you to share your experience in the comments section below.
If you find this review helpful, please share it! Others may be looking for this information.