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Amway was set up in 1959, with only a disused service station as a base. Today,
Amway is one of the world's largest direct sales companies, with over 2.5 million
independent distributors in more than 70 countries world-wide. There are 35,000
independent distributorships in the UK, Republic of Ireland and Channel Islands
offering a range of products from a vast product portfolio.
The critical relationship between Amway and the seller or distributor is at the heart
of Amway's successful approach to direct selling.In direct selling, the sale is the
culmination of many marketing activities which involve matching customer
requirements to the goods or services offered. The main benefit of this form of
selling is that it allows distributors to focus on individual customers and their needs.
The starting point for any kind of direct selling activity is the preparation. Anybody
involved in direct selling should be fully trained and familiar with all aspects of the
product and customer needs. It is important to remember that consumers have
many choices in the market-place and are better informed than ever of these
choices. Preparation is therefore increasingly important for Amway's distributors.
Although it has been said that sales people are born and not made, the
development of skills and knowledge is essential for good sales performance.
Product knowledge, in particular, is vital - so that the seller can present a product's
benefits and functions comprehensively and answer any questions the consumer
may have.
The importance of communication
Clear communication is essential when managing activities. Amway needs to
communicate regularly with its 35,000 distributors in order to help them prepare for
their increasingly challenging role. Communication is the passing on of ideas and
information. In business, it is essential to have good clear channels of
communication.
There are many possible objectives and benefits from a close and well developed
communication system. Communication is only successful when the intended result
distributors to get to know each other. They also provide an opportunity for
distributors to get to know each other and are useful for relaying messages, giving
advice and generating personal discussion.
Events include:
Pace Setter - a reward incentive to help new and existing distributors reach
the 6bonus level within three consecutive calendar months.It also encourages a
balanced business, with equal amounts of retailing and sponsoring - essential for
long-term success and profitability.
the Amway Management Team, tour the UK Headquarters, attend key informative,
motivational business sessions and go to the New Direct Distributor Gala Dinner.
criteria set by Amway, travel for a seven day trip with compliments of Amway to
some of the world's finest beach locations and hotels where they attend a number
of business sessions and exchange thoughts and ideas with corporate staff.
Launch into '98 - a major annual launch of new products and services
UK, the Republic of Ireland and Channel Islands. Amagram is used to communicate
information about new products, promotions, community news, distributor events
and recognitions as well as news of other affiliates throughout the Amway world.
Amagram shows how distributors can make more out of their business. It is also
used to help distributors understand the philosophy by which the business operates
and the legislation regulating the Direct Selling Industry. For example, The Trading
Schemes Act 1997, widens controls over illegal 'pyramid selling' and provides basic
standards of business practice for participants in legal Trading Schemes.
to leading distributors. It may involve providing them with information which they
need to pass down to other distributors or it could provide top distributors with
'elite' information such as the previews of launches or any changes in policy which
only applies to this group, at a particular time.
is used to address a particular change or launch, e.g. new car care product range.
Amway | Using communications to develop business opportunities
Other communication channels
The circumstances under which a business communicates constantly change.
Organisations have to constantly review their communication systems to ensure the
correct messages are transmitted in the correct way to the required audiences.
For Amway, this means that different communication media are required for a range
of purposes. For example:
enquiries
Amway has recently launched their first ever brand advertising campaign. In
: Artistry products
Developing a new range of skin care and cosmetics products is a costly process. It is
important to co-develop the distribution network, thus giving key advantages over
other products in the market-place.
Amway created ARTISTRY* as a complete line of skin care and cosmetics, to make
clients look and feel the best that they possibly can. Amway is one of the few
cosmetics companies in the world with its own manufacturing plant, so the
Company can retain control over quality and follow hygiene guidelines which are
stricter than those required by the law.
No product is launched until is has been rigorously tested - before, during and after
manufacturing processes, Amway does not test on animals. Amway has also
invested heavily in the development of the packaging of the ARTISTRY line.
The packaging features a signature gold band alongside the ARTISTRY diamond
logo. Consequently, ARTISTRY products rival those sold in department stores, but
with the added bonus that ARTISTRY products are sold with personalised, expert
service - distributors can be trained to become ARTISTRY Consultants.
To become ARTISTRY Consultants, distributors attend a training course which
covers:
The aim of this course is to allow distributors to develop their product knowledge so
that they can deal professionally and confidently with customers.
At the course, Amway distributors are provided with a training manual. The
ARTISTRY Learning Guide is the central part of a larger training and personal
development programme known as the Amway Performance Learning System
(APLS).
APLS provides information about ARTISTRY products so that distributors can become
successful and knowledgeable ARTISTRY Consultants. Also included with the
ARTISTRY APLS is a video which co-ordinates with the Learning Guide.
Whilst training to become Beauty Consultants, Amway distributors can also use
other usual communication channels to further develop and improve their product
knowledge and obtain key information, such as product updates.
Clarifying business opportunities
Acceptable business procedures must be developed when a large number of
distributors representing a single organization, all work independently. It is
important that communications from Amway provide a moral direction for its
distributors but, at the same time, allows them to develop their own identity.
The Amway Rules of Conduct and Code of Ethics conform to the DTI's requirements
and define the rights, duties and responsibilities of Amway distributors. Other
communications are also designed to reaffirm acceptable moral principles.
The manner in which a salesperson deals with an ethical issue can have far
reaching consequences not just on that individual but also upon the organization as
a whole. For example, distributors must not mislead customers on the claims of a
product in order to achieve a sale.
Direct selling is about person-to-person marketing where the salesperson must have
credibility and trust. The processes of communication at Amway are designed to
help distributors become well trained and professional in all their dealings.
QuestionQ. 1Discuss the significance of how Amway used a range of communication
methods and processes to help individual distributors develop their own business
opportunities.
Q.2. Suggest the non conventional promotional tools that the company use to gain
competitive advantage.
(25=10 Marks)