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Avon Products

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by

Katie DiTomaso

on 20 March 2014

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Transcript of Avon Products

A Global Philanthropy for Women
Overview
What is Avon?
The Global Market
Case Summary
Avon and China
Avon's Business Strategy
Questions
Expansion in the Marketplace
CEO Andrea Jung talks about Avon's global market expansion
What is Avon?
Avon Products Inc. was the world's largest direct selling organization and merchandiser beauty related products
Mission
: Give empowerment to Women
Market to 112 countries
Over 1.6 million independent sales representatives
Expansion in the Marketplace
Avon started in 1886
Entered the global marketplace in the 1950s
Expanded to Latin America, United Kingdom, Asia, Europe, and Germany
Case Summary
1999-2005
Company's famous direct sale model made revenues grow in excess of 10% per year, profits tripled and Jung became a Wall Street favorite
70% of its revenues came from international markets
Until 2005, " Success story turns ugly"
Case Summary
China put a ban on direct sales
Economic weakness in Eastern Europe, Russia, and Mexico stalled growth
By September, stock fell 45%
Redefining Market Strategy
To help transform Avon, Jung:
Hired seasoned managers from well known global consumer product companies
Improved communication, performance visibility, and accountability
Reduced number of management layers from 15 to 8
Laid of 30% of managers
Cut 25% of products and invested in centralized product development
Avon Back in China
China rescinds the ban on direct sales
Allows Avon to recruit 400,000 new representatives in China
Global financial crisis hits
"This was an opportunity for Avon to expand its business" - Jung
Response to Global Crisis
Avon changed marketing strategy again to fit with the global crisis
Began to emphasize "value for money"
Questions
Works Cited
http://www.scribd.com/doc/52292825/Competitive-Strategic-Management-Developing-Avon-In-A-Global-Perspective

Hill, Charles W. L.. Global business today. 4[th ed. Boston, Mass.: McGraw-Hill/Irwin, 2006. Print.

http://www.avoncompany.com/aboutavon/avonmarkets.html
Avon utilizes a standardized strategy as opposed to a localization strategy for their global marketing. Do you think this has helped or hurt their sales?
Do you think that they could benefit from adapting a localization strategy?
Full transcript