Case Study Analysis “Avon Calls on Foreign Markets”



Case Study Analysis “Avon Calls on Foreign Markets”

Introduction

Avon Company was founded in 1886. It basically deals with manufacturing and distribution of beauty products worldwide. Over time, Avon has gained attention through its adverts such as "Ding dong, Avon calling" and "hello tomorrow".  These adverts have had positive influences on Avon's markets helping it keep at par with the ever changing and dynamic market demands. Avon's headquarters are based in the United States while most its market demand lies outside North America (Avon, 2011). The company operates in 66 countries while it distributes its make ups to other 44 territories.  Statistics indicate that there are approximately 5.8 million independent representatives who basically sell the company's products. This paper seeks to elaborate the reason as to why Avon is much dependant on international market while putting emphasis on the challenges and benefits that come along with this marketing strategy (Avon, 2011). The paper will also give special attention to the effect of social economic and demographic changes on the company's operations. Comprehensive recommendations as to how the company should work to maintain its markets and general performance will also be focused.

Discussion and Analysis

Avon is a leading global consumer beauty brand and the world's largest direct seller. It's a company that values forward thinking and reinvention while honoring its heritage.  Time and again, Avon delivers first-to-market beauty technologies, revolutionizing various product categories in the industry. And the world knows Avon; the company is in more than 100 markets and has 90% brand recognition worldwide.  Avon has more than 40,000 Associates worldwide and 6.2 million Representatives (Avon, 2011).

The company has been innovating and introducing new brands in its portfolio through celebrity associations. Bond Girl 007 women's fragrance, Spotlight and In Bloom line of fragrances, among others, were developed in partnerships with some of the big names of the entertainment industry. Such associations have provided an alternate way of endorsing the company's value proposition. Further, the company can leverage the status of the celebrity to effectively communicate the values associated with Avon brand (Canedy, 1997). The company, hence, through these aggressive advertising and branding strategy can effectually interact with its target consumer groups and strengthen its position against rivals such as L'Oreal and Revlon.

In the recent past Avon has shown interest in international expansion. The reason behind this is due to the fact that the United States cosmetic market has fully been exploited with cosmetics, toiletries and fragrances products.  This is reflects a slow growth potential due to the competitive beauty market. As a result Avon has embarked on less competitive markets has shown in its 2010 annual report. Avon's distribution system has also played a big role in maintaining international markets. The company relies on distributing through independent persons most of which are ladies who place orders for customers and deliver products to customers (Kowitt, 2012). They elaborate to customers how to use their products and how effective their products work. This has helped cut down operating ...