Avon Products, Inc.[7] doing business as Avon is an American multinational company selling cosmetics, skin care, perfume, and personal care products. It is a multi-level marketing company based in London. In 2020, Avon had annual sales of $9.1 billion worldwide.[2]
It is the fourteenth-largest beauty company[8] and, with 6.4 million representatives, is the second largest multi-level marketing company in the world (after Amway).[9]
In May 2019, the Brazilian multinational company Natura &Co announced its intent to acquire Avon; the deal closed in January 2020. Following the merger, existing Natura shareholders held 73% of the combined company, Natura Holding S.A., with former Avon shareholders owning 27%.[10] At merger completion, Avon became a privately held company, common stock was removed from the NYSE trading.[11]
History
Avon's founder, David H. McConnell, initially sold books as a door-to-door salesman to New York homes. In September 1886, he decided to sell perfumes rather than books.[12] He started the new business in a small office at 126 Chambers Street, Manhattan, New York. McConnell changed the company name in 1892. His business partner suggested calling it the "California Perfume Company." His business partner was living in California at the time and suggested the name because of the abundance of flowers in California.[13][14]
In May 1894, Alexander D. Henderson joined the company, became vice-president and treasurer, and helped shape its policies and assist in its growth.[15] In 1897 they built a laboratory in Suffern, New York.[13]
Business model and marketing
Avon uses both door-to-door salespeople ("Avon ladies", as well as "Avon men") and brochures to advertise its products.[54] Some Avon training centers have a small retail section with skin care products, such as creams, serums, makeup, and washes. Avon recruits sales representatives who sell beauty products, jewelry, accessories, and clothing.[55] The salespeople are not employees, their income is solely based on the sales revenue or recruiting of further salespeople.
Some of the brand-names used by the company include Avon Color (including Power Stay, Color Trend Make Up + Care, and Ultra Colour range), Imari, Far Away, Avon Eve, Sk!n, Today Tomorrow Always, Black Suede, Avon Fashions, Anew, Clearskin, Avon Care, Avon Senses, Skin So Soft among others.[56] According to the U.S. government, Avon has 5 million to 6 million sales representatives operating in over 100 countries as of 2014. Avon and its subsidiaries have 40,000 to 50,000 employees, 6,000 of which are in the United States.
Avon was an early member of the U.S. Direct Selling Association, which was founded in 1910. The company left the association in 2014, saying that the trade group was not paying enough attention to the industry as a whole.[55]
Controversies
American corruption charges
Beginning in 2008, the conduct of various employees and executives of Avon Products were investigated for possible violations of the law, including bribery and violations of the Foreign Corrupt Practices Act.[57]
Avon Products began a probe of its China division after an internal whistleblower alleged bribery in June 2008.[57] At least four executives, both in Asia and in the United States, were suspended in 2010,[57] and later fired for their roles in the activities being investigated.[58] According to The New York Times, Avon spent over $170 million on legal fees and costs related to the investigation: $59 million in 2009 and $95 million in 2010, and $22.5 million for the first quarter of 2011.[59]
Withdrawal from major markets
In October 2013, Avon Products announced the closure of its branch in France at the end of that month. Its French employees accused it of keeping the workers in the dark for months and not acting in line with the company's publicly stated values of being a socially responsible company that upholds values of trust, respect and integrity and a culture of "open and candid communication."[69] As of January 2014, Avon France was in receivership.[70]
This was followed by an announcement via Facebook on February 15, 2018, that Avon Australia and New Zealand would close by the end of the year.[71] This decision resulted in the loss of 220 jobs and 21,400 sales representatives. The company has attracted criticism for poor communication with its customers and employees.[72]
Avon is still active in Russia and is recruiting more people and continuing to manufacture products as of January 2024.[73]