Strategic Analysis

Avon

As of November 1999, Avon was experiencing economic troubles. Avon’s growth rate of annual sales was less than 1.5 percent during the greatest economic boom in history. This prompted a transfer in leadership which appointed Andrea Jung as CEO. Since that time, Avon has experienced remarkable growth.

Under the direction of the new CEO, a new strategy was developed to reinvent Avon’s image, improve customer satisfaction, and to increase profit margins and market share. Avon has gained an outstanding reputation as the best direct seller of beauty products. Through the continued efforts and achievements of its sales representatives, Avon is now known worldwide. Avon’s core competence has mainly been its direct selling busniess model. This led Jung and the management team to implement a Sales Leadership program that provided incentives to acquire, train, motivate, and retain the number of active sales representatives it needs to sustain significant growth. Avon also has a representative development program that focuses on the professional training of representatives. This enables the representatives to provide valuable information on Avon brand products. Avon