Power in numbers: why Avon is big in MLM
125 years in the business.
5 million representatives.
10.8 billion dollars annual sales.
Impressed yet? The milestones for Avon keep adding up as they continue to reign over other MLM companies. So what do these numbers tell you? Stability and power to say the least. Having been consistently at the top of Fortune Magazine’s leading companies, Avon, without a doubt, is a huge name.
Before you start dismissing other direct selling companies, let’s take a look at some more facts and figures about Avon. I’ve compiled various information about Avon from third parties about what we may or may not be too crazy about. After all, as tempting as the numbers may be, a responsible entrepreneur carefully examines his every venture.
As a new Avon Representative, your start up cost is just $10 – true to their claim, you can “start your business for a little more than the price of a lipstick”. Well, their most affordable lipstick retails at $6. For $10, you get a starter kit that includes sample products, about 2-3 catalogues with different campaigns, brochures, and some more information to jumpstart your direct selling business.
Building your inventory is not a requirement for being an Avon agent, which is, if you ask me, definitely a plus. Other than not having to be flat broke, you don’t need to worry about turning your items into money in a short period of time. All you have to do is to sell Avon products to customers starting with your family and friends, take their orders, purchase the items, and earn commissions.
For example, a sales of $25 to $144 earns you a commission of 20%. From the bestsellers page of Avon, product prices average at $20. So a total sales of $40 from just 2 products, earns you $8. If you want to have a 50% commission, generate a total of $1,550 or more to earn you $775. That’s about 78 products at $20 each.
Although 5 million representatives may sound very impressive, it can also feel like a threat. With that many agents selling Avon products, not to mention online shopping, is it still possible to achieve the amount of money you want? Plus, there are about 100 DSA (Direct Sellers Association) members who provide products that compete with Avon’s, each with thousands or millions of representatives.
Some also report that succeeding catalogues of Avon are not provided for free. Meaning, representatives have to purchase them. Also, because you are not compelled to have an inventory, it may be difficult to present samples of shades or fragrances or whatever your buyer wants to see.
For an MLM company that has been in the industry for over a century, there must be something that Avon does which simply clicks.
First of all, Avon is continuously present in the tri-media. In general, companies spend about at least 2% of their sales on marketing. For Avon, that’s 216 million dollars on marketing alone! To add to that, they have also joined social networking sites to stay close to representatives and consumers. If you think about it, probably 8 out of 10 people each know at least one Avon representative.
Second, they keep everything fresh, coming up with new products for direct selling and campaigns regularly. Every 2 weeks, Avon issues a new campaign and updated catalogues that their representatives can use as a sales tool.
Third, Avon understands value for money. They provide people around the globe with everyday use products which they can afford without compromising quality.
Whether you’re joining a company as an employee or an employer, stability plays a big role. With Avon being the leader in direct selling and MLM for the longest time, it looks like they’re not going anywhere at least for the next century.