For over 120 years, Avon has enjoyed worldwide success as a top global brand and world leader in the personal care industry. Recently, single digit growth demonstrated the need to make substantial changes in their operating structure. In the spring of 2000, Andrea Jung President and CEO since November 1999, introduced new strategies to promote growth for the company. Our team has divided into two groups to determine if Andrea Jung's new plans for strategic growth is properly focused and directed.
Two of Avon's new strategic plans were used to focus on our analysis. Andrea Jung emphasized a need to expand Avon's brand name in the United States by partnering with department stores such as JC Penney and Sears in an effort to create a store-within-a-store where new product lines can established. "In implementing both strategies, Avon would benefit from increased profits, sales, and nationwide exposure" (Pearce, pg 41). Team members thought that this was a good idea because the plan allows Avon to experience possibly an increase in sales.
Customers can see the Avon label in the store and have the opportunity to purchase Avon products in stores instead of using the direct selling method.
Avon has an extremely low amount of male customers since their brand image is seen as a woman's beauty and personal care company. The male consumer increasing purchasing personal care products and sales of men's fragrances rose close to a billion dollars in 1999 while women's fragrances see a decrease in sales. Avon could use the store-within-a-store concept to focus on men's personal care market by selling fragrances, shaving creams, after shave balms, deodorants and anti-aging creams.
The team members who thought against Avon partnering with department stores such as JC Penney and Sears had a few concerns. In partnering up with two of...