Marketing Strategy Analysis of Avon: A Comprehensive Report

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MARKETING STRATEGY ANALYSIS OF AVON
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MARKETING STRATEGY ANALYSIS OF AVON
Table of Contents
Task 1A............................................................................................................................................3
Introduction..................................................................................................................................3
Analysis of the process and stages of marketing including the detailed marketing mix.............3
Major role of marketing in developing value for the consumers.................................................6
The engagement of stakeholders and their impact on marketing activities.................................7
Conclusion...................................................................................................................................9
Task 1B..........................................................................................................................................10
Self-reflection............................................................................................................................10
References......................................................................................................................................12
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MARKETING STRATEGY ANALYSIS OF AVON
Task 1A
Introduction
In this world of globalisation, one of the major factors is the establishment of the competitive
edge over the rival organisations. Marketing is one of the most important concepts that help the
organisations to establish their products in the minds of the consumers. The buying trend of the
consumers is very dependent on the marketing of the organisation in an effective manner. Avon
Product Inc is one of the major cosmetic companies in the world and it is an USA based
company but at present Headquartered in London. However, Avon has a global presence and in
USA, only the net revenue of the company in 2018 is almost 6 billion dollars. The global market
share of Avon is almost 20 % and in UK the market share is almost 15%% (AVON.,2019). . In
this study, the major marketing function of Avon will be analysed by the help of the marketing
mix in a proper way. Moreover, the involvement of the stakeholders and its influence on the
marketing strategy formulation will be done in an effective and efficient manner.
Analysis of the process and stages of marketing including the detailed marketing mix
In the words of Kotler et al., (2015), the marketing mix is one of the major components that help
to develop the target market of the organisation according to the exact requirement of the
consumers. One of the major important components is the formulation of the huge range of
products that is one of the major parameter of the marketing mix. The marketing mix mainly
consists of 7 PS those are the Product, price, place, promotion, people, process and physical
evidence.
Product: Product is the major component on which the total marketing concept of an
organisation is dependant. It is observed that Avon Inc has huge amount of product portfolio.
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MARKETING STRATEGY ANALYSIS OF AVON
Mainly the cosmetic market can be divided into four parts those are skin care products,
fragrance, hair care product and colored cosmetics. Avon has got products in all the four
important components and the marketing is actually done based on the target group and the
requirement of the products. They have some specialized product as well which are anti aging
creams specially designed for female consumers above forty-five. Moreover, in the marketing
campaign men’s products are also involved like perfumes and hair products. This diverse range
of products helps the company to maintain a sustainable consumer base of almost 30 % in the
global market (Al-Debi, and Al-Waely, 2015). Approximately 6.4 million marketing
representatives are present in Avon who is delegated with the responsibility to market product
according to the fixed target groups. Moreover, at present to add value Avon is coming up with
marketing of a range of product by the help of catalogue that helps to enhance visibility of the
product among the consumers.
Place: Place of marketing is one of the most important component in this world of globalisation.
One of the important factors is that Avon has product presence in nearly 100 countries. In Asian
market, it introduced its product from 2005. The place has a huge role to play as according to the
culture and the daily needs of the consumers the product portfolio and the needs of the
consumers change. Avon looks after this, performs proper marketing research to find out the
actual needs of the local market, and then formulated campaigns based on that. Obviously, there
should be basic difference between the needs of UK and China due to difference in climates and
cultures. This kind of detailed marketing strategy based on details help the organisation to make
profit of almost 20 % (Kamarohim, Bojei, Muhammad, 2016).
Price: In this world of globalised market, one of the major components is the price of the
product that helps to establish a competitive edge over the rival organisation by almost 15%.
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MARKETING STRATEGY ANALYSIS OF AVON
Avon has market revenue of almost 6 billion dollars and its net income is almost 107.4 million
dollars. Almost 88% of the revenues are earned by Avon form the overseas market (Gladka, and
Fedorova, 2019). According to Avon, the pricing policy of Avon is considered as the premium
pricing policy depending on the quality of the product. Premium policy is targeted for the
premium target group that helps in enhancing revenue by 15%. Moreover, there is competitive
pricing policy for the middle class population to increase the consumerism pattern. The price
range of the product is between 6 to10 Euros
Promotion : The promotional activity is one of the most important factor and Avon use the
promotional activities by formulating campaign and endorsement in digital, social and physical
media to enhance the visibility among the consumers in an effective manner. Avon collaborates
with celebrities to perform promotional campaigns so that it can attract consumers and develop
sustainable consumer base (Berman, and Evans, 2015).
People: In Avon there is presence of distinct marketing department within that there are
different teams controlling the digital marketing, physical marketing and the promotion events. It
is one of the important components on the global basis (Bao, 2018). The employees are the real
asset and this marketing department helps to formulated solid marketing plan for the
organisation.
Process: The process of marketing of Avon is now enhanced by the implementation of the
feedback system as it helps to develop the consumer satisfaction level. In case of digital
marketing also, queries can be posted and employees clarify the queries post immediately that
helps to enhance the process of marketing and establish a competitive edge over the organisation
(Al-Debi, and Al-Waely, 2015).
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MARKETING STRATEGY ANALYSIS OF AVON
Physical evidences: The physical evidence is one of the major component that includes the
branding communication and designing of logos and banners in website and physical marketing
that affects the consumer attraction quotient in a positive manner.
Major role of marketing in developing value for the consumers
Marketing plays a very significant role in current times as it helps in reaching to the target
customer segment thereby generating sales. Moreover it plays a very integral role in creating
value for the customers. To put it simply it means the benefit that any product can create for the
customer (Ström, Vendel and Bredican, 2014). Moreover, it also means what the customer
perceives as value for that particular product. In this case the product range that is being dealt
with is beauty products. Products, which can help in enhancing beauty and in restoring the
natural goodness that every individual is born with. Avon Cosmetics is a brand with a huge
product portfolio and along with these smart marketing strategies will help in creating immense
value for the customer.
Women of today are no more limited to the household and pursue a career which makes them
balance between career and home. This leaves them with a lot of time crunch. They therefore
want a brand, which can cater to all their needs like skincare, hair care, makeup and perfumes
(De Mooij, 2019). Thus, marketing can use this to create value for the customers. Second comes
the convenience at which the customer can buy the product. Avon cosmetics are available online,
offline at specialized retail outlets and even directly with their Beauty Advisors. The beauty
advisors not only sell the products directly to the customers but also help them in buying
products as per their need, skin or hair type or problem they are suffering from. This adds great
value for the customer as they are able to use the correct product type in the correct manner
which helps in getting the best results (Gummesson et al., 2014).
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MARKETING STRATEGY ANALYSIS OF AVON
The product pricing that has been done is also very favourable. They have products in the
premier range as well as middle range so that all kinds of customers can use it. Therefore, the
company can use marketing to reach to a wide range of customers from different financial
background.
Apart from this, it is also very necessary for the company to build a brand image for itself so that
it can easily become a trusted brand in the mind of the customers. Marketing can greatly impact
the brand image of the company (Ramanathan, Subramanian and Parrott, 2017). Like Avon has
an initiative where it works for welfare of breast cancer patients. This social responsibility
initiative helps in enhancing its brand image. Then working towards sustainability where they do
not use plastics for packaging, most of their containers are recyclable, and it is not tested on any
animals. Raw materials used are mostly natural and pure. All these makes the customers believe
in the product and they perceive it as value for money.
Finally the company also spends a lot of their spends on research and development so that they
can continuously improve their product. The company has currently 294 registered patents on
different formulations (McDonagh and Prothero, 2014). This helps in manufacturing products
that are continuously adding value in the life their customers.
The engagement of stakeholders and their impact on marketing activities
Engaging with the stakeholders is crucial for an organisation’s success and marketing can
become effective only if it has stakeholder engagement. Avon also has certain key stakeholders
who are very vital to its business like its investors, board of directors, consumers, suppliers and
employees. Each has its own perspective and can definitely affect the various marketing
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MARKETING STRATEGY ANALYSIS OF AVON
activities of the company (Henisz, Dorobantu and Nartey, 2014). Therefore it is essential to keep
them engaged so that they can create an impact.
Communication is a very important tool that can be used for the purpose of stakeholder
engagement. The stakeholders should be regularly communicated regarding the marketing plan,
the probable outcomes expected and how it will impact sales thereby impacting revenue. This
will keep hem updated and will also help in asking about their viewpoints about the plan.
Furthermore the processes in which their engagement is required needs to be clearly outlined so
that the stakeholders can understand the vision and put in their views accordingly (Jaakkola and
Alexander, 2014). They should also be made a part of crucial meetings so that they can
understand each process and proceedings more clearly and understand them so that their
engagement in the marketing plan and activities can be increased. Moreover, it also helps in
building solid relationships with the key stakeholders so that the engagement can be improved.
Once the stakeholder engagement is managed effectively it can surely impact the marketing
activities of the organisation.
First every marketing plan and subsequent activities requires a budget. Hence, if the marketing
plan and the activities can be clearly communicated and then explained along with the results
that is expected then budgets can easily sanctioned. Moreover, if the stakeholders are convinced
they can help in enhancing the budget affecting the plan greatly.
Internet technology has immensely influenced marketing and as a result, digital marketing has
become an integral part of marketing and marketing communication. This has given great power
to the consumers. They can now use the social media platforms to communicate about both the
positive as well as negative feedback thereby making sure that the company can in no way play
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MARKETING STRATEGY ANALYSIS OF AVON
foul regarding products as well as service (Keegan and Rowley, 2017). Moreover they have also
helped in attracting more people towards the brand thus creating a royal customer pool.
Employees in the current times have become the most involved stakeholders of any company and
Avon is no exception. As they are the most valued assets they can greatly impact the marketing
activities in Avon. Their valued ideas on the marketing activities and customer well being can
definitely help in creating a premium quality customer experience. On the contrary they can also
create negative publicity by filing lawsuits or writing comments on social media for problems
like low employee morale or workplace discrimination or poor pay package (Jaakkola and
Alexander, 2014). This can greatly mar the brand image thus affecting the marketing activities of
the company. Thus it is clear that stakeholders can greatly impact the marketing endeavours
hence they should be engaged continuously to build better relationships for a peaceful
coexistence.
Conclusion
The study mainly analysed in detail the marketing mix and the strategy formulation of marketing
for the Avon Inc. Moreover, the value addition in the company’s products by the help of
marketing is also done in details in the study. Furthermore, the stakeholder engagement and its
influence on the marketing strategy of Avon have been described in detail manner in the study.
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MARKETING STRATEGY ANALYSIS OF AVON
Task 1B
Self-reflection
In this, study one of the major important component that has been analysed in the marketing
strategies and different communicating tool that has been used by Avon Inc to spread its business
among various consumers all over the world. I think the different marketing tools used by Avon
Inc helps the organisation to have deep impact on the psychology of the consumers. Moreover
Avon have almost 300 patents those are formulated for exclusive beauty products to enhances
the consumer base. I think that the digital media is one of the most important communication
tool used by Avon too reach a huge level of consumers throughout the globe in an effective
manner. Avon develops the website in an effective manner and it communicates with tits
consumers by digital media in the form one to one interaction in an effective way.
It has been seen that sometimes consumers are not comfortable coming to the store and
discussing their problems regarding skin care and beauty products. However; in the digital
marketing mode, they can have one to one interaction in digital platform without disclosing their
identity. This can be regarded as one of the major s advantage of using digital communication.
Moreover, if the global consumer profile is observed 70 % of the consumers are present in the
digital and the social media. It is very much effective to use digital media and social media to
market the product and to interact with them to enhance the consumerism. It may be said that the
consumerism and consumer-buying trend depends on the marketing communication tools. I
think according to the situation of Avon physical campaigning is also one of the most important
communicating tools to efficiently communicate with the consumers in a proper manner. In my
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MARKETING STRATEGY ANALYSIS OF AVON
opinion the promotional campaign of Avon with samples are also very much effective and it
enhances the visibility of the product in an effective and efficient manner.
The samples may be properly explained and the place of campaigning is useful, as maximum
consumers should come to that place. Ideal marketing communication may be done in the malls.
In my opinion, one of the key successes to excellent marketing of Avon is its wonderful
employee base and the marketing strategies taken by them in an efficient manner. I think that
endorsement by Hollywood celebrities is one of the essential marketing strategies that help to
communicate with the consumers and enhance the visibility of the product in the market. This
kind of communication helps to increase the market share of Avon by almost 3 %. The physical
marketing is done the social media communication through beauty blogs is one of the value
added communication technique that is used by Avon in a successful manner to establish
competitive edge over the rival organisation in an efficient way. If comparison is done within,
the three communication technique digital media may be considered as one of the most important
technique that has the most efficiency.
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MARKETING STRATEGY ANALYSIS OF AVON
References
Al-Debi, H. and Al-Waely, D.F.J., 2015. The Effect of Services Marketing Mix Dimensions on
Attracting Customers and Retaining Them: the Case of Jordanian Insurance
Companies. International Journal of Marketing Studies, 7(5), p.132.
AVON. (2019). Redirecting. [online] Available
at: https://www.google.com/url?q=https://www.avon.uk.com/&sa=D&source=hangouts&ust=156
6990135243000&usg=AFQjCNH3pKLlQbO294O1n93JmKg_kCnkWQ [Accessed 27 Aug.
2019].
Bao, H., 2018. Marketing of Tourism Services/Experiences. In The Emerald Handbook of
Entrepreneurship in Tourism, Travel and Hospitality: Skills for Successful Ventures (pp. 261-
275). Emerald Publishing Limited.
Berman, B. and Evans, J.R., 2015. A Model for Implementing the Marketing Audit.
In Marketing Horizons: A 1980's Perspective (pp. 338-343). Springer, Cham.
De Mooij, M., 2019. Consumer behavior and culture: Consequences for global marketing and
advertising. SAGE Publications Limited.
Gladka, O. and Fedorova, V., 2019. Defining personnel marketing strategies. Business: Theory
and Practice, 20, pp.146-157.
Gummesson, E., Mele, C., Polese, F., Galvagno, M. and Dalli, D., 2014. Theory of value co-
creation: a systematic literature review. Managing service quality.
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