When first reading this article, one thinks that there is nothing wrong with Avon, and that Andrea Jung has completely turned this company around. However, through careful analysis, one can see that there are still problems within Avon that must be corrected if they intend to compete in the hectic and chaotic world of the cosmetic, fragrance, and toiletry (CFT) industry.
One problem that Avon faces is the strong competition within fields they are trying to expand into. Avon is marketing a nutritional product line called Wellness, which includes vitamins, supplements, bars, etc. This market is competitively strong, with such nation-wide retailers as GNC, Vitamin World, Walgreens, and countless other drug stores and grocers that carry substitute items, which may be less expensive.
The best recommendation I can give is to strongly suggest doing market research before engaging in branching off into other forms of product lines. Avon should stick to what it knows (cosmetics), and when they are at the top, then branch off into other ventures.
Avon also faces a poor brand image. Most women view Avon as "my grandmother's brand" or "not for me". One of the fastest growing demographic sets is that of the teen and preteen. This market is one yet penetrated by Avon.
In order to penetrate the teen/preteen markets, Avon must produce quality and practical products that young women will be attracted to, use, and to buy them more than once. To accomplish this, an increase in R&D's allocation of funds must be needed. In addition to increasing funds, Avon can aggressively pursue new talent, whether that is recruiting top talent directly out of college, or offering higher salaries and options to competitor's star employees/researchers.
A third problem faced by Avon is that of keeping and retaining Avon representatives. There seems to be growing animosity between reps and the corporation. Reps see the new Avon Centers, mall kiosks, and the Avon websites as threats to their financial welfare.
