Avon Product Inc Case Abstract David H.

McConnell founded The California Perfume Company (CPC) in 1886with the first office located in New York. In 1906 the San Francisco earthquakedestroyed CPCs California office however, before long the company reopened. CPCsfirst office outside United State was opened in 1914 in Montreal, Canada. In the 1920sCPC sales doubled to $2 million during this time there were more than 25,000representatives in the United States. The Companys name was change to Avon ProductsInc. after the British town Stratford-upon-Avon in 1938. Avons sales increased to about$16 million and in 1946 the company was announced publicly with advertising campaignsuch as Avon Calling. Avon expanded overseas to countries such as Puerto Rico, Cubaand Venezuela. In the 1970s U.S sales top $750 millions and the first Avon Asian business was opened in Japan. Avon also acquired the Jeweler Tiffanys during this period of growth. It was the first major U.S. cosmetics manufacturer to permanently endanimal testing.Avon adopted five (5) core values which are Trust, respect, belief, humility andintegrity which are evident in the mission statement to be a Global beauty leader,womens choice of buying, premier direct seller, the best place to work, largest womenfoundation and the most admired company.Avon success lies within it channel of distribution, it is the worlds largest directseller with 5.4 million Avon representatives in over 100 countries. Additionally, it is thelargest micro lender to women and it among the world top global brands. The company increased its investment in 2007 by over $120 million which aided in the development of new sales leadership opportunity, improved training, technology tools and changes in commission structure. There are three (3) product categories which Avon distributes, they are beauty,fashion and home. In 2008, Avon changed its marketing approach of concentrating mostly on a homey image and is now including celebrities as a part of their promotions.The company advertising cost increased from $136 million in 2005 to $249 million in2006 and $368 million in 2007. Reese Witherspoon is the Avon Foundation first global ambassador and honorary chairwoman who appear in advertisement for Avon make up, skin care products and fragrances. Spotlight the new fragrance was launched in 2009with celebrity Courteney Cox as the face of the brand.Avons largest manufacturing plants, Brazil, China and Poland received the ISO14001 certifications in 2008. Various awards were granted during this period such as the Clean Industry Certificate to the manufacturing plant in Mexico. During the same period Avons revenues increased 7.5 percent and net income increased by 65 percent. Avon Products Inc. closest competitors are Revlon, Inc and Mary Kay Inc. MaryKay Inc uses the same approach as Avon which is direct marketing approach which Revlon sells its products through cosmetics counters in department stores are pharmacies. Avon revenues far exceed that of its competitors in 2008 Avons revenue was $10.37 billion compared to Mary Kay $2.40 billion and Revlon $1.35 billion. Avon implemented reconstructing programs in 20098 which included closing two manufacturing facilities. In addition, there is heavy investment in online search engines and internet carrier sites to help increase Avons revenue.

Andrea Jung is the Chief Executive Office who is leading the management team of thirteen to achieve its goal. Avon: Beauty, Home and Fashion Vision Statement (Actual) To be the company that best understands and satisfies the product, service, and self-fulfillment needs of women globally. Mission statement (Actual) The Global Beauty Leader We will build a unique portfolio of Beauty and related brands, striving to surpass our competitors in quality, innovation and value, andelevating our image to become the Beauty company most women turn to worldwide. The Womens Choice for Buying We will become the destination store for women, offering the convenience of multiple brands and channels, and providing a personal high touch shopping experience that helps create lifelong customer relationships. The Premier Direct Seller We will expand our presence in direct selling and leadthe reinvention of the channel, offering an entrepreneurial opportunity that deliverssuperior earnings, recognition, service and support, making it easy and rewarding to be affiliated with Avon and elevating the image of our industry. The Best Place to Work We will be known for our leadership edge, through our passion for high standards, our respect for diversity and our commitment to createexceptional opportunities for professional growth so that associates can fulfill their highest potential. (9)[6] The Largest Womens Foundation We will be a committed global champion for the health and well-being of women through philanthropic efforts that eliminate breast cancer from the face of the earth, and that empower women to achieveeconomic independence. The Most Admired Company We will deliver superior returns to our shareholders by tirelessly pursuing new growth opportunities while continually improving our profitability, a socially responsible, ethical company that is watched and emulated asa model of success. (5, 7) The five values of Avon are: Trust, respect, belief, humility, and integrity. (6, 8)

Vision (proposed) To be the leading provider of home, fashion and beauty products that will satisfy our customers while preserving the environment. Mission statement (proposed) Avon is committed to being the leading global provider of home, fashion and beauty products that will enhance the lives of our customers. We will utilize latest technologyand will pursue new growth opportunities that will bring about wealth for all our stakeholders. At Avon we firmly believe in respect: respect for people and respect for theenvironment.The vision statement was improved to include customers instead of women,since the company is now offering products for women, men and children. Additionally,in light of the fact that the world is going green we thought that it was prudent to include