Avon is the largest cosmetic multinational company based in the United States. It history dates back to the time when women were oppressed and dominated to an extent where they could not vote in their country. The company’s products enhance women’s beauty. For a multinational company, it is a global leader in the industry which is characterized by its enormous growth and higher revenues. At present, Avon is a direct seller of its products, which has enabled it capture the largest markets in over a hundred countries. The company has the largest product line which include beauty products, jewelry, clothing among others. Recently, it has managed to penetrate the highly competitive market in other North American countries such as Canada and Mexico.
The firm was put up in 1886 with the sole purpose of selling women’s cosmetics. David McConnel was the founder of the company which was headquartered in in New York. At the time, he started as a sales person hawking books. The business was not doing thus he was forced to offer free gifts in the form of perfumes to attract customers. From doing that, he realized that many women were attracted to the idea of perfumes. As a consequence, he opted for cosmetics as his main line of business. At the start, he had to employ door-to-door marketing as the main strategy of promoting his products. By 1887, the company was in a position to hire close to thirteen women to help in the process of selling products directly to customers in their houses. The company changed its name from California cosmetic to Avon products. Arguably, Avon is currently the market leader in the cosmetics industry. In the following discourse, both the external and internal environment of Avon Inc. will be analyzed. The discussion will then give recommendations aimed at improving the operations of the firm.
The use of PESTEL analysis is critical in understanding the external environment of the company. Politically, Avon is a company that enjoys support across the world since the United States is the most powerful political entity in the world, currently. Technically, the position allows the company to enter into any market without any restrictions. The United States enjoys mutual political and economic relations with other countries that Avon conducts business. Wherever the company has a branch, it observes the respective legal requirements and follows the procedures of doing business. Over time, this has allowed it to operate even in countries considered hostile, or volatile, such as those in North Africa.
Economically, the setbacks experienced in recent years threatened the survival of the company, but it managed to achieve its mission. The recessions adjusted the demand and supply curve, but women still afforded cosmetics due to the desire to remain attractive and maintain their skins. Studies indicate that the demand for cosmetics tend to go up during recessions. Socially, the emergence and growth of the middle class gives the company a boost because many people are preoccupied with the idea of fashion. Notably, consumers are more interested in the company’s products because of what it offers.
Recently, the company initiated a program that would see its production design change to focus on the bond/connection with the customer. Currently, some customers are not convinced that the image of the company is reflected positively in paid advertisements. Notably, Avon has been introducing new products that help people to resolve their skin problems, as well as meet their cultural demands, but it has failed to adjust its promotional strategies to suit the market (Kumar, & Dumonceaux, 2006). The company should think of using other outlets as marketing instruments to ensure customers receive adequate information about its products.
Technologically, the company applies new methods to align its products to the market, as well as compete effectively in the toiletries and cosmetics industry.
The company enjoys economies of scale, apart from being a global leader in the cosmetics industry. It also applies a marketing strategy that allows it to connect to clients directly. Whenever a new product is introduced into the market, the employees are quick to popularize it since they benefit directly. The company also conducts research in different areas to ensure it matches its products with the markets’ needs. Basically, this helps it stay ahead of the competition. Some of the company’s competitors are Revlon, Estee and Max Factor are some of the competitors in the United Kingdom market. However, the strategies that the firm employs make it the best.
The company is doing very well in its markets, especially the American and the United Kingdom. However, it must consider readjusting a few policies and structures of operations. In marketing, Avon relies heavily on its website to popularize new products. However, it should consider using the social media and direct agents because they are the most effective given the nature of the company’s products. Direct agents will always have time to take customers through simple lessons to ensure they understand the products better since that benefits them directly. Notably, the company has the best slogans, such as ‘Avon calling, The Company for women, and Avon is made with you in mind’. However, these slogans are sexist, which should not be the case; the company needs the support of men to succeed in certain regions, especially the Arab states. Another recommendation is that the company should distribute its products to different outlets, in plenty, because they are usually unavailable yet they are customer’s darling. The company needs to be in touch with its agents to ensure its products are adequately labelled.