This website uses cookies to ensure you have the best experience. Learn more

Avon Case Analysis

1398 words - 6 pages

RUNNING HEAD: Avon Products Inc. Case Analysis

Taking Sides Avon Case Analysis
MGT/578 - Strategy Formulation and Implementation
December 18, 2006

Introduction –
In the spring of 2000, Andrea Jung, president and CEO since November 1999 at Avon Products, Inc., faced the strategic decision of developing a growth strategy for a 115-year-old company (Pearce & Robinson, 2004). Not only was Avon experiencing a shrinking growth rate, but its earnings over the past few years had only risen in the low-single digits. Jung realized that not only had stagnant sales contributed to this but other factors as well to include ...view middle of the document...

Avon spent $30 million to re-launch Avon.com, in order to enable consumers to buy products from sales representatives online or directly through the company. The company was intending to allow each sales representative to customize his or her own website, which also links to the company’s home page.

Another trend in online beauty retailing was the diminishing distinction between prestige and mass market brands. The most successful and visited personal care websites were those that existed for a longer time and had a high level of advertising. Avon’s Websites strategy was to feature not only cosmetics but also health and beauty products as consumers visit these sites more than cosmetic-only websites.

Avon came out the gate with a great sense of energy and urgency by implementing new products beyond cosmetics like the new line of spa services and other non-personal care products. Avon will continue to lead the cosmetic industry with product lines that best fit Avon’s brand image.

Martha
Avon Products Inc. is the world’s largest direct seller of beauty and related personal care products, sold to women in 127 countries via three million independent sales representatives who generated approximately $5.1 billion in annual revenues (Pearce & Robinson, 2005). Andrea Jung’s grand strategy is properly focused and directed to increasing sales and revenue for Avon Products Inc. Despite earnings on the rise and the growth rate had shrunk, Jung’s is directed by providing forecast sales and long-term goals, such as the potential growth of each product Avon produces. Jung has covered all product bases used in everyday households from skin care, makeup/color cosmetics, hair care, personal hygiene, perfume/fragrances, spa services, and other non-personal care products. When Jung considered the different future sales, competitors like Mary Kay Inc., L’Oreal, and other retail competitors.
Expected Future Sales Growth 1998-2005:
[pic]
Jung has also covered the different target markets from age groups, sex, and ethnic origin in order to go after the market that will cause the most impact to Avon and increase sales.
Customer in the Personal Care Industry Segmented by Age:
[pic]
Overall growth of 2.8 percent from 1995 through 1999 and the personal care products market was expected to increase steadily in the future reaching $197.97 in 2003 (Pearce & Robinson, 2005). A key success factor used by Avon was using strong brand loyalty and strong brand image in order to make viable product claims to boost profits (Pearce & Robinson, 2005). Andrea Jung has ensured that the different areas of being able to sell the product through different selling avenues by direct, retail, and online selling. Also, ensuring that the domestic and international markets are penetrated which will increase sales.
Scott
Jung should follow the advice of the outside consultants using a three staged approach of expansion into the retail markets. Avon is...

Other Papers Like Avon Case Analysis

Avon Case Answers Essay

683 words - 3 pages and low buyers), and on-line vs. representative access. Q2) Should Avon sell direct to the consumer? Why or why not? Avon should not sell direct to the consumer. They shouldn’t sell direct because most likely, as was the case when Avon tried to sell by direct mailings, the orders may be too small to meet Avon’s required profit margins. Additionally, Avon would have to make drastic changes to its current business model with regards to

Avon Products Case Study

1478 words - 6 pages [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

Avon Case Study

1846 words - 8 pages Avon, A Cut Above the Rest Nathaniel J. Wilson Dr. Robert Waldo HRM 532 – Talent Management May 4, 2014 Introduction A door to door merchandise company that began well over a century ago flourishes and then almost crumbles to its knees. Why you might ask, well it’s very simple; when major companies continue to grow faster than the structure will allow, they simply cannot keep up with the consumer demand. Avon Products Inc., a

Materiality

718 words - 3 pages Avon Week 01 Written Assignment Christine Bory Rasmussen College Author Note: This assignment is being submitted on January 12, 2014 for Steve Rudolph’s MAN4720 course at Rasmussen College by Christine Bory. Avon In this case, the new CEO Jung did a situation analysis to determine the strengths and weakness of the company and what could be done to improve sales. In the analysis it was determined they were weak in research and

HOW IMPORTANT IS IT FOR MANAGERS TODAY TO HAVE A GOOD UNDERSTANDING OF CULTURAL DIVERSITY IN THE WORKPLACE?

4084 words - 17 pages culture groups, (d) by promoting team creativity and innovation, (e) by improving problem solving, and (f) by enhancing organisational flexibility. In his study he has also found out that CEOs of high profile firms such as Avon, Xerox, Corning, and Proctor and Gamble have said that managing diversity is "not simply something to do because it's nice." Rather, it is a "competitive necessity," a "business imperative," a "strategic priority".( http

Business Report on Alibaba

1674 words - 7 pages Business Report on Alibaba Name: Xiya Chen Group:IBM-E2 Subject: Business & Management Executive Summary This report is based on the business environment analysis to identify key factor for Alibaba. From ratio analysis, it is found that financial performance of Alibaba is decreased in last two years due to decline in profitability and management efficiency. It is also identified from PESTEL analysis that political, social and legal

Innovation

1677 words - 7 pages Proctor & Gamble are Avon, Colgate Palmolive Company, Unilever, Johnson & Johnson, Revlon, Kimberly-Clark Corporation, church & Dwight Co Inc. Before year 2000 all the innovations at P&G were carried out internally and the company has was spending 50% more than its competitors for the innovation but only 15% of P&G innovations were meeting the revenues . P& G realized that in house inventing was not capable of sustaining

Android Under Attack

4541 words - 19 pages that came first. David explained to Ken Bailey about the relationship of Enronaa and Androids. David also talks about Nancy’s email on the policy of routine document shredding. Nancy is a lawyer at Androids’ headquarters at Chicago. 2. PROBLEM ANALYSIS 2.1 5Why’s Analysis In order to identify the main problem in ‘Androids under Attack’, we must first analyze the overall situation of the case. Specifically for this purpose, we decided to

Changing Characteristics of the Workforce

2591 words - 11 pages measure EI. The WLEIS consists of 16 items. These items included, “I have a good sense of why I have certain feelings most of the time,” and “I always set goals for myself and then try my best to achieve to achieve them and I am able to control my temper and handle difficulties rationally”. The response format was a seven-point Likert scale with one representing strongly disagree and seven representing strongly agree. Confirmatory factor analysis

Product Management

4674 words - 19 pages tvs etc Meta-mediaries Offers bundle of services related to the transaction Examples? M_K_M_T_IP.COM HOW TO DETERMINE COMPETITORS? MANAGERIAL? • Industry code: SIC • Commercial data services: Pro… HOW MANAGERS PERCEIVE COMPETITION? • Size • Success • Threatening behavior (Hertz, Avon) Customer based measures Observational procedures • Product placement in store • Brand switching matrix • Panel data analysis Experimental

Critique Qualiative Research

3287 words - 14 pages decision making in which the clinician uses the best evidence available, in consultation with the patient, to decide upon the option which suits the patient best." The purpose of this assignment is to enable the development of skills in critical analysis by critiquing a research article, which will contribute to further development of knowledge and skills in using EBP in clinical settings. A framework developed by Hek and

Related Essays

Avon Case Study

1769 words - 8 pages the marketing function and to earn higher profits. While this method has proven to be successful for Avon and has certainly contributed to their longevity in the market, there are still crucial factors imposing on the company’s global presence throughout the world. The case study “Avon Calls on Foreign Markets” shed light on issues related to branding, pricing, promotion, as well as distribution. Throughout this analysis, I have identified the

Avon Case Essay

871 words - 4 pages 1. Evaluate Avon’s Strategic International Human Resources practices in global markets regarding development of a global management cadre, HCNs, and building company associates and independent representatives in host countries. Avon is a company that realized early on that their managers had to be trained to deal with intercultural in order to remain productive and successful in the over 100 countries the company operates within. They implement

Avon Products1 Essay

1526 words - 7 pages . In this case, Avon won’t have too much dividend liability to their investors in the next three years before the redemption without reducing the dividend payment, which will make sure the yield-seeking shareholders will still be interested in their shares. In addition, as Avon wouldn’t be able to pay its common dividend if its preferred dividend was in arrears, it would be burdened with less liability if it’s facing severe financial distress

Avon Branding Essay

3874 words - 16 pages 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