...NUMBER 1 DIRECT SELLING COMPANY? Master of Management Peter F. Drucker once said: “What an enterprise is, is decided by the customers”. For a successful Direct Seller, in addition to treating himself/herself as part of the business body to accurately reflect enterprise image and concept, it is more important to clarify and satisfy real customer’s need through sincere and objective mind. This is also the most important spirit of Direct Selling and is the reason why an excellent Direct Selling company stays strongly in the market. Direct Selling can be divided into single level Direct Selling and multi-level Marketing; however, in recent years, to cope with the change of industry environment, some of the Direct Selling companies such as Avon started to shift its strategy toward the development of multiple channels for Direct Selling. We hope, through this study, to understand the business operation system and planning in Direct Selling and compare the advantages, disadvantages, opportunities and threats of different business systems. One of the very significant factors for effective sales performance is the marketing strategy. Marketing is a social and managerial process by which individual obtains what they need and want by creating, exchanging and offering product and services with value to others. This study is all about the strategy that a company, like Avon, will need in order to have an effective sales performance which made them the number 1 direct selling company in...
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...Avon Products, Inc. (Avon) is based in New York. The firm engages in the manufacture and marketing of beauty and complimentary products primarily in North America, Latin America, Europe, and Asia Pacific (Yahoo Finance, 2005). Avon's products are classified into three product categories: Beauty, Beauty Plus, and Beyond Beauty. The Beauty category consists of cosmetics, fragrances, skin care, and toiletries; Beauty Plus includes fashion jewelry, watches, apparel, and accessories; and Beyond Beauty comprises home products, gift and decorative products, candles, and toys (Ibid). The company sells and markets its products through a combination of direct selling, marketing by independent Avon representatives, and via its consumer Web site, avon.com. This paper will explore how the company is fairing under the leadership of its current CEO, Andrea Jung. There are two opposing views regarding the company's current and future success. One group feels that the firm has a promising future with Jung at the helm while the other group does not. This paper will analyze the pros and cons uncovered by each team member and discuss which view prevailed in the debate and why. Pros and Cons Pros of Jung and Avon Andrea Jung became president and CEO of Avon in 1999 and has totally revamped the company. Under her leadership, the company has updated its product line, launched new advertising, and created a new image (Fact Monster, 2005). Avon's sales have increased by 30 %, profits 40%, and...
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...4.0 BUSINESS GROWTH STRATEGY 4.1 How and Why Vida Beauty Adopt This Growth Strategy First of all, growth strategy refers to an organization substantially broadens the scope of one or more of its business in terms of their respective customer group, customer functions and alternative technologies to improve its overall performance. Then, in developing growth strategies for growth firm there are two strategies which is internal growth strategy and external growth strategy. Internal strategy involves efforts taken within the firm itself. Then, for perform internal strategy they need to create new product development, other product related strategy and international expansion with the purpose of increasing sales revenue and profitability. External strategy is relying on establishing relationships with third parties such as mergers, acquisitions, strategic alliances, joint ventures, licensing and franchising. In our opinion, Vida Beauty use internal strategy to make sure that the companies become a growth firm and expansion. In internal growth strategies the distinctive attributes of internally generated growth is that a business relies on its competencies, expertise and the employee also. In addition, internally also called as “organic growth” because it does not rely on outside intervention. Organic growth is growth that comes from a company’s existing business as opposed to growth that comes from buying new business. Besides that, it also the process of business expansion due...
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...Marketing is essential to the success of a company’s business no matter how big or how small, with the main focus on quality, consumer value and customer satisfaction. The marketing mix is a strategy used in marketing to ensure the primary focus is met on a consistent basis. The four elements of the marketing mix are known as the "Four P's" of marketing. The marketing mix combines these four elements to produce the results it needs to achieve in a specific target market. Many organizations use the four Ps to gain a competitive advantage in the marketplace. (SmallBizConnect, 2014). The four major components of the marketing mix are explained below: * Product (or Service) * The product is the goods or services that a business sells to their target market. When developing a product or service the company should consider quality, design, packaging, and features of the product or service. * Place * Place refers to the location, distribution channels, methods, and logistics for getting the product or service to the customer. * Price * The amount of money customers pay to purchase the company’s product or service. Price setting must consider the competition in the target market and the cost of the entire marketing mix. * Promotion * The focus of promotion is to acquire new customers, while also retaining current customers. Furthermore, Promotion is communicating the benefits and value of the product to consumers and then persuading them to become...
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...premium products. Tupperware is a member of the Direct Selling Association (DSA) and pledges to abide by the codes of standards and procedures as a condition of admission and continuing membership in the DSA as it relies very heavily on direct selling model. It is the seventh largest direct selling company in the world. The company’s direct sales in the U.S. account for approximately $30 billion and its worldwide sales account for approximately $100 billion. Tupperware Brands Corp. Core Products Tupperware: Tupperware’s principle product line consists of design-centric preparation, storage and serving solutions for the kitchen and home. It also has an established line of kitchen cookware and tools, children’s educational toys, microwave products and gifts. The company has expanded over the years with products such as Modular Mates, FridgeSmart, One Touch canisters, the Rock ‘N Serve microwave line, OvenWorks and silicon baking forms for microwave or oven use, Open House, Elegant and Outdoor Dining serving lines, the Chef Series knives and cookware, Flat Out, Stuffables, CheeseSmart and BreadSmartstorage containers, and Quick Chef and Lil’ Chopper Prep Essentials, Ultra Pro ovenware plus many specialized products for the kitchen and home. About two-thirds of sales are under the Tupperware brand, and include design-centric preparation, storage and serving solutions for the kitchen and home. Beauty: The Beauty businesses manufacture and distribute skin care products, cosmetics...
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...Torre Table of Contents EXECUTIVE SUMMARY/ABSTRACT 4 OVERVIEW 5 History and Background 5 Mission Statement 5 Social/Corporate Responsibility 6 BUSINESS ANALYSIS 8 Core Competencies 8 Management Structure 9 Current Objectives 9 Current Short Term Objectives 9 Current Long Term Objectives 10 Current Strategy 10 Advertising and Representative Value Proposition (“RVP”) 10 Product Line Simplification(PLS) 10 Strategic Sourcing Initiative 10 Enterprise Resource Planning System 11 Zero-Overhead-Growth 11 Restructuring Initiatives 11 SWOT Analysis 13 Strengths 13 Weaknesses 15 Opportunities 17 Threats 22 FINANCIAL INFORMATION 23 SUMMARY OF RECOMMENDATIONS 25 Technology and Social Media 25 Focusing on International Growth- the BRIC Countries 27 Brazil 28 Recommendations for Brazil 33 Russia 34 Recommandations for Russia 40 India 41 Recommendations for India 46 China 47 Recommendations for China 53 Conclusion ………….…………………………………………………………………………………….54 REFERENCES 55 AVON- A GLOBAL COMPANY FOR WOMEN EXECUTIVE SUMMARY/ABSTRACT Avon is a powerhouse in the beauty industry with over $10 Billion in sales and claims its stake as being the largest direct seller in the world. After performing extensive research on the company using multiple online tools...
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...Torre Table of Contents EXECUTIVE SUMMARY/ABSTRACT 4 OVERVIEW 5 History and Background 5 Mission Statement 5 Social/Corporate Responsibility 6 BUSINESS ANALYSIS 8 Core Competencies 8 Management Structure 9 Current Objectives 9 Current Short Term Objectives 9 Current Long Term Objectives 10 Current Strategy 10 Advertising and Representative Value Proposition (“RVP”) 10 Product Line Simplification(PLS) 10 Strategic Sourcing Initiative 10 Enterprise Resource Planning System 11 Zero-Overhead-Growth 11 Restructuring Initiatives 11 SWOT Analysis 13 Strengths 13 Weaknesses 15 Opportunities 17 Threats 22 FINANCIAL INFORMATION 23 SUMMARY OF RECOMMENDATIONS 25 Technology and Social Media 25 Focusing on International Growth- the BRIC Countries 27 Brazil 28 Recommendations for Brazil 33 Russia 34 Recommandations for Russia 40 India 41 Recommendations for India 46 China 47 Recommendations for China 53 Conclusion ………….…………………………………………………………………………………….54 REFERENCES 55 AVON- A GLOBAL COMPANY FOR WOMEN EXECUTIVE SUMMARY/ABSTRACT Avon is a powerhouse in the beauty industry with over $10 Billion in sales and claims its stake as being the largest direct seller in the world. After performing extensive research on the company using multiple online tools...
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...Table of Contents EXECUTIVE SUMMARY/ABSTRACT 4 OVERVIEW 5 History and Background 5 Mission Statement 5 Social/Corporate Responsibility 6 BUSINESS ANALYSIS 8 Core Competencies 8 Management Structure 9 Current Objectives 9 Current Short Term Objectives 9 Current Long Term Objectives 10 Current Strategy 10 Advertising and Representative Value Proposition (“RVP”) 10 Product Line Simplification(PLS) 10 Strategic Sourcing Initiative 10 Enterprise Resource Planning System 11 Zero-Overhead-Growth 11 Restructuring Initiatives 11 SWOT Analysis 13 Strengths 13 Weaknesses 15 Opportunities 17 Threats 22 FINANCIAL INFORMATION 23 SUMMARY OF RECOMMENDATIONS 25 Technology and Social Media 25 Focusing on International Growth- the BRIC Countries 27 Brazil 28 Recommendations for Brazil 33 Russia 34 Recommandations for Russia 40 India 41 Recommendations for India 46 China 47 Recommendations for China 53 Conclusion ………….…………………………………………………………………………………….54 REFERENCES 55 AVON- A GLOBAL COMPANY FOR WOMEN EXECUTIVE SUMMARY/ABSTRACT Avon is a powerhouse in the beauty industry with over $10 Billion in sales and claims its stake as being the largest direct seller in the world. After performing extensive research on the company using multiple online tools, journals, articles and texts, we...
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...Shiseido’s International Strategy Overview Shiseido started its business as Japan’s first Western-style pharmacy in 1872. Over the 140 years of development, Shiseido has positioned itself as a leading cosmetics company through helping people live beautifully both in domestic and in global markets. Shiseido has been making efforts to build customer trust brands through improving the technological capability, product function and safety, hospitality at sales counters and other elements regarding to customer trust. Shiseido began its internationalization process in 1957 by establishing a subsidiary corporate in Taiwan. After that, Shiseido accelerated its process of being a global play through entering prestige markets in Europe, Americas and China. Over 50 years, Shiseido has built a strong brand in the global market through diversity and brand equity. Currently, Shiseido is operating business in 87 countries and regions including Japan. And in 2012, the net sales in the global markets reach roughly 50 percent of the total net sales of Shiseido and the overseas sales ratio grows to over 44 percent (Shiseido, 2012). In 2012, Shiseido’s global cosmetics division centers on cultivating its prestige brands and emphasizes on developing its business in Asia market, especially in China. As a result, the sales from the global cosmetics division grow by over 12 percent year on year on a local currency basis (Shiseido, 2012). The sales in the Europe increase by around 10 percent, mainly...
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...Jessica Wang, Jana Levin, Jackie D’Aquila, David Sit CM 447 Coursework 2 26/04/13 I. OVERVIEW For decades, Avon has been an iconic brand for its unique business model, active service to the community, and success as a global name. However, since 2008, Avon’s profits have been falling significantly due to a failure to adapt to changes in the macroenvironment. For example, the recent growth of technology has influenced the way that consumers are buying beauty products. Direct selling has decreased in popularity due to increases channels of distribution, and more consumers turning to the Internet to make cosmetics purchases. Yet, Avon remains behind other major beauty companies like L’Oreal and Unilever in terms of online presence. The combination of these factors has reduced the demand for Avon products and decreased the amount of women, who are interested in selling them. In response to their falling sales, Avon has adapted a penetration strategy that involves brand extensions to men’s personal care, teen cosmetics, and natural skincare products. In addition, Avon has extended its distribution to outlets to mall kiosks and larger retail stores. This diversification in product selection and sales has left Avon with a lack of focus that has left employees spreading their efforts too thin and consumers questioning its brand identity. Lastly, Avon’s success in the 1960s and 1970s was mostly among stay-at-home suburban mums, and the lack of sustained advertising...
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...1990-2012 Point of View Avon, as of 2012, was the world’s largest direct seller of beauty products. Headquartered in New York, USA, it reported US $ 10.7 billion as annual revenues in 2012. Avon’s business was based on the traditional marketing model of door to door selling, through a network of 6.4 million active sales representatives (reps) who sold the products directly to consumers. Over the years, Avon expanded its business to other parts of the world, and had a presence in more than 100 countries across the globe. It was highly popular in emerging markets like China and Russia. The company, with a history of more than 125 years, was a pioneer in direct selling. During the late 1990s, however, the business started to face problems. In 1999, Andrea Jung (Jung) became the CEO and things started looking up for Avon. But business started to decline after 2008, mainly due to problems in the direct selling model in Avon’s home market, the US. Trends like online shopping on the internet platform, specialty retailers, etc., gained ground at the cost of traditional door-to-door selling. Moreover, Avon’s sales representatives themselves had reservations about the company’s attitude of putting pressure on them to increase the number of recruits. Issues: The case will help the students: »Study the distribution channel adopted by Avon »Discuss the advantages and disadvantages of direct selling for the company and for the customers. »Discuss and debate whether the model is sustainable...
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...global al afacerilor prin prisma factorilor de impact asupra industriei cosmeticelor The cosmetic industry is one of which products tend to be countercyclical. Demand for such products normally remains constant and unaffected by economic distress. The color cosmetics are predicted to see a slowdown in volume demand. A growing trend in the cosmetic industry is the introduction of ‘green’ products. More than one in seven (16%) of global beauty products launched in 2008 were certified organic, ethical or natural. There are concerns that the global economic climate will stifle new product development, innovation and sustainability programs in 2009. An economic slowdown usually curbs companies from investing in research and development and it is that research that has brought forth a wealth of green cosmetics. For example, retailers such as Wal-Mart are increasingly requiring more ecofriendly supply chain. There are forecasts that consumers are unlikely to give up their commitments to organic products just to save a few pennies. 68% of consumers will remain loyal to a company that has a social and environmental commitment. Many consumers are now ‘voting with dollars’ for organic products and supporting brands that support values similar to their own. Economic factors mainly affect the purchasing power of customers. The more customer demand for the product the more profit to the organization, at the same time if there is no customers demand it’s going to affect the organization in...
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...hand cream were not McConnell’s products. When he was sixteen, he started selling books door to door. In his travels as a book salesman, McConnell made two important discoveries. Firstly, he noticed that his female customers were more interested in the free perfume samples he offered than they were in his books. He made these fragrances himself to serve as door openers when he traveled from home to home. Secondly, McConnell saw women struggling to make ends meet and recognized in many of them natural salespeople who would easily relate to other women and passionately market the products his new company would first sell perfumes. Then, the choices of customers affected McConnell and he established the California Perfume Company in the NY. Today Avon, the company for women, is a leading global beauty company, with over $10 billion in annual revenue. As the world's largest direct seller, Avon markets to women in more than 100 countries through approximately 6.5 million active independent Avon Sales Representatives. Avon's product line includes beauty products, as well as fashion and home products, and features such well-recognized brand names as Avon Color, Anew, Skin-So-Soft, Advance Techniques, Avon Naturals, and mark. Each representative distributes a product catalog to their consumer every two weeks, and a new catalog typically includes 200—300 new items, generally seasonal product or promotional items. After a consumer has selected products to buy, the representative places...
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...STRATEGIC ANALYSIS OF AVON PRODUCT INC Name: Institution: Tutor: Course: Date: Table of Contents Strategic Analysis of Avon Product Inc 2 Executive Summary 2 Introduction 3 1.1 Background of the Company 3 2.0 Market Segmentation strategy 4 2.1 Value addition for new products and services 4 2.2 Strategic economic evaluation and implementation processes 4 2.3 Development in sales and cost effectiveness 5 2.4 Good market studying strategies 5 2.5 Proper search of the new market and opportunities 6 3.0 Targeting strategy 6 3.1 Proper market survey 6 3.2 Diversification through acquisition 7 3.3 Waste reduction and Environmental sustainability 7 3.4 Production of healthy and high quality products 8 4.0 Positioning strategy 9 4.1 Techno-economic paradigm 9 4.2 Proper market decision 9 4.3 Primary and secondary data collection 10 Recommendation 10 References 11 Strategic Analysis of Avon ProductInc Executive Summary Avon Company is the leading world beauty company that operates as a manufacturer, retailor, and marketer of cosmetics and other beauty related products. It started its operations in 1880s as a small segment through a door-to-door sale of perfume products. It later diversified into health-related products in 1980s, a period during which it recorded negative profit margin due to poor management, production and market plans. Despite the challenges, Avon Company has grown to be the number one global producer and marketer of the beauty products with women as the...
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...Abstract Marketing is an integral part of the success of any business. The “Marketing Mix,” otherwise called the “Four P’s” include Product, Price, Place, and Promotion, and outline the fundamental requirements for a business to produce revenue. Firstly, a business needs to have a product, good or service from which to build their company. Secondly, the product has to be reasonably priced and be of lasting quality or value to the consumer for the business to be able to make profits and continue to flourish. Thirdly, products need to be made readily available to consumers and needs to be affectively distributed to meet the demands of the consumer. Lastly, the consumer needs to be made aware of a product or service through promotion. In utilizing the Four P’s, businesses have the fundamental tools to grow a successful company, as is the case with the Unilever subsidiary, Dove. Up In the Mix: The Four P’s Over the course of history the needs of consumers has grown. In an expanding market with growing competition individuals are presented with many companies from which to choose to purchase their various goods and services. In starting any business the basic goals are eventual profit and customer satisfaction. There are essential tools utilized by companies to gain and retain the business of the consumer. These essential tools are part of the “Marketing Mix” and are referred to as the “Four P’s.” The Four P’s include Product, Price, Place, and Promotion (Board, p. 140) Understanding...
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