NATIONAL SCHOOL OF POLITICAL AND

ADMINISTRATIVE STUDIES

Master in Communication and Advertising







Brands, innovation and consumers- The
case of AVON
Student:
Ioana Maria Ilie





Bucharest, June 2014





Introduction

The aim of this paper as I first looked at it is to analyze the future of an existing company
that uses multilevel marketing taking into consideration nowadays trend regarding online sales. I
intend to do this by talking about multilevel marketing, the impact of internet on sales, how internet
development changes things and if the relationship between the dealer and the producer has changed
due to the technological developments.
Marketing is more than a department in a company, it is an entire philosophy which makes
the organization to see, serve and satisfy the needs of the customer. The tactical instruments that
people in marketing use are hidden within the marketing mix. The whole process of creating
products and brands, establishing prices, distribution and communication tools are the elements
which create the marketing mix, being also the main weapons of the marketing people.
The companies rarely work by their own when they bring value to their customers. Thus, the
success of a company doesnt depend only on how well it fulfills its duties. A company has to know
how to integrate his own marketing mix in the nowadays trends and still remain known for its
values.
I chose to analyze Avons distribution policy because it has a unique client support and
distribution system, which is unique thanks to the strong partnership the company developed with its
independent distributors.
Like any other management theory, marketing keeps up with the new technologies. Starting
from messages sent through traditional messages (television, radio, magazine, newspapers, PR
events, indoor and outdoor events), marketing moves from the virtual space, looking to attract and
gain new consumers.
In this context, Internet plays a crucial role, it being the relevant mirage between
communicating with our loved ones. Nowadays, Internet in on everyones lips, so it was expected
that it enters into marketing and business areas, it making easy the communication between
businessmen, producers and possible customers, generating and developing businesses. Today we
talk about virtual markets, where any negotiation, closing a deal is possible very quickly.
The question that raises nowadays is that if online marketing is a completion form towards
traditional marketing or it simply helps it? The impact of internets emergence is a phenomenon
whose impact is hard to measure.
Online marketing is a business tools which offers unlimited possibilities at a minimal cost. In
the 20
th
century, using online marketing is easier than using the classic methods.
Theoretical approach

Marketing is a fundamental concept, a new economical view, a new view of the world. It
emphasizes on obtaining benefits, by satisfying the consumers needs by adapting products, prices,
distribution. The marketing notion has an Anglo-Saxon origins coming from the verb to market
(which means to buy and sell, to transact on the market), but also from the noun market (which is
the place where one buys different things). Starting from this broad senses, the literature has come to
many more, existing different marketing definitions.
The first marketing definition that has to be taken into account is the one by the American
Marketing Association (AMA) and published for the first time in the American magazine
Marketing News, in 1985: Marketing is the process of planning and executing the conception,
pricing, promotion and distribution of ideas, goods and services to crate exchange and satisfy
individual organizational objectives.
1

This marketing definition has some elements that need to be mentioned: includes in the
marketing area both the goods and the services, emphasizes the elements of the marketing mix
(product, price, distribution and promotion), but in the same time it keeps the focus at adapting the
objectives to the target market, which is expected to change.
At the same time, another known definition of marketing is the one of Professor Philip
Kotler, which says that: Marketing is the social process by which individuals and groups obtain
what they need and want through creating and exchanging products and value with others.
2

Even if this last definition underlines all the important elements such as needs, desires and
requests, value and satisfaction, exchanges, it doesnt have enough elements to totally define what
marketing really is.
J.E. McCarthy is the one that bring into focus the 4 Ps: production, promotion, price and
place (distribution)
3
, other authors have brought other Ps into focus.



1
AMA (1985), AMA Board Approves New Marketing Definition, Marketing News, No. 5
2
Kotler Philip, Armstrong Gary,Saunders John, Wong Veroica (1999), Principiile marketingului, Editura Teora,
Bucureti, 1999, p.28.
3
Van Watercshoot Walter, Van den Bulte Christophe (1992),The 4P Classification os the Markting Mix Revised,
Journal of Marketing, 56 , 83-93



Case study
Nowadays, companies have a big problem with attracting new clients and making the
existing ones loyal to their brand. Most of the times, management decisions are taking with the
number of consumers in mind. These decisions are less visible than others, but they need to be taken
into consideration. Here can be applied very well a marketing theory referring to the client retention,
according to which is more expensive to gain new customers than to maintain the existing ones.
The approached problem in this study case has to do with the impact that internet had over a
multi-level marketing company, such as AVON. Multi-level marketing is another name for
pyramidal companies. Avon uses both door-to-door sales people (women mainly) and brochures to
advertise its products. There are classroom areas where the representatives learn about the products
and sales techniques. Each Avon representative is an independent sales representative running their
own business, and each of them has advantages and discounts.
Having in mind the type of marketing AVON uses and the challenge that comes from the
fact that nowadays people tend to use more and more the internet for online purchases, the goal of
this research is to create a general image on what is the impact that the actual internet trend has on a
company using door to door sales people.
For this paper, I set the following objectives:
To determine how does a company like AVON deal with the actual trend
To determine how to the consumers deal with the actual trend
To identify if the consumers remain attached to the brochures and their representative or take
a step forward and order online
To identify the degree of satisfaction of the costumer
To identify the relationship between the representative and the customer
To determine the impact of internet on sales (it increased sales or not)
To determine if the brands can create loyal customers through internet
To identify the main difficulties that AVON consumers have with the online orders( if there
are any)
For this study case, I also propose to begin from the following hypothesis:
H0: Loyal consumers will remain attached to their representative and the printed brochure.
H1: Taking into consideration nowadays technology, it would be easier for some of them to simply
click on the Internet and have the products at their door the next day.
H0: A company that uses multi-level marketing and door to door sales persons will remain attached
to their selling and marketing techniques.
H1: A company could be overcome by the nowadays trend, and dont know how to manage the
changes to its own advantage.
H0: The relationship between the consumer and the representative is one based on trust, the
consumer being attached to it wont let go so easy.
H1: in order to fulfill his own urgent needs of cosmetics supplies, the consumer will choose the ease
of the internet shopping.
For this case study, I chose to spread questionnaires among Avon consumers, females only.
Taking into consideration that the type of research I am using is an exploratory one, as a sampling
procedure I used random sampling (supposing that every girl uses cosmetics, and every girl used
AVON at least once).
The sample size is given by the following formula:

, where:
n Sample size;
t Coefficient associated with the probability of research guarantee results (trust coefficient);
p The weight of the people with the researched characteristic;
- Error margin/ maximum admitted error.
I took into consideration a research guarantee results of 95%, so a trust level of 0, 05. For
this value, the probability coefficient (t) is 1, 96. The considered error margin has 5% value, and the
weight of people with researched characteristics is p=0, 8 (80% of people have used AVON at least
once).

Data gathering will be realized in May 2014 in an electronic database.







Final remarks

Online marketing doesnt come to delete traditional marketing principles and doesnt intend
to compete with it, it is simply an upgraded version. Online marketing has its roots in traditional
marketing, but also differentiates itself in a very obvious way thanks to a unique characteristic:
interaction. On the Internet, communication in made in two ways and sellers and buyers can close
transaction from their own houses or offices, any hour of the day or night.
Being an improved version of marketing, an outcome of its evolution, online marketing
comes with a series of advantages, among which I can enumerate: having all the needed
information, consumers possibility of connecting to the Internet and finding our information about
products and services, and also buying them at any time. Having taking all these into consideration,
online marketing helps stores to extend themselves and reach broader areas.
The final conclusion of this paper is that online marketing comes to complete traditional
marketing, as a natural development of communication and technological media.