Avon (China) Co., which was the earliest company to obtain direct sales licenses in China, announced a loss of $10.8 million in 2010. Avon’s competitors, Mary Kay, Perfect, and Amway’s performance have grown year after year. The Avon counters in Jinan Mall are missing, and the Avon shops in the streets are much less. Economists believe that if a direct selling company wants to succeed in China, the direct sales model that succeeds in the international market must also be based on China's national conditions.
Jinan Avon: Withdrawal of specialty stores Avon's performance announcement revealed that Avon's global net profit for the year was US$1.073 billion. In all regions, only China experienced a loss, Latin American performance declined, and other regions achieved growth. For Avon China's 2010 loss reasons, Avon Financial Report believes that this is caused by the company's continued change from a "store plus direct sellers" hybrid model to the main direct sales.
With a mixed business model of “stores and direct sellersâ€, Avon won the first direct sales license in China in 2006. However, since 2007, Avon China has been in negative growth, and the company’s top management will all return to direct sales as a strategic choice for the company. In Jinan, the original Avon shop that can be found around is disappearing. Ms. Gao said that there was an Avon store next to the original experimental middle school. The Grand View Mall and the People’s Shopping Mall before the renovation also had Avon counters. Now these places cannot buy Avon products. She can only buy through Avon's direct sales staff or from specialty stores such as Carrefour and Wenxi Road.
Quality is no problem, management is a bit confusing?
Ms. Gu, who once used Avon products, said that Avon had a special counter in a large shopping mall, which made people feel that Avon’s product quality should be guaranteed. Now the big shopping mall basically can not find Avon, and the price difference between different Avon stores is very big, sometimes the price of a bottle of cream can be a few tens of dollars.
In an Avon store in Lixia District, the owner said that the company often gives a benchmark price for a specific product, and the sales price of the counter, specialty store, or direct seller floats within this price range. For example, in her shop, many products are less than half the original price, such as hand cream that has been priced at 19 yuan, and the original price is 50 yuan. In some counters, the price of some products is even higher than the original price of the company.
An cosmetics distributor who asked not to be named said that as a multinational direct selling brand that has been operating for many years, she felt that the quality of Avon products should be fine. As for the online exposure of Avon, she believes that there may be malicious attacks.
However, the current management of Avon (China) is a bit messy. The person thinks that the location of the Avon stores, the layout of the stores, and the dress of the operators are not unified. This is a certain distance from the image of the famous brand stores. Moreover, the chaotic price system of each Avon store is also criticized.
Competitors: New Year's Efforts to Open New Stores Different from Avon, Mary Kay, Perfect, Amway and other companies in China have a thriving scene.
Following the surge in performance in 2009, Amway China's performance was close to 22 billion yuan in 2010, achieving seven consecutive titles in the domestic direct selling field. In the next three years, the company will also open new stores in 90 new cities.
A Mary Kay authorized distributor introduced that since the establishment of Mary Kay China, the annual performance has been increasing at a rate of 25%. Mary Kay China (excluding Hong Kong, Macau and Taiwan) has achieved sales of more than 10 billion yuan***. Mary Kay Beauty Consultant Ms. Lee said that the studios that provide experience services and lectures for customers have also expanded from one or two when they first entered Jinan City to today’s 67 companies.
It has been perfect for direct sales brands that have been in China for more than a decade and has achieved impressive results in recent years. In 2010, Jinan added seven or eight perfect product stores, which increased the number of perfect product stores in Jinan to more than 50, and the sales force team is also expanding. Unlike Avon, the perfect product has a strict price system. The maximum can only enjoy 18% discount.
The direct marketing model should also be integrated with the national situation of China. Ge Jintian, Dean of the School of Economics at the University of Jinan, believes that direct sales will have a lot of room for development in the future. However, the successful direct sales model should also be based on China’s national conditions. “Stores and direct sellers†should walk on two legs. The sales model can be used in second and third-tier cities and rural markets.
Ge Jintian believes that direct sales, as an important sales method, should have a huge market in China. At present, there are not many companies that have direct marketing licenses approved by the Ministry of Commerce, and most of them are international companies with high reputation and many years of establishment. After entering China, they all have certain brand advantages. He said that through the acceptance of the Ministry of Commerce, it has been marketing for many years abroad. The quality of the products of these direct selling companies should all be good. Compared with counter products of shopping malls, they have certain price advantages. In addition, China has a large population and diverse consumer groups. In terms of direct sales companies, there is a huge market space.
However, Ge Jintian emphasized that if the direct selling companies want to succeed, the internationally popular direct sales model must also be integrated with China's national conditions. Therefore, he personally believes that direct selling companies should implement different direct selling strategies according to different market regions, and in the development of mature direct selling markets, they can conduct direct sales. In second- and third-tier cities and rural markets, it is possible to implement the sales method of walking on both legs of “special store plus direct sellerâ€.
Jinan Avon: Withdrawal of specialty stores Avon's performance announcement revealed that Avon's global net profit for the year was US$1.073 billion. In all regions, only China experienced a loss, Latin American performance declined, and other regions achieved growth. For Avon China's 2010 loss reasons, Avon Financial Report believes that this is caused by the company's continued change from a "store plus direct sellers" hybrid model to the main direct sales.
With a mixed business model of “stores and direct sellersâ€, Avon won the first direct sales license in China in 2006. However, since 2007, Avon China has been in negative growth, and the company’s top management will all return to direct sales as a strategic choice for the company. In Jinan, the original Avon shop that can be found around is disappearing. Ms. Gao said that there was an Avon store next to the original experimental middle school. The Grand View Mall and the People’s Shopping Mall before the renovation also had Avon counters. Now these places cannot buy Avon products. She can only buy through Avon's direct sales staff or from specialty stores such as Carrefour and Wenxi Road.
Quality is no problem, management is a bit confusing?
Ms. Gu, who once used Avon products, said that Avon had a special counter in a large shopping mall, which made people feel that Avon’s product quality should be guaranteed. Now the big shopping mall basically can not find Avon, and the price difference between different Avon stores is very big, sometimes the price of a bottle of cream can be a few tens of dollars.
In an Avon store in Lixia District, the owner said that the company often gives a benchmark price for a specific product, and the sales price of the counter, specialty store, or direct seller floats within this price range. For example, in her shop, many products are less than half the original price, such as hand cream that has been priced at 19 yuan, and the original price is 50 yuan. In some counters, the price of some products is even higher than the original price of the company.
An cosmetics distributor who asked not to be named said that as a multinational direct selling brand that has been operating for many years, she felt that the quality of Avon products should be fine. As for the online exposure of Avon, she believes that there may be malicious attacks.
However, the current management of Avon (China) is a bit messy. The person thinks that the location of the Avon stores, the layout of the stores, and the dress of the operators are not unified. This is a certain distance from the image of the famous brand stores. Moreover, the chaotic price system of each Avon store is also criticized.
Competitors: New Year's Efforts to Open New Stores Different from Avon, Mary Kay, Perfect, Amway and other companies in China have a thriving scene.
Following the surge in performance in 2009, Amway China's performance was close to 22 billion yuan in 2010, achieving seven consecutive titles in the domestic direct selling field. In the next three years, the company will also open new stores in 90 new cities.
A Mary Kay authorized distributor introduced that since the establishment of Mary Kay China, the annual performance has been increasing at a rate of 25%. Mary Kay China (excluding Hong Kong, Macau and Taiwan) has achieved sales of more than 10 billion yuan***. Mary Kay Beauty Consultant Ms. Lee said that the studios that provide experience services and lectures for customers have also expanded from one or two when they first entered Jinan City to today’s 67 companies.
It has been perfect for direct sales brands that have been in China for more than a decade and has achieved impressive results in recent years. In 2010, Jinan added seven or eight perfect product stores, which increased the number of perfect product stores in Jinan to more than 50, and the sales force team is also expanding. Unlike Avon, the perfect product has a strict price system. The maximum can only enjoy 18% discount.
The direct marketing model should also be integrated with the national situation of China. Ge Jintian, Dean of the School of Economics at the University of Jinan, believes that direct sales will have a lot of room for development in the future. However, the successful direct sales model should also be based on China’s national conditions. “Stores and direct sellers†should walk on two legs. The sales model can be used in second and third-tier cities and rural markets.
Ge Jintian believes that direct sales, as an important sales method, should have a huge market in China. At present, there are not many companies that have direct marketing licenses approved by the Ministry of Commerce, and most of them are international companies with high reputation and many years of establishment. After entering China, they all have certain brand advantages. He said that through the acceptance of the Ministry of Commerce, it has been marketing for many years abroad. The quality of the products of these direct selling companies should all be good. Compared with counter products of shopping malls, they have certain price advantages. In addition, China has a large population and diverse consumer groups. In terms of direct sales companies, there is a huge market space.
However, Ge Jintian emphasized that if the direct selling companies want to succeed, the internationally popular direct sales model must also be integrated with China's national conditions. Therefore, he personally believes that direct selling companies should implement different direct selling strategies according to different market regions, and in the development of mature direct selling markets, they can conduct direct sales. In second- and third-tier cities and rural markets, it is possible to implement the sales method of walking on both legs of “special store plus direct sellerâ€.