The Target Market For Avon

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MKT: 715 Case Study No. 9-591-111 Harvard Business School. (2003). Avon.com David B. Godes 1) Women are the target market for Avon. Avon is “the company for Women”. Harvard Business School. (2003) p. 8. Since the company began in 1886, the company has promoted building relationship and it seems natural for women to embrace the power of the Web to help women forge relationships beyond their geographic confines. Andrea Jung, CEO. Avon’s market segment is women aged 25-50yrs average to below average income households. The majority of sales generated from roughly 25 million women in the U.S. Harvard Business School. (2003) p. 3. Avon is the largest direct-seller of beauty products and 5th largest beauty company with overall sales of over $5 billion. Women are the most important segment to the Avon Company; women connect with each other that are confident and loyal to the Avon brand. Women historically make purchases of beauty products based on emotion and image. Society has placed great emphasis on the beauty of women and products that promote youthful and radiate appearance. The success of Avon has influence other companies to cater to women with bath/spa packages, beauty products, and intimate devices. All target women who desire to look their best emotionally and physically. This market can be segmented by market research data showing where women of particular ages are, shopping habits and income levels. Avon products are very reasonable and maintain quality. Brochures are designed well and provoke a sale. 2) Avon should maintain the integrity of the Avon brand. Women are historically Avon’s customer base and show record profits by direct-selling. The profitability of the company (Total Revenue: $9.9 billion 2007) proves that women have purchase power. http://www.avoncompany.com/investor/businessnews Women are interested in personal contact and customer service. Avon brand is the foundation of direct-selling of beauty products. People like to shop through direct selling. According to recent surveys, 74% of Americans have purchased good or services through direct sales. People value the products available through direct selling and 45% of Americans want to buy from direct sellers. Sales in the U.S. have more than doubled in the last decade to more than $30 billion and are now more than $100billion worldwide. http://www.dsa.org/aboutselling/benefits 3) The Avon concept of “selling” is using a chain of referrals for direct selling. The network of family, friends, co-workers and existing customers enable this process. Harvard Business School. (2003) p. 5. Initially the launch of Avon.com in 1997 and provided direct-to-consumer sales only and was limited in several ways. The limitations and reduced interaction between representative and customers generated low profits. Today, Avon.com is a viable method of direct-selling because the products are available for view but can only be purchased following a sequence of events. A user id / password is established followed by the site prompting the user to enter the name of an Avon representative / sale consultant or your zip code to locate one. The website maintains the integrity of customer relationship and profit due to the Avon representative; the web accomplishes “selling” for Avon. 4) There is low risk for “channel conflict” because the website has mechanisms to prevent this such as log in and connecting with Avon representative in the customer’s geographic region. In addition, technology exists to combat channel conflict problems. Reshare technology is explained below: Unable to realize the full potential of eCommerce due to concerns about channel conflict? Anxious to explore ways of mitigating those concerns and developing an impactful channel strategy for your company and brand(s)? Reshare® is a leading Internet professional services firm specializing in eBusiness solutions with a strong...
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