Magazine article Marketing

Avon

Magazine article Marketing

Avon

Article excerpt

The cosmetics firm's new chief executive faces a struggle to stabilise the brand, writes Kim Benjamin.

Cosmetics firm Avon's famous 'ding dong, Avon calling' ads of the 50s and 60s made it a household name, popular with generations of women, while its workforce of door-to-door sales representatives have been at the core of the brand.

In the past three years, however, Avon has experienced a steep decline in profits, as it faces increasing competition from more affordable cosmetic ranges, aggressive pricing by rivals in Eastern Europe and the loss of many of its sales reps.

It also made the headlines last year following implementation problems with a computer system in Brazil, one of its key markets.

Last month, Avon suffered a further blow when mass-market perfume maker Coty dropped its pounds 6.65bn takeover bid, saying that Avon had taken too long to make a decision about the deal.

The brand has been criticised for lagging behind the times and all eyes are now on chief executive Sherilyn McCoy, who joined the company last month and was previously a vice-chairman at Johnson & Johnson.

She has pledged to stabilise the Avon business, but faces an uphill struggle.

The 126-year-old firm appears to be in need of its own makeover. With profits plummeting and the withdrawal of Coty's bid, what can the brand do to turn its fortunes around and recapture its glory days?

We asked Helen Cooper, a former European category director, cosmetics, at Avon, brand director at Boots, and now managing director at porridge brand Grasshopper, and Matthew Jacobs, associate planning director on Nivea at Carat, which used to handle the Avon media account.

AVON: THE FIGURES

- Operating profit per US representative has fallen 75% over the past 10 years

- Shares in the firm fell 45% in 2011

Source: The Wall Street Journal

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DIAGNOSIS - Two industry experts on how Avon can rebuild on a 126-year-old foundation

My first eye shadow was Avon - a lurid, Abba-esque shade of turquoise given to me on my 11th birthday. My mum was horrified, so, of course, I loved it and wore it constantly.

Yet the company with more 'ding dong' than Terry-Thomas and Leslie Phillips combined now appears stuck in a rut. In an era when buying online is the norm, it remains wedded to brochures in an 18-campaign annual cycle that no longer feels relevant to the way consumers shop Despite its core products being great quality, they are lost in more than 100 pages crammed with all sorts of stuff in which I am simply not interested. …

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