Beauty giant Avon has injected a fresh roster of talent as it prepares itself for a more ‘digital’ future.
Avon is eyeing a brand turnaround by unlocking digital and e-commerce capabilities in the hopes that will increase access to a brand that still largely relies on door-to-door salespeople and print brochures to showcase products.
At a recent investors presentation, its boss admitted that the challenges it's facing are not an "industry problem", (the beauty sector is up 5% between 2017 and 2017 while people working in the 'part-time economy' is up 25% in the same period. Rather, "it's an Avon problem" as the business continues to rely on increasingly outdated models of distribution.
Avon has lagged earnings estimates in four of the last six quarters, with negative sales in six of the trailing nine quarters. Revenue has dropped from $9.23bn in 2011 to $5.7bn in 2017.
But its ambitious turnaround plan comes at a competitive time. Tactile by nature, beauty products have historically been seen as an exception to e-commerce but the beauty industry is in the midst of a boom, with start-ups as well as more established brands all leveraging new tech to attract and convert customers.
With the race to deliver digital-first experiences now on, Geometry UK's head of digital, Debbie Ellison said Avon has found itself chasing the likes of L’Oréal, which has "reigned supreme" after launching everything from mobile apps that can style and colour hair to helping consumers choose the right cosmetics using augmented reality.
"You'd be hard pressed to find a purchase journey more influenced by digital than in the beauty category where customisation creates products for a universe of one," she said.
Avon's new hires
Playing catch-up, Avon has overhauled its marketing and product teams and injected $300m into a digital and IT upgrade within its walls. After joining from Unilever last February to take up the role of chief executive, Zijderveld is hoping his raft of senior hires will cement a more digital future.
In July last year, it created a 'digital board' to propel its innovation programme. Former Ikea marketer Benedetto Conversano was enlisted to lead this and overhaul its tech proposition as the company’s first-ever chief digital officer alongside Heather Payne who was brought in chief technology officer.
Conversano quickly enlisted ex-Bupa chief information officer, Colin Shenoy, who joined as vice president of IT transformation.
Avon then made moves to strengthen its senior marketing leadership, appointing ex-Diageo marketer James Thompson as global chief brand and beauty officer, to map out a plan to modernise the brand for the Instagram generation.
Alex Long was promoted to chief commercial marketing officer to drive Avon’s marketing execution and then Tatiana Piccolo joined the team as vice-president of global fragrances, from the Brazilian cosmetics group Natura, to assist Thompson with re-energising its product marketing.
Adding to this was the appointment of two new vice-presidents for global brand marketing in ex-Loreal general manager, Anna Chokina covering skincare and personal care, and Elena Degtyareva was promoted to take on fashion and home.
The overhaul continued into the new year, with Avon hiring FMCG expert Victoria Westwood as senior marketing manager – a newly created role - and the arrival of the former chief information and digital officer at Belon International, Nick Burton. He has joined Conversano's digital team to help drive the company's new sales model, as vice-president for digital development.
Alongside the cohort of new recruits, Avon also appointed Spark Foundry as its global media agency to aid its ambitious digital plans.
Digital plans in place
New hire Chokina explained that Avon's period of intense recruitment comes as it looks to "open up" the business. The company estimates that around 98% of consumers know the brand, but only 5%–10% have sufficient access to buy its products. With the new hires now in place, its digital-first strategy to improve those figures has started to roll out in the hopes of delivering growth in the second half of 2019.
Chokin said of the progress: "[We're] currently looking at low-hanging fruit, and some of the things we can do very quickly, as well as more fundamental transformational things that we’re putting in place as we speak."
Among the initiatives already in the market are an e-brochure and a new personalized beauty app which was developed to help Avon’s 6 million representatives deliver better-customized services to customers.
Meanwhile, in Brazil - its biggest market - it is trialing a partnership with on-demand delivery service Rappi. The pilot has seen 150 products, available to purchase from its top sales reps, then delivered within a two-hour window.
On Avon's plans to increase brand awareness and consideration through digital and e-commerce, chief executive Zijderveld, recently said Avon had "moved beyond the physical brochure to provide products anywhere, anytime, to attract new and young urban consumers."
The e-brochure is an online copy of the physical version, that allows customers to flick through the pages from any screen. To make e-commerce easier, the digital brochure allows customers to click on products and add the item to their shopping bag.
Quite simply, said Chokina, "those representatives that use the e-brochure can sell more than those who use the traditional door-to-door, print brochure."
Avon’s strategy is to turn its army of sales reps into millions "micro-influencers" has also seen each representative set up with a new 'My Avon' online store to sell to local customers. Zijderveld hopes these online stores will "give representatives the capability to sell online to anyone, anywhere."
And its marketing budgets are shifting accordingly. Avon has said it currently spends about 30% of its marketing dollars on digital channels and plans to increase that in the coming year.
Given Avon's strong heritage and high brand awareness, Chokina feels confident that Avon's sales will see a turn around this year.
"We have the social selling knowledge, and an excellent team headed by our chief executive. We are all newcomers, and we share the same passion and vision to make sure Avon is well placed to take advantage of that."