Will Avon turn a Chinese ban into an advantage?

July 23, 2006 at 9:06 am Leave a comment

xin_8cffc683e45345bf866e18262681cd1c_avon.gifBack in the mid-90’s I was working for Grey China Advertising, and one of our clients was Avon. Their personal, direct sales model was under great pressure from the government, due to a backlash against pyramid schemes and multi-level marketing scams across the country. I remember meeting some of the local Avon sales reps, and finding it all pretty sad – they were all hyped up about selling Avon products and supporting their families, and then it was all shut down. By 1998, the Avon Lady was fully banned from China , and Avon had to build up a network of 5,700 Beauty Boutiques to sell its products.

Well…now the Avon Ladies are back – 114,000 of them to be exact, according to their press release, due to the recent lifting of the ban. Apart from feeling glad that all those hyped-up sales reps can hit the doorbells again, I’m also curious to see whether, inadvertantly due to the ban, Avon now has a winning formula in place – personal sellers, training centers, physical stores, after-sales and of course the internet. The press release certainly hints at this:

Under the new model, the Beauty Boutiques now offer after-sales services (order pick-ups, product returns, credits, product trials, billing assistance, etc.) to Sales Promoters, and beauty consultation services to consumers, while continuing to sell products at retail.

Most marketers would kill for a network like this – harnessing both the power of personal ‘guanxi’, the internet and a physical retail presence. Perhaps the ban will lead to a bigger, stronger Avon in China.

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Entry filed under: china, media general.

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