Avon | Research & Encyclopedia Articles

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Avon Products Summary

Avon

American cosmetic and gift company Avon Products, Inc. is known for its eye-catching, digest-sized catalogs shimmering with fresh-faced models wearing reasonably priced makeup and advertising costume jewelry, colognes, and an array of other items. Their goods are backed by a satisfaction guarantee and delivered by a friendly face, usually female, who earns or supplements an income by the commission received. Avon's retail concept, symbolized by the direct-sales "Avon lady," is a cherished part of American culture, and now, a recognized addition to countries around the globe as well. In the 1990s, Avon was the world's top direct-sales cosmetics firm, with a total work force of 2.6 million in over 130 countries, producing sales of $4.8 billion ($1.7 billion in the United States alone). Ninety percent of American women have purchased Avon products in their lifetime, most likely because of the convenience, price, and quality, but perhaps also due to the history of female fraternity and empowerment that Avon promotes. The company's overwhelmingly female employee base and tradition of visiting customers in their homes allowed women control of their own earnings long before it was widely accepted.

Avon was founded in 1886, and Mrs. P.F.E. Albee of Winchester, New Hampshire, originated the idea of going door-to-door to push her wares. The company offered a money-back guarantee on their products and the salespeople nurtured relationships with customers, minimizing the need for advertising. The company prospered with their pleasant, neighborly image and low-cost, dependable products. However, in the 1970s and 1980s Avon's fortunes declined when a number of unsavvy business moves hurt sales and provoked an exodus of salespeople. At that time, the company also suffered from its outdated approach: Women were no longer waiting at home for the doorbell to ring; they were at work all day. In 1993, Avon began boosting morale and incentives for salespeople, then updated its image, and in 1998 launched a $30 million advertising campaign. The company recruited a bevy of new representatives who would sell in offices and other business settings, and they focused on a more desirable product line. In addition, Avon reached out overseas, prompting women in South American, Russia, Eastern Europe, and China to sign up as salespeople. In fact, the number of Avon representatives in Brazil—478,000—is more than twice that of Brazil's army, with 200,000 soldiers. Avon's strategies sharply increased profits and swelled its stock.

Though the cherished but politically incorrect term "Avon lady" is not quite accurate—two percent of the force is male—the company still primarily consists of women selling cosmetics to female friends, family members, neighbors, and coworkers, with 98 percent of its revenue coming from direct sales. Avon used the slogan "Avon calling!" accompanied by a "ding-dong" doorbell noise when it was known mainly for reaching clients at home before the rise of women in the work force. However, the company in 1996 sold about 50 percent of its goods in the workplace, and branched out to offer a more extensive line of gifts for time-constrained working women. Although Avon has traditionally carried skin care and other hygiene products as well as cologne and jewelry for women, men, and children, in the 1990s it expanded its selection greatly to become a convenient way to shop for knick-knacks, toys, clothing and lingerie, books, and videos.

Though management ranks were off-limits to women until roughly the 1980s, Avon has quickly risen to become known for its respected record in the area of female promotions. In 1997, however, some were rankled when Christina Gold, president of North American operations, was slighted for a promotion to CEO in favor of an outside male candidate. She later resigned. Despite this incident, Working Woman magazine still called Avon one of the top female-friendly firms in 1998 due to its largely female employee base and number of corporate women officers. Overall, only three percent of top executives at Fortune 500 companies in 1997 were women. At Avon, on the other hand, over 30 percent of corporate officers are women, and four of the eleven members of the board of directors are women. Avon also has a good record of promoting women, with more women in management slots—86 percent—than any other Fortune 500 firm. The company is also heavily involved in supporting research for breast cancer.