Premium Essay

Avon Branding

In: Business and Management

Submitted By cakeeater27
Words 3833
Pages 16
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 in contemporary media has perpetuated the brand’s association with a more mundane lifestyle and an older demographic. Specifically, these associations are not attractive to today’s consumers, who crave glamour and follow urban trendsetters. In a market that is becoming increasingly digital, Avon has failed to translate its identity into its website and has not used social media to

Similar Documents

Premium Essay

Avon

...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...

Words: 1618 - Pages: 7

Premium Essay

Management

...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 have collected enough evidence to make recommendations as to how Avon can continue its global expansion while still maintaining long and short term company objectives and staying within core competencies. We believe Avon can and should expand strategically into each of the BRIC countries while also leverage the power of the technology and the Internet to increase business through social...

Words: 16514 - Pages: 67

Premium Essay

Marketing

... It may try to portray the product in a certain way and give the brand characteristics that would influence the consumer's purchasing decisions. 2. Why do firms try to establish brand names? Firms try to build brand names as it is a way of differentiating its products and services from those of its competitors. The most famous brand names are now invaluable, intangible assets for the firms who produce them. This differentiation will encourage consumer loyalty and allow a price premium, thereby increasing profits. 3. Make a list of twenty of the best known brand names. Which of these are examples of corporate branding and which are multiple product branding? • Coca Cola – Corporate • Microsoft – Corporate • IBM – Corporate • Intel - Corporate • Nokia – Corporate • General Electric – Corporate • Avon - Corporate • Cadbury – Corporate • Tommy Hilfiger – Multiple • Ford – Corporate • Disney - Corporate • McDonalds - Corporate • Hewlett Packard – Corporate • Toyota - Corporate • Gillette - Corporate • Sony - Corporate • Nestlé - Corporate • GAP - • Pepsi - Multiple • Adidas - Corporate 4. Choose any 3 brand names and make a list of the core brand values Colgate Three fundamental...

Words: 643 - Pages: 3

Premium Essay

Thuong

...GLOBAL ANALYSIS- AVON MGT 795: Section G11 Professor: Patrick Saparito Jennifer Callaghan J.R. Longino Rasa Navickaite Meghan Quinn Lia 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...

Words: 16535 - Pages: 67

Premium Essay

Global Analysis- Avon

...GLOBAL ANALYSIS- AVON MGT 795: Section G11 Professor: Patrick Saparito Jennifer Callaghan J.R. Longino Rasa Navickaite Meghan Quinn Lia 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...

Words: 16535 - Pages: 67

Premium Essay

Brand Rankings

...Interbrand: Daniel Diez: (212) 798-7729 Daniel.Diez@interbrand.com Porter Novelli for Interbrand: Alan Marcus: (212) 601-8443 Alan.Marcus@porternovelli.com INTERBRAND RELEASES 13TH ANNUAL BEST GLOBAL BRANDS REPORT Coca-Cola retains the #1 spot — Apple jumps to #2; Facebook enters Top 100 as Google overtakes Microsoft NEW YORK, New York, October 2, 2012 – Coca-Cola, Apple and IBM lead Interbrand’s 13th annual Best Global Brands report. While Coca-Cola retained its #1 position, Apple jumped to #2 with stellar sales in both developed and emerging markets over the last year. Social media giant, Facebook (#69), enters the report after making headlines as the third largest IPO in US history, and Google (#4) experienced a 26% increase in brand value over the last year, exceeding rival Microsoft’s (#5) brand value for the first time in the history of Interbrand’s report. Interbrand, the world’s leading brand consultancy, publishes its Best Global Brands report of the world’s 100 most valuable brands on an annual basis. Interbrand’s methodology - the first of its kind to be ISO certified – analyzes the many ways a brand touches and benefits an organization, from driving bottom-line business results to delivering on customer expectations. To develop its report, Interbrand examines the three key aspects that contribute to a brand’s value: • The financial performance of the branded products or service • The role the brand plays in influencing consumer choice • The strength the brand...

Words: 2533 - Pages: 11

Premium Essay

Best Retail Brands 2012 - Interbrand

...Best Retail Brands Founded in 1974, Interbrand is one of the world’s largest branding consultancies. With nearly 40 offices in 26 countries, Interbrand’s combination of rigorous strategy, analytics and world-class design enables it to assist clients in creating and managing brand value effectively across all touchpoints in all market dynamics. Interbrand is widely recognized for its Best Global Brands report, the definitive guide to the world’s most valuable brands, as well as its Best Global Green Brands report which identifies the gap between customer perception and a brand’s performance relative to sustainability. It is also known for having created www.Brandchannel.com, an international online exchange and resource about brand marketing and branding. For more information on Interbrand, visit www.Interbrand.com. For more than 30 years we have been creating retail brand experiences for companies around the world. Interbrand Design Forum’s talent for game-changing innovation spurred us to create a business model that integrates analytics-based strategy into what began as a design and architecture group — the first and only company with such a comprehensive offering. Our broad range of services includes: retail design, brand strategy, shopper sciences, packaging, digital, documentation and rollout. This unique ability to address retail’s growing complexity has led many of the world’s top companies to our doorstep and propelled Interbrand Design Forum to the forefront of...

Words: 24571 - Pages: 99

Premium Essay

Avon Case Stude

...Le’Shundia K.Porter August 1, 2012 HRM 532 Assignment 2 Avon Products Dr. Sue Lowe Abstract Avon is the company that stands for beauty, innovation, and optimism, and above all for women. Avon Products, Inc. Avon is based in New York. The company appoints the manufacture and marketing of beauty and complimentary products primarily in North America, Latin America, Europe, and Asia Pacific. 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. Andrea Jung became president and CEO of Avon in 1999 and has totally makeover the company. Under her leadership, the company has updated its product line, launched new advertising, and created a new image. Avon’s sales have increased by 30 %, profits 40%, and the stock price has dramatically improved. Jung’s has been able to align the firm’s core capabilities with its strategic targets which has lead to outstanding results. It appears that Jung has been able to establish a clear vision for the firm that has been incorporated in every aspect of the firm’s operating system. This vision is shared by all employees and representatives of Avon motivate the company for continued success. Provide a brief description...

Words: 1638 - Pages: 7

Free Essay

The Wire

...The first season introduces two major groups of characters: the Baltimore police department and a drug dealing organization run by the Barksdale family. The season follows the investigation of the latter over its 13 episodes. An investigation into a large Baltimore based drug dealing is triggered when detective Jimmy McNulty meets privately with judge Daniel Phelan following the acquittal of D'Angelo Barksdale for murder after a key witness changes her story. McNulty tells Phelan that the witness has probably been intimidated by members of a drug trafficking empire run by D'Angelo's uncle, Avon Barksdale, having recognized several faces at the trial, notably Avon's second-in-command, Stringer Bell. He also tells Phelan that nobody is investigating Barksdale's criminal activity, which includes a significant portion of the city's drug trade and several unsolved homicides. Phelan takes issue with this and complains to senior Police Department figures, embarrassing them into creating a detail dedicated to investigating Barksdale. However, owing to the department's dysfunctionality, the investigation is intended as a façade to appease the judge. An interdepartmental struggle between the more motivated officers on the detail and their superiors spans the whole season, with interference by the higher-ups often threatening to ruin the investigation. The detail's commander, Cedric Daniels, acts as mediator between the two opposing groups of police. Meanwhile, the organized and cautious...

Words: 528 - Pages: 3

Free Essay

Avon Products Case Study

...[Type the company name] | AVON PRODUCTS CASE STUDY 1 | [Type the document subtitle] | | Pamela | [Pick the date] | Abstract Avon Products, Inc was a leading global cosmetics company, with over $8 billion in annual revenue in 2005. As the world’s largest direct seller, the company marketed to women in 143 countries via five (5) million independent Avon Sales Representatives. Avon product lines included numerous popular brand names, and an extensive line of costume jewelry and clothing. Although revenues increased in 2003, 2004 and 2005, Avon’s net income was $848 million in 2005. The company met with stiff competition in the US market from other cosmetic companies. In order to maintain its market share in the US while targeting other countries, especially China, the company drastically changed its global operating structure. This brought senior management closer to its key business geographies, strengthened global integration, accelerated information flow and positioned the company for sustainable growth. Avon expected to incur costs to implement these initiatives over the next several years, with a significant portion of the total costs to be incurred during 2006. Benefits from restructuring helped to fund a notable increase in consumer investment and improved the competitiveness of its direct selling opportunity. Additionally, the company increased investment in advertising, marketing intelligence, consumer research and product innovation. The cosmetics mogul...

Words: 1478 - Pages: 6

Premium Essay

Why Avon Company Is Considered as the Number 1 Direct Selling Company?

...WHY AVON COMPANY IS CONSIDERED THE 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...

Words: 3116 - Pages: 13

Premium Essay

Wsj Assignment

...Topics: Strategy, Changing Markets, Cash Flow _______________________________________________ Avon’s Investments Fall Short by Hannah Karp, Wall Street Journal, December 8, 2011 QUESTIONS:  1: Briefly describe the main points of the article. The article highlights Avon Products Inc.’s financial and regulatory woes. Avon’s wide and persistent gap between net income and free cash flows have been highlighted as the main reason for the company’s problems. The gap indicates that the company's investments aren't paying off very well and that its net income doesn't fully reflect depreciation and other costs of those investments. Other problems like computerized supply-management system in Latin America, Avon's direct-selling model in China and not being able to understand the American consumer have all led to a shortage of free cash flow. The article also talks about Avon being under the scrutiny of Securities and Exchange Commission for allegations of bribing foreign officials and improperly disclosing information to Wall Street analysts. 2: How are Net Income and Free Cash Flows calculated differently? What does it mean when the article states “free cash flow and net incomes tend to balance out over the long run”? * Net income amounts to revenue minus costs and the depreciation of a company's assets * FCF = NOPAT (Net Operating Profit after Taxes ) - Net investment in operating capital When the article states “free cash flow and net incomes tend to balance...

Words: 1872 - Pages: 8

Premium Essay

Avon Case

...MERT CAN ODABAŞ Avon Company Overview The first Avon lady book salesman was David McConell. He launched Avon Calling in 1886 as offering women cosmetics in the comfort of their own homes, however, perfumes and 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...

Words: 2250 - Pages: 9

Premium Essay

Avon

...AVON PRODUCTS, INC.: DEVELOPING A GLOBAL PERSPECTIVE INTRODUCTION “When the history of this organization is written,” noted James E. Preston, chairman and chief executive officer of Avon Products, Inc., in February, 1993, “a meeting last June in Florida of 60 managers from around the world may turn out to have been a watershed event. Our four days of brainstorming, debate and discussion brought to an end two years of research and examination of our basic businesses, and launched us on a new way of thinking about and managing those businesses.” Preston was excited about the new direction taking shape at Avon. The past several years had been difficult for the organization. Hostile takeover attempts plagued the firm during the 1980s. Avon sales volume in the United States and international markets showed little or no growth. Profit margins on many products declined due to price discounting by competitors. Turnover rates of sales representatives had increased. The corporate debt was referred to as “staggering” at $1.13 billion or 82.5% of total capital in 1988 (See Appendices A, B, and C). Preston was confident, however, that 1993 would be a year of improvement for the company, both in financial performance and in the progress made “repositioning ourselves as the woman’s company for the Nineties and beyond.” Avon’s research department informed management that corporate problems centered around image and market access. That shaped the agenda of the June, 1992, meeting in Florida:...

Words: 8366 - Pages: 34

Premium Essay

Cross Culture

...TOPIC6: Avon in Global Markets in 2009: Managing and Developing a Global Workforce Discussion Questions 1. Referring to this chapter and Chapter 9, evaluate Avon’s Strategic International Resources practices in global markets regarding development of a global management cadre, HCNs, and building company associates and independent representatives in host countries. 2. Describe how Avon’s business model has changed in light of demographic and social changes in the United States and abroad. What role has IHRM played in the company’s global expansion? 3. Avon’s future global expansion is contingent on hiring and retaining the best workforce and salespeople in global markets. What training and cross-cultural strategies do you recommend to the company to deal with this area? 4. What are the cross-cultural implications for management that you learned in this case? Or what are the major cross-cultural impacts for management present in this case? 5. Executive Summary 6. 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...

Words: 462 - Pages: 2