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Case study of Avon products.

Brian Frankel

on 31 May 2010

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Transcript of AVON

Product Price Place Promotion MARKETING MIX Problem Identification Current BCG model Product Life Cycle SWOT Market
Positioning Distribution Product Strategies Purchase Decision Process Market Segmentation Recommendations & Direct-selling females as independent contractors
1950-“Ding-Don Avon calling campaign” –expanded into Europe and South America
one-on-one meetings home/work Direct mail -fail due to order sizes small to meet Avons required profit margins
word of mouth sales and distribution Products arrived in several big boxes, saved cost;
representatives ordered extra quantities of popular
items to keep in inventory for quick delivery
positioned to deliver high quality and highly innovative products at an outstanding value
Value Chain analysis U.S. industry mature, annual growth between 2%-4% Competition Maslow's Hierarchy of needs Pro's & Con's of Direct Selling Pro's Con's -face to face interactions

-representatives are known on a personal level

-products are sampled well before purchase

-word of mouth product review

-larger commission pay for representatives

-Time consumption

-Middle-man who takes away from revenues

Customer satisfaction with products

-high turnover of representatives

Questions - Answers? Need Recognition Purchase Decision Post-Purchase Decision Recognition the problem
More than just typical make-up
Need to build self-esteem, self confidence, feel beautiful
Need social accpetance
Avon consumers are loyal to the brand
Consumers enjoy the consultation of the direct selling method
Consumers enjoy the social and friendly atmosphere that is attached to the purchase

Customers are affliated with womens charitable events
Customers are fulfulling self actualization by donationg to breast cancer foundation
The end user is happy with the product and will be returning for purchase
Few customers loose communication - Beautification
- Personal Shopping Experience
Whos needs? What needs? - Tech Savvy Consumers
- “Now” Generation
- Professional Women
- Representatives
- Society
- Efficiency
- Convenience
- eReps
- No Catalogue
- Environmental Awareness

Keep price points the same at or below the mass market price
Keep traditional direct selling representatives (30-40%) Incude/Merge traditional to E-representatives (10-20%)
Increase Television advertising
Product placement (Make up events)
Have celebrity brand representatives
R & D on different ethnic backgrounds

Place extension increases distribution channels

Price (Hi) Price (low) Quality (Hi) Quality (low) - Consumers

- Representatives
Women -Ages 25 - 50 years old
-Avg income to below avg income -Women 30's and 40's
- proably selling as second job Power of direct selling
low costs for avon (no fixed costs)
large market share
Loss of standard customers (appox 5 million)
people may not have direct access

Non-traditional retail outlets

Increase distribution
channels reach larger global audience
- Women (25-50 y/o)
- Average & Below Income
- Representatives
Whos needs? What needs? AVON
-CFT (cosmetics, fragrance, toiletries) -High quality products at an outstanding value
-Price at or below the market -Electronic (online website)
B2B -Direct marketing:
Paid advertising campaign through media
-Public relations:
Promoting avon.com through social events
A community for women
Avon Breast Cancer 3-Day Walk
Environmentally friendly image
-Personal selling:
Promotion by representatives
-Sales promotion:
Special sales promotion for the online first time buyers What is the best way to leverage sales representatives in building Avon.com? Which products should be sold online? How would they promote the site?
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